ETC Model: How One Small Dialysis Organization Is Navigating Uncharted Policy Waters

The ETC model proposes to increase access to home dialysis and transplant for patients with ESRD. Implementation of this model is happening while many dialysis organizations are still suffering the far-reaching effects of the coronavirus disease 2019 (COVID-19) pandemic. In addition, the model has the potential to negatively affect small and independent dialysis organizations disproportionately. It incentivizes home dialysis over transplant and promotes development of new home dialysis programs, rewards achievement over improvement, and places an excessive burden on small and independent dialysis organizations. Advantages of the program include the focus on self-care as an acceptable alternative to home dialysis for some patients and the potential for some organizations to make improvements in care with increased reimbursements. The authors hope that the Centers for Medicare and Medicaid Services will address many of these concerns in updated rulemaking and guidance. The ETC model proposes to increase access to home dialysis and transplant for patients with ESRD. Implementation of this model is happening while many dialysis organizations are still suffering the far-reaching effects of the coronavirus disease 2019 (COVID-19) pandemic. In addition, the model has the potential to negatively affect small and independent dialysis organizations disproportionately. It incentivizes home dialysis over transplant and promotes development of new home dialysis programs, rewards achievement over improvement, and places an excessive burden on small and independent dialysis organizations. Advantages of the program include the focus on self-care as an acceptable alternative to home dialysis for some patients and the potential for some organizations to make improvements in care with increased reimbursements. The authors hope that the Centers for Medicare and Medicaid Services will address many of these concerns in updated rulemaking and guidance. Clinical Summary•The ETC model promotes home dialysis and transplant by incentivizing programs that increase the use of these modalities.•Owing to the lack of resources, SDOs/IDOs may be unable to start new home dialysis programs on time to take advantage of Performance Payments Adjustments beginning from July 1, 2022, which may negatively impact their financial performance.•The negative impact to SDOs/IDOs may also result from the inability to aggregate, heavier weighting for home dialysis over transplant, and achievement over improvement.•There are ways CMS could address ETC model concerns in final rulemaking to mitigate potentially disastrous effects on SDOs. •The ETC model promotes home dialysis and transplant by incentivizing programs that increase the use of these modalities.•Owing to the lack of resources, SDOs/IDOs may be unable to start new home dialysis programs on time to take advantage of Performance Payments Adjustments beginning from July 1, 2022, which may negatively impact their financial performance.•The negative impact to SDOs/IDOs may also result from the inability to aggregate, heavier weighting for home dialysis over transplant, and achievement over improvement.•There are ways CMS could address ETC model concerns in final rulemaking to mitigate potentially disastrous effects on SDOs. Start by doing what is necessary; then do what is possible, and suddenly you are doing the impossible. —St. Francis of Assisi ESRD beneficiaries account for approximately 1% of the Medicare population and 7% of total fee-for-service (FFS) Medicare expenditure.1Kirchoff S.M. Medicare Coverage of End Stage Renal Disease (ESRD). Congressional Research Service, August 16, 2018R45290https://crsreports.congress.govGoogle Scholar In 2016, only 12% of Medicare beneficiaries were dialyzing at home in the United States. The US performance on home dialysis was low compared with other developed nations such as Hong Kong (74%), New Zealand (47%), Australia (28%), and Canada (25%). Similarly, with 39 transplants per 1000 dialysis patients, the United States lagged behind other industrialized nations.2United States Renal Data System2018 USRDS Annual Data Report: Epidemiology of Kidney Disease in the United States. Volume 2. National Institutes of Health, National Institute of Diabetes and Digestive and Kidney Diseases, Bethesda, MD2018Google Scholar On September 29, 2020, the Centers for Medicare and Medicaid Services (CMS) published the Final Rule of End-Stage Renal Disease Treatment Choices (ETC) model. The Department of Health Human Services responded to the charge to take bold action to transform how kidney diseases are prevented, diagnosed, and treated within the next decade. Its stated rationale was to increase ESRD beneficiary treatment choices and home dialysis and kidney transplant rates by payment enhancements and penalties. However, these payment enhancements and penalties are weighted heavily in the favor of home dialysis. Participation is mandatory on the part of the enrolled dialysis providers and facilities, and the model will run from January 1, 2021, through June 30, 2027. Medicare beneficiaries may only “opt out” by transferring to a nonenrolled facility. We believe that the ETC model will fundamentally change the way business is conducted by SDOs/IDOs in the years to come and may seriously impact these organizations' financial viability. CMS randomly selected 96 out of 306 hospital referral regions (HRRs) to participate in the model. Of the 2463 dialysis facilities in the selected geographic areas, 97 facilities either did not have a home dialysis program or have a corporate relationship with a home dialysis program in the HRR as of 2020. The majority of these