New Kidney Disease Strategy Could Save Medicare Billions

The U.S. Government spends upwards of a trillion dollars a year on Medicare, and a substantial portion of the Medicare budget goes toward dialysis treatment and related care for patients with late-stage kidney disease.  Since Medicare covers kidney dialysis regardless of age, and kidney disease is growing at alarming rates, the costs to the federal government are quickly becoming unsustainable.  Yet if younger people were screened, diagnosed, and treated earlier for kidney disease, Medicare could potentially see huge savings and our country would have a healthier, more productive workforce.

Tragically, over 35 million Americans are living with chronic kidney disease, yet nine out of 10 don’t know they have it.[1]  This is because kidney disease often has no early symptoms and can go undiscovered unless someone takes a simple blood or urine test to find out. Unfortunately, nearly 40% of patients are not diagnosed with their disease until it has progressed to kidney failure, also known as end-stage renal disease or “ESRD” when treatment options are far more costly and outcomes are much worse.[2]   

When caught and treated early, kidney disease can be slowed or stopped to avoid serious complications like heart attack, stroke, kidney failure, and early death. But if the disease goes undiagnosed and progresses to kidney failure, many must go on dialysis and may have to seek a kidney transplant, facing long wait-lists.  Nearly 555,000 Americans are currently on dialysis which is driving up Medicare program costs to over $50 billion annually, with per-patient Medicare spending for ESRD patients coming in nearly six times higher than the average beneficiary. Social Security spending is also on the rise since most patients with late-stage kidney disease can no longer work and turn to disability benefits for income support.[3]

Last year, the American Kidney Fund and the National Alliance of Health Care Purchasers Coalitions released a report, “Healthy Workforces, Sustainable Futures:  Why Employers Should Invest in Early Kidney Care.” The report estimated that over 11 million workers are impacted by chronic kidney disease – nearly 7.4% of the total U.S. workforce – so employers are also feeling the impact. Caring for workers who are in the late stages of the disease is costly, adding up to 8% of annual employer health care costs. That is the equivalent to $107 billion in annual health care spending plus an additional $30 billion in lost productivity each year for American businesses.[4]

In response to this crisis, American Kidney Fund, a nonprofit patient advocacy group, and National Alliance of Healthcare Purchasers, which represents employer-sponsored health plans, have partnered on a new approach to improve kidney care prevention so patients at younger ages can avoid the dire and costly outcomes of this disease. This proposal seeks to not only improve patient health but would also save significant costs over the long-term for the U.S. Government, health plans, and employers.   

In a recent letter sent to Congress and supported by advocates in the aging, nutrition, patient, and employer communities, they propose a shared savings demonstration to reduce the number of patients that would progress to ESRD and Medicare coverage of dialysis..

The proposed demo would be implemented by the HHS Center for Medicare and Medicaid Innovation (CMMI) to benchmark this approach for its broader consideration later. Health plans (public and private) that voluntarily participate would receive advanced funding to set up kidney care plans, including diagnostic screening, care coordination, nutrition counseling, and innovative disease-modifying treatments. By allowing participating plans to keep Medicare savings accrued from having fewer beneficiaries requiring dialysis and kidney transplants, the demo would incent earlier kidney disease intervention and treatment and save costs on the back end.

Although the Congressional Budget Office (CBO) has not yet scored this shared savings demo proposal, data shows that early intervention and treatments to prevent ESRD could yield an estimated $9 billion in annual Medicare savings and $325 billion in annual savings to employers. [5]

As the Trump Administration and Congress consider ways to reduce federal government costs and remove challenges and perverse incentives in our health care system, this early kidney care prevention model deserves the highest attention.  If we want a strong, healthy American workforce that contributes to our economic growth, diagnosing and treating at the onset of kidney disease is commonsense for keeping American employees healthy and preserving our nation’s resources. 

Jerry Rogers is the editor of RealClearHealth, and Holly Bode is the SVP Government Affairs, American Kidney Fund.