The CMS has not disclosed how many applications it has received from providers seeking to operate ESCOs, but some observers suspect the number is low. In response to stakeholder feedback, the CMS extended the application date. ESCOs that include a large dialysis organization were given until June 23 to sign up, while those with small dialysis organizations have until Sept. 15.
“It's not likely going to be the large number of applications they were hoping for,” said Dr. Edward Jones, chairman of Kidney Care Partners, a coalition of patient advocates, dialysis professionals, care providers and manufacturers. Members of his coalition have expressed concern about the CMS' two-sided financial risk model, in which larger organizations would be able to earn shared savings but also face losses if cost and quality targets were not achieved. Smaller organizations would not face losses.
DaVita HealthCare Partners, which along with Fresenius Medical Care dominates dialysis care in the U.S., hopes to operate as many as five ESCOs. “We really believe in care coordination,” DaVita Chief Medical Officer Dr. Allen Nissenson said in a recent interview. “We want to be held accountable for the outcomes, as well as for the cost.”
But DaVita and other providers remain critical of how the CMS has implemented the program. “The economics are not great, the quality targets are not known and they haven't told us what interventions are going to be dictated by the waivers,” said Robert Sepucha, vice president of corporate affairs for Fresenius, which has submitted six applications.
Another concern is that the program's waivers won't give providers enough leeway to try new interventions that are prohibited under traditional Medicare reimbursement, such as offering low-income patients free transportation to the dialysis clinic.
The quality metrics applied to this patient population have to be specific, Jones said, because dialysis patients tend to have multiple chronic diseases and face difficult and costly treatments. “The problem is, very few of the quality measures have been field-tested, and some are tested in the general population but not in the dialysis population,” he added.
In response, the CMS said it already has published a preliminary set of quality measures covering disease management, quality of life, mortality rates, and hospitalization and readmission rates. It expects to release final details on its quality-measurement strategy by late fall. Participants can expect “substantial overlap” between the preliminary and final quality measures, the agency added.
The treatment of end-stage renal disease cost Medicare $34 billion in 2011, about 6% of all Medicare spending. Hemodialysis for end-stage renal disease costs the program about $88,000 annually per patient.