The 2011 ESRD Prospective Payment System: Perspectives From Fresenius Medical Care, a Large Dialysis Organization

Abstract

On August 12, 2010, the US Centers for Medicare & Medicaid Services (CMS) published the End-Stage Renal Disease (ESRD) prospective payment system (PPS) final rule, redefining reimbursement for dialysis services.1Centers for Medicare & Medicaid ServicesMedicare program; end-stage renal disease prospective payment system Final rule.Fed Regist. 2010; 75: 49029-49214PubMed Google Scholar Dialysis providers had the option to phase in over a 4-year period or to fully operate under the new “bundled” payment system effective January 1, 2011. Fresenius Medical Care, North America (FMCNA), the largest provider of dialysis services in the United States, elected to fully opt in, with all our dialysis units adopting the expanded bundle payment. FMCNA believes that this is the right decision for the patients we treat, for the physicians who care for them, and for the company, recognizing the challenges, risks, and opportunities that lie ahead.The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA)2Medicare Improvements for Patients and Providers Act of 2008. Medicare, Provisions Relating to Part B, Other Payment and Coverage Improvements. Pub L No. 110-275, §153(a) (2008).Google Scholar established the broad framework to expand the case-mix–adjusted global payment for dialysis treatments by including intravenous medications (and their oral equivalents) and dialysis-related laboratory tests, along with regular annual payment adjustments to be implemented by the CMS. Perceived challenges, risks, and opportunities to the PPS payment have been reviewed,3Patel U.D. Mehrotra R. Himmelfarb J. The new prospective payment system for outpatient dialysis services: potential benefits and pitfalls.NephSAP End-Stage Renal Dis. 2010; 9: 347-351Google Scholar and before the release of the final rule, the proposed PPS also was vetted by stakeholders,4Sedor J.R. Watnick S. Patel U.D. et al.ASN End-Stage Renal Disease Task Force: perspective on prospective payments for renal dialysis facilities.J Am Soc Nephrol. 2010; 21: 1235-1237Crossref PubMed Scopus (20) Google Scholar including in a recent issue of the American Journal of Kidney Diseases.5Weiner D.E. Watnick S.G. The 2009 proposed rule for prospective ESRD payment: historical perspectives and public policies—bundle up!.Am J Kidney Dis. 2010; 55: 217-222Abstract Full Text Full Text PDF PubMed Scopus (12) Google Scholar After thorough evaluation, FMCNA concluded that: (1) the ability to manage the bundle payment for our dialysis services will allow for the greatest flexibility to tailor care for each patient, with the best quality and greatest efficiency; (2) the company is well positioned to face the challenges and embrace the opportunities presented; and (3) opting “all in” will enable one strategy and one focus (in contrast to straddling between old and new payment systems) for implementing appropriate processes of care required to succeed in this new environment.OpportunitiesThe key principle for continued success involves optimally aligning incentives for patients, physicians, payers (specifically the CMS), and the provider (Fig 1).Patient-Centered CareOptimizing health reduces hospitalization while increasing longevity and enhancing quality of life. This principle reflects the primary goal of all health care systems, including dialysis providers. Under the expanded bundle, payment for dialysis is significantly greater within the first 120 days of initiating therapy and the CMS waives the “noncoverage” clause for the first 90 days for Medicare-eligible patients who opt for home therapies. Because morbidity and mortality also are greatest during the first 120 days,6US Renal Data SystemUSRDS 2010 Annual Data Report: Atlas of Chronic Kidney and End-Stage Renal Disease in the United States. National Institutes of Health, National Institute of Diabetes and Digestive and Kidney Diseases, Bethesda, MD2010Google Scholar FMCNA has developed several programs designed to empower patients in making and implementing treatment choices at the time of dialysis therapy initiation, if not before. These include the well-established proprietary RightStart program, which focuses on optimizing care in the first 120 days of dialysis therapy initiation7Wingard R.L. Pupim L.B. Krishnan M. Shintani A. Ikizler T.A. Hakim R.M. Early intervention improves mortality and hospitalization rates in incident hemodialysis patients: RightStart program.Clin J Am Soc Nephrol. 