The Economics of End Stage Renal Disease

Application: Case Study: The Economics of End-Stage Renal Disease

Introduction

Quality health care is the right of every person. The aging population, chronic illness and the health care involved contribute to the increased cost of this care for many people in our country and world. "Kidney disease is the ninth leading cause of death in the United States." (Center for Disease Control, 2008). "End-stage renal disease (ESRD) is defined as permanent kidney failure." (Milstead, 2008, p. 240). The cost, quality and access to health care for this disease are being challenged, as are many other health care issues.

Major reimbursement mechanisms

The major reimbursement mechanisms presented in this case study are Medicare and Medicaid. End-stage renal disease (ESRD) is usually covered by Medicare and includes coverage for those under the age of 65. (Milstead, 2008, p. 240). "The belief that transplant was soon to become routine and would replace dialysis" was the basis for 1972 government legislation that lead to Medicare coverage for ESRD. Government insurance payment for dialysis while waiting for a kidney transplant is much more costly than the transplant. (Denver Post, 2011, para., 20).

Economics of providing ESRD treatment

The patient with ESRD is faced with the fact that "two basic forces govern the economics of ESRD treatment: (1) patient and provider choice of treatment option; and (2) government reimbursement policies." (Milstead, 2008, p. 241). With a history of Medicare coverage, providing access related to demand, containing cost, improving quality of care, larger treatment centers and organizations are now involved. (Milstead, 2008, p. 241). The largest provider of dialysis treatment in North American is Fresenius National Medical Care (FNMS) and is in a position to negotiate with payers and venders. (Milstead, 2008, p. 241). Medicare, Medicaid and third party payers reimburse for ESRD treatment but the challenge ...