CMS Announces Transformative New Model of Care for Medicare Beneficiaries with Chronic Kidney Disease
Today, the Centers for Medicare & Medicaid Services (CMS) announced it has finalized the End-Stage Renal Disease (ESRD) Treatment Choices (ETC) Model, to improve or maintain the quality of care and reduce Medicare expenditures for patients with chronic kidney disease. The ETC Model delivers on President Trump’s Advancing Kidney Health Executive Order and encourages an increased use of home dialysis and kidney transplants to help improve the quality of life of Medicare beneficiaries with ESRD. The ETC Model will impact approximately 30 percent of kidney care providers and will be implemented on January 1, 2021 at an estimated savings of $23 million over five and a half years.
“Over the past year, the Trump Administration has taken more action to advance American kidney health than we’ve seen in decades,” said HHS Secretary Alex Azar. “This new payment model helps address a broken set of incentives that have prevented far too many Americans from benefiting from enjoying the better lives that could come with more convenient dialysis options or the possibility of a transplant.”
“President Trump is tackling a longstanding problem for people with kidney disease because they deserve better than a system that perpetuates costly care and poor outcomes,” said CMS Administrator Seema Verma. “He challenged us to deliver a new model that focuses on prevention and better quality of life for our Medicare beneficiaries, so they can spend less time in dialysis centers and more time living fuller lives.” Approximately twenty percent of dollars in traditional Medicare—$114 billion a year—are spent on Americans with kidney disease. While more than 100,000 American who begin dialysis to treat end-stage renal disease each year, one in five will die within a year.
Many beneficiaries with ESRD suffer from poor health outcomes and face increased risk of complications with underlying diseases. For example, people with ESRD who get coronavirus disease 2019 (COVID-19) have higher rates of hospitalization. The current Medicare payment system and a lack of beneficiary education may encourage in-center hemodialysis as the default treatment for patients beginning dialysis. Having to travel to dialysis centers for their treatment also potentially exposes those with ESRD to illnesses like COVID-19.
The ETC Model will test shifting Medicare payments from traditional fee-for-service payments to payments where providers are incentivized for encouraging receipt of home dialysis and kidney transplants. This value-based payment model will encourage participating care providers to invest in and build their home dialysis programs, allowing patients to receive care in the comfort and safety of their home. Home dialysis gives patients the freedom to choose the therapy that works best with their lifestyles, without being tied to the dialysis facility’s schedule.
The ETC Model also incentivizes transplantation by financially rewarding ESRD facilities and clinicians based on their transplant rate calculated as the sum of the transplant waitlist rate and the living donor transplant rate. Transplant waitlisting means that a beneficiary becomes eligible to get a kidney when one becomes available at their transplant center. Transplantation is widely viewed as the optimal treatment for most patients with ESRD, generally increasing survival and quality of life while reducing medical expenditures. In 2017 only 29.9 % of people with ESRD in the U.S. had a functioning transplant kidney, and only 2.9 % of ESRD patients received a transplant before needing to start dialysis. The model provides financial incentives to increase transplant waitlisting and avoid instead of dialysis, when appropriate.
Providers are encouraged to have early conversations with patients about treatment options. All beneficiaries attributed to participants in the ETC Model will maintain freedom of choice among healthcare providers, and all current beneficiary protections under Medicare are maintained in the Model. The incentive structure of the value-based care ETC Model encourages clinicians to care for the whole person and make real improvements to the beneficiaries’ quality of life. CMS will monitor the financial impact over the course of the ETC Model.
The ETC Model builds on several of CMS’s top kidney accomplishments as part of President Donald Trump’s Advancing American Kidney Health initiative, which have included:
- Increasing payments for new renal dialysis drugs and biological products to encourage the development and investment in new transformative therapies.
- Changing transplant center requirements to give providers greater flexibility and freedom to support patients who need organ transplants.
- Establishing a transitional add-on payment adjustment to encourage the development of new and innovative equipment and supplies that would give beneficiaries more dialysis treatment options.
- Health Resources and Services Administration’s (HRSA’s) final rule amends the regulations implementing the National Organ Transplant Act of 1984, to remove financial barriers to organ donation by expanding the scope of reimbursable expenses incurred by living organ donors to include lost wages, and child-care and elder-care expenses incurred by a caregiver.
- Announcing the Kidney Care Choices Model, which creates strong financial incentives for health care providers to manage beneficiaries with chronic kidney disease (CKD) to delay the onset of dialysis, and incentivize kidney transplantation.
- Proposing expanding the scope of reimbursable expenses incurred by living organ donors to include lost wages and child-care and elder-care expenses.
These actions aim to keep the patient at the center of their care with treatment options that improve their overall health outcomes, while saving healthcare dollars. The ETC model is the next opportunity for the agency to continue the wave of innovation to modernize Medicare.
For a fact sheet on the ETC Model, please visit: https://www.cms.gov/newsroom/fact-sheets/end-stage-renal-disease-treatment-choices-etc-model-fact-sheet More information on the model is available at: https://innovation.cms.gov/initiatives/esrd-treatment-choices-model
The ETC Model is part of a CMS final rule on specialty care models, which can be viewed at: https://innovation.cms.gov/media/document/specialty-care-models-rule