Federal Lawsuit Over CA Dialysis Law Alleges It Will End Vital Program for Low-Income Patients

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A federal lawsuit has been filed over a California law aimed at preventing increased billing costs at dialysis clinics but that plaintiffs contend will drive up patients’ medical bills.

The lawsuit filed Friday in Santa Ana, California, by two nonprofits, including the American Kidney Fund, and two patients asks the court to declare the law unconstitutional.

The plaintiffs contend the law passed earlier this year in California will put an end to an American Kidney Fund program that covers insurance premiums for low-income patients with kidney disease who need dialysis. The program, which is paid for by dialysis clinics, helps about 3,700 patients in the state, according to the lawsuit.

LaVarne Burton, the fund’s president and chief executive, said the law creates requirements in California that conflict with federal laws the program must follow, which will lead to its end in the state. That development, she said, will hurt patients who largely have Medicare but need additional insurance to cover their costs.

“You cannot say that we’re going to solve this problem on the backs of these patients who are the most fragile and critically ill,” she said.

California passed the law in an effort to deter dialysis clinics from encouraging patients to enroll in health plans that give them higher reimbursement rates.

State lawmakers contended that two large dialysis clinics in California were contributing to the fund’s program, which in turn covered their patients’ premiums with private insurers that paid higher reimbursement rates back to the clinics.

Democratic Assemblyman Jim Wood, who co-authored the law, said in a statement that the program can continue to operate as a legitimate charity for patients but not as a way for clinics to boost profits while increasing health care costs.

“This action proves they only care about millions in profits, not patients,” he said.

The state passed the law after a ballot measure to cap dialysis clinics’ profits failed in 2018.

A message seeking comment was left at the state Attorney General’s office.

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