In 1972, after a month of deliberation, Congress launched the nation’s most ambitious experiment in universal health care: a change to the Social Security Act that granted comprehensive coverage under Medicare to virtually anyone diagnosed with kidney failure, regardless of age or income.
It was a supremely hopeful moment. Although the technology to keep kidney patients alive through dialysis had arrived, it was still unattainable for all but a lucky few. At one hospital, a death panel — or "God committee" in the parlance of the time — was deciding who got it and who didn’t. The new program would help about 11,000 Americans, just for starters. For a modest initial price tag of $135 million, it would cover not only their dialysis and transplants, but all of their medical needs. Some consider it the closest that the United States has come to socialized medicine.
Now, almost four decades later, a program once envisioned as a model for a national health care system has evolved into a hulking monster. Taxpayers spend more than $20 billion a year to care for those on dialysis — about $77,000 per patient, more, by some accounts, than any other nation. Yet the United States continues to have one of the industrialized world’s highest mortality rates for dialysis care. Even taking into account differences in patient characteristics, studies suggest that if our system performed as well as Italy’s, or France’s, or Japan’s, thousands fewer patients would die each year.
In a country that regularly boasts about its superior medical system, such results might be cause for outrage. But although dialysis is a lifeline for almost 400,000 Americans, few outside this insular world have probed why a program with such compassionate aims produces such troubling outcomes. Even during a fervid national debate over health care, the state of dialysis garnered little public attention.
Over the course of more than a year, ProPublica reviewed thousands of inspection reports and interviewed more than 100 patients, advocates, doctors, policy makers, researchers and industry experts to get a grasp on American dialysis. The findings were bleak: At clinics from coast to coast, patients commonly receive treatment in settings that are unsanitary and prone to perilous lapses in care. Regulators have few tools and little will to enforce quality standards. Industry consolidation has left patients with fewer choices of provider. The government has withheld critical data about clinics’ performance from patients, the very people who need it most. Meanwhile, the two corporate chains that dominate the dialysis-care system are consistently profitable, together making about $2 billion in operating profits a year.
One reason the system’s problems have evolved out of the health care spotlight is that kidney failure disproportionately afflicts minorities and the dispossessed. But given a patient pool growing by 3 percent a year and the outsize 6 percent bite that the kidney program takes from the Medicare budget, we ignore dialysis at our own risk. "We’re offering our patients a therapy we wouldn’t accept for ourselves," said Dr. Tom F. Parker III, a Dallas nephrologist and national advocate for better care. More and more leaders in the field, he said, "are starting to say this isn’t sufficient."
As the United States moves to expand access to health care, dialysis offers potent lessons. Its story expresses the fears of both ends of the ideological spectrum about what can happen when the doors to care are thrown wide open: Neither government controls nor market forces have kept costs from ballooning or ensured the highest-quality care. Almost every key assumption about how the program would unfold has proved wrong.
The Sharp End of the Needle
Henry Baer went in for his third dialysis treatment on New Year’s Eve day in 2005. It turned out to be his last. He was only 39, but years of diabetes and high blood pressure had caused Baer’s kidneys to shut down. Built-up waste and fluid were causing his limbs to swell and making him short of breath. He was sent for what’s called in-center hemodialysis, the most common type of dialysis, at a beige-toned clinic near his home in Prescott Valley, Ariz.
His first two sessions were pretty normal. A patient-care technician hooked Baer to a machine the size of a filing cabinet, connecting it with plastic tubing to the catheter in his chest. He sat in a lounge chair, still as stone, for about four hours as the machine, whirring gently, moved his blood through a specialized filter, then returned it, cleansed of toxins. It was uncomfortable and boring. "Sis, this isn’t for me," he told his older sister, Karen Gable, vowing to make himself a viable candidate for a kidney transplant.
Just over two hours into his next session, Baer’s incoming bloodline "became disconnected," a federal inspection reportsays. The attending technician panicked, "yelling and screaming hysterically." Blood sprayed onto Baer’s shirt, pants, arms and hands. Then, "contrary to emergency standing orders," the report continued, she reconnected the line to Baer’s catheter, infusing him with "potentially contaminated blood." By the time Mike Wright, Baer’s boss at a local car dealership, picked Baer up after the treatment, he was complaining of nausea.
Over the next two days, Baer spiked a fever. His wife found him in bed, having a convulsion. He was taken to the hospital, where tests later showed that his catheter had become infected with antibiotic-resistant staph. The infection moved swiftly to his heart and brain. He died a few days later, on Jan. 7, 2006, leaving behind a 2-month-old daughter. (Fresenius Medical Care North America, the clinic’s operator, declined to comment on the incident, citing patient privacy rules. In 2008, without admitting wrongdoing, it agreed to settle a wrongful-death lawsuit brought by Baer’s survivors.)
What happened to Baer was a worst-case scenario. Yet in some ways it is symptomatic of how dialysis is delivered. Medical supervision is minimal. Clinics must have board-certified physicians as medical directors, but usually have no doctor on site, and some struggle to meet the federal requirement of at least one full-time registered nurse. Technicians, who can start with just a high-school diploma and an in-house course (though they are later required to pass a state or national certification test), have been the field’s workhorses for a generation. Medicare sets no staffing ratios for dialysis centers, and most states don’t either.
