ESRD Medicare: How It Differs From Traditional Medicare

For some eligible individuals, there are two different types of Medicare: traditional Medicare and ESRD Medicare. The former is the Medicare we all know. You are eligible based on your age and/or qualifying disability as well as citizenship and/or legal residency status.

ESRD Medicare, on the other hand, has other requirements and conditions. This type of Medicare is for people of any age who have end-stage renal disease (ESRD)—that is, kidney disease that requires dialysis treatment or a kidney transplant.

It is important to understand the difference between these two types of Medicare. Unless you stop paying your monthly premiums, traditional Medicare cannot drop your coverage. ESRD Medicare, however, can stop covering you under certain conditions. Know your rights.

What Qualifies As End-Stage Renal Disease

The kidneys are responsible for filtering blood, balancing electrolytes (e.g., sodium, potassium), and removing excess fluid and waste from the body. Without at least one functioning kidney, you cannot live.

There may be times when your kidneys struggle to work at their best. These impairments may be the result of dehydration, exposure to chemicals, infection, or any number of stressors. In most cases, the kidneys will recover if the underlying problem is corrected.

In other cases, you could develop long-term kidney disease. The Centers for Disease Control and Prevention reports that 15% of American adults have some type of chronic kidney disease.

If that chronic kidney disease gets bad enough (stage 5), you will be diagnosed with end-stage renal disease, meaning your kidneys are failing. Without dialysis or an organ transplant, your life is at risk.

Eligibility for ESRD Medicare

Having end-stage renal disease could qualify you for Medicare. This is the case even if you are not yet 65 years old.

There are other criteria that must also be met that are not otherwise required for traditional Medicare:

• You must satisfy eligibility requirements for Social Security Disability Insurance or meet the criteria for one of the following.
• You worked the right amount of time under Social Security, or as a government employee, or you have satisfied Railroad Retirement Board benefits.
• You, your spouse, or your guardian (if you are a dependent) has to have already paid at least 40 quarters (10 years) of payroll taxes into Medicare and Social Security.

Unlike people with other types of disabilities, you do not have to wait 24 months before you become eligible for the program. The same goes for people with amyotrophic lateral sclerosis (ALS).

As soon as the criteria above are met, you should apply for Medicare. Your coverage benefits will kick in three months after you start dialysis treatment.

How Much ESRD Medicare Pays for Dialysis

Dialysis is not one size fits all. You could receive hemodialysis (dialysis using a man-made filter) or peritoneal dialysis (dialysis using the peritoneal membrane in your abdomen as a filter). You could receive dialysis as an inpatient, as an outpatient, or at home.

Medicare provides coverage for each of these treatment options, but how it pays for each service differs.

Inpatient Dialysis

Inpatient dialysis means you are admitted to the hospital to receive treatment. This may be the case the first time you undergo dialysis or if dialysis is needed on an emergent basis. As an inpatient, your care will be billed to Medicare Part A.

In 2023, this makes you responsible for a deductible of $1,600 for each hospital stay. Any physician care you receive in the hospital will be billed to Medicare Part B, requiring you to pay a 20% coinsurance for those services.

Outpatient Dialysis

Outpatient dialysis may be performed at a certified dialysis clinic or even at a Medicare-approved hospital. The difference is that you are not admitted to the hospital as an inpatient.

Outpatient services are billed under Medicare Part B. This means you will pay a 20% coinsurance for each dialysis session. This will include laboratory tests, medications, and physician care used for your dialysis treatment.

Home Dialysis

Getting dialysis at home (or anywhere that is convenient for you) may be the most appealing option schedule-wise, but it does come with risks.

Medicare Part B pays for home dialysis training from a dialysis facility, training for you and caregivers who will provide home dialysis, and for home dialysis equipment, supplies, and medications. You will also be required to see a supervising physician at least once per month. Again, you are left to pay a 20% coinsurance.

You will want to consider how much a specific treatment will cost you out of pocket before you commit to one type of dialysis over another.

Where ESRD Medicare Lets You Get Dialysis

People on ESRD Medicare were only eligible for Original Medicare coverage (Part A and Part B), not coverage through a Medicare Advantage program. That was the case at least until the 21st Century Cures Act was signed into law in 2016. Starting in 2021, people with ESRD Medicare can sign up for a Medicare Advantage plan.

People on Original Medicare can access care at any dialysis clinic, but people on Medicare Advantage plans will have to confirm their kidney doctor, dialysis clinic, and transplant team are in the network of the plan they want to choose.

This means that people on Medicare Advantage will be limited to dialysis clinics in their local network, which would require them to pay more out of pocket to continue care in their current facilities or to pay for dialysis at all.

This is because the Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS) have instituted language that eliminates time and distance limits for dialysis facilities instead of excluding those requirements from Medicare Advantage plans.

Dialysis Patient Citizens filed a lawsuit against HHS and CMS in 2020 to correct this language and improve dialysis access; however, the lawsuit was dismissed in 2021.

When You Get a Kidney Transplant

Similar to inpatient dialysis, Medicare Part A will cover you to receive a kidney transplant. This will require you to pay a $1,600 deductible for a 2023 hospital stay as well as a 20% deductible for physician services that are reimbursed under Medicare Part B.

What is unique about kidney transplantation is that Medicare will also cover the full costs of care for a living donor. Neither you nor the donor will need to pay a single penny out of pocket for their care, even if there are complications from the procedure.

After you get a kidney transplant, you will need to be put on immunosuppressive drugs for the rest of your life. These drugs are required to prevent your body from rejecting the transplanted kidney.

Medicare will pay for these medications as long as Medicare covered your kidney transplant (i.e., you were on Medicare Part A) and as long as you continue to have Medicare Part B.

Do not expect Medicare to take care of you after you have a kidney transplant though, at least not for the long haul. They will only provide coverage for 36 months after a Medicare-approved transplant. However, new legislation was proposed in April 2022 that would allow you to extend some of your Part B benefits. This oartial benefit, referred to as Part B-ID, would provide coverage for your immunosuppressive drugs but not other services. You would pay a lower monthly premium to keep that coverage.

Otherwise, the only way your other Medicare benefits will continue is if you are on Medicare for another reason, whether that is because of age or another disability.

A Word From Verywell

Kidney disease is a growing problem in the United States, affecting the lives of more than 37 million Americans. Understanding who Medicare covers, when coverage begins, and how much you will be expected to pay for those services is part of the puzzle.

Know your rights and get the best care at the right time.