Renal community concerned about proposed cuts to ESRD bundle

Dialysis providers, administrators, and dialysis patient advocacy groups in the renal community have expressed concern over the cuts to the ESRD bundle outlined in a proposed rule the Centers for Medicare & Medicaid Services issued July 1.

The agency released a proposed rule on July 1 to trim 12% off the composite rate in the ESRD bundle to make up for significant drops in the use of anemia drugs. The cut would actually amount to 9.4%, because CMS would give the renal community a 2.6% increase based on the market basket analysis for 2014. If finalized later this year, the proposed changes to the Prospective Payment System for the ESRD Program would reduce the Medicare composite base rate from $240.36 per patient per treatment to $216.95 per treatment.

The following are responses to the proposed cuts to the ESRD bundle from renal organizations:

American Society of Nephrology

“People with kidney disease, among the most vulnerable patients, are disproportionately underrepresented minorities, and such a large cut may reduce access to care and quality of treatment,” said the President of the American Society of Nephrology Bruce A. Molitoris, MD, FASN.

“It's troubling that Congress mandated a payment reduction at the same time that CMS is using the ESRD program as a model for bundled payment, a quality-incentive program, and a specialty-specific integrated care delivery model,” said Thomas H. Hostetter, MD, who chairs the ASN Public Policy Board.

National Renal Administrators Association

"NRAA is extremely concerned about the destructive effects the proposed payment reduction will have on small independent providers," said NRAA President Katrina Russell. "The Medicare Payment Advisory Committee has consistently shown a trend of small dialysis organizations (SDOs) having significantly lower Medicare margins than the rest of the industry. The MedPAC March 2012 report to Congress, the most recent MedPAC report with this level of detail, indicated the average Medicare margins for SDOs is 0.1%. This average Medicare margin number does not take into account the 2% reduction in Medicare payment these providers are now seeing as a result of budget sequestration nor the substantial price increase in the cost of a certain drug used to treat anemia in dialysis patients. This rule proposes nearly 10% additional reduction in payment which is unsustainable for small independent providers and may result in significant issues with patient choice and access to care issues. We will continue to carefully review the proposed rule and develop constructive alternatives to help ensure adequate patient access to care and choice of provider.”

American Nephrology Nurses’ Association

"We are urging policymakers to intervene with CMS to modify the final rule," said ANNA President Norma Gomez, MSN, MBA, RN, CNN. "Some patients could lose quality care and access to the treatments they need to survive.”

“CMS has the authority – and the obligation – to protect people with kidney failure who depend on dialysis,” Gomez said. “This proposed rule does just the opposite.”

National Kidney Foundation

Currently, across all dialysis providers, Medicare profit margins are only 3-4% (as estimated by the Medicare Payment Advisory Committee – MEDPAC). Since CMS is proposing a 9.4% cut to the base rate for Medicare payments, most providers will have to make considerable changes in how they operate in order to cover the most basic costs of care," NKF said in a statement. "NKF is concerned that some providers may not be able to withstand cuts and will have to close facilities and that many others may have to eliminate patient-focused programs, services, and benefits that improve patients' health and quality of life. Rather than wait and see how dialysis facilities respond to the cuts, we hope that Congress and CMS will engage in a meaningful dialogue with dialysis providers, patient groups, professionals, and others involved in caring for patients to identify ways to reduce the proposed cuts while still complying with the law."

American Kidney Fund

“Such a dramatic cut in services to this vulnerable group of patients is unconscionable, especially on top of other cuts to the dialysis payment system in recent years,” said LaVarne A. Burton, president and CEO of the American Kidney Fund. “If this rule is finalized, it is going to limit patients’ access to dialysis and reduce their options for care. Providers need sufficient Medicare funding to continue providing high quality care. We are urging CMS to consider the serious consequences of making such a devastating cut, and to take a more moderate approach that will protect patients.”

Renal Physicians Association

"Reimbursement for dialysis services under the ESRD Prospective Payment System has been reduced numerous times in recent years, prior to the additional sequestration-related cuts implemented earlier in 2013," RPA said in a statement. "Further cuts on the scale of those outlined in the proposed rule will not only compromise the ability of most dialysis facilities to maintain the staffing levels necessary to provide appropriate care to Medicare beneficiaries with ESRD, but will also increase the likelihood that some dialysis facilities will be forced to close their doors. Additionally, the reductions are likely to have a disproportionately negative impact on rural communities and efforts to address health care disparities in the ESRD patient population."

“There have been tremendous strides in the quality and availability of ESRD care to Medicare beneficiaries over the past decade,” said RPA President Robert J. Kossmann, MD." “Implementing cuts of the size proposed by CMS would substantially put those gains at risk and threaten access to appropriate care for dialysis patients in the Medicare program. They also are at odds with two of CMS’ three ‘Triple Aims’ with regard to improving individual patient care and population health. RPA urges CMS to work with the renal care community to develop an approach to refining the ESRD PPS that balances the Agency’s fiduciary responsibilities with preserving the access to high quality ESRD care currently afforded to Medicare beneficiaries with ESRD.”