I happened upon a personal finance column that appeared in the New York Times April 1981. The story predicted that treatment of end-stage renal disease (ESRD) would soon become a serious financial and moral issue.
The article pointed out that in 1980, there were slightly over 62,000 patients on dialysis. The total annual cost to the federal government for treatment was $1 billion and climbing. (ESRD is the only disease covered under Medicare regardless of age.) Medicare covers 80% of the cost with the rest coming from private insurance or state Medicaid programs.
At the time, medical experts worried that by the end of the decade the number of ESRD patients could reach 90,000 with costs rising to $4 billion to $5 billion annually. (It’s not clear why a 50% growth in patients would lead to a 400% growth in cost, though the early 80s was a time of double-digit inflation.)
In 1989, there were 175,000 patients with ESRD, of which 130,000 were on dialysis and 45,000 with a functioning transplant. That’s nearly double the number predicted. The total cost of treatment was $4 billion which after adjustments indicates that per patient costs were rising about as fast as inflation. That’s a bit of a bargain since total medical costs rose significantly faster than inflation during that period.
So where are we today? In 2008 (the latest year data is available) there were 547,000 patients with ESRD, of which 382,000 were on dialysis and 165,000 with a functioning transplant. Total Medicare expenditures on ESRD were $27 billion, consuming about 6% of the total Medicare budget. The growth in kidney disease may have been a crisis in 1989. Today, it is an absolute financial disaster with an immeasurable human toll as patients on dialysis die waiting for transplants.
ESRD prevalence counts and prevalence rates in the U.S. Graphic from USRDS 2010 Annual Report
Medicare expenditures on ESRD, not adjusted for inflation. Graphic from USRDS 2010 Annual Report
Incidentally, the 1981 NY Times article said the best chance of reducing costs for dialysis was to encourage use of home dialysis which would reduce capital and labor costs for dialysis facilities. Home dialysis never became popular. The number of patients using peritoneal dialysis, the most common home treatment, has remained steady since the mid-1980s while the total number of ESRD patients has grown rapidly. Today only 5 percent of kidney patients choose it as their form of therapy.
The article also stated that few patients could be helped by transplantation therapy. Unknown to the author, the immunosuppressant drug cyclosporine would be released in 1983, making transplant from deceased donors and unrelated living donors possible. The number of transplants boomed. But as the data above shows, the number of kidney patients grew even faster, creating a waiting list that continues to grow to this day.
For another interesting historical note, see this May 2010 blog post.