2007; 2: 1170-1175Crossref PubMed Scopus (59) Google Scholar; Treatment Options, a predialysis education program; RightReturn, which focuses on care in the immediate posthospitalization period; and the upcoming RightCare, with an emphasis on optimizing predialysis care. We continue to support Fistula First, but in conjunction with a catheter reduction program.8Lacson Jr, E. Lazarus J.M. Himmelfarb J. Ikizler T.A. Hakim R.M. Balancing Fistula First with catheters last.Am J Kidney Dis. 2007; 50: 379-395Abstract Full Text Full Text PDF PubMed Scopus (125) Google ScholarPhysician-Driven CareThe physician is the best advocate for optimizing patient health. This responsibility begins before initiating dialysis therapy and continues after starting dialysis. We will pursue greater collaboration with physicians to maximize the participation of patients in the FMCNA programs mentioned, designed to improve early outcomes and promote home therapy. Active participation by physicians in decision making through regional and national medical advisory boards will be crucial in this new environment, particularly in the review and selection of the best evidence-based medical interventions, algorithms, and care processes. These medical advisory board physicians, in collaboration with the Pharmacy and Therapeutics Committee, will educate their peers in the application of best practice algorithms for most patients, but also in individualizing therapy when appropriate. They will be updated constantly with information gleaned from analyzing electronic health data and may recommend initiatives for comparative effectiveness research. A stronger physician influence, evolving into a well-balanced physician-provider relationship within FMCNA, is anticipated moving forward.Efficient Delivery of High-Quality CareCongress addressed increasing costs of providing dialysis care while preserving access for all patient beneficiaries by financially rewarding high-quality efficient care delivery. For example, the PPS promotes home dialysis by keeping reimbursement constant regardless of location, although CMS-estimated costs for home therapies are lower. Additionally, a Quality Incentive Program (QIP) withholds up to 2% of facility payments based on meeting certain thresholds. This QIP is the first attempt by the CMS to link reimbursement with quality targets, beginning with adequacy and anemia standards. New quality standards currently are being developed, and to be successful, it is critical that the CMS considers input from all stakeholders. A collaborative consultative transparent process with careful consideration of evidence-based outcomes, feasibility of data collection, and accuracy of proposed measures is essential when considering future quality standards. FMCNA believes that for the QIP to become a mature and robust quality incentive, the CMS should redistribute the amount withheld from underperforming facilities to those that have achieved high-quality care.Leveraging Provider Expertise to Deliver Efficient Affordable CareDecreasing hospitalizations while increasing longevity is good for patients and providers alike. Success here will decrease facility fixed costs, reflecting that payment is rendered only when dialysis sessions occur. Accordingly, patient-facility incentives are aligned because it is in the provider's best interest to optimize patient health, thereby maximizing provision of outpatient dialysis as prescribed by the physician. This goal is achieved by promoting self-care and patient empowerment to select home therapies, decreasing catheter rates (a major cause of morbidity), and decreasing rehospitalization. Increasing efficiency is imperative because the original composite rate payment has been progressively and substantially devalued by ongoing inflation.5Weiner D.E. Watnick S.G. The 2009 proposed rule for prospective ESRD payment: historical perspectives and public policies—bundle up!.Am J Kidney Dis. 2010; 55: 217-222Abstract Full Text Full Text PDF PubMed Scopus (12) Google Scholar, 9Iglehart J.K. The American health care system The End Stage Renal Disease Program.N Engl J Med. 1993; 328: 366-371Crossref PubMed Scopus (71) Google Scholar The new ESRD PPS has a mechanism to update the base rate annually, which was lacking in the previous system, simultaneously enhancing provider viability and program sustainability. Overall, despite attendant risks and operational challenges, the bundle provides opportunities for “doing well by doing good.” As a vertically integrated company, FMCNA is well positioned to drive out waste, standardize laboratory tests, and remain flexible in implementing technologic innovations.RisksThe major risk faced by all providers is the disproportionately large 3% “transition budget-neutrality” adjustment factor applied to all payments. The CMS used outpatient and inpatient claims to project the financial impact of participating fully in the ESRD PPS, including patient case-mix and prevalence of documented comorbid conditions; these calculations were not reproducible by providers.10Mayne T.J. Burgess M. Weldon J. Finding the case mix adjusters in the bundle.Nephrol News Issues. 