CMS releases their proposed changes to dialysis reimbursement

By Bill Peckham

The Centers for Medicare & Medicaid Services (CMS) today proposed a new prospective payment system (PPS) for  dialysis services provided to Medicare beneficiaries (press release). These new rules have been anticipated since the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) was approved by Congress and became law in July of last year.

One element of the dialysis program legislation in MIPPA is a quality improvement program (QIP) that is intended to motivate improved quality at facilities. CMS published a separate fact sheet on the QIP provisions in the proposed rule - basically they are going to start with two of the three measures reported on CMS's Dialysis Facility Compare (DFC) website (reported on DFC but not being used is patient survival). The two measures being proposed are hemodialysis adequacy and anemia management (both above and below the target range) . CMS did not come out with many details, for instance what percent of providers would be subject to the withhold, but they are strongly inviting comments:

CMS will accept comments on this conceptual QIP model in the ESRD PPS proposed rule through November and will issue a separate proposed rule based on consideration of the comments received at a future date.

For the next 60 days CMS is asking for feedback on the entire rule but this is one of a number of areas CMS is making a specific request for input; this request will, I think, generate many comments. After the first read I'm wondering why not include unit mortality rates which are a part of DFC? And why not go beyond DFC and draw from the KECC Dialysis Facility Reports which include things such as hospitalizations and infections? (view actual Dialysis Facility Reports here)

The QIP model is one piece of MIPPA's task for CMS. The other piece, I would say more important piece, is to put in place a new system for how dialysis will be reimbursed. CMS published a fact sheet on the PPS for dialysis (aside from the QIP model) and the entire 547 page PDF explaining and detailing CMS's choices is available (LARGE PDF FILE link).

When I first saw the report the first thing I wanted to know is the payment frequency - would payments be per treatment, weekly, monthly or something else. The idea of a monthly bundle is very problematic and to their credit CMS went with a per treatment payment scheme. CMS is proposing to base the bundle on a per treatment basis.

The unit of payment section of the 547 page document starts on page 58. The key sentence is on page 60:

We propose to continue the present per treatment basis of payment in which ESRD facilities would be paid for up to three treatments per week, unless medical necessity justified more than three weekly treatments.

This is a big relief. Not only the per treatment payment but very important is allowing for medically justified treatments beyond the standard 3 per week. More on this in future posts.

There is a lot to digest and blog about. The rule includes training for home hemodialysis in their calculation of a PPS - this means low reimbursement for intense and extended training, one-on-one training for weeks at a time. This is a concern since it would create or make worse a barrier to improving home hemodialysis access. Access to the healthiest forms of dialysis should not depend on your zip code. This is an area CMS asked for input and will, I think, generate many comments.

The base payment rate that CMS came up with is $198.64, which seems very low but it'll take some time to figure out how to compare that number with current reimbursement. For instance I think the $198 represents the lowest payment under the new bundle, whereas current reimbursement adjusted the base rate both up and down. CMS also is proposing that the beneficiary coinsurance amount be 20% of the bundled payment amount, including applicable case-mix adjustments and outlier payments. This represents a change in that lab tests that previously were 100% paid by CMS now are part of the bundle and 20% of the cost is the responsibility of the patient or their secondary insurer.

The entire idea that fractional payments are included in each per treatment payment under the expanded bundle does not seem to be addressed. A per treatment expanded bundle payment means that in that payment there is partial reimbursement for things like the labs that are not currently in the composite payment. For instance the new Conditions for Coverage require semi-annual tests for hepatitis, a test that cost hundreds of dollars. Something like five dollars of the new expanded per treatment payment should be intended to pay for this semi-annual test so that after six months of treatments the unit has received full reimbursement (78 fractional payments) for the test.

In this example you can see the problems. For one, the bundle is based on 2007 costs which was when they did the test yearly - it's now done twice as often. How is that accommodated? Then there is the issue flowing from hospitalizations and travel. If during the six months the patient is traveling or hospitalized while the unit is suppose to be getting the fractional payments for the hepatitis test then the unit will not be fully reimbursed. The unit will still be obligated to have the test done once the patient returns even though they have not been fully reimbursed. You can anticipate this same sort of fractional payment issue with any service not provided each treatment in 2007 - iron for instance to name another big one; there are other medications and lab tests that are in the same boat.

Labs should have never been part of this but MIPPA required their inclusion, so they're included. However, CMS does have an obligation to construct a way to accommodate missing fractional payments. Fractional payments also feature in questions around medically justified forth treatments.

Obviously there is still a lot to understand but I'm feeling optimistic after my first read. In the next few days it'll be interesting to track the reaction of other dialysis stakeholders who are sure to weigh in. If you've been working through the rule's 547 pages  please comment; tell me how you're reading it.

Comments

[roberta mikles]

Bill, Advocates4QualitySafeCare supports your statement "After the first read I'm wondering why not include unit mortality rates which are a part of DFC? And why not go beyond DFC and draw from the KECC Dialysis Facility Reports which include things such as hospitalizations and infections?" These two aforementioned are a MUST to be included.

One 'reality' question to ask is "How will delivery of care be affected by the new bundled rate, e.g. lab tests, medications, supplies, etc.?" Again, there is more to delivery of care than that which is on the Dialysis Facility Compare or included in the CPMs.

Roberta Mikles, RN, Director
Advocates4QualitySafeCare

[RAM]

I was surprised to see that the Quality Incentive Program measurements were apparently reduced to anemia management and Hemodialysis adequacy. The previous Report to Congress, "A Design for a Bundled End Stage Renal Disease Prospective Payment System", suggested many other measures, such as patient satisfaction, Iron, vascular access, bone and mineral metabolism, and others.

