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1/ Brief thread on our latest in @JAMAInternalMed, where we look at the potential effect of steering patients from Medicare to ACA-compliant individual market plans
https://jamanetwork.com/journals/jamainternalmedicine/article-abstract/2777844 https://twitter.com/LorenAdler/status/1374107703426088966
https://jamanetwork.com/journals/jamainternalmedicine/article-abstract/2777844 https://twitter.com/LorenAdler/status/1374107703426088966
2/ Some background: although 80% of US patients have Medicare, there is concern that facilities might steer patients to the individual market by indirectly subsidizing patients' premiums through 3rd party organizations. https://www.healthaffairs.org/do/10.1377/hblog20161213.057930/full/
3/ One might ask, what is wrong with helping patients with their out of pocket expenses, especially if they prefer an individual market plan? Isn’t increasing patient choice good? What should we be prioritizing?
4/ Policymakers and plans are concerned, however, that steering patients is a ploy to boost dialysis profits.
If the patient's premium is less than the revenue increase in from the individual market, paying for premiums is, in a sense, a form of dialysis arbitrage
If the patient's premium is less than the revenue increase in from the individual market, paying for premiums is, in a sense, a form of dialysis arbitrage
5/ And someone has to foot this increase in dialysis spending. A dramatic increase in individual market spending would be passed on to patients in the form of higher premiums and taxpayers through increased federal subsidies.
We sought to quantify this impact
We sought to quantify this impact
6/ From a database of 28% of ACA-compliant individual market plans, we estimated monthly outpatient dialysis spending. We compare this to monthly FFS Medicare spending. The differences are HUGE:
Medicare 3364/pt/mo
ACA 10149/pt/mo
That's a >300% increase in spending!
Medicare 3364/pt/mo
ACA 10149/pt/mo
That's a >300% increase in spending!
6b/ While we could not definitively identify why dialysis is so expensive in the ACA, many have argued it is due to the consolidated market – DaVita and Fresenius own >75% of the US market, and they likely leverage that market power into high prices
7/ We next estimate the impact of shifting patients from Medicare to the ACA:
Small changes in the individual market lead to large changes in spending.
For instance, increasing ESKD prevalence from 0.10% (status quo) to 0.24% would increase overall ACA spending by 4.1%!
Small changes in the individual market lead to large changes in spending.
For instance, increasing ESKD prevalence from 0.10% (status quo) to 0.24% would increase overall ACA spending by 4.1%!
8/ Because patients with ESKD are disproportionately expensive, shifting patients to the individual market has large impacts that are borne by society (with large sums of money transferred from patients and taxpayers to dialysis facilities)
9) Most would rightfully have ethical concerns if facilities directly paid for patients’ premiums in exchange for even larger returns. Does using a 3rd party organization as a “pass through” for these subsidies change the ethics or the negative impacts to society?
10/ Policymakers have worried about the potential effects of steering, and our study is the first to estimate these effects
@CMSGov was concerned enough that they issued an interim final rule in 2016 requiring disclosures of this practice to patients
https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-30016.pdf
@CMSGov was concerned enough that they issued an interim final rule in 2016 requiring disclosures of this practice to patients
https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-30016.pdf
11/ California also passed a law in 2019 (Assembly Bill 290) capping dialysis reimbursement at Medicare rates if patients receive third-party assistance.
Both @CMSGov ‘s and California’s efforts have been held up in courts
http://www.dialysispatients.org/wp-content/uploads/2019/09/17-00016-Docket-No.-36-Order-Granting-PI-282017.01.2529.pdf https://www.latimes.com/world-nation/story/2019-12-30/judge-blocks-california-law-on-dialysis-clinics
Both @CMSGov ‘s and California’s efforts have been held up in courts
http://www.dialysispatients.org/wp-content/uploads/2019/09/17-00016-Docket-No.-36-Order-Granting-PI-282017.01.2529.pdf https://www.latimes.com/world-nation/story/2019-12-30/judge-blocks-california-law-on-dialysis-clinics
12/ Final thought: would subsidizing premiums be a problem if ACA plans paid the same for Medicare?
Since ESKD is disproportionately expensive, ACA spending would still rise if patients were steered into the ACA by having premiums subsidized by dialysis facilities
Since ESKD is disproportionately expensive, ACA spending would still rise if patients were steered into the ACA by having premiums subsidized by dialysis facilities
13/13 However, we have to ask ourselves if dialysis facilities would find it financially advantageous to do so in this scenario?
The answer is almost certainly no.
The answer is almost certainly no.
Huge shout out to ErinTrish, @MattAFiedler, NingNing, LauraGascue, @LorenAdler for collaborating on this
@SchaefferCenter @BrookingsInst
@SchaefferCenter @BrookingsInst