facilities appear to belong to SDOs/IDOs. Availability and distribution of home programs are highly skewed. While the dialysis facilities in the large dialysis organizations (LDOs) almost always have a home dialysis program or a relationship with another entity in their organization within the same HRR, only 28% of SDOs/IDOs have similar relationships. Home dialysis is a valuable treatment option, but it comes with significant start-up and operational costs. We often find that patients come to dialysis with misconceptions about home dialysis that lead to a hesitation to consider this modality and a negative patient perspective. The lack of practitioners trained in home dialysis, years of focus on in-center treatment models, and lack of patient understanding of the benefits of home dialysis will take time to overcome. Expecting these systemic changes within a few years is unrealistic and potentially devastating to many care providers. Atlantic Dialysis Management Services is a for-profit, nephrologist-owned SDO operating 13 dialysis facilities in metropolitan New York City and Long Island. Six of the 13 dialysis facilities have mandatory inclusion in the ETC model. Three of the 6 facilities are in Queens County, New York, and 3 are in Nassau and Suffolk counties on Long Island. Only 2 of these 6 facilities currently offer home dialysis. Because the facilities included in the ETC model are independently owned and listed individually in the Medicare Provider Enrollment, Chain, and Ownership System, they are not eligible for aggregation under the current rules. In the past, this model allowed for greater independence and innovation among neighboring units while providing a safety net of common quality goals and economies of scale. It allowed for patient choice and allowed providers to have more voice in the way patients were treated, avoiding “one-size fits all medicine.” With the new ETC model, 4 of our facilities have to create new home dialysis programs quickly or incur significant financial losses when the Performance Payment Adjustment begins on July 1, 2022. To incentivize dialysis facilities to increase home dialysis, CMS proposes Home Dialysis Payment Adjustment (HDPA). All home dialysis treatments will receive additional payments on a sliding scale from 3% during the first measurement year (MY) to 1% in the third MY. HDPA will phase out as of December 21, 2023.3Medicare program; specialty care models to improve quality of care and reduce expenditures. Federal Register, volume 85, issue 189 (September 29, 2020). 85 FR 61114 pp 61114-61381; 42 CFR 512.Google Scholar We estimate that the HDPA for the MY 1 would be around $8 per treatment for us. This additional revenue would not be large enough to make the significant investments necessary to add new home programs to all clinics. State licensure issues, space availability to house the programs, lack of trained nursing staff, additional investments necessary for the equipment, and volume of patients needed to run these home programs efficiently are some of the concerns moving forward. The ability to run a multitude of home programs independent of each other in a financially responsible manner is particularly concerning. Performance Payments Adjustments are skewed heavily toward attaining achievement goals for home dialysis that are likely unrealistic for many dialysis providers, which makes it unlikely we will benefit from these incentives. Overall, these impending severe penalties as of July 1, 2022, overshadow the excitement of building a new, more holistic approach to patient care. The year 2020 was a watershed year for us. Even though we were aware of the coming ETC model, we were unable to prepare most of 2020 because of the coronavirus disease 2019 (COVID-19) pandemic, which hit New York City hard in the spring of that year and caused devastating damage to our operations for over a year. We hoped that CMS would delay implementing the model just as they did with the companion radiation oncology model. Instead, the model start and end dates, and the benchmark period to measure the achievement and improvement scores, were changed. In our 6 facilities in the ETC model, an additional 71 patients died in 2020 compared with 2019, a nearly 65% increase in mortality, 82% of which were due to COVID-19 (Table 1). Disruption of safety net hospitals, primary care, and other services resulted in delayed referrals and a lack of planning opportunities for home dialysis and transplants during 2020. Since the benchmark year for the ETC model is July 1, 2019, through June 30, 2020, it is not hard to imagine COVID-19 pandemic will not negatively impact our initial performance and the years to come.Table 1Mortality Data for FFS Medicare Beneficiaries in the Current ETC Model for Atlantic Dialysis Management Services-Affiliated ETC-Enrolled FacilitiesTotal BeneficiariesAs of December 31, 20191/1/2020-12/31/20201/1/2021-4/30/2021Number of FFS Medicare beneficiaries549473410Number of FFS Medicare beneficiary deaths11018135Number of FFS Medicare beneficiary deaths due to COVID-19N/A580Abbreviations: ETC, End-Stage Renal Disease Treatment Choices; FFS, fee for service; N/A, not available. Open table in a new tab Abbreviations: ETC, End-Stage Renal Disease Treatment Choices; FFS, fee for service; N/A, not available. During 2021, the start of the first performance year of the ETC model, the COVID-19 vaccine for our patients and the staff became available. Unfortunately, the difficulties in procuring the vaccine, lack of adequate supply, and a complicated distribution, administration, and storage system made it very difficult for many SDOs/IDOs to administer vaccines to large numbers of their patients and staff in a short period. This situation required