2010; 24 (37-38, 40): 34PubMed Google Scholar The 3% factor that the CMS estimated failed to anticipate provider behavioral changes in predicting the opt-in rate. We have learned from the Kidney Care Council that 98% of 4,469 member facilities surveyed by The Moran Company fully opted in to the PPS. The expectation is that the CMS will decrease this added penalty through a transparent process open to stakeholders or the legislative process to a level that is consistent with the statutory mandate that implementation be budget neutral.Prior concerns for inadequate payment to cover oral drugs without intravenous equivalents were alleviated temporarily by the decision to postpone implementation until 2014, consistent with an interagency recommendation to study the potential impact of this plan.11Government Accounting OfficeEnd-Stage Renal Disease: CMS Should Monitor Access to and Quality of Dialysis Care After Implementation of the New Bundled Payment System. GAO, Washington, DC2010Google Scholar However, it is uncertain how this issue will be resolved.ChallengesThe major challenge for the CMS, physicians, and providers is to develop the electronic health record infrastructure that will support timely and accurate billing information and allow appropriate monitoring of the impacts of the new bundle. Providers must rely on individual physicians to accurately document comorbid illnesses, updating these regularly to ensure proper adjustments for reimbursement. Because the CMS used comorbidity data from hospital billing information, prospectively acquired comorbid data from the facilities requires thorough review to reliably determine future payment adjusters. Currently, this infrastructure rests on limited claims data. In the near future, the CMS will rely on the CROWNWeb system to increase its capability to accept and analyze more relevant information. Maturation of the QIP into a more comprehensive quality system requires both a functional and reliable CROWNWeb and vigilant stakeholder participation in determining evidence-based quality indicators. Finally, the CMS should address laboratory variability to ensure that QIP-related results are directly comparable, especially if small changes in the distribution of results, as in the case of hemoglobin level, can substantially affect reimbursement.VisionAs stewards of public funds, the CMS and the dialysis industry have a responsibility to support sustainable high-quality care for dialysis patients. Efficient affordable care should be balanced by accountability. Therefore, we see this new PPS as a step in the right direction. Maturation of the program may require development of full or partial accountable care organizations,12Lowell K.H. Bertko J. The Accountable Care Organization (ACO) model: building blocks for success.J Ambul Care Manage. 2010; 33: 81-88Crossref PubMed Scopus (25) Google Scholar a concept that should be explored further. FMCNA will always advocate for the most efficient and effective delivery of the appropriate best available therapy to patients entrusted to our care. On August 12, 2010, the US Centers for Medicare & Medicaid Services (CMS) published the End-Stage Renal Disease (ESRD) prospective payment system (PPS) final rule, redefining reimbursement for dialysis services.1Centers for Medicare & Medicaid ServicesMedicare program; end-stage renal disease prospective payment system Final rule.Fed Regist. 2010; 75: 49029-49214PubMed Google Scholar Dialysis providers had the option to phase in over a 4-year period or to fully operate under the new “bundled” payment system effective January 1, 2011. Fresenius Medical Care, North America (FMCNA), the largest provider of dialysis services in the United States, elected to fully opt in, with all our dialysis units adopting the expanded bundle payment. FMCNA believes that this is the right decision for the patients we treat, for the physicians who care for them, and for the company, recognizing the challenges, risks, and opportunities that lie ahead. The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA)2Medicare Improvements for Patients and Providers Act of 2008. Medicare, Provisions Relating to Part B, Other Payment and Coverage Improvements. Pub L No. 110-275, §153(a) (2008).Google Scholar established the broad framework to expand the case-mix–adjusted global payment for dialysis treatments by including intravenous medications (and their oral equivalents) and dialysis-related laboratory tests, along with regular annual payment adjustments to be implemented by the CMS. Perceived challenges, risks, and opportunities to the PPS payment have been reviewed,3Patel U.D. Mehrotra R. Himmelfarb J. The new prospective payment system for outpatient dialysis services: potential benefits and pitfalls.NephSAP End-Stage Renal Dis. 2010; 9: 347-351Google Scholar and before the release of the final rule, the proposed PPS also was vetted by stakeholders,4Sedor J.R. Watnick S. Patel U.D. et al.ASN End-Stage Renal Disease Task Force: perspective on prospective payments for renal dialysis facilities.J Am Soc Nephrol. 2010; 21: 1235-1237Crossref PubMed Scopus (20) Google Scholar including in a recent issue of the American Journal of Kidney Diseases.5Weiner D.E. Watnick S.G. The 2009 proposed rule for prospective ESRD payment: historical perspectives and public policies—bundle up!.Am J Kidney Dis. 2010; 55: 217-222Abstract Full Text Full Text PDF PubMed Scopus (12) Google Scholar After thorough evaluation, FMCNA concluded that: (1) the ability to manage the bundle payment for our dialysis services will allow for the greatest flexibility to tailor care for each patient, with the best quality and greatest efficiency; (2) the company is well positioned to face the challenges and embrace the opportunities presented; and (3) opting “all in” will enable one strategy and one focus (in contrast to straddling between old and new payment systems) for implementing appropriate processes of care required to succeed in this new environment. OpportunitiesThe key principle for continued success involves optimally aligning incentives for patients, physicians, payers (specifically the CMS), and the provider (Fig 1).Patient-Centered CareOptimizing health reduces hospitalization while increasing longevity and enhancing quality of life. This principle reflects the primary goal of all health care systems, including dialysis providers. Under the expanded bundle, payment for dialysis is significantly greater within the first 120 days of initiating therapy and the CMS waives the “noncoverage” clause for the first 90 days for Medicare-eligible patients who opt for home therapies. Because morbidity and mortality also are greatest during the first 120 days,6US Renal Data SystemUSRDS 2010 Annual Data Report: Atlas of Chronic Kidney and End-Stage Renal Disease in the United States. National Institutes of Health, National Institute of Diabetes and Digestive and Kidney Diseases, Bethesda, MD2010Google Scholar FMCNA has developed several programs designed to empower patients in making and implementing treatment choices at the time of dialysis therapy initiation, if not before. These include the well-established proprietary RightStart program, which focuses on optimizing care in the first 120 days of dialysis therapy initiation7Wingard R.L. Pupim L.B. Krishnan M. Shintani A. Ikizler T.A. Hakim R.M. Early intervention improves mortality and hospitalization rates in incident hemodialysis patients: RightStart program.Clin J Am Soc Nephrol. 2007; 2: 1170-1175Crossref PubMed Scopus (59) Google Scholar; Treatment Options, a predialysis education program; RightReturn, which focuses on care in the immediate posthospitalization period; and the upcoming RightCare, with an emphasis on optimizing predialysis care. We continue to support Fistula First, but in conjunction with a catheter reduction program.8Lacson Jr, E. Lazarus J.M. Himmelfarb J. Ikizler T.A. Hakim R.M. Balancing Fistula First with catheters last.Am J Kidney Dis. 2007; 50: 379-395Abstract Full Text Full Text PDF PubMed Scopus (125) Google ScholarPhysician-Driven CareThe physician is the best advocate for optimizing patient health. This responsibility begins before initiating dialysis therapy and continues after starting dialysis. We will pursue greater collaboration with physicians to maximize the participation of patients in the FMCNA programs mentioned, designed to improve early outcomes and promote home therapy. Active participation by physicians in decision making through regional and national medical advisory boards will be crucial in this new environment, particularly in the review and selection of the best evidence-based medical interventions, algorithms, and care processes. These medical advisory board physicians, in collaboration with the Pharmacy and Therapeutics Committee, will educate their peers in the application of best practice algorithms for most patients, but also in individualizing therapy when appropriate. They will be updated constantly with information gleaned from analyzing electronic health data and may recommend initiatives for comparative effectiveness research. A stronger physician influence, evolving into a well-balanced physician-provider relationship within FMCNA, is anticipated moving forward.Efficient Delivery of High-Quality CareCongress addressed increasing costs of providing dialysis care while preserving access for all patient beneficiaries by financially rewarding high-quality efficient care delivery. For example, the PPS promotes home dialysis by keeping reimbursement constant regardless of location, although CMS-estimated costs for home therapies are lower. Additionally, a Quality Incentive Program (QIP) withholds up to 2% of facility payments based on meeting certain thresholds. This QIP is the first attempt by the CMS to link reimbursement with quality targets, beginning with adequacy and anemia standards. New quality standards currently are being developed, and to be successful, it is critical that the CMS considers input from all stakeholders. A collaborative consultative transparent process with careful consideration of evidence-based outcomes, feasibility of data collection, and accuracy of proposed measures is essential when considering future quality standards. FMCNA believes that for the QIP to become a mature and robust quality incentive, the CMS should redistribute the amount withheld from underperforming facilities to those that have achieved high-quality care.Leveraging Provider Expertise to Deliver Efficient Affordable CareDecreasing hospitalizations while increasing longevity is good for patients and providers alike. Success here will decrease facility fixed costs, reflecting that payment is rendered only when dialysis sessions occur. Accordingly, patient-facility incentives are aligned because it is in the provider's best interest to optimize patient