California Proposition 8: Limit on Dialysis Clinic Revenue


Hello, my name is Benjamin McAnally, and I’m a student at
Claremont McKenna College. I will be discussing Proposition 8, an initiative that would
impose new regulations on private dialysis clinics,
and cap their profits. For people with kidney failure, dialysis mimics healthy kidney function, removing waste, excess fluids, and chemicals from the blood stream. Dialysis is generally performed
in specialized clinics. Two private, for-profit companies, DaVida Kidney Care and
Fresenius Medical Care own the majority of dialysis
clinics in California. These businesses are highly profitable. Critics, including organized labor, accuse the companies of
generating excess profits while providing poor patient care due to inadequate staffing. Criticisms the companies deny. Proposition 8 would cap
these companies’ profits at 15%, requiring them to devote 85% of their revenues to direct
patient care services and healthcare quality improvement. It would also mandate them to give rebates to their patients’ insurers if their annual revenues
exceed 115% of their costs. The Legislative Analyst
estimates that Proposition 8 would have a negligible
impact on state finances. Proposition 8 is backed
by the Service Employees International United Healthcare Workers, a labor union that seeks
to organize workers in dialysis clinics. Supporters say that Proposition 8 would improve healthcare by forcing private dialysis clinics
to use a higher percentage of their profits on patient care. They also say it would
reduce excess charges to insurance companies, thus
lowering insurance premiums for all Californians. Proposition 8 is opposed
by the two companies that would be most
directly affect by the law. Fresenius Medical Care
North America and DaVida, as well as by various physician, nurse, and patient advocacy groups. Opponents argue that the measure does not take into account administrative costs and would force 83% of dialysis clinics to operate in the red. They say that the measure would result in clinic closures and
reduced patient access. In summary, a yes vote on Proposition 8 supports placing new
regulations on private dialysis clinics and
capping their profits. A no vote on Proposition 8 would reject these new rules for
private dialysis clinics. For more information on Proposition 8 visit roseinstitute.org
and these other sites.

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