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Kidney Care Policy, Market Shifts in Light of New and Old Challenges

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The COVID-19 public health emergency, new policy changes, and existing unmet patient needs will pressure the evolving payer, provider, and reimbursement landscape for kidney care in 2021.

The chronic kidney disease (CKD) and end-stage renal disease (ESRD) patient populations are under increasing focus from government programs, established payer and provider stakeholders, and emerging specialty companies seeking to disrupt the care environment and address long-standing disparities in care. In the year ahead, Avalere is tracking 5 critical issues in the kidney care space that will inform how treatment is delivered and paid for in 2021 and beyond.

Key Factors Informing Kidney Care Access and Payment
Key Factors Informing Kidney Care Access and Payment

COVID-19’s Lasting Mark on Kidney Care

Due to the elevated risks that COVID-19 presents, the CKD, ESRD, and post-transplant populations, providers have had to modify their approach to engaging, diagnosing, and treating these patients. For dialysis facilities, this included establishing new protocols to screen and triage at-risk patients and establish specific schedules or separate sites of care for potentially COVID-positive patients. Policymakers also established a number of flexibilities for these providers to utilize tele-nephrology for the first time and waived previous requirements for face-to-face visits between home dialysis patients and their managing clinicians. Uncertainty remains whether the Biden Administration or Congress will seek to expand these flexibilities; nephrologists and dialysis organizations will need to consider the longer-term prospects of greater home dialysis and tele-nephrology as the potential “new normal” for the CKD and ESRD patients. Moving forward, telemedicine flexibilities and expanded digital health capabilities can also drive better and more equitable care for this vulnerable patient population.

Medicare Advantage’s Increasing Role in Kidney Care

Due to the implementation of provisions from the 21st Century Cures Act, this year marked the first time when Medicare ESRD patients could actively enroll into any Medicare Advantage (MA) plan. The extent to which patients migrate from traditional Medicare to MA plans will be crucial to monitor for these stakeholders for two key reasons:

  • Avalere analyses indicate that ESRD fee-for-service (FFS) costs exceed the MA payment rate in 10 of the top 15 metropolitan statistical areas based on total ESRD patient population. While CMS and Congress have not made any major changes to the payment methodology, stakeholders may consider if a change is warranted and how a payment change could alter coverage and treatment incentives.
  • Avalere research identified demographic differences between FFS and MA ESRD patient populations, which suggest ESRD patients in FFS are more often beneficiaries who are racial or ethnic minorities and dually-eligible for Medicare and Medicaid. Plans and other stakeholders should analyze the extent to which the ESRD population transitioned to MA and whether these plans are appropriate tailored to these patients’ needs.

In the past year, CMS also changed the network adequacy requirements for MA plans related to outpatient dialysis facilities, which could allow for new contracting arrangements between plans and dialysis providers. Given these risks and flexibilities, MA plans may rely increasingly on partnerships with emerging kidney care specialty companies to better identify and manage patients “upstream” in CKD disease progression and transition into dialysis.

Medicare Models Drive Shifts in Care Delivery

While initially introduced as part of former President Trump’s 2019 “Advancing American Kidney Health” initiative, this year will see the formal implementation of the signature payment and delivery models of that executive order. The voluntary Kidney Care Choices models present the first time Medicare is running a payment and delivery model around broader, more holistic kidney health instead of siloing the CKD and ESRD populations, incentivize participating nephrologists and offices to provide more comprehensive care management to late-stage CKD and ESRD patients. Separately, while finalized just last September, the mandatory ESRD Treatment Choices model officially started in January of this year and will require roughly 30% of dialysis facilities and managing clinicians in the US to participate. This model seeks to drive greater utilization of home dialysis and organ transplantation by introducing two-sided risk for these providers over its 6.5-year duration. The new administration and the introduction of down-side financial risk next year, creates uncertainty in terms of if and how this model could be modified in the coming months.

Paying for Innovation in a Bundled Payment System

Given the disincentives for incremental costs in Medicare’s ESRD bundled payment system, CMS recently introduced 2 new payment pathways to reduce access barriers to innovative therapies, equipment, and supplies. The Transitional Drug Add-on Payment Adjustment was established in 2016 rulemaking to account for drugs not captured in the bundle; CMS revised the payment parameters and eligibility criteria in recent years and just incorporated the only 2 products to receive this status into the bundle for the start of 2021. Similarly, CMS has since introduced and revised the Transitional Add-on Payment for New and Innovative Equipment and Supplies for qualifying equipment and supplies. Stakeholders will need to assess impacts of and engage CMS on any future revisions to these payment pathways, particularly with expected new entrants in this space in the coming years.

Opportunities to Address Gaps Through Quality Measures and Shared Decision-Making

The current measurement landscape in the kidney care space is predominately focused on facility-based hemodialysis: measures related to CKD prevention and slowing progression of disease from earlier stages to later stages remain limited. Given CMS’ interest in measures that ensure patients receive the right care at the right time, the concept of shared decision-making (SDM) among CKD patients will be pivotal as they consider treatment options. This leaves opportunities for medical societies and advocacy organizations to work with patients to develop meaningful tools for individuals in the earlier stages of their disease that may have limited knowledge on their care pathway to promote more efficient referrals and management of care options. Development of appropriate quality measures and SDM tools can help address the underlying social determinants of health driving lack of access to care for CKD patients. Addressing the needs of disparate CKD/ESRD patients can also help mitigate unnecessary costs and poorer outcomes in high-risk communities and patient populations.

Looking Ahead

Avalere is monitoring these developments and will continue to leverage its expertise across policy, market access, data analytics, and quality disciplines to assess how kidney care policy and markets evolve in the coming months. To learn more about the evolving kidney care space and how Avalere can help your business drive access and continuity of care in this dynamic time, connect with us.

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