California Assembly Passes Bill to Restrict Dialysis Profits

The California Assembly voted 46-15 to pass A.B. 290, a measure that would limit dialysis provider and rehabilitation center profits operating in the state when insurance premiums are covered by third-party payers.

The bill now moves on to the state Senate for consideration.

“We need to stop third-party health care providers from profiteering by taking advantage of vulnerable and unsuspecting patients who need life-saving treatment,” Assemblyman Jim Wood, the author of A.B. 290, said in a press release. “Their profit-inflating schemes do nothing to improve the care of kidney patients or those recovering from addiction. This legislation will hold these two industries accountable while safeguarding critical financial assistance to patients in need.”

The legislation limits the amount of payment for medical services for dialysis providers and rehabilitation centers to the Medicare rate when patients have premiums paid by third-party payers, such as the American Kidney Fund.

The legislation was passed by the Assembly Health Committee on March 19 – a committee chaired by Wood – by an 11-2 vote, and the Appropriations Committee passed the bill on May 16 by a 12-3 vote. No votes were recorded on the bill from 19 legislators during the full assembly vote.

The bill is supported by Health Access California, the California Labor Federation, Service Employees International Union California, California Association of Health Plans and the Association of California Life and Health Insurance Companies, according to a press release from the California Association of Health Plans. The bill now goes to the California Senate for consideration.

The Dialysis is Life Support coalition, made up of doctors, hospitals, dialysis patients and caregivers, along with business and community groups, denounced the legislation, saying in a statement that passage of A.B. 290 “puts insurance companies one step closer to maximizing their profits while putting vulnerable dialysis patients in California at risk.”

“Short term, A.B. 290 directly threatens the financial security of nearly 4,000 dialysis patients in California,” spokesperson Kathy Fairbanks said in a press release. “If A.B. 290 is enacted, the non-profit American Kidney Fund has stated it will be forced to stop providing assistance to patients in California, driving up the cost of care for low-income patients who rely on financial grants from the organization.

“Long term, A.B. 290 threatens dialysis clinic access for the more than 70,000 dialysis patients in California where dialysis clinics have some of the highest government quality ratings in the country. Shifting even a few patients from private insurance to government programs upsets the dialysis ecosystem and will reduce funding to dialysis clinics across the state,” she said. “Many California patients will have no choice but to dialyze in hospital emergency rooms at much higher cost to the health care system and taxpayers.”


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