health, thereby maximizing provision of outpatient dialysis as prescribed by the physician. This goal is achieved by promoting self-care and patient empowerment to select home therapies, decreasing catheter rates (a major cause of morbidity), and decreasing rehospitalization. Increasing efficiency is imperative because the original composite rate payment has been progressively and substantially devalued by ongoing inflation.5Weiner D.E. Watnick S.G. The 2009 proposed rule for prospective ESRD payment: historical perspectives and public policies—bundle up!.Am J Kidney Dis. 2010; 55: 217-222Abstract Full Text Full Text PDF PubMed Scopus (12) Google Scholar, 9Iglehart J.K. The American health care system The End Stage Renal Disease Program.N Engl J Med. 1993; 328: 366-371Crossref PubMed Scopus (71) Google Scholar The new ESRD PPS has a mechanism to update the base rate annually, which was lacking in the previous system, simultaneously enhancing provider viability and program sustainability. Overall, despite attendant risks and operational challenges, the bundle provides opportunities for “doing well by doing good.” As a vertically integrated company, FMCNA is well positioned to drive out waste, standardize laboratory tests, and remain flexible in implementing technologic innovations. The key principle for continued success involves optimally aligning incentives for patients, physicians, payers (specifically the CMS), and the provider (Fig 1). Patient-Centered CareOptimizing health reduces hospitalization while increasing longevity and enhancing quality of life. This principle reflects the primary goal of all health care systems, including dialysis providers. Under the expanded bundle, payment for dialysis is significantly greater within the first 120 days of initiating therapy and the CMS waives the “noncoverage” clause for the first 90 days for Medicare-eligible patients who opt for home therapies. Because morbidity and mortality also are greatest during the first 120 days,6US Renal Data SystemUSRDS 2010 Annual Data Report: Atlas of Chronic Kidney and End-Stage Renal Disease in the United States. National Institutes of Health, National Institute of Diabetes and Digestive and Kidney Diseases, Bethesda, MD2010Google Scholar FMCNA has developed several programs designed to empower patients in making and implementing treatment choices at the time of dialysis therapy initiation, if not before. These include the well-established proprietary RightStart program, which focuses on optimizing care in the first 120 days of dialysis therapy initiation7Wingard R.L. Pupim L.B. Krishnan M. Shintani A. Ikizler T.A. Hakim R.M. Early intervention improves mortality and hospitalization rates in incident hemodialysis patients: RightStart program.Clin J Am Soc Nephrol. 2007; 2: 1170-1175Crossref PubMed Scopus (59) Google Scholar; Treatment Options, a predialysis education program; RightReturn, which focuses on care in the immediate posthospitalization period; and the upcoming RightCare, with an emphasis on optimizing predialysis care. We continue to support Fistula First, but in conjunction with a catheter reduction program.8Lacson Jr, E. Lazarus J.M. Himmelfarb J. Ikizler T.A. Hakim R.M. Balancing Fistula First with catheters last.Am J Kidney Dis. 2007; 50: 379-395Abstract Full Text Full Text PDF PubMed Scopus (125) Google Scholar Optimizing health reduces hospitalization while increasing longevity and enhancing quality of life. This principle reflects the primary goal of all health care systems, including dialysis providers. Under the expanded bundle, payment for dialysis is significantly greater within the first 120 days of initiating therapy and the CMS waives the “noncoverage” clause for the first 90 days for Medicare-eligible patients who opt for home therapies. Because morbidity and mortality also are greatest during the first 120 days,6US Renal Data SystemUSRDS 2010 Annual Data Report: Atlas of Chronic Kidney and End-Stage Renal Disease in the United States. National Institutes of Health, National Institute of Diabetes and Digestive and Kidney Diseases, Bethesda, MD2010Google Scholar FMCNA has developed several programs designed to empower patients in making and implementing treatment choices at the time of dialysis therapy initiation, if not before. These include the well-established proprietary RightStart program, which focuses on optimizing care in the first 120 days of dialysis therapy initiation7Wingard R.L. Pupim L.B. Krishnan M. Shintani A. Ikizler T.A. Hakim R.M. Early intervention improves mortality and hospitalization rates in incident hemodialysis patients: RightStart program.Clin J Am Soc Nephrol. 