Medigap and ESRD
Since 1972, most people with end-stage renal disease (ESRD) become eligible for Medicare, and most of them choose to enroll in the program as their primary health insurance coverage. For many of these patients, private supplemental Medigap insurance is needed to afford their cost-deductibles and co-pays, as Medicare covers 80 percent of medical care with no cap on out-of-pocket (OOP) expenses.
ESRD patients have complex health care needs and face high out-of-pocket costs: average OOP costs for ESRD patients on Medicare are $7,000. Of the Medicare patients with average OOP close to $12,000, 45 percent are ESRD patients.
However, not all Medicare beneficiaries have access to supplemental coverage—more than 92,000 dialysis patients cannot purchase a Medigap plan because in 23 states insurers are not required to offer Medigap to ESRD patients under the age of 65; nationwide, 60 percent of all ESRD patients are under 65 years old. While some low-income ESRD patients may also be eligible for Medicaid (i.e., dually eligible for Medicare and Medicaid), eligibility rules vary by state, and not all low-income patients may qualify. And some may have to “spend down” their assets to become eligible for Medicaid, which can be financially devastating for these individuals and their families.
For over 20 years, the American Kidney Fund (AKF) has provided charitable premium assistance to low-income ESRD patients that helps pay their Medigap premiums. Without it, they would not be able to afford this critical supplemental insurance that covers their Medicare cost-sharing. About 80 percent of the people who are on dialysis are not able to work, and the average annual income of the patients who look to AKF for assistance is $20,000. Recently in several states, insurers have started to reject charitable premium assistance from AKF for Medigap premiums, even though they have accepted our checks in the past. This threatens the access to coverage and care for vulnerable individuals with ESRD.
AKF staff have met with state insurance department officials and lawmakers to address this problem, and will continue to do so throughout the year. If you would like to join our Advocacy Network to lend your voice on this effort and other AKF advocacy priorities, click here.