Myths vs. Reality: The True Story of Medicare ESRD Reimbursement

[Zach]

I'm just getting warmed up.     

[Rerun]

ALL I know is the Tax Payers are getting RIPPED OFF.  In 1962 dialysis was $10,000 a year and in 2006 it is $10,000 a week.  That, of course, includes Epogen. 

(Zach, That should light a fire under your ass) 

[Dr. Evil]

This is a big topic. 

May I suggest a great book to get anyone up to speed on the origins of dialysis and some good backround on the financial side.

"The Price of Access"- by Tim McFreeley.  He was general counsel for the old NMC and was around at the beginning up to when Fresenius bought them out.

It is hands down the best history book of how the stand alone dialysis unit came to be, and the origins of ESRD becoming an entitlement under medicare.
Amazon, B&N, etc. should have it....I can't recommend it enough.

I have more to say on this topic.....tune back in later

[Zach]

ALL I know is the Tax Payers are getting RIPPED OFF.  In 1962 dialysis was $10,000 a year and in 2006 it is $10,000 a week.  That, of course, includes Epogen. 

(Zach, That should light a fire under your ass) 

Here are some facts:

In a May 15, 2005 Medicare Summary Notice (the notice of a patient's recent medical expenses charged to Medicare) it stated for the month of March 2005 (about 14 treatments), the amount charged for my dialysis procedure was $2,368.82.

In a July 15, 2005 Medicare Summary Notice, it stated for the month of May 2005 (about 14 treatments), the amount charged for my dialysis procedure was $12,220.00.

My most recent Medicare Summary Notice, dated July 15, 2006, the amount charged for my dialysis procedure during the month of June 2006 (about 13 treatments) was $13,000.00.

All these charges were just for dialysis procedure (90999), no meds, no syringes.

I don't know the facts behind the rise in the amount charged, but dialysis units might now be following what most in the medical industrial complex is doing, which is designating a "Suggested Retail Price."

My insurance situation has not changed in over twenty-three years:  Medicare is primary (80%), and Blue Cross/Blue Shield is secondary (20%).

There has always been a mystery around healthcare pricing --they are not simply listed for all to see.

Back when the House and Senate passed the bill which established Medicare in 1965, did the American Medical Association (AMA) oppose it or support it?

[Dr. Evil]

ALL I know is the Tax Payers are getting RIPPED OFF.  In 1962 dialysis was $10,000 a year and in 2006 it is $10,000 a week.  That, of course, includes Epogen. 

(Zach, That should light a fire under your ass) 

A few points.
I am not going to defend either medicare nor the dialysis centers.  Nor will I pretend to know the right answers. I will try to explain a few things.

1) Not sure about the above numbers.....
2) There was no epogen in 1962...so you are comparing apples and oranges

I will try to get the actual numbers for the cost of a dialysis treatment vs. the medicare reimbursement.

You have to remember that our entire system is based on the principal of cost shifting.  Medicare doesn't pay the full cost of things...it assumes that there is enough private insurance payors that are reimbursing at a significantly higher rate to offset the inadequate medicare payment.  This is why, lets say, tylenol at the hospital costs $15 a pill if you have insurance, cause medicare only pays 1 cent and uninsured pay zero. 

Same with dialysis.  If you are less than 65 and go on dialysis with insurance, your bill for the treatment will be high.  The exact numbers vary.  For this discussion, lets say medicare fixes the price of a treatment at $140.  They will pay 80% of this ...$112.  The dialysis center can then go to your secondary (or you) for the other 20% ($28).

Now if you have private insurance, the dialysis center may charge $200, $300, or even over $1000 a treatment!  Now this won't last forever, as
1) ESRD patients tend to die sooner than other populations (...just the facts here...)
2) After 30 months, medicare will become the primary insurer.

Because the center participates in medicare, it has to accept the payment medicare gives them and cannot go after any more than what they determine to be allowable (for the medicare beneficiary....[you the patient]

The reality is that if the whole unit was medicare only and no secondary insurance....then you can barely keep the lights on.....let alone make any money.  Secondary coverage helps a bit.  The real kicker is having a few private pay patients.

whew.....need to take a break
(more to come)

[kitkatz]

So...when I started dialysis, I had two insurances, then they signed me up on Medicare. So Medicare pays 80% and they billed me insurances for the rest.  Okey then...thirty months go by...almost three years...now Medicare is my primary insurance and noone else gets billed.  Is this correct?  Sounds like a losing proposition for the dialysis center.  I would think they would love to keep me on my insurance so they can bill like crazy.

