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Why Did Medicare Drop End-Stage Renal Disease Payment Rule?

The Centers for Medicare & Medicaid Services (CMS) has finalized a rule that updates the payment rates for the End-Stage Renal Disease Prospective Payment System (ESRD PPS) and makes changes to the quality incentive program and the ESRD Treatment Choices (ETC) model. The changes are designed to encourage dialysis providers to decrease disparities in home dialysis and transplant rates. It’s part of a larger effort by the Biden administration.

Fierce Healthcare’s recent article entitled “Medicare drops end-stage renal disease payment rule that aims to close health equity gaps” reports that this is the first CMS Innovation Center model to directly address health equity.

“Today’s final rule is a decisive step to ensure people with Medicare with chronic kidney disease have easy access to quality care and convenient treatment options,” said CMS Administrator Chiquita Brooks-LaSure in a statement. “Enabling dialysis providers to offer more dialysis treatment options for Medicare patients will catalyze better health outcomes, greater autonomy and better quality of life for all patients with kidney disease.”

According to the CMS Office of Minority Health’s studies on racial, ethnic and socioeconomic factors, disadvantaged people with Medicare have increased occurrences of ESRD. They’re also more likely to experience higher hospital readmissions and costs and they’re more apt to get in-center hemodialysis (versus home dialysis). Studies also indicate non-white ESRD patients are less likely to receive pre-ESRD kidney care, become waitlisted for a transplant or receive a kidney transplant.

The end-stage renal disease payment model rule includes small payment increases for dialysis facilities, including 2.5% for hospital-based facilities and 3.3% for freestanding providers. The total increases represent an estimated 2.5% increase overall from 2021.

CMS says that it’s improving access to home dialysis for patients of all socioeconomic backgrounds and is finalizing changes to the ETC model to test a new payment incentive that rewards ESRD facilities and clinicians who manage dialysis patients for achieving significant improvement in the home dialysis rate and kidney transplant rate for lower-income beneficiaries.

CMS also is approving the first-ever technology under a recently established policy that permits enhanced payments for innovative technologies that are a substantial clinical improvement relative to existing options. This will help ESRD facilities offer an additional option to beneficiaries for home dialysis at this critical time in the pandemic. Under the 2022 prospective payment system for ESRD, Medicare says it will pay about $8.8 billion to approximately 7,700 ESRD facilities for furnishing renal dialysis services. The final 2022 ESRD PPS base rate is $257.90, which is an increase of nearly $5 to the current base rate of $253.13, the agency said.

Reference: Fierce Healthcare (Oct. 31, 2021) “Medicare drops end-stage renal disease payment rule that aims to close health equity gaps”