Medicare Advantage plans don’t typically have a large population of members with End-Stage Renal Disease (ESRD). In our work with dozens of plans, we see about 5% of members with ESRD, a condition where there is permanent and almost complete loss of kidney function.
These few members, however, can have a big impact on a plan’s financial health if the Centers for Medicare and Medicaid (CMS) are underpaying premiums for these members. And especially if CMS has been underpaying for a length of time.
The average cost to treat a patient with ESRD can run well over $60,000 a year because members may require dialysis several times a week. To offset this higher cost of care, CMS typically pays health plans a premium of $7,100 for managing members with ESRD, compared to a premium of $815 for non-ESRD members. When you multiply the gap between non-ESRD premiums and ESRD premiums year over year, having the wrong ESRD status for a member can be quite costly to your plan.