[Dr. Evil]

hmmmm-

You may have had 2 primary insurance companies (yours and a spouse, etc...)...then they get you signed up for medicare.

At some point (30 months, or less if you lose your insurance), Medicare takes over primary.

You probably have a secondary now as well...

Sometimes the original primary changes to secondary, or you buy a new secondary insurance plan (once you have medicare as primary).
Often times the dialysis centers will try to offer their patients secondary coverage 'cause it helps everyone out and generally doesn't cost too much (...in a relative sense).

....this stuff gets confusing, but that is how I generally understand it.....
 

[kitkatz]

So what you are saying is everyone gets billed and everyone gets the shaft!

[Dr. Evil]

Well, you are getting your treatments, so I am not sure if you are getting "shafted"

The situation that is our nightmare is someone who is uninsured and cannot qualify for medicare 'cause they didn't pay into the system enough (or was married to someone, etc...).

Prime example is an illegal alien or a chronic drug abuser/street person who never worked on the books.
Then, no one will pay for them, and they won't sign up for welfare/medicaid 'casue they are illegal. 
Lots of centers won't take them.....and I am not saying that they should, since no one is paying.

This is where community hospitals tend to just dialysis these people at direct taxpayer expense.  Sometimes they even pay for the plane ticket back to their home country since it is cheaper.!

[Dr. Evil]

One more thing.....my description above of ESRD payments is only for the Dialysis facility.

The physician fee is entirely different.

We get a monthly capitated payment (MCP) for each dialysis patient.  The actual $ number varies depending on where you live. In round numbers,

If we see you 4 times a month, we get about $300 for that month [that is the full medicare allowable, again with medicare only paying 80%].
"                 " 2 or 3 times a month, we get about $250 for that month (same for 2 or 3 times)
"                  " one time a month, we get about $200 for that month.

If you are hospitalized, we bill separately for the hospital charges and the MCP is reduced accordingly.
Phone calls, talking to family, staff time do not count.
We can have a PA or ARNP perform some of the monthly visits, but at least one has to be the MD.

[kitkatz]

How come the center doctor can get away with "Hello how are you? Anything I can do for you?"; walks away when I answer "I am fine"; then charges 450.00 a month for this service?  I feel underserved by this doctor.  I am afraid of him too, because he is pill happy.  Every complaint and he will give you another pill and he does not even sit down and get to know me.  Is he doing anything behind the scenes for me?  Besides i am a Kaiser patient in a nonKaiser dialysis center. He does not have final say so over me. The Kaiser doc has final say so and I have final say so over my treatment.  I think I drive him absolutely nuts! 

[Dr. Evil]

How come the center doctor can get away with "Hello how are you? Anything I can do for you?"; walks away when I answer "I am fine"; then charges 450.00 a month for this service?  I feel underserved by this doctor.  I am afraid of him too, because he is pill happy.  Every complaint and he will give you another pill and he does not even sit down and get to know me.  Is he doing anything behind the scenes for me?  Besides i am a Kaiser patient in a nonKaiser dialysis center. He does not have final say so over me. The Kaiser doc has final say so and I have final say so over my treatment.  I think I drive him absolutely nuts! 

Interesting....several points:
1) I don't know what your doc is up to.  He could...or should...be going over your labs, kt/v, etc...and he may do this out of your sight with the staff.  However, I would expect him to go over this with you each month as well.

2) I don't understand the Kaiser vs. non-Kaiser doc thing.  THANK GOD I am practicing in an area without an HMO....I don't know how they work in such a restricted environment...I think I might quit if I had to limit my consults, hospitalizations, etc...etc....

3) Not that I have a lot of grey hair, but the more I do this stuff, the more I also try to avoid meds.  I used to also reach for a med for every complaint.  Now, I feel more comfortable telling pts that sometimes you may have (insert problem here)...and there is not much we can do for it. (ie- suck it up!...too bad!)    If (problem) really bothers you, then we can try various meds, but there may be x,y,z side effect.  People respond to this approach much better than I initially thought they would.

4) Ask your doc more direct questions

5) If all else fails, look for another doc.

6) There is a trend to only deal with nephrology problems for dialysis patients.  I guess I am old-school. I like to be the primary doc for my ESRD pts., as so many issues are tied to ESRD, that it all comes back to me one way or another anyway.  I am in the minority on this issue I think.  In some really busy areas, I guess nephrologists may really be too tied up with so many pts.  So I try not to judge (....at least too much!)   Plus I see them every week, so I kinda have a handle on all their problems (or pretend that I do) anyway.

hope this helps

[BigSky]

According to my medicare statement the dialysis procedure itself is $6,500 a month (13 treatments).  This is for procedure only excluding lab work, Aranesp, etc. etc.


