The economics of end stage renal disease Essay Example | Topics and Well Written Essays - 750 words

The economics of end stage renal disease - Essay Example For ESRD patients, all medical expenses both relating to their kidney disease or other conditions are the responsibility of Medicare (Hirth, 2007). ENDR patients pay for their treatment in four ways: 1) a monthly premium ($78.20 in 2005), 2) 20% for covered outpatient facilities (copayment) 3) a deductible for inpatient care and 4) outpatient prescription drugs. In many cases, patients have private insurance that cover the copayment and prescription drugs. In low-income groups, people may have their premium and deductible paid for by the government too. The amount actually paid by ERSD patients is very low (Hirth, 2007). The Medicare plan provides payments depending on the service provided. There is a single composite rate for dialysis for patients that comprise dialysis including labour, equipment and supplies (Hirth, 2007). Physicians, generally nephrologists, are paid a fixed monthly amount for out-patient services where as hospitals are paid a fixed amount too for in-patient care depending on the diagnosis of the patient (Hirth, 2007). The decision by the American government to cover ESDR was motivated by the political and economic prognosis at the time (case study). The funding for the Medicare program is from wage taxes, general tax revenues and beneficiary premiums (Hirth, 2007). 76% of dialysis centres are private run (Hirsh, 2007) and two chains are responsible for all private dialysis centres in the US (Hirth, 2007). An example being Fresenius National Medical Care (case study). A study in Canada looked at the economic burden of ESRD in 2000 and found that the direct, mortality and morbity costs to the government in one year was $1857 million (Zelmar, 2007). In the US, $27 billion was spent in 2003 (USRDS from Hirth, 2007) and costs are still increasing (case study). Outpatient clinics need a large investment to be profitable (case study).The Medicare Payment Advisory Commission has recommended