Press "Enter" to skip to content

Kidney Disease Payment System Draws Medicare Scrutiny

ORLANDO — Medicare needs to change the way it pays for kidney disease treatment in order to get better results, Adam Boehler, director of the Center for Medicare & Medicaid Innovation, said here.

“We do not think the state of kidney care is acceptable,” Boehler said Wednesday at the annual meeting of the Healthcare Information and Management Systems Society. “Right now, we’re at a place where 10% of patients in Medicare [with kidney disease] are seen at home, while you have Hong Kong, with a 70% rate. That’s not OK. The level of transplants is not OK.”

“What happens is that end-stage renal disease (ESRD) is siphoned out and [effort is] focused there, instead of viewing the whole spectrum, instead of thinking about chronic kidney disease before ranging from diagnosing it in the first place, to integration of later-stage chronic kidney disease, to ESRD,” he said. “Because what you really want is the prevention of ESRD from developing,” he said. “If it develops, you want [it] to be transplant wherever possible; if not, [treatment at] home wherever possible, and it should be a last resort that people go to a dialysis center.”

“It’s something I’ve had personal experience with; my aunt died in dialysis, was never offered home dialysis, and we want to make sure people go to the appropriate places,” Boehler added.

Adam Boehler, director of the Center for Medicare & Medicaid Innovation (Photo by Joyce Frieden)

Boehler said he wasn’t trying to demonize dialysis centers. “It’s our fault; we set the incentives,” he said, referring to Medicare. “You need to change those incentives. If we want people to do what’s best for patients, if we want them to lower costs and improve quality for patients, they need to make money for doing that — we’ll look specialty by specialty to set it up like that.”

Medicare spends about $120 billion a year on kidney care, Boehler noted. “The first thing you may think about in ESRD is dialysis centers … but that is not the majority of spend. The majority of spend is in other places — hospitals, complications arising from them, et cetera. That doesn’t mean we have to cut the spend there; it means you have to change around the way people make money.” Right now, he said, for the dialysis centers, “if somebody gets a transplant, that’s a lost customer.”

Ambulance service is another area where payment needs to be changed, said Boehler. Right now, “when you call 911 and the ambulance comes, it’s only paid if it takes you to the hospital … Let’s create an incentive that’s equal, where you do what’s right for the patient. And if you want to treat them there [at home] under physician supervision, you could, and get paid the same. Or if you want to take them to a behavioral health clinic because the issue is not an ED [emergency department]-related issue, you are compensated the same. So we’re looking a lot at that.”

Although paying for ambulance services “seems like a relatively small item, 40% of Medicare admissions come in through 911; it’s huge … A very simple change can make a big difference. We’re looking for those little threads that make a big difference.”

Boehler also reiterated his interest in paying for value, not the number of services provided. “I’ve been clear publicly that one of my goals is to blow up fee-for-service over time; I’m not supportive of a system that pays for volume,” he said. Although some doctors are afraid that being paid for value means they’ll have to take on lots of risk, that’s not necessarily the case, he added.

“Value from my perspective doesn’t equate to risk; risk is not for everybody,” he said. “There are plenty of physician groups … that are not going to be fully [at financial risk]. It’s our job to say, ‘Different avenues for different people.’ You could have a lighter avenue that’s outcomes-based, that’s focused in primary care, on keeping people out of the hospital. You could have a different outcomes metric for oncologists that want to participate … The key is creating the right avenues for everybody to get involved somehow in value, even if they’re not ready to take full risk. All that is, is paying people for the right things, just making sure people make money for keeping patients healthy — and if you pay for that, you’ll get that.”