How long should you wait to treat a possibly fatal but curable disease? That's a question with major implications for millions of patients and for insurers and government programs that have to pay for the treatment.

In the last year this question has focused on hepatitis C, a viral infection of the liver that, left untreated, can lead to cirrhosis, cancer, liver failure and death. Hepatitis C is the leading cause for liver transplants in the United States.

The virus can be eliminated in more than 90 percent of the individuals who take newly approved drugs over a three-month treatment - but at a staggering cost of $75,000 to $100,000 per patient. Treating everyone in the U.S. who has the hepatitis C virus would cost at least $200 billion. To put that in perspective: In a typical year, U.S. spending on all prescription drugs is $300 billion to $360 billion.

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In July the California Department of Health Care Services ordered a new protocol that will mean many thousands of Medi-Cal patients will have to wait for treatment. But far from jeopardizing lives, the department is helping solve the hepatitis C conundrum with a sensible policy: Treat everyone who needs it, but not until treatment is necessary.

As serious as hepatitis C can be, it often produces no symptoms - no cirrhosis, cancer or liver failure. Many of the estimated 3 million to 7 million infected people in the U.S. and 130 million to 170 million worldwide do not know they have the disease; most fail to develop symptoms over their lifetime. Statistically, only a third will ever be seriously troubled by their infection.

The California protocol essentially calls for two things: watchful waiting, and using simple screening indicators. One indicator - called FIB-4 - is calculated from routine blood tests and estimates the amount of scarring on the liver. It is inexpensive, easy to measure and shown to be highly predictive of the disease's progression.

Treatment to eliminate the virus can be delayed until the marker shows heightened liver fibrosis (scarring), without significantly increasing a patient's risk for illness and death.

The marker was revealed during research we began four years ago with pharmaceutical companies and the Veterans Administration aimed at demonstrating to infected veterans when they needed to embark on a different hepatitis C treatment - an onerous, yearlong drug regimen - or face organ failure. A simple test every six months or so can alert a physician to whether the risk of serious complications is increasing.

The California protocol will, in a way, ration care, and any form of rationing is controversial. Consumer groups and some health insurance companies have called for investigations into the costs of hepatitis C drugs to pressure drug makers to roll back prices. Manufacturers contend their products are a bargain, even at a very high price, because the American healthcare system would otherwise have to deal with the long-term consequences of millions of chronic hepatitis C cases. (The first of these medications are already coming under price pressure after the introduction of competing therapies.)

But the state's protocol provides a way through the thicket. A California Association of Health Plans study released in June estimated that treating the 127,000 Medi-Cal patients with hepatitis C for one year might cost $438 million to $1.71 billion. By implementing the screening protocol, Medi-Cal can probably hold costs to the lower part of that range without risking patient health.

Other states are starting to implement similar protocols. Now physicians, health insurance companies, managed care organizations and other government health-care programs need to follow suit to manage the new, highly effective but very expensive treatments for hepatitis C.

Doing so will strike a practical, and humane, balance. Knowing who does not need treatment right away improves access for those who do.

Neither D. Steven Fox, an assistant professor at University of Southern California, nor Jeffrey S. McCombs, an associate professor at the USC School of Pharmacy, has a financial interest in hepatitis C therapies or tests.

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