March 29, 2018
2 min read

Calif. bill would limit third-party payments for dialysis care

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A California legislator introduced a bill on March 22 that would limit acceptance of third-party payments for patients treated at dialysis clinics and drug treatment centers in the state.

Senate bill 1156, sponsored by State Sen. Connie Leyva, D-Chino, with support from SEIU-United Healthcare Workers West, would place strict criteria on programs like the American Kidney Fund’s Health Insurance Premium Program when paying health care premiums for a patient if it financially benefits the organization. If the entity is paying a patient’s premiums for a commercial-based health care plan, it would have to verify the patient is not eligible for Medicare or Medicaid, and if the entity persists in buying health coverage for the patient, the health care provider would only be reimbursed at Medicare levels.

Leyva said in a statement that her bill addresses dishonest providers who take advantage of sick people by enrolling them in commercial coverage to maximize high reimbursement rates for services. “Often times, this coverage is not in the best interest of the patient, results in higher out-of-pocket costs or disruption in care and is being imposed upon consumers even though these patients are eligible for public coverage like Medicare or Medi-Cal,” she said.

Under SB 1156, third-party payers would have to:

  • Certify that patients are not eligible for Medicare, Medi-Cal, or Covered California subsidies if they are covering premiums for commercial health plans, and would have to disclose to regulators of their intention to pay a patient’s premiums in advance;
  • Require third party payers to pay premiums for the full plan year, even if the patient stops treatments that benefit the provider; and
  • Prove they meet these requirements. Failure by the third-party payer to meet these requirements means the financially interested provider is only entitled to a predetermined payment rate for any services provided to that patient.

In a statement, AKF CEO LaVarne Burton said the organization was “disappointed” in seeing the legislation introduced in the state senate. “If passed this bill would cause profound harm to many of the nearly 67,000 Californians who rely on dialysis to stay alive. AKF provides a safety net to dialysis patients who are unable to afford their health care coverage. More than 17,000 people who are on dialysis live in the counties in Sen. Leyva’s district, and nearly 300 of them are receiving assistance from AKF to pay their health insurance premiums. This bill seeks to limit those patients’ access to lifesaving financial assistance and is nothing more than a thinly-veiled attempt by large health insurance companies to kick kidney patients off their insurance plans.

“AKF provides financial assistance for all types of health insurance plans, including Medicare, Medigap and Medicare Advantage. Though most end-stage renal disease (ESRD) patients qualify for Medicare regardless of their age, California is one of only two states that specifically excludes ESRD patients who are under 65 from supplemental Medigap coverage,” Burton said. “Because Medicare covers only 80% of all medical appointments and treatments, including dialysis (with no out of pocket maximum), patients without a Medigap plan are financially liable for 20% of the cost. For someone with an expensive, chronic health condition like ESRD, that could mean financial ruin.”

The bill will have its first hearing April 18 in the California Senate Health Committee.