2007; 2: 1170-1175Crossref PubMed Scopus (59) Google Scholar; Treatment Options, a predialysis education program; RightReturn, which focuses on care in the immediate posthospitalization period; and the upcoming RightCare, with an emphasis on optimizing predialysis care. We continue to support Fistula First, but in conjunction with a catheter reduction program.8Lacson Jr, E. Lazarus J.M. Himmelfarb J. Ikizler T.A. Hakim R.M. Balancing Fistula First with catheters last.Am J Kidney Dis. 2007; 50: 379-395Abstract Full Text Full Text PDF PubMed Scopus (125) Google Scholar Physician-Driven CareThe physician is the best advocate for optimizing patient health. This responsibility begins before initiating dialysis therapy and continues after starting dialysis. We will pursue greater collaboration with physicians to maximize the participation of patients in the FMCNA programs mentioned, designed to improve early outcomes and promote home therapy. Active participation by physicians in decision making through regional and national medical advisory boards will be crucial in this new environment, particularly in the review and selection of the best evidence-based medical interventions, algorithms, and care processes. These medical advisory board physicians, in collaboration with the Pharmacy and Therapeutics Committee, will educate their peers in the application of best practice algorithms for most patients, but also in individualizing therapy when appropriate. They will be updated constantly with information gleaned from analyzing electronic health data and may recommend initiatives for comparative effectiveness research. A stronger physician influence, evolving into a well-balanced physician-provider relationship within FMCNA, is anticipated moving forward. The physician is the best advocate for optimizing patient health. This responsibility begins before initiating dialysis therapy and continues after starting dialysis. We will pursue greater collaboration with physicians to maximize the participation of patients in the FMCNA programs mentioned, designed to improve early outcomes and promote home therapy. Active participation by physicians in decision making through regional and national medical advisory boards will be crucial in this new environment, particularly in the review and selection of the best evidence-based medical interventions, algorithms, and care processes. These medical advisory board physicians, in collaboration with the Pharmacy and Therapeutics Committee, will educate their peers in the application of best practice algorithms for most patients, but also in individualizing therapy when appropriate. They will be updated constantly with information gleaned from analyzing electronic health data and may recommend initiatives for comparative effectiveness research. A stronger physician influence, evolving into a well-balanced physician-provider relationship within FMCNA, is anticipated moving forward. Efficient Delivery of High-Quality CareCongress addressed increasing costs of providing dialysis care while preserving access for all patient beneficiaries by financially rewarding high-quality efficient care delivery. For example, the PPS promotes home dialysis by keeping reimbursement constant regardless of location, although CMS-estimated costs for home therapies are lower. Additionally, a Quality Incentive Program (QIP) withholds up to 2% of facility payments based on meeting certain thresholds. This QIP is the first attempt by the CMS to link reimbursement with quality targets, beginning with adequacy and anemia standards. New quality standards currently are being developed, and to be successful, it is critical that the CMS considers input from all stakeholders. A collaborative consultative transparent process with careful consideration of evidence-based outcomes, feasibility of data collection, and accuracy of proposed measures is essential when considering future quality standards. FMCNA believes that for the QIP to become a mature and robust quality incentive, the CMS should redistribute the amount withheld from underperforming facilities to those that have achieved high-quality care. Congress addressed increasing costs of providing dialysis care while preserving access for all patient beneficiaries by financially rewarding high-quality efficient care delivery. For example, the PPS promotes home dialysis by keeping reimbursement constant regardless of location, although CMS-estimated costs for home therapies are lower. Additionally, a Quality Incentive Program (QIP) withholds up to 2% of facility payments based on meeting certain thresholds. This QIP is the first attempt by the CMS to link reimbursement with quality targets, beginning with adequacy and anemia standards. New quality standards currently are being developed, and to be successful, it is critical that the CMS considers input from all stakeholders. A collaborative consultative transparent process with careful consideration of evidence-based outcomes, feasibility of data collection, and accuracy of proposed measures is essential when considering future quality standards. FMCNA believes that for the QIP to become a mature and robust quality incentive, the CMS should redistribute the amount withheld from underperforming facilities to those that have achieved high-quality care. Leveraging Provider Expertise to Deliver Efficient Affordable CareDecreasing hospitalizations while increasing longevity is good for patients and providers alike. Success here will decrease facility fixed costs, reflecting that payment is rendered only when dialysis sessions occur. Accordingly, patient-facility incentives