Paying for Home Dialysis: A Brief Primer
Medicare—Enroll during 7-month “initial enrollment period” or annually 1/1-3/31 with Part B starting the following 7/1 (no “special enrollment period” for ESRD)
Patients who want to do home dialysis may already have Medicare because:
- They’re 65 or older
- They have received disability checks for at least 24 months
- They started a home training program during the first 3 months of dialysis and Medicare backdated to the month they started dialysis.
Patients who have Medicare and no other drug plan should choose a Part D plan to help pay for their drugs. Those with limited income can get help to pay premiums and drug costs.
Facilities get a “new onset adjustment” of 51% for the first 4 months of dialysis for Medicare patients. However, if a patient doesn’t have Medicare—and doesn’t start training until after the 3rd month of dialysis, Medicare will start in the 4th month, and the facility will lose 3 months of higher payments. Not sure when Medicare will start?Use our calculator! Facilities can’t bill for home training while they’re getting the new onset adjustment, but the Medicare payment for home training is comparatively small.
If a patient has an employer group plan (EGHP), that plan will pay primary for 30 months, starting the month the patient is eligible for Medicare, even if the patient doesn’t enroll in Medicare. If the patient enrolls in Medicare, too, providers who accept “assignment of benefits” cannot bill the patient if the EGHP pays at least 100% of Medicare’s allowed charge.
As a primary payer, traditional Medicare Part B pays 80% of the allowed charge for dialysis after the patient meets an annual deductible. Those with limited income may qualify for Medicaid or be able to get a Medigap plan to pay the deductible and 20% coinsurance. Some patients may not qualify for either—because their income is too high or they live in a state that doesn’t have regulations allowing people under 65 with ESRD to buy a Medigap plan.
Medicare Advantage (MA)—Enroll 10/15-12/7; disenroll or switch 1/1-2/14 in most cases
Private insurance companies sell MA plans are health maintenance organizations (HMOs) or preferred provider organizations (PPOs). MA plans cover dialysis and transplant, but may require members receiving services in their home area to see providers in their network or pay more than what they would have paid if they had traditional Medicare Part B. If patients are traveling away from their home area, MA plans must pay as much as Medicare Part B would have paid for dialysis. MA plans may cover some things that traditional Medicare doesn’t cover, and some have low or no premiums. However, MA plans’ deductibles and out-of-pocket costs vary from plan to plan and company to company. The annual out-of-pocket cap for MA plans is $6,700, though some plans may have lower costs than this.
If someone has limited income, Medicaid may help pay MA out-of-pocket costs and there are some MA “special needs plans” specifically for people with Medicaid. Anyone who has an MA plan and doesn’t qualify for Medicaid cannot use a Medigap plan to pay their out-of-pocket costs. MA plans may have a primary doctor who coordinates care and must be consulted to make referrals to other providers.
Medicaid helps to pay medical costs for people with limited income and assets. Each state has its own eligibility standards. Some have a “medically needy” or “spend down” program that allows people with large bills to qualify for Medicaid by paying part of their medical expenses themselves. Medicaid covers dialysis at the rate approved by the state. As a supplement to Medicare, Medicaid may or may not pay the full 20% remaining. Some patients with limited income and assets who don’t qualify for Medicaid may still qualify for a Medicare Savings Program to help pay the Medicare premium and Medicare out-of-pocket costs.
Affordable Care Act & the Health Insurance Marketplace—Enroll 11/15-2/15 in most cases
Patients who have Medicare can’t buy a health plan on the marketplace. However, some patients may start dialysis with a qualified health plan (QHP) through the Health Insurance Marketplace. Others may have employer coverage through Small Business Health Options Program (SHOP) on the marketplace. There are four “metal” levels of marketplace plans: bronze, silver, gold, platinum. All cover dialysis as an “essential service.” However, plans may have networks of providers, lists of covered drugs (formularies), and premiums and out-of-pocket costs can vary. Tax credits and subsidies may help to pay premiums and out-of-pocket costs. However, if the state hasn’t expanded Medicaid, those with income below 100% of the federal poverty level don’t qualify for either.
Those who have marketplace plans may keep their plan instead of enrolling in Medicare and people who have SHOP coverage can have Medicare as a secondary payer. Patients should look carefully at their policies and compare their marketplace plan to Medicare. Out-of-pocket costs for patients may be lower and choice of providers wider in traditional Medicare, especially if they don’t qualify for tax credits or subsidies. Here is a list of marketplace FAQs.
How to Advise Patients
Encourage your patients to read and understand their coverage and out-of-pocket costs. They should:
- Make sure their doctor and any other provider or supplier they like is in their plan’s network.
- Ask their doctor what drugs they may need in the future if they get a transplant and make sure their current and future drugs are on the plan’s formulary without too many limits. (Health insurance and Part D plans can limit how much of a drug the patient can take over a set period, require the person to take a less costly drug and show that the cheaper drug didn’t work—called “step therapy”—before paying for the more costly drug, and/or require the doctor to document the medical need and seek authorization from the plan before the patient can get the drug covered.)
- Take Part A and B or waive BOTH if they have EGHP coverage. Those who take Part A only can only enroll in Part B from 1/1-3/31 but Part B won’t start until 7/1. Those with ESRD do not have the same “special enrollment period those with Medicare due to age or disability have. There could be a coverage gap for dialysis and a higher Part B premium.
- Know that if Medicare Part A is in effect during the month of a kidney transplant, they can use Medicare Part B to cover immunosuppressants when they have Part B—while they have ESRD Medicare or later when they have Medicare due to age or disability.
Refer patients to representatives of Social Security, Medicare, and Medicaid who can advise them about federal and state programs. If you give someone the wrong information, the patient may not be able to correct the error. If a federal or state employee gives misinformation, the patient may have recourse through “equitable relief.”
Another helpful resource is the federally-funded State Health Insurance Assistance Program that provides counselors in all states to help people with Medicare review coverage and resolve problems. The SHIPTalk website has links to state programs and other resources.