NN&I is presenting two perspectives on the ESRD bundle cuts the Centers for Medicare & Medicaid Services has proposed, one from a representative of a large dialysis organization and one from a representative of a small dialysis organization.

I am a nephrologist from Lincoln, Neb. and frustrated with my country’s approach to health care financing. Current policy will create a two-tiered system of health care access. I am concerned about my patients and the hundreds of thousands of kidney failure patients throughout the United States who will have fewer treatment choices if proposed cuts to Medicare payment are finalized. Medicare and Medicaid pay for the majority of dialysis treatments in the United States under the End Stage Renal Disease (ESRD) program. Treatment modality choice has been a cornerstone of Medicare policy for dialysis patients.

(LDO perspective on the bundle cuts: Consider the impact on the most vulnerable patient population in the country)

Recently proposed funding cuts by the Centers for Medicare & Medicaid Services (CMS) will make access to dialysis care more challenging for many patients. Some kidney dialysis units will have no choice but to close and patients will be required to travel greater distances. Many patients will lose the ability to choose their treatment schedules. When a dialysis facility closes and patients need to receive care at another center, the new facility may have limited capacity to treat the additional patients. This then makes it much more difficult for patients to schedule dialysis treatments around their daily activities and responsibilities or to hold down jobs.

I am reminded of a conversation that I had with my home-town physician in rural Nebraska when I was training to be a kidney specialist 35 years ago. He asked me, “Why would you want to be a kidney specialist? All of those poor folks die!” At that time, in rural Nebraska, no facilities were available to care for kidney patients. Thanks largely to the Medicare ESRD benefit, there are dialysis facilities now available. But the dialysis population is growing and the health care system is not keeping pace. Instead of expanding to meet the needs, we are contracting to meet the budget.

(Where Medicare and the ESRD Program are headed)

Cost report data from 2011 show that more than 50% of independent small and medium size dialysis units already lose money on Medicare patients. Facilities that treat patients with private insurance can often afford to continue treating patients who have Medicare coverage because private insurance pays dialysis facilities more than Medicare. There is cross-subsidization that occurs by private payers for Medicare patients. The dialysis centers that I work with are non-profit independent facilities. We have rural dialysis units that do not have any private insurance patients. I am preparing to close one of our rural units in Beatrice, Neb. in March 2014 because we can no longer afford to subsidize that unit and risk our other units.  Another unit in York, Neb. has opted to stay open with financial support from the local community through the Critical Access Hospital, but for how long? 

Congress has mandated via the American Taxpayer Relief Act (ATRA) of 2012 that CMS re-calculate payments for dialysis treatments because of the decrease in use of expensive anemia drugs over the past five years. This change was primarily prompted by clinical research that suggested lower target hemoglobin values were safer for dialysis patients and that therefore, less drug therapy was necessary. CMS has done that calculation and published rules to decrease payments for dialysis care by approximately 10%. CMS currently pays about $240 per dialysis session. That payment includes all of the costs of the treatment, most drugs administered during the treatment and all of the clinic care necessary including social workers, dietitians and nursing care. CMS proposes to decrease that payment to $217 starting Jan. 1, 2014.

Doing dialysis at home instead of in a dialysis center could be a solution, but the required upfront investment by dialysis providers has severely limited the availability of home dialysis programs.  Most nephrologists would choose to do dialysis at home, if they themselves required dialysis. Home dialysis results in greater patient autonomy and rehabilitation. These proposed funding cuts will make home dialysis nearly impossible, with grave consequences for hundreds of thousands of kidney failure patients who struggle to lead more normal lives with home dialysis.

(Despite benefits from the ESRD bundle, stopping the payment 'leakage' is a priority)

We have a thriving home dialysis program in my practice, but this has taken us more than 10 years to develop and considerable financial investment. The proposed rule also has inadequate payments for the training of patients to dialyze at home. Our program will survive, because we have the infrastructure in place to continue the program. Other units across the nation that do not have that infrastructure will not be able to develop home dialysis programs. Only 16% of all dialysis facilities have such programs and nationwide, only 8% of dialysis patients conduct their treatments at home. More than 80% of dialysis units currently do not have a home dialysis program and when coupled with the upfront costs as well as inadequate proposed payment for home training will mean that new programs are unlikely to be started.

Under the proposed rule, rural facilities will close and urban facilities will consolidate. In rural areas, patients will be required to travel or relocate to larger urban centers.  Urban areas will suffer limited access in poor areas and limited choice in more affluent areas.  The result will be an upper tier of health care resources focused in affluent urban centers and a second tier of limited access and limited choice in rural and poor urban areas. These are policy decisions that our leaders must and will make.  We need CMS to reconsider its proposal and if CMS won’t or can’t act, then Congress will need to pass legislation to address this unequal access policy. I find it hard to believe that Congress has intended this two tiered delivery system to be good health care policy for the nation. So many lives are counting on it. Thirty-five years of progress must not be squandered.

Find more Viewpoints posts