Court strikes down California law targeting dialysis industry profits
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A federal appeals court has ruled that a California law limiting dialysis companies' profits from privately insured patients is unconstitutional. The law aimed to curb the industry's alleged 'profit-maximizing scheme' involving charity donations and patient insurance steering.
A federal appeals court has struck down a California law that aimed to limit dialysis companies' profits from privately insured patients. The law, Assembly Bill 290, was designed to curb an alleged 'profit-maximizing scheme' where dialysis providers donate to a nonprofit that pays premiums for patients, potentially steering them away from public insurance and into private insurance, which pays higher rates. The 9th U.S. Circuit Court of Appeals ruled that the law's provisions, including a reimbursement cap and patient disclosure requirements, violate the First Amendment. The court found that California did not narrowly tailor the law to achieve its interests. About 800,000 people in the U.S. suffer from end-stage renal disease, with most on Medicare, but those on private insurance incur much higher costs. The dialysis industry has long been criticized for its high costs and consolidated market.
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