Industry Voices—CMS payment policies threaten to undermine access to kidney care

When it comes to kidney disease, the numbers speak for themselves: 130,000 Americans are diagnosed with chronic kidney disease each year, and one in three adults is at risk of developing the disease.

Without intervention, this disease can progress to kidney failure, or end-stage renal disease (ESRD), a permanent stage of kidney disease where the kidneys can no longer function on their own, requiring patients to receive a kidney transplant or dialysis treatments up to three times per week. 

The gravity of this situation cannot be understated. Our nation’s kidney care providers need support to continue to provide life-saving care amid a workforce shortage, and our nation’s kidney care patients need and deserve access to innovative therapies to treat and manage their disease just as patients with other chronic conditions routinely have access to. 

In the 51 years since the Medicare ESRD program was established, the United States has ensured that all individuals—regardless of race, ethnicity, age, or other medical conditions—have access to life-sustaining dialysis. Yet, this group of individuals experiences a disproportionate amount of inequity when it comes to accessing innovative treatment options. We are also now seeing new disparities in access to the right healthcare providers as Medicare fails to provide adequate funding to address staggering inflation for dialysis providers despite providing more significant increases for hospitals, nursing homes and even home health providers.

Amidst these challenges, the Centers for Medicare and Medicaid Services (CMS) has proposed policies that will undermine the individuals they seek to serve: those living with kidney failure. 

In a recently proposed rule to update and revise the ESRD Prospective Payment System (PPS) for 2024, CMS ignores calls from the kidney care community and even bipartisan members of Congress to provide meaningful relief for the ongoing workforce crisis that is already jeopardizing access to care for patients and support access to kidney care innovations. Moreover, while it recognizes that the ESRD bundled payment rate is inadequate to support sustainable innovation, its methodology to implement the policy is woefully insufficient to meet patient needs. Unfortunately, once again, dialysis patients are being left behind as others with chronic diseases have access to the funding they need.

The proposed rule fails to address the impact of inflation and rising workforce costs adequately. Case in point: CMS has declined to apply the adjustment that other Medicare providers receive to address incorrect estimates about inflationary costs. Unless CMS reconsiders this decision, vulnerable ESRD patients nationwide will experience staff shortages that impact their quality of care and basic access to dialysis services. 

However, many facilities nationwide continue to struggle to hire sufficient staff to meet the needs of their patients. Though annual payments are intended to capture increases in labor costs and expenses related to equipment, medication, and devices, underpayments continue to plague the Medicare program. Federal data from the Bureau of Labor Statistics show an over 8% increase in the cost of labor between 2020 and 2022. Still, Medicare payment rates only increased by 3 percent for 2023, 5% less than the government’s own labor statistics. 

As a result, the risk of reduction in treatment capacity and outright closures of kidney care facilities nationwide will only increase.

Just as concerning is CMS’s recognition that the bundled payment rate for dialysis services is insufficient to support innovation. Through the proposed, flawed payment methodology for post-transitional drug add-on payment adjustment (TDAPA) drugs, CMS fails to direct new money to patients who need access to innovative products. By adding funding across all treatments, instead of directing the funding to those patients with the conditions that require the innovation, the proposed rule creates an untenable situation while purporting to support innovation.

In the case of the only innovative product currently subject to the proposal, CMS would require dialysis facilities to operate above capacity in order to receive adequate funding for providing the drug to just one patient. This policy would effectively deter physicians from prescribing next-generation therapies and stifle market potential and incentives, including potential diagnostic innovations that could detect and monitor chronic kidney disease earlier, which is one of the Administration's goals.

Yet, making three simple changes to the methodology, as follows, (1) having money follow the patient; (2) reducing the amount of the add-on by the funding already in the base for treating the condition; and (3) making the add-on its own permanent capitated amount, CMS could protect access for patients who need these products and inspire other innovative researchers to develop new therapies to address other gaps in treatment.

Taking these steps would ensure that dialysis patients—who are disproportionately Black, low-income and living in medically underserved areas—can access improvements and innovation in treatment, which has long been accessible to patients with cancer, heart disease and other chronic diseases. 

CMS itself recognizes ESRD patients as among the most vulnerable of all beneficiaries. That makes the agency’s unwillingness to address ongoing labor and innovation concerns all the more mystifying and disconcerting. By doubling down on inadequate reimbursements for innovative treatments, CMS has erected new access barriers while failing to address health equity concerns that have long been present. Given that patients living with kidney disease or ESRD disproportionately come from communities of color, this rule—and the proposed way it seeks to reimburse new drugs and treatments—will only worsen health disparities.

Altogether, the provisions outlined in CMS’ proposed rule for the ESRD payment system for 2024 will exacerbate the ongoing workforce challenges and stop innovation in its tracks—undermining rather than improving vital kidney care that patients need more now than ever. CMS should go back to the drawing board and listen to the concerns of providers, patients and members of Congress calling for more to be done to address these issues. 

John P. Butler, is the chair of Kidney Care Partners and president & CEO of Akebia Therapeutics. Mahesh Krishnan, M.D., is the chair-elect of Kidney Care Partners and group vice president, research and development, at DaVita Kidney Care