are aligned because it is in the provider's best interest to optimize patient health, thereby maximizing provision of outpatient dialysis as prescribed by the physician. This goal is achieved by promoting self-care and patient empowerment to select home therapies, decreasing catheter rates (a major cause of morbidity), and decreasing rehospitalization. Increasing efficiency is imperative because the original composite rate payment has been progressively and substantially devalued by ongoing inflation.5Weiner D.E. Watnick S.G. The 2009 proposed rule for prospective ESRD payment: historical perspectives and public policies—bundle up!.Am J Kidney Dis. 2010; 55: 217-222Abstract Full Text Full Text PDF PubMed Scopus (12) Google Scholar, 9Iglehart J.K. The American health care system The End Stage Renal Disease Program.N Engl J Med. 1993; 328: 366-371Crossref PubMed Scopus (71) Google Scholar The new ESRD PPS has a mechanism to update the base rate annually, which was lacking in the previous system, simultaneously enhancing provider viability and program sustainability. Overall, despite attendant risks and operational challenges, the bundle provides opportunities for “doing well by doing good.” As a vertically integrated company, FMCNA is well positioned to drive out waste, standardize laboratory tests, and remain flexible in implementing technologic innovations. Decreasing hospitalizations while increasing longevity is good for patients and providers alike. Success here will decrease facility fixed costs, reflecting that payment is rendered only when dialysis sessions occur. Accordingly, patient-facility incentives are aligned because it is in the provider's best interest to optimize patient health, thereby maximizing provision of outpatient dialysis as prescribed by the physician. This goal is achieved by promoting self-care and patient empowerment to select home therapies, decreasing catheter rates (a major cause of morbidity), and decreasing rehospitalization. Increasing efficiency is imperative because the original composite rate payment has been progressively and substantially devalued by ongoing inflation.5Weiner D.E. Watnick S.G. The 2009 proposed rule for prospective ESRD payment: historical perspectives and public policies—bundle up!.Am J Kidney Dis. 2010; 55: 217-222Abstract Full Text Full Text PDF PubMed Scopus (12) Google Scholar, 9Iglehart J.K. The American health care system The End Stage Renal Disease Program.N Engl J Med. 1993; 328: 366-371Crossref PubMed Scopus (71) Google Scholar The new ESRD PPS has a mechanism to update the base rate annually, which was lacking in the previous system, simultaneously enhancing provider viability and program sustainability. Overall, despite attendant risks and operational challenges, the bundle provides opportunities for “doing well by doing good.” As a vertically integrated company, FMCNA is well positioned to drive out waste, standardize laboratory tests, and remain flexible in implementing technologic innovations. RisksThe major risk faced by all providers is the disproportionately large 3% “transition budget-neutrality” adjustment factor applied to all payments. The CMS used outpatient and inpatient claims to project the financial impact of participating fully in the ESRD PPS, including patient case-mix and prevalence of documented comorbid conditions; these calculations were not reproducible by providers.10Mayne T.J. Burgess M. Weldon J. Finding the case mix adjusters in the bundle.Nephrol News Issues. 2010; 24 (37-38, 40): 34PubMed Google Scholar The 3% factor that the CMS estimated failed to anticipate provider behavioral changes in predicting the opt-in rate. We have learned from the Kidney Care Council that 98% of 4,469 member facilities surveyed by The Moran Company fully opted in to the PPS. The expectation is that the CMS will decrease this added penalty through a transparent process open to stakeholders or the legislative process to a level that is consistent with the statutory mandate that implementation be budget neutral.Prior concerns for inadequate payment to cover oral drugs without intravenous equivalents were alleviated temporarily by the decision to postpone implementation until 2014, consistent with an interagency recommendation to study the potential impact of this plan.11Government Accounting OfficeEnd-Stage Renal Disease: CMS Should Monitor Access to and Quality of Dialysis Care After Implementation of the New Bundled Payment System. GAO, Washington, DC2010Google Scholar However, it is uncertain how this issue will be resolved. The major risk faced by all providers is the disproportionately large 3% “transition budget-neutrality” adjustment factor applied to all payments. The CMS used outpatient and inpatient claims to project the financial impact of participating fully in the ESRD PPS, including patient case-mix and prevalence of documented comorbid conditions; these calculations were not reproducible by providers.10Mayne T.J. Burgess M. Weldon J. Finding the case mix adjusters in the bundle.Nephrol News Issues. 