Information Regarding HR 8594
December 29, 2022
The bill HR 8594, entitled the “Restore Protections for Dialysis Patients Act.” raises concerns because its impact on how claims are handled/covered for dialysis services. Although the issue will likely return next Congress, it appears to be less likely the bill will move as currently drafted.
BACKGROUND: In June 2022, the Supreme Court released a ruling in Marietta Memorial Hosp. v. DaVita, Inc. This ruling involves a dispute between a large dialysis provider and an employer/plan administrator and their TPA.
To summarize, the provider challenged the plan’s classification of all dialysis providers as out-of-network and categorized its reimbursement of claims as a “low reimbursement rate” that allegedly violated the Medicare Secondary Payer (MSP) rules. The Supreme Court ruled in favor of the plan. The basis for their ruling was that the employer sponsoring the group health plan offered the same limited coverage for outpatient dialysis services to all plan participants.
The basis for the provider’s allegations were that the out of network classification and low reimbursement rates violate MSP rules, which prohibit differentiation in benefits between individuals with end stage renal disease (ESRD) and other members covered by the plan. It alleges that it cannot limit such coverage due to the existence of ESRD, the need for renal dialysis, or in any other manner. MSP rules also prohibit a plan from taking into account that an individual is entitled to or eligible for Medicare due to ESRD.
In their 7-2 decision, the Supreme Court rejected the disparate impact argument. The Court held that the MSP statute does not authorize disparate impact liability, and the plan’s coverage terms for outpatient dialysis do not violate MSP rules because those terms apply uniformly to all covered individuals.
On July 29, Rep. Yvette Clarke introduced HR 8594, entitled the Restore Protections for Dialysis Patients Act. If enacted, the bill would amend the MSP statute to prohibit the type of plan design that was at issue in the Marietta case. Specifically, it would add a provision in the MSP section that deals with ESRD.
This provision would state that:
“Notwithstanding any other provision of law, a group health plan shall be treated as differentiating in the benefits it provides in violation of clause (ii) if the plan limits, restricts, or conditions the benefits the plan provides for renal dialysis services as compared to the benefits the plan provides for other medical services that are necessary to treat other chronic medical conditions and that are covered under the plan.”
The bill would also add to the existing prohibition against taking into account that an individual is entitled to or eligible for Medicare due to ESRD. It would add a clause further prohibiting taking into account that “such an individual requires the use of an item or service.”
You can read more about this bill on the AHIP website.