Richard Menard
Healthcare Business Analyst

[roberta mikles]

I think we all must remember, and keep in mind, that CMS is attempting to IMPROVE care and deliver QUALITY SAFE care. BUT ---What CMS needs to understand is that there is MORE to delivery of quality safe care than anemia management, dialysis adequacy and other CPMs. If a patient acquires an BSI and dies, what difference does it make if their anemia was appropriately managed or their blood was being cleaned? Truthfully, think about it. If a patient is hospitalized, loses their life, or has a severe negative outcome because of the wrong bath, lack of staff identifying a pyrogenic reaction, not following prescribed orders, not reporting to the RN symptoms that require further assessment or following facility policies and procedures,,, then, again what good is it to have those two areas as major areas in the QIP. What I have been stating for several years was recently basically reiterated by Dr. John P. Capelli of Our Lady of Lourdes Medical Center. His article in Nephrology News & Issues "Measuring the quality of patient care goes beyond just numbers" clearly sends a message not only to providers, but to CMS. I have continued to state that, perhaps, Medicare should do that which is done in hospitals and that is to withhold payment when certain preventable errors occur resulting in negative outcomes. When CMS only addresses anemia management and adeqacy as indicators of quality safe care, or sanctions a facility that is out of paramenters for same, but does not address other areas of care, especially infection control and infection rates, then something is drastically wrong. This is unacceptable and patients deserve more.
Roberta Mikles, RN, Director
Advocates4QualitySafeCare

[Dori]

The simplest solution, IMHO to the immediate question of quality measurement is to use the DOPPS-developed (and therefore research-based) "Practice Risk Score" (PRS) . This composite of anemia, adequacy, access, and albumin predicts mortality at the facility level. Why develop a new set of measures? Yes, these are all clinical. As someone who advocated for health-related quality of life to become a clinical performance measure, I'd love to see it included. As a pragmatist, that seems unlikely. At least CMS could choose the PRS, a measure that really makes a difference.

I was very pleased to see that reimbursement would be at the treatment level, could be for up to 20 treatments/mo. (with medical justification), and that longer and/or more frequent HD were mentioned. I was NOT pleased to see Congress'' requirement for a "98% budget neutral" bill, that results in the renal community LOSING a further $200 million--after decades of historical lagging because there has never been an annual update. And I was NOT pleased that home dialysis training was included in the bundle as "overhead"--a serious threat to home programs.

The addition of Part B & D drugs in the bundle is concerning. Having dialysis clinics responsible for providing folks' BP drugs, binders, vitamins, etc. could create a powerful incentive for better dialysis--which reduces the use of these drugs. Or, it could create a group of "second class Medicare beneficiaries," reduced to begging their clinics for drugs they need, and no longer able to obtain them otherwise unless they're willing to pay for them themselves. It's hard to say which way this could go...

More to come...

[Denise Eilers]

Although I am pleased that under the new bundle dialysis will be reimbursed per treatment, I am disappointed that the CMS rules do not include incentives for home treatment.

Just as KCP is set to launch its PEAK program (Performance Excellence and Accountability in Kidney Care) with a goal to reduce mortality among first year dialysis patients by 20% by the end of 2012, CMS has chosen to ignore mortality as a quality marker.

I also wonder how quickly Quality of Life would be used as an indicator if some people at CMS were dialysis patients.

Denise Eilers, BSN, RN

[roberta mikles]

Denise, our group has been discussing such (incentives for home treatment) considering all know that quality of life is improved, along with other advantages when doing HHD.
Roberta Mikles, RN, Patient Advocate
Advocates4QualitySafeCare

[Denise Eilers]

Roberta, You are preaching to the choir. My late husband was a home hemodialysis patient for just shy of 25 years, so I can attest firsthand to the benefits of home treatments. I totally agree with you about improved quality of life. CMS needs to realize that labs are only one piece of the puzzle.

[roberta mikles]

Denise, please feel free to contact me as I am willing to support whoever feels the same.
Roberta

[Zach]

Anyone here plan to attend (and speak) at the Town Hall Meeting on End-Stage Renal Disease (ESRD) Perspective Payment System on 10/23/2009 ?

http://www.cms.hhs.gov/apps/events/event.asp?id=589&kw=&mh=nomonth&cboorder=date&yr=noyear&type=2

[roberta mikles]

If I am correct, one has to be there in 'person' which is greatly limiting to many. If I am incorrect, please let me know. It would be great if it were such as an 'open-door' forum, whereby all who had comments, concerns, and opinions could participate. Again, when such is limited, as 'in-person attendance' it prevents many from participating.
Roberta Mikles, RN
Patient Advocate

[Bill Peckham]

I'd be interested in hearing from someone who has attended one of these in the past. I think so far as the proposed rule goes commenting online is as effective as commenting in person. CMS is in an official comment period - how or when you submit a comment doesn't add or take away from the weight it is given.

It would be interesting to live blog the meeting - the comments are sure to give a pulse of the industry.

[Zach]

Only 381 spaces left.

[River]

Let me see if I have this correct: with the new bundling system, since it is per treatment and Medicare recipients are obligated to pay 20% of the cost, then every hemodialyzor who is on Medicare but not on Medicaid is obligated to pay a minimum of $475/month for dialysis?

This rises to something on the order of $750/month minimum if the dialyzor is on home dialysis and dialyzes the maximum times per month that Medicare will cover?

How is one supposed to afford that? It would quickly bankrupt us.

Washington state is one of the states where one apparently cannot buy a Medicare supplemental policy as an ESRD patient under 65. Thus, any Medicare patient under 65 would be on the hook for large sums of money every month in co-pays. Is the patient objligated to spend and spend and spend until he or she is destitute enough to qualify for Medicaid assistance?

And does anyone know how, if at all, this new rule affects PD?