CMS Seeks Incentives for At-Home Dialysis in Wake of COVID-19

July 7, 2020

End-stage renal disease has long been one of the most expensive and debilitating conditions that affects Medicare beneficiaries. Not only does dialysis cost $90,000 a year—those awaiting a kidney transplant automatically qualify for Medicare—but the need to travel to a dialysis center multiple times a week disrupts employment and home life.

CMS said Monday it planned to pay more for dialysis equipment used at home, with the aim of moving more treatment outside dialysis centers while the nation grapples with the coronavirus disease 2019 (COVID-19) pandemic.

In a statement, CMS said that the “transitional add-on payment for new and innovative equipment and supplies,” or TPNIES, would allow greater access to home dialysis machines, making it easier to get them to Medicare beneficiaries.

The proposed 235-page rule, published in the Federal Register, is CMS’ latest attempt to use dollars to steer patients with end-stage renal disease (ESRD) out of dialysis centers, but this time a pandemic brings added urgency. Comments are due September 4, 2020, and most changes would take effect January 1, 2021.

ESRD has long been one of the most expensive and debilitating conditions that affects Medicare beneficiaries. Not only does dialysis cost $90,000 a year—those awaiting a kidney transplant automatically qualify for Medicare—but the need to travel to a dialysis center multiple times a week disrupts employment and home life. With demand for dialysis increasing as rates of diabetes and obesity rise and the population ages, options are needed.

A year ago this week, President Donald Trump outlined key goals for renal care in an executive order, and HHS Secretary Alex Azar unveiled Kidney Care First and 3 Comprehensive Kidney Care Contracting (CKCC) models. All were designed to increase choice in the setting of care for ESRD, speed the process for kidney transplantation, and weed out underperforming clinics.

Getting these concepts to the point of a federal rulemaking proved challenging, however. Dialysis industry leaders challenged the mandatory model that was proposed, the End-Stage Renal Disease Treatment Choices Model. The new rule that was to take effect in January stalled before it got off the ground.

Then came COVID-19. ESRD patients were landing in the hospital in high numbers, and they didn’t fare well once they got there.

“CMS data shows that those with ESRD have the highest rate of hospitalization of any single group, a trend consistent with having to frequently leave home to receive dialysis,” Administrator Seema Verma said in a statement. “In the midst of a deadly pandemic that poses a particular threat to those with serious underlying conditions, President Trump’s call for increased access to home dialysis has never been more urgent. Unfortunately, government rules too often stand in the way.”

COVID-19 can also cause acute kidney injury among those with no prior history of renal problems. Thus, not only is COVID-19 taxing the health system while patients battle the virus; it is creating new groups of patients who may need dialysis once they recover.

“Today’s action represents a sorely needed course direction, making it easier for ESRD facilities to make new and innovative home dialysis machines available to patients who need them,” Verma said.

A CMS fact sheet explains that new machines being used in a home for a single patient could be treated as a capital-related asset under TPNIES for up to 2 years, allowing CMS to pay 65% of the preadjusted per treatment amount as determined by the Medicare Administrative Contractor.

The fact sheet outlines several other payment changes, including:

  1. increasing base rates for care for ESRD, known as the prospective payment system (PPS),
  2. adding a payment to train patients to use home dialysis,
  3. making adjustments for high-cost patients and for dialysis facilities that are typically low volume, but are higher volume right now due to COVID-19,
  4. folding the cost of ESRD drugs called calcimimetics into the ESRD PPS bundled payment, which will help Medicare Advantage plans, and
  5. adjusting the wage index under the ESRD prospective payment system, which adjusts wages based on differences in local labor markets. However, decreases would be capped the first year.

In the fact sheet, CMS projects that the net result of the change, which would take effect January 1, 2021, will increase the total payments to all ESRD facilities and to freestanding facilities by 1.6% percent compared with calendar year 2020. For hospital-based ESRD facilities, CMS expected total payments to fall by 0.4% compared with calendar year 2020.

A coalition of 34 kidney care and advocacy organizations, Kidney Care Partners (KCP), on Wednesday released a statement that supported some aspects of CMS' proposal while calling for changes to the ESRD PPS bundle. In its statement, KCP said it supported the add-on payment for TPNIES as well as a payment adjustment for drugs in a "functional category" within ESRD PPS. It also supports new funds for calcimimetics. However, KCP said it was "disappointed" that CMS did not call for changes in the adjusters to the bundle, which analyses, including one from MedPAC, say "leads to money being taken away from patient care."

CMS also said it has proposed adjustments to payment model reforms made under last year’s rule changes:

ESRD Quality Improvement Program. In this program CMS evaluates the entire facility on measures specific to a given payment year and reduces payments when the facility fails to meet preset benchmarks, or a total performance score. CMS also publicly reports the results. Under changes proposals for 2023 an 2024, a key measure—the ultrafiltration rate—would be based on patient months instead of facility months, which aligns more closely with outcomes based measures.

National Healthcare Safety Network Validation Study. To ease burdens on facilities, CMS will allow 20 records from any 2 quarters instead of 20 records from each of the first 2 quarters.