The Trump administration wants to give the country's kidney care a facelift, as treatment in the U.S. has remained relatively unchanged since President Richard Nixon signed the Medicare kidney disease entitlement into law in 1972. But concerns over methodology and measurement could swamp one prong of the administration's plans.
Though industry agrees the country's aging kidney care system is overdue for a revamp, some stakeholders are concerned about the mandatory CMS model in Medicare that, along with four voluntary models, is meant to incentivize dialysis centers to provide high quality care in a patient's home.
"As proposed, a single hypothesis is being tested: that a bonus-and-penalty payment adjustment to two types of providers will increase transplantation and home dialysis use," said Hrant Jamgochian, CEO of patient group Dialysis Patient Citizens. "We think it is a mistake to bet everything on a single intervention covering the entire United States."
The group has corporate sponsors, including for-profit dialysis giants DaVita, Fresenius Medical Care and American Renal Associates, along with drugmakers Baxter, AstraZeneca and Amgen.
President Donald Trump called fighting kidney disease a "core national priority" when he announced the plan in July. The government wants to slash the number of Americans with end-stage renal disease by a fourth by 2030. Currently, roughly 37 million people and 15% of U.S. adults suffer from some form of kidney disease, according to the Centers for Disease Control and Prevention.
And it's fertile ground to lower increasingly unsustainable healthcare spending, experts say. Medicare shells out about $114 billion each year on kidney disease — more than 20% of all fee-for-service dollars in the program.
The executive order has three aspects: reducing the number of Americans with end-stage renal disease by increasing preventive care, increasing the number of organs for transplant by developing artificial and wearable kidneys and modernizing the organ recovery and transplant system while incentivizing the use of home dialysis.
In tandem, CMS introduced five new payment models in Medicare and Medicaid. The four optional payment models give providers incentives to focus on preventive care and manage patient health in a holistic way. CMS expects more than 200,000 Medicare patients to enroll in the arrangements, which will run from January through 2026.
The mandatory End-Stage Renal Disease Treatment Choices(ETC) Model, will enroll all U.S. dialysis providers in randomly selected geographic areas spanning half the country to account for about 50% of all adult ESRD beneficiaries. By adjusting Medicare payments based on home dialysis and transplant rates, the Center for Medicare and Medicaid Innovation believes it can push those providers to provide dialysis in the home.
Experts say the home is the safest site of care for dialysis, and more cost effective. However, of the roughly 340 people starting treatment for kidney failure each day, only 12% receive dialysis in their homes, partially because the current Medicare system encourages in-center dialysis as the default option for patients beginning treatment.
The mandatory model aims to lessen barriers kidney care centers have to moving into the home, and to increase transplant rates. But many commenters questioned whether the methodology of the ETC Model is targeted enough to achieve those aims.
"We have significant methodological concerns such that we believe CMS should not implement the proposed ETC Model," the Medicare Payment Advisory Commission, a nonpartisan Congressional advisory board, wrote in its comments.
The ETC Model includes two payment adjustments to the base Medicare rates providers receive: the home dialysis payment adjustment, which will bump up the payment rate for home dialysis patients and treatments by 3% in 2020, 2% in 2021 and 1% in 2022; and the performance payment adjustment, which will adjust a provider's base payment rate higher or lower depending on their quality outcomes compared to a benchmark set by a control group.
MedPAC called the way CMS plans to calculate these payment rates flawed and also aired concerns about the validity of other measurements in the model.
"For both the home dialysis and transplant measures, we have specific concerns about the reliability of the measurement; the comparison-to-control-group benchmarks and scoring method; the risk-adjustment method; and, in certain instances, the alignment of incentives for participants," MedPAC continued.
CMS also proposes randomly assigning providers into the model across the country, a plan which Dialysis Patient Citizens called "inappropriate."
Large, for-profit dialysis chains such as DaVita, American Renal Associates or Fresenius would likely have some facilities participating in the model and others not, creating conflicting payment incentives, the group argued.
"By creating different payment incentives in different regions, ETC discourages chains from making uniform, systemwide changes to policies and procedures and thereby fails to marshal the chains' greatest strength," the group wrote in its comments. That could lead to gains by gaming the system and reallocating resources (including transplantable kidneys) to regions participating in the mandatory payment model.
Besides inadvertently rewarding bad behavior, random geographic assignment will likely penalize providers for factors beyond their control. Distributions of home dialysis rates among participants in each group won't be equal, stakeholders noted.
And, due to the ongoing shortage of peritoneal dialysis solutions since 2014 due to demand increase for the drug and limited manufacturing capability, and the shortage of viable kidney transplants, home dialysis and transplant rates will also be skewed nationally.
Pay increases aren't enough
CMS forecasts that Medicare spending to participating dialysis facilities and clinicians will drop by $185 million over the six and a half years the model runs.
Providers worry those savings will be scooped out of their bottom lines and that they'll be dinged financially for factors beyond their control.
Home dialysis equipment and supplies are often cost-prohibitive from a start-up and operational standpoint, New Orleans-based Oschner Health System argued in its comments, and clinicians can't manage the availability of kidney transplants in their area.
"Though CMS would support providers offering home dialysis through a positive payment adjustment, the proposed amount will likely be insufficient to cover new costs," not-for-profit Oschner, which has a network of 40 hospitals and more than 100 health and urgent care centers, said.
Stakeholders worry the payment incentive won't be large enough to get providers to make long-term changes in their behavior, with the American Medical Association contending the adjustment is just too low. Additionally, phasing it out over the first three years of the model won't make a dent in the underlying payment system for dialysis, meaning larger barriers to home dialysis in the current payment system will continue to exist.
Many stakeholders recommended a shared savings program to overcome deficiencies in the current proposed arrangement. But the state of Maryland came out in support of the payment structure, with state Department of Health Secretary Robert Neall saying it will provide "strong incentive to shift care away from in-center dialysis."
Dialysis providers mostly silent
Few for-profit dialysis chains commented on the proposed rule at time of publication, and though large insurers like UnitedHealth Group, CVS Health, Cigna, Anthem and Humana all stand to reap long-term benefits from the administration's push toward home dialysis and preventive treatment, few payers commented on the mandatory payment model.
Last year, dialysis centers reported about $24 billion in revenue, most of it by industry heavyweights DaVita and Fresenius Medical Care. DaVita and Fresenius' comments were not available at time of publication, as the Federal Register often has a lag time of several days.
But both companies are bullish on home dialysis, with Fresenius reporting earlier this month a growth rate for home dialysis eight times that of in-center dialysis from March through August this year. It's been about six months since the company's $2 billion investment in the treatment with its acquisition of home demodialysis device maker NxStage Medical.
Much-hyped startups Somatus and Cricket Health also did not comment on the ETC Model.
Despite this initial lack of engagement with the mandatory Medicare payment model, the fact remains that, geographically, half of the country's providers will have to participate. The model was designed to be "broad and sweeping," according to Center for Medicare and Medicaid Innovation head Adam Boehler, and it's sure to be so if finalized and streamlined to assuage industry concerns.
"The interest in this project at the highest levels of government makes this a once-in-a-lifetime opportunity to improve kidney care that must not be squandered," Jamgochian, CEO of Dialysis Patient Citizens, concluded.