In most cases, dialysis treatment replicates what healthy kidneys do by using a machine to filter a patient’s blood of excess fluid and waste. Roughly 80,000 Californians receive dialysis from a clinic every month. Proposition 29 would create new requirements for clinics where dialysis treatment is administered.
The official title on the ballot: Dialysis Clinic Requirements Initiative
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A "yes" vote means:
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- Kidney dialysis clinics would face new requirements, including having a physician, nurse, or physician's assistant on site during treatment hours
- Kidney dialysis clinics would be prohibited from reducing services or closing without approval from the state
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A "no" vote means:
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- Kidney dialysis clinics would not be required to have a physician, nurse, or physician assistant on site during patient treatment hours. They would continue operating as they do now.
What The Measure Would Do
Proposition 29 would create new requirements for kidney dialysis clinics that provide life-sustaining treatment for people suffering from chronic kidney disease.
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If the ballot measure passes, kidney dialysis clinics would have to have at least one physician, nurse practitioner or physician assistant on site during all treatment hours. Clinics would be required to report information on infections to state public health officials and provide patients with a list of doctors who own at least a 5% stake in the facility, among other requirements.
Right now, most patients’ physicians design and oversee their treatment plan and refer them to a clinic, which carries out the treatment. Federal law requires that a physician visit a patient during dialysis treatment at least once a month, according to the state legislative analyst’s office and it also requires that they report infections to the federal government.
The measure would prohibit clinics from reducing services or closing without approval from the state and from denying patients treatment based on the type of insurance they have.
According to a report from the state’s Legislative Analyst’s Office, there are roughly 650 licensed clinics that offer dialysis treatment to some 80,000 people each month.
This is the third time a labor union, Service Employees International Union-United Healthcare Workers West, has put a kidney dialysis measure on the ballot. As CalMatters notes, "The union says it wants to reform the booming industry and increase transparency, while dialysis companies that spent millions to defeat the two prior measures say it’s a union ploy to pressure clinics and organize dialysis workers."
SEIU has long sought to unionize dialysis workers, an effort that the companies that run the clinics have quashed again and again. Dialysis companies say the ballot measures are an effort to pressure them to come to the negotiating table in order to avoid costly ballot measure campaigns.
Politico explained the tactic in 2020, when the union put kidney dialysis on the ballot as Proposition 23:
John Logan, director of labor employment studies at San Francisco State University, said unions have long used non-traditional tactics like ballot-box campaigns to get companies to the negotiating table.
“They don’t have to invest any of their money to support it, but the other side has to spend tens of millions because it would be a disaster if it were to pass,” he said.
Arguments For
Proponents of Proposition 29 argue that profitable dialysis clinic companies should have to do more to make the time-consuming procedure safer for patients. That includes having at least one medical professional with six months of experience or more on staff during operating hours.
Supporters also say technicians at clinics are overworked and could use the extra support having a physician on-site would bring.
They argue that forcing clinics to be more transparent when it comes to ownership and infection-related issues would benefit the patient.
According to the California Legislative Analyst's Office, “Two private for-profit companies — DaVita, Inc. and Fresenius Medical Care — own or operate nearly 75 percent of licensed clinics in California.”
Who supports this proposition?
- California Democratic Party
- Service Employees International Union-United Healthcare Workers West
- California Labor Federation
See the full list of supporters
Arguments Against
Opponents say the ballot measure will lead to higher costs for patients and force some clinics to scale back or close altogether because they wouldn't be able to afford the additional staffing costs. Some opponents estimate that it could affect hundreds of clinics and say that that the new jobs created by the measure would be mainly administrative. Opponents also argue that Proposition 29 would exacerbate a healthcare provider shortage California is facing.
The state legislative analyst’s office agrees that this will increase costs for clinics and that closures are one potential outcome. In their analysis, they write:
Overall, the proposition would increase costs for clinics. In particular, the proposition’s requirement that each clinic have a physician, nurse practitioner, or physician assistant on-site during all treatment hours would increase each clinic’s costs by several hundred thousand dollars annually on average. Other requirements of the proposition would not significantly increase clinic costs.
Clinics Could Respond to Higher Costs in Different Ways. The cost to have a physician, nurse practitioner, or physician assistant on-site would affect individual clinics differently depending on their finances. For example, the additional cost could cause some clinics to operate at a loss, or at a greater loss than previously. As noted earlier, an owner or operator might be able to support these clinics with its higher-earning clinics. However, the owner or operator might not be willing or able to do this over the longer term. Owners and operators might respond to Proposition 29 in one or more of the following ways:
- Negotiate Increased Rates With Payers. Owners and operators might try to negotiate higher rates from payers to cover some of the costs. Specifically, owners and operators may be able to negotiate higher rates with private commercial insurance companies and, to a lesser extent, with Medi-Cal managed care plans.
- Continue Current Operations, but With Lower Profits. For some owners and operators, the higher costs would reduce their profits, but they still could operate at current levels without closing clinics.
- Close Some Clinics. Given the higher costs a clinic would face, some owners and operators may decide to seek consent from CDPH to close some of their clinics that are operating at a loss.
Opponents also argue that clinics are already required to report infections to the federal government, CalMatters notes.
Who opposes this proposition?
- DaVita, Inc. and Fresenius Medical Care, who together own or operate almost 75% of dialysis clinics in the state
- California Medical Association
- California Chamber of Commerce
- California Republican Party
See the full list of opponents
Follow The Money
DaVita, Inc. and Fresenius Medical Care, the biggest spenders against Proposition 29, own or operate almost 75% of dialysis clinics in the state.
Potential Financial Impact
The ballot measure’s official fiscal impact statement:
Increased state and local government costs likely in the tens of millions of dollars annually.
According to the analysis, those increased costs for the state will come in the form of increased California Medi-Cal costs and state and local health insurance costs due to clinic owners and operators negotiating higher costs and some dialysis patients needing to get treatment in hospitals if their local clinic closes. Here’s the fine print:
Overall, we assume that clinic owners and operators generally would: (1) be able to negotiate with some payers to receive higher payment rates to cover some of the new costs imposed by the proposition, particularly if many clinics were to close otherwise; (2) continue to operate some clinics with reduced income; and (3) close some clinics, with the consent of CDPH. This scenario would lead to increased costs for state and local governments likely in the tens of millions of dollars annually. (State and local governments currently spend more than $65 billion on Medi-Cal and employee and retiree health coverage.) This amount is less than one-half of 1 percent of the state’s total General Fund spending. (The General Fund is the state’s main operating account, which pays for education, prisons, health care, and other public services.)
In the less likely event that a relatively large number of clinics would close due to this proposition, having obtained consent from CDPH, state and local governments could have additional costs in the short run. These additional costs are highly uncertain.
More resources:
- Learn more about Proposition 29 in CalMatters' 2022 Voter Guide
- Listen to AirTalk's breakdown of Proposition 29
- Read the full report from the Legislative Analyst's Office on Proposition 29 (California Legislative Analysts's Office)
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