a tremendous amount of resource and focus to overcome. The SDOs/IDOs frequently have fewer human resources in critical positions than their larger LDO counterparts. In times of crisis, this creates an allocation of resources conundrum, resulting in a disproportionately negative impact on SDOs/IDOs. We made the same choice that our fellow dialysis professionals made; to focus our attention on protecting the lives of our patients and staff. The tradeoff was to lose out on preparing for the ETC model. While the COVID-19 pandemic raged in the city, our operational workload skyrocketed. We had to close some of our facilities and relocate the patients and staff to other locations. Health care-wide shortages of personal protective equipment were a significant concern. Most facilities worked with a skeleton staff, and the usual encounters with social workers and other professionals in the dialysis facilities and at other health care locations were drastically limited. Visitation to most facilities was not allowed, and meetings became virtual in an industry where personal interaction is key. The real-world implications of not being able to expedite home dialysis program projects, get staff to take certification examinations, and set up new sites inspected seriously impacted our ability to increase capacity. The concern over staggering patient losses made us very apprehensive about expanding at all. All these factors seriously hampered our ability to mount a robust response to the incoming ETC model. Since the beginning of 2021, CMS has introduced several new initiatives that will impact SDOs/IDOs and focus on the ETC model. Before January 1, 2021, ESRD beneficiaries were not allowed to join Medicare Advantage plans. Over 13% of our Medicare beneficiaries have switched to these plans since 2021, taking them out of the ETC calculations. Because enrollment for these programs is still open, the number of eligible FFS Medicare beneficiaries will fluctuate in the months to come. Other CMS payment model initiatives, such as Kidney Care First and Comprehensive Kidney Care Contracting, even though primarily affecting nephrologists, will potentially compete for our attention and resources too. These models do not share identical metrics or structures with the ETC model. In addition, they frequently involve the same patient populations and have a variety of incentives and penalties, which are different from the ETC model for the facility. While these 2 models are voluntary for a provider to enroll in, it is difficult to imagine why multiple models would be introduced at once, potentially forcing providers to choose between programs, rather than benefit from the proposed improvements of each plan. In the spring, CMS postponed the commencement of Kidney Care First and Comprehensive Kidney Care Contracting programs to 2022. From the perspective of SDOs/IDOs, participating in a wide variety of programs creates confusion and decreases the ability to comply with all requirements. The impact of these competing demands on the ETC model is difficult to forecast at this time, but it is hard to imagine it being a positive one. One of our priorities was to educate everyone on the new payment model. We conducted a series of educational webinars for the facility staff, including the administrators, charge nurses, social workers, and medical directors. Because are also part of the new ETC model and their is to the at the facility we several webinars for the and to address their We also selected an lead and a lead to our the lead will with Management and Management Services to the FFS Medicare Because the ETC model the lead will use our in 1 to the number of beneficiaries that will be to the facility for the This is to the nephrologists, facility administrators, medical and social workers to the number of eligible beneficiaries for home dialysis, self-care dialysis, and transplant In we have the for the first 4 months of the first MY for the 6 facilities in the ETC model in our of (FFS) Medicare Beneficiaries for and Performance in the Current ETC Model for Atlantic Dialysis Management Services-Affiliated ETC-Enrolled From January 1, to 30, of FFS Medicare Of FFS Medicare beneficiaries because of nursing facility and Of FFS Medicare beneficiaries to facility on treatments in the of dialysis treatments in the facility and Of FFS Medicare beneficiary months on home dialysis Of FFS Medicare beneficiaries than as of the of the Of FFS Medicare than as of the of the on a transplant eligible patients Of kidney transplants ETC, End-Stage Renal Disease Treatment Beneficiaries because of nursing facility and Beneficiaries of dialysis treatments in the facility and Open table in a new tab ETC, End-Stage Renal Disease Treatment This small up another concern for The of from the ETC model to the facilities has from the of us have to the number of patients this would our initial estimate of scores, and other The of medical we the The that we use is not to that ETC model of has us to in an and other to to where we are from and of this The lead is responsible for the home dialysis programs and with to get for new home dialysis programs in the facilities that do not have a This is responsible for and the self-care dialysis program in all ETC facilities as 2 beneficiaries on self-care as home dialysis The lead is also responsible for to be at the facilities that offer home dialysis programs to increase patient referrals We are aware that some of our have not the home and we that a be This will include to home including Dialysis and Dialysis and home equipment and Dialysis and home the lead will be in the to home and potential in these programs, such as and patient care (Table of to for in the ETC patients, staff, and providers about