Although some clinics are orderly and expert — attentive not only to patients’ health, but also to their dignity — others are run like factories, turning over three shifts of patients a day, sometimes four. Safety experts say technicians shouldn’t monitor more than four patients at once, but some operators save money by stretching them further. The pace can be so intense, inspections show, that clinics have allowed patients to soil themselves rather than interrupt dialysis for a bathroom break. One technician said he quit his job at a large Colorado clinic because he often had to juggle six patients or more. "The last two years, I was just getting old," he said.
Conditions within clinics are sometimes shockingly poor. ProPublica examined inspection records for more than 1,500 clinics in California, New York, North Carolina, Ohio, Pennsylvania and Texas from 2002 to 2009. Surveyors came across filthy or unsafe conditions in almost half the units they checked. At some, they found blood encrusted in the folds of patients’ treatment chairs or spattered on walls, floors or ceiling tiles. Ants were so common at a unit in Durham, N.C., that when a patient complained, a staffer just handed him a can of bug spray.
Hundreds of clinics were cited for infection-control breaches that exposed patients to hepatitis, staph, tuberculosis and HIV. A Manhattan center closed in 2008 after cross-contamination infected three patients with hepatitis C within six months. Prescription errors were common: 60 clinics had at least five citations for them. In dozens of instances, patients died or were hospitalized after suffering hemorrhages like Baer’s, when dialysis needles or tubing dislodged and staffers failed to adhere to safety guidelines.
Providers say they work hard to meet or exceed government standards, correcting deficiencies quickly when they surface and sometimes employing their own internal auditing programs. "You will find cases where things go wrong, but it’s a small percent when you consider all of the hundreds of thousands of treatments every day," said Diane Wish, the CEO of a small Ohio dialysis chain and president of the National Renal Administrators Association, the group that represents dialysis facility managers. But patient advocates say conditions in some clinics have been problematic for so long that everyone in the system has come to accept it. "It’s become ingrained that dialysis is expensive and dangerous and has terrible outcomes," said Bill Peckham, a patient known widely for his blog, Dialysis From the Sharp End of the Needle. "Once you’re there, God help you. What do you expect? You’re on dialysis."
Rise of an Entitlement
Dialysis entered the American consciousness in the early 1960s as the country’s signature example of medical rationing. In those days, kidney disease killed about 100,000 people a year. Chronic dialysis was possible, thanks to two inventions: the artificial-kidney machine developed by the Dutch doctor Willem Kolff during World War II and a vascular-access device designed by Belding Scribner, a pioneering Seattle physician who opened the first outpatient dialysis center in the United States. But treatments were expensive, and most private insurers would not pay for them. At Scribner’s medical center, the Life or Death Committee parceled out the few slots, weighing not only the health of patients and their income, but also their perceived social worth.
News reports about the committee’s work sparked one of the earliest national debates over the right to care and put pressure on the government to step in. A turning point came when Shep Glazer, vice president of the largest patient group, made an emotional appeal to the House Ways and Means Committee as he underwent dialysis on the hearing-room floor. "If your kidneys failed tomorrow, wouldn’t you want the opportunity to live?" asked the 43-year-old father of two. "Wouldn’t you want to see your children grow up?"
The measure establishing taxpayer funding for treatment of end-stage renal disease, signed into law by President Richard M. Nixon, was expansive, and its lopsided, bipartisan approval reflected the times. Many lawmakers — even conservatives — thought the United States would adopt a European-style national health care system. Also, the program that took effect in July 1973 was expected to have about 35,000 patients and cost about $1 billion in its 10th year.
Those estimates came to seem almost laughable. The number of dialysis patients surpassed 35,000 by 1977 and has gone up from there. The growth reflected not only lower-than-expected transplant rates and the spread of diabetes, but also positive trends, like better cardiac care. With Americans living long enough for their kidneys to fail and no disqualifying conditions for the program, even the oldest and sickest patients increasingly were prescribed dialysis. Upwards of 100,000 now start treatment each year. "It’s been a perfect example of that line, ‘Build it and they will come,’" said Dr. Jay Wish, director of dialysis services for University Hospitals Case Medical Center in Cleveland.
Because the kidney program absorbed that unforeseen wave — and thus prolonged so many lives — some call it one of the great success stories of modern medicine. Still, the annual bill for the program quickly outpaced early projections, surging past $1 billion within six years. Per-patient expenditures were expected to drop as technology advanced. Instead they have risen steadily, as drug and hospitalization costs grew for the program’s increasingly frail clientele.
Medicare has struggled to enforce quality standards for dialysis while meeting its prime directive of providing universal access. As the medical community’s understanding of kidney disease grew, the government set biochemical targets for improving care. Clinics got better at hitting them, but overall rates of death and hospitalization have seen little change. And Medicare’s record of making sure that clinics meet health and safety standards has been spotty. Clinics are supposed to be inspected once every three years on average, but as of October, almost one in 10 hadn’t had a top-to-bottom check in at least five years, as shown by data from the Centers for Medicare and Medicaid Services (known as CMS). About 250 facilities hadn’t had a full recertification inspection in seven years or more. Nursing homes, by contrast, must be inspected once every 15 months, and in 2006, CMS reported that 99.9 percent had been.
Even when inspectors find that clinics are not meeting government standards, the consequences are seldom meaningful. CMS can demand that facilities submit correction plans, but it cannot fine violators as it can nursing homes. The agency almost never imposes its toughest sanction — termination from Medicare — because clinic closures could hinder access to care. From 2000 to 2008, the agency barred just 16 dialysis facilities; federal regulations set no limits on how many violations are too many. "It’s a judgment call," said Jan Tarantino, deputy director of CMS’s survey-and-certification group.
When the Memphis University Dialysis Center was terminated from Medicare in June 2007, the step had been at least four years in the making. During that time, the clinic was flagged for dangerous conditions, inadequate care, higher-than-expected mortality rates and subpar clinical results. CMS threatened to yank the unit’s certification in March 2006 and again the following year. Both times, however, even though inspectors continued to find problems, the agency allowed the clinic to stay open.
In April 2007, nine days after CMS sent the center a letter confirming that it was back in compliance, 66-year-old James "Tug" McMurry came in for treatment. When he had slow blood flow after being given his regular dose of blood thinner, staffers administered doses of a clot-dissolving medicine, according to a CMS survey. Later, a nurse told inspectors that a doctor had given a verbal order to administer the drug, but the doctor denied it, writing "This order was not given by me" on a form.
McMurry called one of his sisters, Betty Tindall, on his way home that day. "He said, ‘They don’t know what they’re doing up there,’" Tindall recalled. A couple of hours later, McMurry’s neighbor heard him bang on the shared wall between their apartments. "Help! Help!" he yelled. Paramedics found him slumped in a chair, vomiting. Tests at the hospital showed McMurry had suffered a devastating brain hemorrhage. By the time family members made it to his bedside, he was in an irreversible coma.
In an inspection three weeks later, regulators cited Memphis University Dialysis for failing to provide "safe dialysis services" and violating rules on the proper administration of drugs. They found multiple errors involving blood thinners, including one that resulted in the hospitalization of another patient. This time, CMS revoked the dialysis unit’s Medicare certification, prompting it to close. "It took people dying before they did anything," said Bobby Martin, an attorney for McMurry’s brother and sister-in-law, who reached a confidential settlement with DaVita Inc., the clinic’s owner, in August 2009. (A DaVita official declined to comment on the case, citing patient privacy.)
CMS officials disputed the idea that they had acted too slowly. "Please understand that this is not an easy decision," said Jessica Jenkins, a spokeswoman for the regional office that handled the matter. "We’re not in the business of putting facilities out of business."
Coke or Pepsi
Problems like those that regulators found in McMurry’s clinic are partly rooted in economics. The government’s payment policies for dialysis have created financial incentives that, in some ways, have worked against better patient care, while enabling for-profit corporations to dominate the business.
When the end-stage-renal-disease program began, hospitals provided most of the care on a nonprofit basis. But spurred by the guarantee of Medicare money, the marketplace met the growing demand for services through the expansion of for-profit companies. Today, more than 80 percent of the nation’s 5,000 clinics are for-profit. Almost two-thirds of all clinics are operated by two chains: Colorado-based DaVita and Fresenius, a subsidiary of a German corporation that is the leading maker of dialysis machines and supplies.
From the start, the government’s payment rules rewarded efficiency. Medicare set a rate for dialysis treatments, originally $138 per session, and covered a maximum of three treatments a week for most patients. Providers could keep whatever they didn’t spend on care. There were no penalties for poor results and no bonuses for good ones. Unlike other Medicare rates, the payment wasn’t adjusted upward for inflation.
Lawmakers cut the base rate to about $123 per treatment in 1983, after the program’s cost came in higher than expected and audits showed providers averaging profits of more than 20 percent. Dialysis companies responded like any other business facing a drop in prices, said Philip J. Held, a nationally recognized researcher on kidney disease and an economist by training. They chopped expenses by shortening treatments, thinning staff and assigning tasks once done by nurses to unlicensed technicians. Some reused dialyzers, the filters that clean a patient’s blood. "It changed the nature of the service," Held said of the rate cut. "You get what you pay for. The price was lower, but the product was dramatically different."
The government created another perverse incentive by allowing clinics to bill Medicare separately for certain medications, reimbursing them at a markup over what they paid drug makers. Dialysis companies embraced the opportunity: Doses of Epogen, prescribed to treat anemia, and similar medications tripled between 1989 and 2005, becoming Medicare’s single largest pharmaceutical expense. "Their core business became giving patients injectable drugs," said Richard A. Hirth, a professor of health management and policy at the University of Michigan School of Public Health. "Dialysis was just the loss leader that got [patients] in the door."
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