GAO provided to Congress, as requested, a statement for the record on Medicare payments for certain drugs provided to patients with end-stage renal disease (ESRD), a condition of permanent kidney failure. Through Medicare's ESRD benefit, patients receive a treatment known as dialysis, which removes excess fluids and toxins from the bloodstream. Patients also receive items and services related to their dialysis treatments, including drugs to treat conditions resulting from the loss of kidney function, such as anemia and low blood calcium. Detailed information on the prudence of bundling payments for all ESRD items and services and a recommendation to establish a bundled payment system as soon as possible are included in our report entitled End-Stage Renal Disease: Bundling Medicare's Payment for Drugs with Payment for All ESRD Services Would Promote Efficiency and Clinical Flexibility. This report, along with a testimony statement, was released at a December 6, 2006, hearing of the full Committee on Ways and Means. Today's statement highlights the information in that report and refers to information other witnesses presented at the hearing.