Payers, Unions Protest Additional Cost Shift of ESRD Services in Opioid Bill

A coalition of diverse interest groups—payers, unions, and business groups—wrote Senate leaders Monday to express their opposition to the inclusion of “pay for” legislation regarding end-stage renal disease (ESRD) in an opioid bill passed in June by the House of Representatives.

HR 6, the “SUPPORT for Patients and Communities Act,” includes an offset that would require private insurers to pay for an additional 3 months of ESRD services beyond the existing 30-month period after which Medicare becomes the primary payer. The last time the wait period was changed was 21 years ago.

The letter cites a Congressional Budget Office estimate that the ESRD payment shift will reduce Medicare spending by $340 million. But the cost shift to private health plans will be hundreds of millions of dollars more because they pay at least twice more than what Medicare does for ESRD treatment, the letter says.

Read about a payer—provider partnership for integrated care of patients with ESRD.

In June, Mercer, a consulting firm, called the offset provision a win for dialysis clinics, since Congress can change the secondary payer rules for patients with ESRD patients as it desires. When the ESRD provision became law in 1981, the payment period was 12 months. It rose to 18 months in 1990 and to 30 months in 1997.

Mercer said private health plans will be responsible for approximately $48,000 per patient for the additional 3 months of ESRD coverage. The number of people with ESRD has grown, on average, 7% annually. CMS has said more than 500,000 Medicare beneficiaries have ESRD.

“While we strongly support congressional efforts to address the opioid epidemic, we are very concerned about offsets that would reduce the ability of private health plans to provide comprehensive, affordable health care coverage,” said the letter, which was signed by America’s Health Insurance Plans (AHIP); Blue Cross Blue Shield Association; the United States Chamber of Commerce; the American Federation of State, County and Municipal Employees; the ERISA Industry Committee; and others.

“Confronted with higher costs for three additional months of ESRD treatment, private health plans would be forced to absorb the costs, raise premiums, or reduce coverage. These options are bad outcomes for workers and retirees,” said the letter.

Earlier this year, it was disclosed that some patients with ESRD were being “inappropriately steered” into private plans and away from Medicare and Medicaid by parties with interests in dialysis clinics in an effort to game the system for financial gain, AHIP and other groups said.

The cost of ESRD, which requires patients to be on dialysis, is so high that most patients are automatically eligible for Medicare. With the advent of the Affordable Care Act, major nationwide dialysis centers had created foundations to pay premiums for these patients, allowing them to charge health plans up to $200,000 a year per patient. Medicare, by contrast, pays about $100,000 a year.