A new payment model for patients with chronic kidney disease is set to go into effect Jan. 1, 2021, CMS announced Friday. The model aims to reduce Medicare spending for end-stage renal disease, a costly illness, by establishing payment incentives encouraging at-home dialysis and kidney transplants.
CMS will incentivize providers to deliver at-home dialysis care with increased payments. Medtechs including Baxter and Outset Medical, which began trading publicly last week, make dialysis technologies that can be used in the home and have pushed for additional payments from the agency.
More broadly, payments will shift from fee-for-service to value-based payments and will affect about 30% of all kidney care providers. The End-Stage Renal Disease Treatment Choices, or ETC Model, is estimated to save the Medicare program $23 million over five years, CMS said.
Revamping kidney care in the U.S. has been an important focus of the Trump administration over the last few years.
The final rules released Friday are set to tackle long-standing issues in the program that provide incentives for costly care without much to show for it in terms of outcomes, federal health regulators said during a call with reporters on Friday.
"You get what you pay for," HHS Secretary Alex Azar said, noting the lackluster health outcomes for those with chronic kidney disease.
Such patients represent about 1% of Medicare enrollees, yet they consume 7% of Medicare spending, CMS Administrator Seema Verma said.
There are two major components to the model set to alter the kidney landscape, the two top administration health officials said.
First, providers will receive a bump in payment for delivering at-home dialysis care. Right now, those with chronic kidney disease are forced to spend multiple hours at least three times a week at a dialysis center. During a pandemic, going to a facility can hold a particular risk for these patients, Verma pointed out. She noted that these patients are at the highest risk for COVID-19 and make up the highest rate of COVID-19 diagnoses in the Medicare population.
CMS argues that at-home dialysis, a preferred treatment option, is less prevalent than in other developed countries. In 2016, only about 12% of all patients treated for ESRD were using at-home dialysis.
Second, during the first year of the model, providers will receive a 3% increase in reimbursement for at-home dialysis followed by a 2% and 1% increase in the subsequent years. However, there is downside financial risk in the model, which is partly why CMS expects to generate savings of $23 million.
CMS will choose which providers participate in the model based on their location in randomly selected regions. That means some dialysis centers will have some providers participating and others will not. Some of the chains have argued this hampers their ability to make system-wide changes due to the lack of uniformity.
A transplant, while not a cure, can offer for patients the semblance of a close-to-normal life and extend that life. However, "only 2.9 % of ESRD patients received a transplant before needing to start dialysis," CMS noted.
The administration is betting that more people will be willing to donate a kidney if they can expect to be reimbursed for lost wages and child care. Regulators said Friday they estimate it will increase the availability of organs by 20% by 2030.