CMS proposes payment system for dialysis services

The CMS has proposed a new prospective payment system for facilities that provide dialysis services to Medicare beneficiaries who have end-stage renal disease, or ESRD. Under the proposed rule, the CMS would establish a base, bundled payment of $198.64 for all of the services related to a dialysis session, including the services included in the current composite rate, as well as oral drugs that are billed separately.

“Combining a fully bundled prospective payment system with required performance standards would encourage facilities to operate more efficiently and ensure that beneficiaries receive high-quality care, while saving dollars for both beneficiaries and the Medicare program,” said Jonathan Blum, director of the CMS' Center for Medicare Management, in a news release.

As part of the proposed rule, the CMS also said the base rate would be adjusted to reflect geographic differences in labor costs, and the agency said it proposes to provide an adjustment for low-volume facilities, as well as a policy that would make an adjustment for “particularly expensive cases.”

The CMS will accept comments on the proposed rule through Nov. 16 and will respond to them in a final rule that will be issued in 2010. The new payment system would apply to dialysis services to beneficiaries on or after Jan. 1, 2011.

According to the CMS, ERSD is the only category for Medicare eligibility that is based on a specific diagnosis without regard to the patient's age. Patients diagnosed with the disease must rely on dialysis or a kidney transplant to survive. In 2007, there were about 591 hospital-based and 4,330 free-standing ESRD facilities offering outpatient dialysis services to nearly 330,000 Medicare patients, which amounted to a cost of $9.2 billion, including the service and other related items, such as drugs.

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