A bill numbered HR 8423 comes before the Senate Finance Committee today. On the surface, the main concern of the "home dialysis bill," as the measure is called, seems to be helping people who have kidney disease.
But like a lot of other things that come before the committees of Congress, it also involves money-the possibility of more money for one group of people, less for another.
In the case of this particular measure, which Sen. Herman E. Talmadge (D-Ga.) claims would "save several hundred million dollars a year" for the government, two of the most interested bystanders will be the Baxter-Travenol Laboratories and National Medical Care Inc. of Boston. Baxter-Travenol may gain if the bill becomes law.National Medical could lose.
Baxter-Travenol is a leading maker of dialysis equipment, including home dialysis units needed to cleanse the blood of people whose kidneys are malfunctioning. It has hired former White House lobbyist Tom Korologos to help shepherd the measure through Congress. National Medical Care Inc., which runs private dialysis centers, is represented by John Sears, former presidental campaign manager for Ronald Reagan.
Under a 1972 amendment pushed through by then-Sen. Vance Hartke (D-Ind.) and Sen. Russell B. Long (D-La.), not only regular aged Medicare patients but also people under 65 needing dialysis are eligible to have Medicare pay the costs. The original cost of the program was estimated at $250 million a year at the end of about four years, but it already has reached $900 million and is estimated to jump to $1.3 billion by 1980.
Many experts in and out of the government attribute the sharp rise in costs to the fact that 90 percent of dialysis is done either in hospitals or clinics, where cost range from $15,000 To $30,000 per person per year, with most patients normally requiring three treatments a week.
According to the Senate Finance Committe, dialysis is cheaper ($8,000 to $12,000 a year) when it can be done at home on special machines.
Talmadge says costs be cut substantially if the House-passed by a variety bill, fostering home dialysis by a variety of methods, could be passed. Baxter-Travenol is highly favorable to the measure.
National Medical Care Inc., on the other hand, is the nation's leading private operator of for-profit dialysis centers and clinics. The Boston-based firm has 82 centers nationwide and last year gave 720,000 Medicare dialysis treatments, for which it was reimbursed $102 each by the United States.
That works out to $73.5 million, or over 8 percent of the total funding in program. In addition to the $102 per-treatment average payment from the United States, the company received an added $36 per payment from each patient privately or from the patient's private insurance.
Some supporters of the bill believe National Medical Care Inc., is leery of the legislation for fear more home dialysis would mean fewer patients from National's clinics, and therefore less profit: and that by basing reimbursements on costs, it would reduce the firm's take.
"Some of these people that operate these medical clinics are opposed," said Talmadge. He said several witness who testified on the bill stood to make a "pecuniary gain" from it's not passing.
However, Sears and his associate Jojn Ward, as well as company officials reached by telephone in Boston, strongly denied this motive. They said they only object to specific provisions of the bill that seem to dictate medical decisions and involve what Sears called "too much compulsion." These include a provision requiring the company to make its costs for services known to the government (with the United States getting full access-to all records), and specifying that reimbursement rates shall be on a "cost-related" basis-a system Sears said amounts to "cost-plus" and is becoming obsolete. Another provision that is opposed, officials said, sets as a non-binding target a goal of having 50 per-cent of new patients use self-dialysis. Still another requires Erika, a subsidiary of National, to sell its supplies at cost without a markup.