On Oct. 5, Representative Kevin Cramer, R-N.D., introduced legislation that would amend the Affordable Care Act to allow third-party payments and charitable assistance. H.R. 3976, called the Access to Marketplace Insurance Act, would open the door to charitable contributions like the American Kidney Fund’s Health Insurance Premium Program (HIPP), which is funded largely by dialysis companies to help patients pay their health coverage premiums.
The bill specifically allows non-profits, civic groups, and churches to help pay cost sharing and health insurance premiums for individuals and families. Many health insurers have been refusing payments from third parties, including the American Kidney Fund.
A Centers for Medicaid & Medicare Services proposed rule that required dialysis providers to disclose to insurers when they were providing charitable funding of premiums to health plans was dismissed by a Texas judge last year because it didn’t allow for sufficient time for community review.
CMS issued the rule after issuing a request for information in August 2016 about whether health care providers were counseling patients to bypass Medicaid and Medicare coverage and steer them to ACA marketplace plans that are more lucrative to providers. The agency said the comments it received “documented a range of concerning practices, with providers and suppliers influencing enrollment decisions in ways that put the financial interest of the supplier above the needs of patients.”
Cramer first introduced H.R. 3976 last year in response to the CMS rule. In May, Cramer helped draft a letter, signed by 184 members of Congress, that asked the U.S. Department of Health and Human Services Secretary to require insurance companies to accept charitable premium assistance.
“I didn’t believe it when I first heard that, under Obamacare, health insurance companies were banning sick individuals from accessing health care if a charitable entity was helping them pay the bill,” said Cramer in a statement. “That practice, and the fact that CMS is allowing it to continue, literally goes against everything the Affordable Care Act claims to stand for, which is why my bill has received such strong bipartisan support. The Access to Marketplace Insurance Act removes the handcuffs from private charities, allowing them to assist insured patients pay their premiums and stay on health insurance.
Last year, American Renal Associates and DaVita Kidney Care suspended support of the AKF’s premium assistance for Medicaid-eligible dialysis patients pursuing ACA exchange plans after the Centers for Medicare & Medicaid Services and the insurance industry accused dialysis providers of steering patients to more lucrative commercial plans. DaVita’s decision led to a loss of approximately $230 million for 2017.
Dialysis providers and the AKF deny that they have steered patients.“AKF continues to condemn anecdotal reports of health care providers ‘steering’ patients into private coverage by use of charitable assistance programs,” AKF CEO LaVarne Burton said. “AKF continues to take strong actions to guard against such behavior in its own assistance program.”
DaVita disclosure on premium assistance
“Dialysis patients across the U.S. access charitable premium assistance in a government-designed system that has been in place for decades,” DaVita said in a statement issued Oct. 10. “The intentional support of the system includes the acceptance of provider funding in an explicit advisory opinion from the CMS Office of Inspector General. Many of the beneficiaries of this assistance are unable to continue working full-time as a result of their severe condition. Charitable premium assistance enables these patients to afford continuity of health insurance coverage that they have had for years, at a time when they need it most. Assistance is based on financial need and available regardless of the type of insurance chosen by the patient, or the dialysis provider serving the patient. Across health care, charitable assistance is available to patients suffering from a variety of other high-cost, chronic diseases.”
DaVita said in its statement that less than 13% of its U.S. dialysis patients, about 25,00 people, receive support from the American Kidney Fund. Approximately 1,800 patients receive charitable premium assistance for individual coverage, including both on- and off-exchange plans. The majority of the patients come to DaVita with their plan already in place, according to the dialysis provider.
More than half of these patients, DaVita said, would utilize premium tax credits and cost-sharing reductions, or find other sources of funding, to maintain their coverage even if charitable premium assistance were no longer available to them. The loss of individual coverage for some or all of the remaining patients could result in a reduction in expected annual operating income of $45-90 million.
DaVita said approximately 4,000 of its patients receive charitable premium assistance for commercial group coverage, including employer group plans and COBRA plans. These patients account for approximately $450 million of DaVita’s expected annual operating income. Even if charitable premium assistance were to become unavailable to these patients – which DaVita does not expect to happen – DaVita believes that some of these patients would find other ways to fund their insurance premium and retain their coverage.
Nearly 80% of DaVita recipients, or approximately 19,000 patients, receive charitable premium assistance for government coverage, such as Medicare Part B and Medicare Supplemental Plans. DaVita said average reimbursement per treatment for these patients is at or below DaVita’s average cost per treatment. Without charitable premium assistance, DaVita said that many of these patients would be forced onto state Medicaid programs or be uninsured.
“DaVita’s view is that private insurers are not unfairly burdened by dialysis charitable assistance, as some have asserted,” DaVita said in the statement. “In fact, in a feature that is unique to ESRD, private insurers receive massive government subsidies in the form of a) the near-universal Medicare eligibility for ESRD patients and b) the 30-month limitation on their obligation to remain the primary insurer. These two subsidies to commercial insurers – one of which uniquely restricts ESRD patients’ freedom of choice – far outweigh the benefit of charitable premium assistance to providers.”