2010; 24 (37-38, 40): 34PubMed Google Scholar The 3% factor that the CMS estimated failed to anticipate provider behavioral changes in predicting the opt-in rate. We have learned from the Kidney Care Council that 98% of 4,469 member facilities surveyed by The Moran Company fully opted in to the PPS. The expectation is that the CMS will decrease this added penalty through a transparent process open to stakeholders or the legislative process to a level that is consistent with the statutory mandate that implementation be budget neutral. Prior concerns for inadequate payment to cover oral drugs without intravenous equivalents were alleviated temporarily by the decision to postpone implementation until 2014, consistent with an interagency recommendation to study the potential impact of this plan.11Government Accounting OfficeEnd-Stage Renal Disease: CMS Should Monitor Access to and Quality of Dialysis Care After Implementation of the New Bundled Payment System. GAO, Washington, DC2010Google Scholar However, it is uncertain how this issue will be resolved. ChallengesThe major challenge for the CMS, physicians, and providers is to develop the electronic health record infrastructure that will support timely and accurate billing information and allow appropriate monitoring of the impacts of the new bundle. Providers must rely on individual physicians to accurately document comorbid illnesses, updating these regularly to ensure proper adjustments for reimbursement. Because the CMS used comorbidity data from hospital billing information, prospectively acquired comorbid data from the facilities requires thorough review to reliably determine future payment adjusters. Currently, this infrastructure rests on limited claims data. In the near future, the CMS will rely on the CROWNWeb system to increase its capability to accept and analyze more relevant information. Maturation of the QIP into a more comprehensive quality system requires both a functional and reliable CROWNWeb and vigilant stakeholder participation in determining evidence-based quality indicators. Finally, the CMS should address laboratory variability to ensure that QIP-related results are directly comparable, especially if small changes in the distribution of results, as in the case of hemoglobin level, can substantially affect reimbursement. The major challenge for the CMS, physicians, and providers is to develop the electronic health record infrastructure that will support timely and accurate billing information and allow appropriate monitoring of the impacts of the new bundle. Providers must rely on individual physicians to accurately document comorbid illnesses, updating these regularly to ensure proper adjustments for reimbursement. Because the CMS used comorbidity data from hospital billing information, prospectively acquired comorbid data from the facilities requires thorough review to reliably determine future payment adjusters. Currently, this infrastructure rests on limited claims data. In the near future, the CMS will rely on the CROWNWeb system to increase its capability to accept and analyze more relevant information. Maturation of the QIP into a more comprehensive quality system requires both a functional and reliable CROWNWeb and vigilant stakeholder participation in determining evidence-based quality indicators. Finally, the CMS should address laboratory variability to ensure that QIP-related results are directly comparable, especially if small changes in the distribution of results, as in the case of hemoglobin level, can substantially affect reimbursement. VisionAs stewards of public funds, the CMS and the dialysis industry have a responsibility to support sustainable high-quality care for dialysis patients. Efficient affordable care should be balanced by accountability. Therefore, we see this new PPS as a step in the right direction. Maturation of the program may require development of full or partial accountable care organizations,12Lowell K.H. Bertko J. The Accountable Care Organization (ACO) model: building blocks for success.J Ambul Care Manage. 2010; 33: 81-88Crossref PubMed Scopus (25) Google Scholar a concept that should be explored further. FMCNA will always advocate for the most efficient and effective delivery of the appropriate best available therapy to patients entrusted to our care. As stewards of public funds, the CMS and the dialysis industry have a responsibility to support sustainable high-quality care for dialysis patients. Efficient affordable care should be balanced by accountability. Therefore, we see this new PPS as a step in the right direction. Maturation of the program may require development of full or partial accountable care organizations,12Lowell K.H. Bertko J. The Accountable Care Organization (ACO) model: building blocks for success.J Ambul Care Manage. 2010; 33: 81-88Crossref PubMed Scopus (25) Google Scholar a concept that should be explored further. FMCNA will always advocate for the most efficient and effective delivery of the appropriate best available therapy to patients entrusted to our care. We acknowledge helpful comments and ideas from the Fresenius Medical, Government Affairs, and Finance Departments. Financial Disclosure: The authors are employees of FMCNA.