From speaking to someone who shall remain nameless in my area, the unit (my area)does not know how much they actually get paid by Medicare for each patient.   From what I was told they get a check for $$$ amount and a list of patients that the money was for.  It doesn't say how much was paid for each patient.  I have been told that there are different payments for different classes of people.  That medicare in part bases payments  by age groups of patients, height, and weight.  The person I spoke with on this said they have tried to get the breakdown of just what groups get what payment but time and time again medicare refuses to release it to them.


I do not know if medicare is just incompetent in filling their request or they truly do not want to release it.  Personally I would think the freedom of information act would make medicare release this information to them.

[Black]

...I will try to get the actual numbers for the cost of a dialysis treatment vs. the medicare reimbursement....

During a visit last week with a Social Worker in a DaVita clinic, we were told that they bill a total of $480 X 3, per week for each patient and Medicare pays $384 X3.  If she is correct, then that's a total of $74,880 per year, and if Medicare is picking up 80%, that's $59,904.

BTW, she claimed that even though home dialysis patients save the clinic thousands of dollars they bill the patients insurance for the extra 2 or 3 treatments per week at $480 each.  Doesn't sound correct to me.  Anyone know?

[Zach]

There's a difference between what a center wants to charge and what Medicare will approve, and then what Medicare will pay.  Now private insurance companies, which may be the primary (80%) payor for some patients, pay a lot more per treatment than Medicare.  What the SW told you about Medicare picking up 80%, that's $59,904 sounds correct.

Home dialysis reimbursement has had a history of issues.

That's for another day.     

[Rerun]

I've only been on dialysis (this trip) for about 12 months, so my primary is still Blue Cross.  The submitted charges for a month is about $40K.  Now, there are the "negotiated savings" blah, blah, blah and they end up with about $5K.  Then they bill Medicare and I don't know what they pay.  But, they SUBMIT....a $40K bill.  Bottom line is I don't pay a dime, and I would QUIT in a heartbeat if I did.

If they can hardly keep the "lights" on then how come DaVita sends all their directors to Las Vegas and pays for flights, hotels, drinks, meals, and more drinks?  I think they do pretty well.

I've said this before and I'll say it again.  "There are people on dialysis who should not be."

[Zach]

There's an ongoing discussion on Medicare reimbursement and EPO use going on in the CKD and Anemia thread.  Take a look at that when you all have a chance.  I had hoped we could consolidate those discussions into this threat.

There was a question I raised in that thread, which I thought I should share here:

At about $10.00 per 1,000 units, EPO has been the single highest per treatment cost added to the Medicare ESRD Reimbursement program.  Patients receive it, on the most part, every dialysis treatment. The exception is when their hgb is too high.

Patients in the 1990s received, on average, a dose of about 4,000 units per treatment.  Today it's not uncommon to find patients receiving 12,000 units per treatment.  Yes, I know the hgb goal has been raised since the "old days."     

And as patients we need to ask ourselves, "Do we owe it to the taxpayers to make sure there is limited waste?"

If we advocate for anything, it might be that.     

Receiving EPO sub-q instead of IV is the way a majority of European dialysis units prescribe it.  Receiving it sub-q also keeps the hemoglobin level more stable.  It has several advantages, not the least of which is saving money ... but then the Dialysis Center would make less money, too.     

[livecam]

At an HMO hospital on my first day of emergency dialysis I remember the man who is still my primary neph telling me "We're going to get you a kidney".  I thought he was being overly optimistic at a time when I wasn't sure if I was going to be around much longer.  Anyway its made sense for a while now.  From the figures mentioned in some prior posts dialysis is very expensive, much more expensive than a transplant.  Post transplant, I got copies of bills for hospital, surgical, pharmacy, and followup expenses because the transplant was done by an outside contractor that billed the HMO.  The total of all of those expenses was far less than the cost of one year of dialysis.  I'm not complaining one bit and in fact I'm glad to have helped the bottom line for both my HMO and Medicare.  When you add apples and oranges transplants are far cheaper than dialysis.

[Black]

There's an ongoing discussion on Medicare reimbursement and EPO use going on in the CKD and Anemia thread.  Take a look at that when you all have a chance.  I had hoped we could consolidate those discussions into this threat.

...

That's OK with me and I started that thread.  My original point has been lost in the shuffle; as theads so often do, it has gone off in a way that interests more people than the original intent.  My original intent was to highlight the fact that nephrologists have been lectured by one of their own and shown in black and white statistics that they overwhelmingly do a very poor job of  treating anemia in their patients, and that patients suffer and die as a result of their negligence.

