Note: P3 will not publish next Sunday due to the holiday. We will be back here on Jan. 2. Have a great holiday week.
Politics. When Washington isn’t making things worse for American health care through its perennial confusion over health, health care and health insurance, it is adopting the market nihilism that has led the country toward a dangerous dependence on duopolies and oligarchies.
In the case of the treatment of End Stage Renal Disease, it is both.
It is a story repeated often in federal-level health policy. A narrative was woven, outrage generated, a response concocted to the satisfaction of those who will never face its consequences. In this case, Shana Alexander’s story, complete with powerful photography, in Life magazine, entitled They decide who lives, who dies; medical miracle puts burden on small committee (1965) followed by a NBC documentary the same year titled, Who Shall Live, sparked outrage over the idea that care was being rationed for people with renal disease.
Congress’ response to NBC’s rhetorical question was “no one” as it passed amendments to the Social Security Act in 1972. Then walked away.
When Congress added the ESRD benefit to Medicare in 1972, it was made available to everyone regardless of age. The open wallet at the time was predicated on a report by researcher Carl Gottschalk, M.D. which suggested that most ESRD patients would be between 15 and 54 years old, the majority of which would be able to return to work because they received a transplant or performed in-home dialysis. At the time, in-center dialysis was believed to play a small role in the care and treatment of renal disease.
Oops.
The unlimited supply of money from the U.S. Treasury was met with an equally prolific demand driven by a host of variables. Costs exploded and Congress, in its last fit of fiscal pique, returned to rein things in. Controlling costs was the imperative with little thought given to what went so terribly wrong that ESRD achieves, year over year, a predictable annual incidence of 2-3%. The result was the bundled payment system we have today, last updated in 2011.
Dialysis providers were pushed to provide services at lower cost. The scale required to purchase drugs and supplies became imperative. Efficient use of human resources argued for in-center hemodialysis - also a handy rationalization for the nephrologists with an economic interest in the clinic. Post-transplantation drugs were only available for 36 months after surgery at which point graph recipients were on their own.
If there ever was a political priority to prevent such a dismal health outcome as dialysis, it was nowhere to be found.
Policy. It is entirely possible to be both interested in your shareholders and your patients. Yet, despite enormous influence over the industry, DVA has demonstrated little commitment to the latter, with its miserly investment in the time and capital necessary to advance the care of kidney disease besides the foregone conclusion of dialysis and death.
It took the Trump, followed by the Biden administration to promote early-stage policies to improve home dialysis uptake, reform transplant practices and, with Congress’s aid, end the 36-month duration of immunosuppressive drugs post-COVID.
Predictably, new business models have emerged. Somatus, Strive Health and Cricket are taking advantage of new policies that put dialysis where is should be, a treatment of last resort and as a bridge to transplant. Payers, stung by what they view as unnecessary costs for dialysis, are promoting programs focused on intervention and prevention.
Demonstrating hope over experience DVA is also trying to wedge themselves into the new models with its Integrated Kidney Care project. Previous efforts like Davita Medical Group never got traction, in part, due to the institutional conflict with the money machine that is (was?) dialysis treatment.
They have asked for forbearance from shareholders for 2022 and if that doesn’t work, a $2B buyback program. The question to ponder is, will the rest of the world have passed them by in the meantime?
Power. Along with the intractability of the legislative process, federal policy indifference to the woeful approach to kidney disease can be explained by a bias against the modern equivalents of gluttony and sloth. “Lifestyle choices,” have sufficed as explanations for the steady growth of ESRD patients over the last couple of decades. The same could be said for a lot of cardiac diseases but facile interpretations are easier when those most affected by ESRD are disproportionately minority and poor.
The least, the lowest and the left behind have navigated their way through a system that has had everything but their health and welfare in mind. They were certainly no match for the viciousness of COVID-19.
For 51 consecutive weeks, dialysis patients experienced excess mortality which has led to an unprecedent decline in prevalence in the U.S. According to USRDS, “The net effect of persistent excess mortality has been an unprecedented decline in the size of the dialysis patient population. For a segment of health care that has been built around a steadily increasing census (and treatment volume), this shock will reverberate for years.” That mortality extends – to be quite direct – to DVA’s “sales pipeline” of aging diabetic and hypertensive adults, most poor and many of them minority.
COVID-19 was full of cruel ironies and here is another. The foregone conclusion of ever rising ESRD prevalence, due to bad behavior and poor life choices that obviated the need for innovation and advances in care leaves, could leave the overly consolidated industry hoisted with its own petard.
Have a great rest of your weekend.
Emily Evans
Managing Director – Health Policy
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