Do you support or oppose these Medicare changes?

Do you support or oppose these Medicare changes?

CMS Proposes Funding In-Home Dialysis for Acute Kidney Injury Patients By Tom Ozimek, 7/4/2024

The federal government has announced a federal rulemaking proposal that would extend Medicare coverage to include in-home dialysis for patients with acute kidney injury.

The Centers for Medicare & Medicaid Services (CMS) said it had issued a proposed rule that would update payment rates and policies of the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) for 2025.

Besides increasing overall expenditures in 2025 on the ESRD payment system by 2.2 percent, or around $170 million, the update includes a proposal to increase patient options for dialysis treatment for Medicare beneficiaries with acute kidney injury.

Contrary to popular misinformation and disinformation, Medicare is not funded by the Federal Insurance Contributions Act (aka “FICA” or payroll tax).

No federal taxes fund federal spending. All federal taxes are destroyed upon receipt by the federal government.

Taxes begin in the M2 money supply measure, but when they reach the Treasury, they are absorbed into the Treasury’s infinite money supply. Effectively, they are destroyed:

When “x” is any amount of federal taxes and ∞ is infinity,  ∞ + x = ∞.

“x” disappears.

Medicare “A” and “B” supposedly are funded differently — “A” by FICA and “B” by the government and by recipients. I say “supposedly” because here is how both are funded:

1. Each month, the federal government sends instructions (not dollars) to health providers’ banks, instructing the banks to increase the size of the providers’ checking accounts by a specific amount (i.e., “Pay to the order of . . .” ).

2. The instant the bank does as instructed new dollars are created and added to the M2 money supply measure. No dollars are subtracted from any corresponding money supply measure.

That is the primary way the government creates net dollars — by instructing banks to increase checking accounts.

3. The banks’  books are balanced,and new dollars created, by clearing the government’s instructions through another part of the government, the Federal Reserve.

Compare the above to the way monetarily non-sovereign state and local governments (and businesses, you and I) pay our bills:

Like the federal government, we send instructions (checks or wires) to creditors’ banks. The difference is that in clearing your instructions, the Fed sends instructions to our banks, telling them to subtract dollars from our accounts.

When monetarily non-sovereign entities pay creditors, no net dollars are created. M2 rises when the creditors’ bank increases balances, and M2 falls when our bank decreases our balances.

Thus, the overall money supply grows when the government pays for things, not when the private sector pays for things. The money supply shrinks when the private sector pays the government for things.

A growing money supply leads to a growing GDP, while a shrinking money supply leads to recessions and depressions.

For 2025, CMS is proposing to allow Medicare beneficiaries with acute kidney injury to receive dialysis at home.

The agency also proposes that dialysis facilities be allowed to bill Medicare for training patients with acute kidney injury to perform in-home dialysis.

The agency also plans to update the payment rate for acute kidney injury dialysis to $273.20, which is the same as the base rate for regular dialysis.

For in-center hemodialysis, which is typically done three times a week, the annual cost was reported to be approximately $72,000 to $88,000, which could translate to about $250 to $350 per session.

Peritoneal dialysis, often done at home, might be slightly less expensive, with annual costs around $53,000 to $65,000, equating to roughly $145 to $180 per day.

The proposal represents a significant shift in CMS policy as, under current Medicare rules, only in-center dialysisis covered for beneficiaries with acute kidney injury who are not hospitalized.

CMS said in the announcement that dialysis-dependent patients with acute kidney injury have the potential to recover kidney function and avoid long-term dialysis.

The agency added that providing such beneficiaries with more flexible treatment options like in-home dialysis would encourage more frequent dialysis at lower ultrafiltration rates, supporting recovery of kidney function in patients with acute kidney injury.

If the rule is ultimately adopted, Medicare coverage of home dialysis will be available to both patients with acute kidney injury as well as end-stage renal disease.

Given that federal spending costs you nothing, and stimulates economic growth, there is no reason why Medicare has been slow to cover in-home dialysis.

Specifically, CMS said that its proposal would increase the base rate to $273.20 in 2025 from $271.02 in 2024, incorporating a 1.8 percent market basket percentage increase adjusted for productivity.

The agency estimates that the updates would increase the total payments to all ESRD facilities next year by 2.2 percent compared to 2024. Hospital-based ESRD facilities are projected to see a 3.9 percent increase in total payments while freestanding facilities will see a total payment increase of 2.1 percent.

CMS is also proposing updates to the policy of handling unusually high costs, or outliers, in providing kidney dialysis services.

It wants to include more specialty drugs and biological products in the list of services considered for extra cost adjustments. These are items that were or would have been included in the composite rate prior to the establishment of the current ESRD payment system.

The agency is also proposing technical changes to how it calculates the extra cost amounts, which consist of the outlier services fixed-dollar loss (FDL) amounts and the Medicare allowable payment (MAP) amounts, in order to better match current data and costs.

The oft-quoted objection to federal spending is that it causes inflation. The arguments are shown in green:

1. When the government spends more, it can increase the overall demand for goods and services in the economy. If the production capacity doesn’t keep up with this increased demand, prices may rise.

However, federal spending amounts to only a small fraction of GDP. GDP = Personal Consumption (68%) + Private Investment (18%) + Government Expenditures (18%) – Net Imports (4%)

Further, in a capitalist economy, increased demand is met by increased capacity.

2. Increased government spending can also raise the cost of production by increasing demand for resources, which can lead to higher prices for consumers.

However, increased demand for resources is widely inflationary for only one resource: Oil.

Further, oil prices are less subjet to supply and demand than to prices determined by major oil suppliers OPEC, Russia, and the U.S.

3.  To finance spending, the government might borrow money, which can influence the interest rates. If the Federal Reserve purchases these securities, it increases the money supply, which can devalue the currency and lead to inflation.

However, the U.S. government, being Monetarily Sovereign, does not borrow dollars. While higher interest rates are inflationary, they are not caused by market forces. They are caused by the Fed’s strange belief that higher rates lower prices.

The government has the infinite ability to spend, which increases the money supply — while also increasing the ability to produce.

4. If businesses and consumers expect that government spending will lead to inflation, they may adjust their behavior accordingly, such as by raising prices or wages, which can create a self-fulfilling prophecy.

However, in a capitalist economy, excessive profits quickly are met with price cutting.

SUMMARY

It is far better for the economy and for individuals if the government funds things rather than the monetarily non-sovereign, private sector paying.

This not only applies to Medicare but also to Social Security and to everything currently tax-funded by city, county, and state governments. Consider the implications.

1. Free, comprehensive medical and health support for all age and income groups.
2. Generous Social Security benefits for all age and income groups. (Yes, the rich, too. This is to avoid needless paperwork and investigations.)
3. Free college for everyone who wants it.
4. Funding for all the sciences.
5. Funding for infrastructure, including infrastructure now funded by cities, counties, and states.

Rodger Malcolm Mitchell

Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell; MUCK RACK: https://muckrack.com/rodger-malcolm-mitchell ACADEMIA: https://www.academia.edu/

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The Sole Purpose of Government Is to Improve and Protect the Lives of the People.

MONETARY SOVEREIGNTY