Dialysis Organization Perspectives on the Financial Repercussions of the Expansion of Medicare Advantage

Background: Following the 2021 policy change that opened Medicare Advantage enrollment to all Medicare beneficiaries with kidney failure, Medicare Advantage enrollment among this population has risen sharply. However, little is known about the financial and organizational consequences of this expansion for dialysis providers. Methods: Administrative leadership and clinical staff from two large national and four small regional dialysis organizations were recruited to participate in semi-structured, in-depth interviews. Interviews were conducted with executive, financial, and clinical staff from January 2022 to May 2024. This descriptive qualitative study analyzed interview transcripts using a modified grounded theory and content analysis approach. Results: Interviews were conducted with thirty-seven leadership and staff from six dialysis organizations. Three main themes were identified reflecting their experiences managing the fiscal repercussions of Medicare Advantage expansion: 1) contract negotiations with Medicare Advantage plans were described as complicated, with large dialysis organizations securing more favorable rates and profit margins than small dialysis organizations; 2) although Medicare Advantage out-of-pocket caps were a cost-savings for patients with kidney failure, the expenses prior to reaching maximums were described by dialysis leadership and staff as a significant financial burden for their patients often leading to medical debt – a cost that small dialysis organizations reported absorbing as bad debt, and 3) dialysis organizations expressed concerns around the long-term financial impacts of Medicare Advantage expansion noting high health care costs, Medicare Advantage enrollment trends by their patients with kidney failure, and financial instability amidst market consolidation for small dialysis providers. Conclusions: Medicare Advantage expansion created uneven financial consequences for large and small dialysis organizations, raising concerns about consolidation, sustainability, and care quality. Ongoing monitoring is needed to ensure that the rapid growth of Medicare Advantage does not compromise the financial stability of dialysis providers or access and quality of care for individuals with kidney failure.