Letter from Kidney Care Partners to the Chair and Ranking Members of the Senate Finance Committee regarding the Medicare Second Payer (MSP) issue

The Honorable Max Baucus
Chairman
Committee on Finance
United States Senate
219 Dirksen Senate Building
Washington, DC 20510

The Honorable Charles Grassley
Ranking Member
Committee on Finance
United States Senate
219 Dirksen Senate Building
Washington, DC 20510

Dear Senators:

On behalf of Kidney Care Partners, a coalition of patient advocates, dialysis professionals, care providers, and suppliers dedicated to working together to improve quality of care for individuals with kidney disease, I wish to thank you for your ongoing attention to the Medicare End Stage Renal Disease (ESRD) program. As you know, the program serves 400,000 Americans living with irreversible kidney failure. Our coalition has been working on behalf of these patients since its creation to advocate for needed reform to a 35-year-old program that has not kept pace with patient and provider needs.

As you know, the House of Representatives addressed ESRD issues in the Children’s Health and Medicare Protection (CHAMP) Act of 2007. One critical provision in the CHAMP Act has recently come under attack from a misinformed group of large corporations. Section 703 of the Act would extend Medicare Secondary Payer (MSP) in the ESRD by 12 months for large group health plans with more than 100 enrollees. Extending MSP to 42 months strikes the right balance between the current 30 months and the 60-month period that some, including the President, advocate. This moderate extensions is a central component of the Kidney Care Quality and Education Act of 2007, introduced by Senator Kent Conrad and cosponsored by six other members of the Committee, including Senators Jeff Bingaman, Blanche Lincoln, Debbie Stabenow, Maria Cantwell, Trent Lott, and Gordon Smith.

Extending Medicare’s secondary-payer status for ESRD patient is a sound policy. An additional year of responsibility for beneficiaries would encourage private payers to adopt protocols that address patient wellness, prevent hospitalizations, and make dialysis safer and more efficient. By contrast, the current policy establishes perverse incentives for employers not to offer wellness services to dialysis patients, since private payers benefit if the beneficiary drops coverage early and goes into Medicare. There is a positive impact on patient care when private payers are incentivized to keep beneficiaries healthy.

While universal coverage for ESRD services is critical to ensure that patients retain access to life-saving care, it is unique to Medicare. The ESRD program is the only are of Medicare that allows private insurers to limit coverage for a chronic condition. ESRD patients are eligible to drop private coverage and enroll in Medicare at any point after the third month of treatment, however many patients prefer their coverage and would like the option to remain in private coverage beyond 30 months. As a result of the policy, kidney patients face coverage disruption, higher out-of-pocket costs, loss of integrated family coverage, and greater complexity. Dialysis patients should be afforded the same rights as others to choose how their care is financed.

Experts estimate that the extension would have negligible to no impact on health insurance premiums. If MSP were extended as proposed, most employers would not cover dialysis patients for the full 42-month period. About 70% of dialysis patients that begin dialysis with private coverage are no longer ensured by the end of the current 30-month period due to a variety of reasons. It is estimated that between 5,000 and 10,000 of the nearly 4000,000 ESRD beneficiaries would remain privately insured from month 31 to month 42 if MSP were extended – and would be spread across hundreds of insurance plans. According to the most recent Census data, approximately 200 million people are covered by private health insurance in the United States. Therefore, a 12-month extension of MSP would result in a 0.005% increase in the total population of privately-insured Americans. It is clear that the policy would have an insignificant impact, if any at all, on health insurance costs to employers.

In a pay-as-you-go environment, a modest extension of MSP raises necessary revenue for critical reforms within the program. It is only designed to generate modest savings. Though relatively small, these savings can be used to offset the costs of other critical reforms, while also providing choice to patients.

As advocates of the entire kidney care community, we feel it is important to set the record straight with regarding to extending MSP by 12 months. We are always available to provide information to the Committee’s members and staff, as you consider this important issue.

Sincerely,

Edward R. Jones, MD
Chairman

Kidney Care Partners:
Abbott Laboratories
AMAG Pharmaceuticals
American Kidney Fund
American Nephrology Nurses’ Association
American Regent, Inc.
American Renal Associates, Inc.
American Society of Nephrology
American Society of Pediatric Nephrology
Amgen
Baxter Healthcare Corporation
Board of Nephrology Examiners Nursing and Technicians
California Dialysis Council
Centers for Dialysis Care
DaVita, Inc.
DaVita Patient Citizens
Diversified Specialty Institutes
Fresenius Medical Care North America
Fresenius Medical Care Products and Hospital Group
Genzyme
Kidney Care Council
National Association of Nephrology Technicians and Technologists
National Kidney Foundation
National Renal Administrators Association
National Renal Alliance, LLC
Northwest Kidney Centers
Renal Advantage, Inc.
Renal Physician’s Association
Renal Support Network
Renal Ventures Management, LLC
Roche Laboratories
Satellite Health Care
U.S. Renal Care
Watson Pharma, Inc.