CMS Adopts ESRD PPS and QIP Final Rule for Dialysis Services

November 11, 2015

On November 6, 2015, the Centers for Medicare and Medicaid Services (CMS) published the final rule regarding the end-stage renal disease (ESRD) prospective payment system (PPS) for renal dialysis services furnished to beneficiaries on or after January 1, 2016, and also regarding modifications to the ESRD quality incentive program (QIP). (80 Federal Register 68968, et seq.)

The final rule sets a base reimbursement rate of $230.39 per dialysis treatment for renal dialysis services provided in calendar year (CY) 2016, which is a $9.04 reduction from the CY 2015 base rate of $239.43. The final rule also codifies a statutory provision that delays the incorporation of oral-only drugs into the ESRD PPS until January 1, 2025.

In addition to finalizing the 2016 ESRD PPS payment policy, some highlights from the final rule include the following:

  • CMS finalized revisions to the case-mix payment adjustment calculation based on updated claims and cost report data and the removal of two comorbidity payment adjustments (for bacterial pneumonia and monoclonal gammopathy).
  • Total payments to ESRD facilities are expected to increase by 0.2 percent, down from the proposed rule’s estimated rate increase of 0.3 percent.
  • CMS finalized a drug designation process for: (1) determining whether a product would no longer be considered an “oral-only” drug, and (2) including new injectable and intravenous products into the bundled payment under the ESRD PPS.
  • CMS revised the criteria to receive a low-volume payment adjustment for ESRD facilities that consistently furnish a low volume of treatments (less than 4,000 per year). Of note, CMS revised the geographic proximity criterion for aggregating treatments for facilities with common ownership from 25 road miles to 5 road miles. CMS also eliminated the exemption from these criteria for grandfathered facilities.
  • CMS set forth requirements for the ESRD QIP, including the following:
    1. For PY 2019, CMS replaced the four individual dialysis adequacy clinical measures (hemodialysis adequacy – minimum delivered hemodialysis dose; peritoneal dialysis adequacy – delivered dose above minimum; pediatric hemodialysis adequacy – minimum spKt/V; and pediatric peritoneal dialysis adequacy) with a single, comprehensive clinical measure (the “dialysis adequacy” clinical measure) covering the patient populations previously captured by the four separate measures. This was done in an effort to ensure that ESRD QIP maintains broadly applicable clinical measures and captures quality metrics for as many ESRD patients as possible.
    2. Beginning with the payment year (PY) 2018, for the pain assessment and follow-up reporting measure, if a facility treats no eligible patients for reporting purposes in one of the two six-month periods evaluated, then the facility’s score will be based solely on the percentage of eligible patients treated during the other six-month period for whom the facility reports one of six conditions.
    3. Beginning with the PY 2017 ESRD QIP, CMS will modify the “small-facility adjuster” calculation to no longer be based upon the within-facility standard error. According to CMS, the revised methodology preserves the intent of the adjuster to include as many facilities in the ESRD QIP as possible while ensuring that the measure scores are reliable.
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