the ETC model and with an lead and the a lead and the a system to beneficiaries and staff of patients are enrolled in the of staff to and in and ETC new home dialysis programs at that have including models, and for home programs and with the Department of Health to get these at multiple facilities to increase home dialysis at a home dialysis for and for home dialysis a and for to staff and patients in ETC, End-Stage Renal Disease Treatment Choices; medical Open table in a new tab ETC, End-Stage Renal Disease Treatment Choices; medical The self-care program is a potential where SDOs/IDOs mitigate losses because 2 self-care patients are to home dialysis patient for With 4 of our facilities that do not have a home program and of in the self-care dialysis may be the only way to get some on the improvement on home dialysis to penalties. However, currently is adequate of what self-care dialysis from the Federal or State In with in the industry Dialysis personal and the Department of Health, we have and that we hope will up to and the The program will involve all dialysis patients for and to self-care and by trained staff. self-care dialysis are in the The in-center dialysis patients the same dialysis in the facility. The dialysis is around and toward the are allowed to the their access and their and their current the for the and to the staff for in the will set up the to the end of they treatment and their of access is not a but we will the patient is We have the necessary to create 2 home dialysis programs in facilities to with and from the New York State Department of Health, we hope that this program will start in the of In addition, we are another of the home which could not start because of these programs be operational in (Table On 21, 2021, CMS updated the for MY 1 of January 1, 2021, through December 31, (Table In for implementing mandatory in the ETC model, we have necessary and to make this model for but as the ETC model is it is that we will do on the achievement for home dialysis. To in this mandatory payment model, we from CMS and for Medicare and Medicaid in several We believe that they have the to the model by and and skewed CMS reduce the number of facilities they have for from provider in the ETC model to the of facilities to impact on all our We have nearly of our facilities for the model, and are other small and independent dialysis organizations the same We hope CMS will through the rulemaking and to address this or not to With only 2 of our 6 facilities home dialysis and of new dialysis programs in the all 6 facilities would be to penalties. We would also facilities that do not have a home program to be allowed to the patients to a facility with a home This would us to on the of the program; to increase patients on home dialysis and home dialysis, rather than on patients in home for a result of our ESRD Care we our and transplant rates over the 4 transplant among FFS Medicare beneficiaries is and it is to be for In addition, it is difficult to improve these rates in a that we have over and have to the We would the on transplants to be in to home dialysis and transplant achievement metrics would us and care provider in a similar because of ESRD Care ETC model currently a more on achievement for home dialysis. achievement at the would in the of is such for an improvement (Table The 4 facilities within which do not have a home program currently will have achievement Even they were able to patients to a it is unlikely the achievement would be significant enough to make us However, by facilities that make significant to the goals of the increase access to home dialysis, with an improvement facilities would be to rather than just the of their In addition, the current model that small facilities, similar to are disproportionately for out of their care patient on home for of 1 and 2 and 1 on the Home Dialysis and in the ETC for 1 and for MY Dialysis for MY for 1 and of benchmark rates for geographic during benchmark a of benchmark rates for geographic during the benchmark than improvement to benchmark year of benchmark rates for geographic during the benchmark than improvement to benchmark year of benchmark rates for geographic during the benchmark than improvement to benchmark year of benchmark rates for geographic during the benchmark than or to benchmark year ETC, End-Stage Renal Disease Treatment Choices; measurement N/A, not available. Open table in a new tab Abbreviations: ETC, End-Stage Renal Disease Treatment Choices; measurement N/A, not available. We believe that a kidney transplant or dialysis at home are the most way to ESRD patients, and we the of CMS to increase the of patients will be at home and receive kidney transplant from either a or a However, we believe that the payment enhancements through HDPA are small to the of resources necessary to start new home dialysis programs in the facilities that do not have a program or It is highly unlikely that CMS to the SDOs/IDOs out of the because we tremendous to the SDOs/IDOs frequently lead in for dialysis We are able to our approach to patient care, providing more of a for that is frequently in larger organizations. The of are more in SDOs/IDOs. Most the and of patients are more in these organizations. It is not for our corporate to with patients on the treatment to patients us and our staff us by and of in health care is these and to it out of would be a for all While as an focus on to add small improvements to our with self-care dialysis programs, more home dialysis programs, and an increased focus on transplant, we hope CMS will consider the of the in the and how to the model to their for years to come. The authors of Atlantic Dialysis Management for in

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