DENVER, Oct. 31, 2016 /PRNewswire/ -- DaVita Kidney Care ("DaVita"), a division of
DaVita Inc. (NYSE: DVA), a leading provider in kidney care
services, today announced information concerning its patients
enrolled in plans governed by the Affordable Care Act ("ACA").
With open enrollment starting tomorrow, and in light of recent
statements from the Centers for Medicare & Medicaid Services
("CMS"), DaVita announced that, effective immediately, it will
suspend support for applications to the American Kidney Fund
("AKF") for charitable premium assistance by patients enrolled in
minimum essential Medicaid coverage who are seeking additional
coverage on a 2017 ACA Plan.
Background and Patient Concerns
U.S. dialysis
providers are required to provide comprehensive education to their
patients, including information regarding their insurance options
and the availability of financial support, such as premium tax
credits or charitable assistance. This requirement has been
in place since well before the ACA. DaVita has a disciplined,
compliant process to provide this education to its patients. Since
the implementation of the ACA in 2014, DaVita has included
information about individual market plans in its patient
education.[1]
Since the implementation of the ACA, a subset of DaVita's
Medicaid patients have opted to obtain additional coverage through
ACA Plans. In pursuing this additional coverage, they were
seeking – and often obtained – access to services beyond dialysis,
including access to specialty physicians, more comprehensive drug
coverage, increased chance of qualifying for transplantation, and
coverage for out-of-state services. While Medicaid patients
are eligible to enroll in individual market plans, as confirmed in
guidance by CMS[2], only a small number have done so, and those who
do typically rely on charitable premium assistance, from the AKF or
otherwise, because they are ineligible for federal premium tax
credits.
The change announced today will affect approximately 2,000
patients, or about one percent of DaVita's total patient
population, who have pre-existing minimum essential Medicaid
coverage and obtained additional coverage through ACA Plans. If CMS
establishes a policy to restrict access by Medicaid patients to ACA
Plans or the use of charitable assistance for such plans, these
patients likely will revert back to Medicaid-only
coverage.
Approximately 3,000 additional DaVita patients are enrolled in
an ACA Plan and not in Medicaid. Most of these patients came
to DaVita with individual market coverage or other commercial
coverage already in place, and many are not eligible for any other
type of coverage. About half of these patients access
charitable premium assistance, either in addition to or instead of
premium tax credits. If charitable premium assistance were no
longer available to them, thousands of dialysis patients across the
U.S. are at risk of becoming uninsured.
"We were thrilled to present ACA coverage options to our
patients, since for some of them this meant opportunities for much
improved care," said Kent Thiry,
chairman and CEO of DaVita. "While our analysis indicates
that dialysis patients account for less than 2% of the overall
medical costs in ACA Plans, we understand the financial pressures
in the risk pool. We stand ready to work with all
stakeholders to preserve the intent of the ACA within a sustainable
rate and regulatory structure. If CMS opts to restrict
Medicaid patients' access to ACA Plans, we are prepared to offer
special rates for patients that CMS and issuers are willing to
grandfather, in order to avoid disruption and preserve their
improved benefits and care."
Financial Impact
Because Medicaid reimburses for
dialysis at a lower rate than ACA Plans, DaVita estimates that a
policy change that prevents patients with minimum essential
Medicaid coverage from accessing charitable premium assistance to
enroll in ACA Plans would result in a reduction in its annualized
operating income of up to approximately $140
million before any offsets. If CMS were to issue a
broader ruling that made access to charitable premium assistance
unavailable to all ESRD patients on ACA Plans, the estimated
financial impact would increase by up to $90
million, based on our estimate that a significant number of
ESRD patients would lose their ACA coverage and end up completely
uninsured, while others could continue the coverage with federal
subsidies.
DaVita looks forward to continuing a collaborative dialogue with
regulators and issuers on efforts to strengthen the sustainability
of the ACA and continue to provide clarity and access to coverage
for patients in the future. We will provide additional
details on our third quarter earnings call on Wednesday, November 2, 2016.
About DaVita Kidney
Care
DaVita Kidney
Care is a division of DaVita Inc., a Fortune 500® company
that, through its operating divisions, provides a variety of health
care services to patient populations throughout the United States and abroad. A leading
provider of dialysis services in the
United States, DaVita Kidney
Care treats patients with chronic kidney failure and end
stage renal disease. DaVita Kidney
Care strives to improve patients' quality of life by
innovating clinical care, and by offering integrated treatment
plans, personalized care teams and convenient health-management
services. As of June 30, 2016,
DaVita Kidney Care operated or
provided administrative services at 2,293 outpatient dialysis
centers located in the United
States serving approximately 185,000 patients. The company
also operated 127 outpatient dialysis centers located in 11
countries outside the United
States. DaVita Kidney Care
supports numerous programs dedicated to creating positive,
sustainable change in communities around the world. The company's
leadership development initiatives and social responsibility
efforts have been recognized by Fortune, Modern Healthcare,
Newsweek and WorldBlu. For more information, please visit
DaVita.com.
General
Media
|
Investor
Relations
|
Kate
Stabrawa
|
Jim
Gustafson
|
303-876-7527
|
310-536-2585
|
Kate.stabrawa@davita.com
|
jim.gustafson@davita.com
|
[1] Individual market plans include both on-exchange and
off-exchange plans (collectively "ACA Plans"). On-exchange
plans, often referred to as "Marketplace plans," are purchased
through the federal or state program and allow individuals to seek
premium tax credits. Off-exchange plans are purchased
directly from the issuers. Both impact the same risk pool
and, as a result, the information provided here refers to both
on-exchange and off-exchange plans.
[2] CMS's RFI and accompanying letter to dialysis facilities
erroneously implied that it is unlawful to enroll a Medicaid
beneficiary in an ACA Plan, citing to Social Security Act Section
1882(d)(3)(i)(II) in its letter to dialysis facilities. In fact,
that statute prohibits someone from selling a Medicare beneficiary
unnecessary Medicare supplemental insurance that merely duplicates
their existing coverage, and is inapplicable to this
situation. Further, Medicaid benefits are often limited; an
ACA Plan is not merely duplicative of Medicaid; and CMS itself has
repeatedly recognized that Medicaid beneficiaries are
eligible to enroll in an ACA Plan, just not eligible for federal
premium tax credits or federal subsidies.
https://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-Insurance-Marketplaces/Downloads/Complex-Sits-Webinar-FINAL.pdf 3/20/2016,
page 26;
https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/PDM-Round-3-FAQ-8-1-16.pdf.
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SOURCE DaVita Kidney Care