In a letter to Health and Human Services Secretary Alex Azar, 15 insurance and other health organizations have asked HHS to take immediate action to stop certain dialysis providers from steering patients with end stage renal disease into commercial coverage.
These are dialysis patients who are eligible for Medicare or Medicaid, but because of the higher reimbursement rates from commercial plans, are being directed towards individual coverage under the Affordable Care Act.
The premiums for these patients are paid through premium assistance programs, which in turn are funded by the dialysis providers, according to the letter from America's Health Insurance Plans, Blue Cross Blue Shield Association and others. The letter specifically names the premiums assistance program of the American Kidney Fund.
The federal government has banned providers from directly subsidizing patients' health insurance premiums.
AHIP wants to prohibit all premium assistance programs that are funded directly or indirectly by providers that have a financial interest in the patient's care.
While the ACA dialysis patients get lower out-of-pocket costs in being covered under private plans, insurers end up picking up the tab for the higher rates. Providers are making huge profits in this gaming of the system, the groups said, which is driving up the cost of the overall health system and results in significant increases in premiums for the entire commercial population.
"J.P. Morgan estimated that the return on 'charitable' donations by dialysis providers to the American Kidney Fund likely exceeds 500 percent," AHIP and others wrote to Azar. "Similarly, an August 2016 analysis written by J.P. Morgan reported that 6,400 qualified health plans purchased through the AKF HIPP (American Kidney Foundation Health Insurance Premium) program drove an estimated $1.7 billion in adverse selection."
American Kidney Fund President and CEO LaVarne A. Burton sent a letter to Azar in response to AHIP's letter.
"Full of misleading statements, omissions, half-truths and outright falsehoods, the letter has one true purpose: to limit the health coverage options of people with kidney failure by forcing them off private insurance and onto government health programs," Burton told Azar.
The groups that signed the letter don't understand what these patients experience, she said by statement. AKF has been the safety net for low-income dialysis patients for nearly 50 years, and has assisted patients in paying their health insurance premiums for over 20 years under the federally approved health insurance premium program, which was launched in 1997.
The provider dialysis controversy has been ongoing for at least two years. AHIP advocated for an end to the practice in a letter to Andy Slavitt, the acting administrator for the Centers for Medicare and Medicaid Services under President Obama.
In February 2017, DaVita, the parent company of DaVita Kidney Care, faced a lawsuit over its alleged scheme to steer patients with government-subsidized insurance into private health plans.
However, recent disclosures have come to light confirming the practice, the AHIP letter said, citing a California Healthline report in which California State Senator Connie Leyva has sponsored a bill in that state to stop premium assistance programs from being funded by providers for the purpose of directing care to their hospitals.
Insurer Blue Shield of California and the Service Employees International Union-United Healthcare Workers West support the bill.
In addition, the Service Employees International Union-United Healthcare Workers West have gathered signatures in a ballot initiative to cut off dialysis clinics' commercial insurance reimbursement at 115 percent of care costs.
Burton said the union is engaged in an effort unionize dialysis facilities and has teamed up with health insurers which want to remove kidney patients from their rolls.
"It is extremely concerning that real people who are living with kidney failure have been caught in the middle of this battle and are now being used as political pawns by these groups, who are working together in an indefensible attempt to discourage and outright reject their health coverage," Burton told Azar. "In our opinion, that's the motivation for what these groups are seeking to do both administratively and legislatively."
Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com