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ESRD Quality Incentive Program

What is the ESRD QIP?

The Centers for Medicare & Medicaid Services (CMS) administers the End-Stage Renal Disease (ESRD) Quality Incentive Program (QIP) to promote high-quality services in outpatient dialysis facilities treating patients with ESRD.  The first of its kind in Medicare, this program changes the way CMS pays for the treatment of  patients with ESRD by linking a portion of payment directly to facilities’ performance on quality of care measures. These types of programs are known as “pay-for-performance” or “value-based purchasing” (VBP) programs.  

The ESRD QIP will reduce payments to ESRD facilities that do not meet or exceed certain performance standards. The maximum payment reduction CMS can apply to any facility is two percent. This reduction will apply to all payments for services performed by the facility receiving the reduction during the applicable payment year (PY).

Payment reductions result when a facility’s overall score on applicable measures does not meet established standards. CMS publicly reports facility ESRD QIP scores; these scores are available online on Dialysis Facility Compare. In addition, each facility is required to display a Performance Score Certificate that lists its Total Performance Score, as well as its performance on each of the quality measures identified for that year.

The foundation, principles, and mechanisms guiding the ESRD QIP will remain the same over time, but the program’s specific quality measures, standards, weights, and formulas will change from year to year.

How does the ESRD QIP work?

The ESRD QIP continues to evolve over time. For example, PY 2014 increased the number of measures from two to six, and expanded the scope of the program to include pediatric  patients with ESRD. CMS intends to update the program in future program years to reflect the evolving clinical understanding of quality care, and to include the broadest possible spectrum of patients with ESRD.

For any program year, three periods apply:

  1. The PY,
  2. The comparison period, and
  3. The performance period.

The comparison period is the designated time (often a full year) during which data is gathered on all dialysis facilities. That information will serve as the basis to evaluate a facility’s future performance.  In other words, data collected during the comparison period is used to create performance standards.

The actual performance period (which usually covers a full year as well) follows the comparison period. In general, a facility will seek to perform at least as well during the performance period as it did during the comparison period in order to avoid future payment reductions.

Immediately following the completion of the performance period, CMS assesses the facility’s performance based on the comparison period and calculates a score for each measure, according to the methodology detailed each year in a final rule published in the Federal Register. Scores for each measure are then combined to create the Total Performance Score for each facility.  If a facility’s Total Performance Score does not meet or exceed the performance standards established during the earlier comparison period, then it will incur payment reductions of up to two percent for the entire PY.

If payment reductions do occur for a facility, then that reduction will apply to payments made to the facility for services it renders during the PY. Naturally, the PY follows the performance period. Results from one PY do not carry over into the next; each year, a new cycle begins for each facility.

Each PY has distinct measures, scoring methodology, and payment reduction scale. Any given calendar year could serve as a comparison period for one future PY, a performance period for another future PY, and as a current PY! See the ESRD QIP Milestones by Program Year guide in the "Downloads" section, below.

You can also track the timing of upcoming periods applicable to the program on our Current QIP Status page.