The shared savings approach in the ongoing Comprehensive ESRD Care Model demonstration, now ending its second full year with 13 physician-provider seamless care organizations, or ESCOs, encourages better management of the highest costs of care, like pharmaceuticals and hospitalizations. These two line items have historically been the most expensive for Medicare in the ESRD Program.

Kidney drug costs have been harnessed since 2011 by a bundled, composite rate payment formula. However, hospitalizations continue to remain high in the treatment of patients with end-stage renal failure and remain a big target for Medicare and within the ESCO model. Under the current Medicare payment system for dialysis care, providers have little incentive to reduce hospitalization costs, other than facing lost payment for missed treatments. In the accountable care payment model in the ESCO demonstration, dialysis providers take on the risk for all costs, including hospitalizations. Reduce those costs, and providers – and nephrologists who are part of the partnership – share in the savings with Medicare.

In the ESRD demonstration’s first year, the ESCOs and Medicare shared $75 million in savings, much of which came from reduced hospitalization costs.

But is cutting hospital days potentially detrimental for patients who really need them? Could patients with more medical complications be denied access to hospital care for the sake of increased profit and program success¬ – or even be quietly urged to withdraw from dialysis to keep ESCO hospitalization costs low?

“This new CMS payment model, in which financial success is largely dependent on hospitalization reduction, will change existing incentives to provide dialysis to as many patients as possible, but also introduce serious and complex new ethical risks regarding goals of care and end-of-of-life considerations,” nephrologists Jeffrey S. Berns, MD, and colleagues, wrote in an article recently published in American Journal of Kidney Diseases.

Berns and colleagues stated that patients with comorbid conditions requiring more hospitalizations may be pushed toward conservative care, thus reducing the expensive risk of hospitalizations and higher costs to the ESCO. Conservative care would mean patients would not go on dialysis or elect to discontinue dialysis and likely enter hospice. Older patients, the authors wrote, may particularly be targeted.

“In the United States, 30% of incident hemodialysis patients 75-89 years old die within one year,” they wrote. “Hospitalization rates are particularly high near the end of life for many dialysis patients, with hospice care often underused.”

Ultimately, “serious ethical conflicts arise when decisions about avoiding or stopping dialysis can enhance the financial success of dialysis facility and other ESCO investors,” according to Bern and colleagues.

Berns and colleagues also worry about the motivation of doctors who are managing the ESCOs – accepting the loss of relatively modest professional fees in place of insuring that hospitalization costs are kept under control to make sure the ESCO is profitable. The authors said it is important that patients seek guidance who are considering withdrawal from treatment, but not from nephrologists or the dialysis providers who have a vested interest in the profitability of the ESCO.

“…CMS policy makers, nephrology and patient advocacy organizations, nephrologists and others need to urgently address these new conflicts of interest created by dialysis integrated care organizations,” the authors wrote. – by Mark E. Neumann

Berns JS, et al. Am J Kidney Dis. 2018;doi: