BMA in the News
November 29, 2016

Medicare Advantage Group Pushes Back on Kidney Treatment Expansion

  • There has been bipartisan support to expand MA coverage to kidney failure patients. 
  • But MA plans claim a lack of competition has driven costs beyond reimbursement levels. 

Medicare Advantage plans want Congress to increase reimbursement for patients with end-stage renal disease as lawmakers propose expanding access for ESRD patients.

Lawmakers are attempting to expand MA eligibility to all kidney failure patients by 2021 through the 21st Century Cures Act, in language that is also a portion of the Senate Finance Committee’s chronic care bill. The language was added into the most recent version of the Cures bill; the Senate Finance Committee still intends to introduce the remainder of its chronic care package. 

But health plans are concerned about rising dialysis costs given little competition in a market dominated by DaVita and Fresenius. Costs for kidney failure patients range from 96 percent to 137 percent of federal reimbursement, according to a paper by the Better Medicare Alliance (BMA). The average cost totals 104 percent of the reimbursement rate.

“To meet network adequacy rules, Medicare Advantage plans do not have negotiating leverage in most geographic areas across the country,” the group wrote in the white paper. “In addition, there is a lack of volume discounting due to the relatively low prevalence of ESRD in Medicare Advantage.”

According to BMA, a patient with kidney failure costs eight times more than a patient without it — $7,023 versus $825 per month on average.

MA plans are off-limits to many kidney failure patients, unless they develop the condition while enrolled in an MA plan or have the option to enroll in a Special Needs Plan — a type of MA plan limited to patients with specific chronic diseases.

The measure in Cures attempts to fix this discrepancy by requiring Medicare to assume the cost of kidney acquisitions and to expand the amount of data used in calculating risk adjustment scores for MA plans. BMA is pushing for tweaks to the risk adjustment methodology and for the expansion of Special Needs Plans. 

A similar bill (H.R. 5659), the ESRD Choice Act, passed the House in September. Patient advocacy groups have pushed for the expansion.

“ESRD patients have historically been prohibited from enrolling in Medicare Advantage, as insurers have wanted to avoid having these patients in the risk pool,” LaVarne A. Burton, president and CEO of the American Kidney Fund, said in a statement. “It is our position that people with ESRD should have the same insurance choices that are available to other people.

“We will continue our work to ensure that ESRD patients have access to other insurance options, including Medigap and exchange plans,” he added. “This access will be critical in the interim before the Medicare Advantage provisions become effective.”

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