On July 21, 2014 the Kaiser Family Foundation released a report on out-of-pocket expenses paid by Medicare beneficiaries. Not surprisingly, the report identified that individuals with end-stage renal disease (ESRD) have the highest out of pocket costs associated with their care, spending on average in 2010, $6,918. Since 1972 the Medicare ESRD program has been a life-saving safety net for millions of Americans who have experienced kidney failure, but the cost of care to patients for dialysis and transplantation can still be high, particularly when patients do not have access to supplemental insurance.
Most ESRD beneficiaries are enrolled in traditional Medicare fee-for-service (Parts A and B). Medicare Part A covers hospital stays, but only after the $1,000 deductible is met. Medicare Part B covers all outpatient care, including dialysis, and also covers immunosuppressive drugs for most kidney transplant recipients. Along with that coverage they may also have Part D to help pay for prescription drugs. About one-third of ESRD patients are eligible for both Medicare and Medicaid due to having lower incomes. When a patient qualifies for Medicaid often times they do not have to pay the Medicare Part B premium and do not have to pay the 20% coinsurance on out-patient care. The remainder of patients with traditional Medicare either have supplemental coverage through private health insurance or they must pay the 20% coinsurance for every doctor’s visit, dialysis treatment, or their immunosuppressive drugs if they have a kidney transplant. For a dialysis patient with no supplemental insurance, their costs can easily exceed $9,000 per year. Medicare supplemental plans, offered through private insurers and known as Medigap plans, are available in the majority of states, but in 19 states Medicare ESRD beneficiaries under age 65 are not able to purchase them because insurers are not required to offer them. Plus, some Medigap plans have high premiums and may have an out-of pocket threshold that needs to be met before the benefits kick in.
One of the NKF’s top policy priorities is to advocate for policy changes that will lead to lower out-of-pocket costs for ESRD beneficiaries. It is also one reason we support H.R. 4814 The Chronic Kidney Disease Improvement in Research and Treatment Act, which, in addition to other improvements to kidney care, opens up more Medicare options for dialysis patients, like access to Medicare Advantage (MA) and Medicare Special Needs Plans (SNPs). These plans can lower out-of-pocket costs for patients who are willing to follow the rules of the plan, such as seeing primarily in-network providers.
While Medicare Advantage has many more restrictions on which providers you can see and which medications are preferred, many seniors prefer it as an alternative to traditional Medicare because it is one plan that covers hospital stays, outpatient care, and often prescription medications. However, people on dialysis are unable to enroll in Medicare Advantage plans unless they were already in one prior to having ESRD. HR 4814 changes this. The bill would permit dialysis patients to enroll in MA plans and reauthorize SNPs for 5 years. This policy change would bring us one step closer to helping Medicare beneficiaries lower their healthcare costs. But it is not a perfect solution for everyone. For that reason, NKF will be hard at work the remainder of this year exploring additional policy options for lowering ESRD patients spending on their care. To help us find a solution, please share your experiences paying for your health care and your thoughts for how we can advocate for change that leads to lower costs for people with ESRD.