March 2020, Volume XXXIII, No 12


Dialysis 2020

A look inside the black box

ccording to the National Kidney Foundation, over 500,000 Americans with end stage renal disease (ESRD) require dialysis for survival. Renal replacement treatment becomes necessary when patients have lost 85–90% of kidney function (resulting in a glomerular filtration rate of less than 15) and is typically performed three times a week at in-center clinics. The payment and treatment for kidney failure, however, is distinctive from other health care sectors. First, bold legislation in 1972 allowed Medicare reimbursements for all ESRD patients, regardless of age or income. Second, two for-profit corporations, Colorado-based DaVita Inc., and German-based Fresenius Medical Care, have emerged with 70% control of the dialysis market and 5,000 clinics across the country.

What does industry dominance by two dialysis providers mean for patients?

The nation-wide consolidation of dialysis providers has reduced industry competition. This begs the question: what is the impact on patient choice? A March 2017 Clinical Journal of the American Society of Nephrology (CJASN) article, “Consolidation in the Dialysis Industry, Patient Choice, and Local Market Competition,” evaluated this inquiry. This analysis of in-center hemodialysis clinics between 2001 and 2011 revealed an 8% decrease in the number of uniquely owned dialysis providers.

The number of facilities, however, increased by 54%, “and patients experienced an average 10% increase in the number of competing proximate facilities from which they could choose to receive dialysis.” What many patients lost in provider choice, they gained in clinic locations.

Yet, the Centers for Medicare and Medicaid Services (CMS) Administrator, Seema Verma, noted in a recent initiative, “Rethinking Rural Health,” that one in five Americans—about 60 million people—live in rural areas. Rural ESRD patients have reduced access to primary care physicians and nephrologists and increased travel times to dialysis centers. Statistics from the Minnesota Department of Health show that rural hospitals with dialysis services decreased 11.8% between 2009 and 2018. Advancements in telehealth and other virtual services allow easier health care team connections for doctor consultations and communications, but many rural areas lack adequate broadband access. Barriers to access, delivery, and oversight of dialysis care remains a pressing issue for rural ESRD patients.

How do ESRD patients evaluate the quality of dialysis facilities?

For many years, patients could not easily evaluate the performance of dialysis clinics. But in 1997, the Balanced Budget Act directed CMS to provide information on the quality of dialysis, according to the Medicare & Medicaid Research Review article, “Developing Dialysis Facility-Specific Performance Measures for Public Reporting.”

Two for-profit corporations ... have emerged with 70% control of the dialysis market

In 2000, CMS created Dialysis Facility Compare (, a website that compiles data to allow patients to review the quality of over 7,000 dialysis facilities. Medicare now grades dialysis centers on the following nine health statistics: mortality rates, hospitalizations, blood transfusions, hypercalcemia levels, hemodialysis clearance rates for adults and children, peritoneal clearance rates for adults, total patients with fistulas, and the number of patients using catheters over 90 days. This data offers clinic-specific performance on quality indicators to inform patients as they select a dialysis facility with their nephrologist.

Despite readily available clinic performance data, the dominance of two main dialysis providers elicits unease among patient advocates. They cite a hefty list of settlements as a reason for growing concerns.

Recent CMS Settlements

Consider these recent settlements:

In 2018, DaVita Medical Group paid a $270 million settlement to CMS for False Claim Act allegations that inaccurate information submitted to Medicare resulted in inflated payments. In 2019, Fresenius resolved allegations that they overbilled Medicare for unnecessary Hepatitis B testing with a payment of $5.2 million.

Inaccurate information submitted by providers to increase Medicare payments undermines the dialysis program for those who need it. Plus, Americans taxpayers pick up the tab. The government response to fraudulent practices also highlights the intersecting interests between dialysis providers, Medicare, and patient safety.

For example, after a 2012 case alleging that DaVita over-used and double-billed the government for vials of the anemia medication, Epogen, Medicare changed their fee-for-service reimbursement structure. Rather than reimburse for the quantity of Epogen used per patient, Medicare “bundled” services and medications into a set payment. The result? In a complete reversal, Medicare incentivized dialysis providers to use less Epogen, as opposed to more. Where does this leave patients?

Medicare coverage, reimbursement rates, cost control, and patient safety

When a patient is on Medicare solely due to ESRD and covered by a group health plan (GHP), Medicare is the secondary payer for 30 months. After this 30-month coordination period, Medicare becomes the primary payer. Between 1983 and 2011, according to the 2017 CJASN article, Medicare reimbursements were “virtually unchanged, leading to significant declines in reimbursement after adjusting for inflation.” The bigger dialysis providers, with improved economies of scale and purchasing leverage, managed reduced fees better than smaller ones, fueling their ascendency within the industry.

Similar to other for-profit companies, dialysis companies cut costs when they face revenue shortfalls. But unlike a Big Box retailer, cost reductions in the dialysis industry affects patient outcomes. For example, Medicare reimburses a fixed amount for a dialysis treatment—so payment for a three-hour dialysis treatment is the same rate as for a four-hour treatment. Even though the Dialysis Outcomes and Practice Patterns Study (DOPPS) reports that longer runs are associated with better patient outcomes, are longer runs considered? The answer depends on the central mission—patient care or profits?