If a moderator can consolidate the threads so the discussion of reimbursement for EPO can be merged here, that would probably be a good idea.

[angieskidney]

There's an ongoing discussion on Medicare reimbursement and EPO use going on in the CKD and Anemia thread.  Take a look at that when you all have a chance.  I had hoped we could consolidate those discussions into this threat.

...

That's OK with me and I started that thread.  My original point has been lost in the shuffle; as theads so often do, it has gone off in a way that interests more people than the original intent.  My original intent was to highlight the fact that nephrologists have been lectured by one of their own and shown in black and white statistics that they overwhelmingly do a very poor job of  treating anemia in their patients, and that patients suffer and die as a result of their negligence.

If a moderator can consolidate the threads so the discussion of reimbursement for EPO can be merged here, that would probably be a good idea.

I thought that was the whole intent of this new thread in the first place! 

[Dr. Evil]

That's OK with me and I started that thread.  My original point has been lost in the shuffle; as theads so often do, it has gone off in a way that interests more people than the original intent.  My original intent was to highlight the fact that nephrologists have been lectured by one of their own and shown in black and white statistics that they overwhelmingly do a very poor job of  treating anemia in their patients, and that patients suffer and die as a result of their negligence.

If a moderator can consolidate the threads so the discussion of reimbursement for EPO can be merged here, that would probably be a good idea.

"....patients suffer and die...negligence...."

Whoa..!!....'dems fightin' words buddy!

True story:  a patient comes to me with CKD...Cr 3-ish.  Hemoglobin 9.8 or so.  Has (most likely) diabetic renal disease, based on her history.  I want to set her up for epogen, check labs, etc, etc....  She declines and tells me that God is going to save her and she has no worries about dialysis or epo shots, etc....and that God will take care of her.

...or another patient I have who has a shitty secondary insurance and he won't consider paying the $20 every two weeks for an epo shot for his anemia. (Although he has a new car and lives in a zip code that would lead you to believe that he can afford the $20 every two weeks.)

Now, one day they will end up on dialysis and show up in those bullshit statistics about how bad we docs are at treating anemia.

Remember....there are lies, damn lies, and statistics.....be critical of these broad demographic statistic slides....a lot gets lost in them!

[Rerun]

Figures lie and liars Figure~ 

[Black]

That's OK with me and I started that thread.  My original point has been lost in the shuffle; as theads so often do, it has gone off in a way that interests more people than the original intent.  My original intent was to highlight the fact that nephrologists have been lectured by one of their own and shown in black and white statistics that they overwhelmingly do a very poor job of  treating anemia in their patients, and that patients suffer and die as a result of their negligence.

If a moderator can consolidate the threads so the discussion of reimbursement for EPO can be merged here, that would probably be a good idea.

"....patients suffer and die...negligence...."

Whoa..!!....'dems fightin' words buddy!

True story:  a patient comes to me with CKD...Cr 3-ish.  Hemoglobin 9.8 or so.  Has (most likely) diabetic renal disease, based on her history.  I want to set her up for epogen, check labs, etc, etc....  She declines and tells me that God is going to save her and she has no worries about dialysis or epo shots, etc....and that God will take care of her.

...or another patient I have who has a shitty secondary insurance and he won't consider paying the $20 every two weeks for an epo shot for his anemia. (Although he has a new car and lives in a zip code that would lead you to believe that he can afford the $20 every two weeks.)

Now, one day they will end up on dialysis and show up in those bullshit statistics about how bad we docs are at treating anemia.

Remember....there are lies, damn lies, and statistics.....be critical of these broad demographic statistic slides....a lot gets lost in them!

Those may be fighting words but your fight isn't with me.   Check out the link I provided in the thread to which I referred.

http://www.hdcn.com/symp/06rpasat/per/flash/flash_perp.htm

I don't doubt that non-compliance is a factor in some cases.  If all Nephs had your caring attitude toward patient care, the stats may be MUCH different -- of course I am assuming that from your few posts I have seen so far.  That does not change the facts presented by the Neph which show that overall most Nephs are NOT doing their job when it comes to anemia.  Of course I'm assuming that he also has a caring attitude toward his patients.

[angieskidney]

Check out the link I provided in the thread to which I referred.

http://www.hdcn.com/symp/06rpasat/per/flash/flash_perp.htm

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[livecam]

...and remember Dr. Evil Medicare will only reimburse for EPO up to a certain Hemoglobin value, I want to say it is 12 but that may need correction.  When patients hit that magic number EPO is held until they drop to a certain point. Even with optimal EPO levels as defined by Medicare a patient will always be somewhat anemic.