Dual-Eligible ERSD Patients Yield High Costs for Payers

July 13, 2020 - Dual eligibles with end-stage renal disease (ESRD) differ from non-duals in demographic factors as well as healthcare spending characteristics, but their healthcare utilization rates are the same as non-dual patterns, an Avalere study revealed.

The study compared populations with ESRD that were dually eligible for Medicare and Medicaid to those who were solely in fee-for-service Medicare in 2018.

“Understanding the demographics, utilization patterns, and costs of these beneficiaries may help stakeholders prepare for the upcoming MA eligibility transition,” the study began.

“In particular, the population enrolled in both Medicare and Medicaid (duals) and those who are not (non-duals) may have different social risk factors, which could have implications for their health outcomes and service use.”

Nearly six in ten percent of all patients in Pennsylvania with ESRD were dual-eligible (57 percent). The dual-eligible population was also evenly split between men (52 percent) and women (48 percent). Among dual-eligible beneficiaries, 43 percent were Black and 47 percent were white.

In contrast, there were nearly double the number of men in the non-dual population (64 percent) as women (36 percent). Additionally, 22 percent of non-dual Medicare patients with ESRD were Black and 73 percent were white.

The two populations were also separated by other social determinants of health factors. Dual eligibles were more likely to have food or housing insecurity, for example.

Spending was a third category in which dual-eligible beneficiaries and non-duals differed. Dual-eligible beneficiaries tended to spend more on a monthly basis—on average 24 percent more than non-duals. They spent on average over $9,000 per month on their Medicare payment and out-of-pocket healthcare spending.

However, while the spending was generally a bit higher for dual-eligible beneficiaries as opposed to non-duals, both groups tended to use healthcare services at about the same rate. They nearly matched on dialysis spending and nephrologist services. Non-duals spent a little more on home dialysis whereas dual-eligible beneficiaries spent three percent more on inpatient services.

This data contrasts with recent discoveries in an American Journal of Accountable Care study. The study found that seriously ill populations tend to use the same services that the average member uses but their costs are so much higher because they use these services more frequently. However, the Avalere study is comparing patients with the same disease.

These coverage characteristics are particularly important in light of two recent developments:

• Patients with ESRD are at greater risk of developing severe, even deadly, coronavirus-related complications
• CMS finalized a rule making patients with ESRD universally eligible to join Medicare Advantage plans, regardless of what plan they are on when they develop the disease

“MA enrollment by individuals with ESRD is expected to accelerate beginning in 2021, when a provision of the 21st Century Cures Act (Cures Act) lifts the current enrollment restrictions,” a brief from America’s Health Insurance Plans explained.

The AHIP brief added that CMS estimated 83,000 patients with ESRD will enroll in Medicare Advantage by 2026, expanding the population by 63 percent.

The controversial rule is expected to lead to higher spending for payers due to the fact that the rule disregards cost variation based on location.

In addition to these new costs, payers will have to account for the cost of coronavirus-related inpatient stays for ESRD populations. In May 2020, a Harris Poll survey found that 15 percent of patients hospitalized due to coronavirus were experiencing acute kidney injury as a result and 20 percent of those who end up in the intensive care unit lose their kidney function.

This is happening to patients who have no history of kidney disease—which means that the outcomes and costs are even more severe for patients whose renal systems are already compromised.

“As MA plans prepare to enroll new patients with ESRD, it will be crucial for them to understand the characteristics and utilization patterns of the FFS population with ESRD so that they can effectively manage the care of these beneficiaries,” the Avalere study emphasized.