US seeks to cut dialysis costs with more home care

Caroline Copley & Caroline Humer -

The Trump administration is working on a new payment approach for treating kidney disease that favours lower cost care at home and transplants, a change that would upend a dialysis industry that provides care in thousands of clinics nationwide.

The goal is to reduce the $114 billion paid by the US government each year to treat chronic kidney disease and end-stage renal disease, a top area of spending. The US Centers for Medicare and Medicaid Services (CMS), which provides Medicare health benefits to more than 55 million Americans, is looking at a trial payment design that would improve care in the early stages of kidney disease, increase access to kidney transplants and favour home dialysis over clinic-based treatment, CMS head Seema Verma said in an interview.

“A lot of the way the programme has been set up, it creates a lot of perverse incentives to actually keep people in an institutional setting,” said Verma, who first signalled in a speech this year that CMS wanted to curb costs and improve quality of life for kidney disease patients through a new payment structure.

Indeed, consultants say home dialysis has been slow to take off because doctors prefer to send patients to clinics.

The changes pose a particular risk to DaVita Inc and Fresenius Medical Care AG, which operate more than 5,000 US dialysis clinics and control around 70 per cent of the market. They could also provide an opening for new rivals, including CVS Health Corp, which seeks to offer lower-cost home dialysis, and startups Cricket Health and Somatus, which focus on early intervention to slow progression to kidney failure.

“We have to be open to what I’m hearing coming out of (CMS), that they want to look at different ways for us being paid and how can we really try to create more opportunities for these patients to be better served,” Fresenius Medical Care Chief Executive Rice Powell told analysts. The company is expanding in home dialysis with its $2 billion purchase of NxStage, a US maker of home-use dialysis machines. Fresenius Medical Care said it plans to convert some dialysis clinics into “transitional care units” to train people for care at home. It aims to boost the percentage of its US customers using home dialysis to more than 15 per cent by 2022 from around 12 per cent currently.

DaVita recently launched new technology, including remote monitoring and telehealth, to improve the patient experience at home and “champions” home dialysis, a company spokeswoman said.

Nearly 15 per cent of the US adult population was suffering from chronic kidney disease in 2018, fuelled by growing rates of diabetes and hypertension, according to the government’s US Renal Data System. In 2016, more than 720,000 people were estimated to have progressed to kidney failure. That is forecast to climb as high as 1.26 million people by 2030.

Without a transplant, patients with end-stage kidney disease require dialysis to clear their blood of waste and excess fluid, which involves spending three-to-five hours hooked up to a machine three times a week.

Home dialysis would not only be cheaper, since it would not require nursing assistance once a patient is properly trained, but could be done at night, freeing people for a regular work schedule. DaVita and Fresenius Medical Care offer two forms of home dialysis: hemodialysis, which requires a machine and special filter much like in clinics, and peritoneal dialysis. — Reuters