Staffing and oversight

In the U.S., technicians are the primary in-center dialysis staff members. A high school education is required for dialysis technicians before completing training and a CMS-approved certification exam. A registered nurse is on site at each facility. CMS Medicare requirements (outlined in the “Conditions for Coverage”) require a physician to see a dialysis patient at the dialysis center once every three months, with monthly mandated nephrologist office visits.

In contrast, many European countries and Japan require a majority or all of dialysis staff to be nurses. Of course, there are many factors that contribute to patient outcomes, but it is interesting to note that dialysis mortality rates are highest in the United States and lowest in Japan. If altered staffing ratios between technicians, nurses, and doctors were beneficial for patient outcomes, would staff changes be considered by dialysis providers under current reimbursement rates?

“Advancing American Kidney Health Initiative”: A new focus for the dialysis industry

The current Trump administration and CMS Administrator Seema Verma have noted the complicated interplay between cost control and patient care. In 2019, an Executive Order signed by President Trump, the Advancing American Kidney Health Initiative, launched sweeping goals and priorities to simultaneously improve kidney health and reduce Medicare costs. The primary goals for this initiative endorse actions that both government and physicians can implement to improve patient outcomes:

Accelerate prevention care. Because chronic kidney disease (CKD) often has no symptoms in the early stages, patients often have progressed to an advanced stage by the time they seek medical care, often leading to a crash (unplanned) start on dialysis. But we know that diabetes and high blood pressure are the two main risk factors for kidney disease, and African Americans, Hispanics, and American Indians face a higher risk. Individuals over 60, as well as people with kidney disease in their family, are also at higher risk for CKD.

Every U.S. taxpayer stands to benefit.

According to Dr. Mark Rosenberg, a nephrologist at the University of Minnesota Medical Center, focusing on high risk populations is essential for better prevention and awareness strategies. When nephrologists are involved earlier in the care of patients with compromised kidney function, patients can be educated to make more informed decisions about renal replacement options.

Increase rates of kidney transplantation. Donate Life America statistics reveal that approximately 100,000 Americans are waiting to receive a kidney, and a three–five year wait is average for a deceased donor. The initiative strives to improve these statistics by reforming the organ procurement and management system to increase donor supply, encourage living donation, and increase the support that living donors receive for lost wages and childcare expenses. In addition, physicians and patients should advocate for extended lifetime coverage of immunosuppressant medications for kidney transplant patients. Currently, anti-rejection medications for patients under 65 are covered by Medicare for three years post-transplant. If patients cannot afford to continue taking the medication that keeps their transplant viable, they will return to dialysis, and the cycle begins again.

Favor home dialysis treatments over in-clinic dialysis treatments. On March 4, 2019, HHS Secretary Alex Azar addressed the National Kidney Foundation on the benefits of home dialysis, and explained it is “better for patients’ self-sufficiency, and better for their physical health.” DaVita, Fresenius, and other clinics set up home dialysis training, typically after a nephrologist recommends this treatment option to his or her patient. According to the National Kidney Foundation, home treatments can be performed in short daily or nocturnal treatments, and often result in fewer medications, improved neuropathy, better sleep, and increased energy.

More frequent Medicare-covered weekly home hemodialysis treatments (five to six times a week) also reduce hospitalizations costs that occur on days between in-center treatments (when patients’ blood chemistries build up). Also, home hemodialysis is less expensive because direct care from technicians and nurses is unnecessary after the home training is complete. Home dialysis patients, similar to in-center patients, require Epogen to increase their red blood cell count. Filled through their dialysis center pharmacy, patients receive this Medicare-covered medication and inject it subcutaneously at home.

Yet, statistics from the United States Renal Data System (USRDS), the national data system that collects, analyzes, and distributes information about kidney diseases in the United States (, cites that only 8% of ESRD patients (in 2016) chose home hemodialysis treatment. This could be partly due to the high number of patients that experience crash dialysis starts, and to lack of education. As more physicians encourage qualified patients to transition from an in-center facility to home hemodialysis, overall costs and patient outcomes should improve.

What’s next? Upcoming kidney care innovations, improvements, and progress

Since Medicare first folded ESRD into its coverage, there have been few technology improvements for dialysis machines. But now, the Advancing American Kidney Health Initiative payment incentives award innovative and improved renal equipment and supplies.

As a result, the U.S. Department of Health and Human Services (HHS) and the American Society of Nephrology (ASN) have joined forces to accelerate improvements for individuals living with kidney disease. Enter Kidney X, (, a public/private partnership attempting to jumpstart dialysis industry innovation to benefit millions of kidney patients worldwide.

The initial KidneyX prize competition focused on redesigning dialysis and included patient-centered treatment options. Dr. Mark Rosenberg, past President of the American Society of Nephrology, is encouraged, “KidneyX and the Executive Order have clearly signaled that the doors are open for innovation in the kidney space and the time is now to get into it.”

New incentives spark competition

DaVita, Fresenius, and emerging competitors are paying attention to these incentives to spark dialysis innovation.

For example:

  • On March 2, 2020, CMS Kidney Care (a CVS Health company), released a press statement announcing their strategic partnership with Satellite Healthcare, a non-profit provider of dialysis services. Their goal is “to provide comprehensive kidney care, and to expand awareness of and access to transplantation and in-home dialysis initially in two locations, Los Angeles and Austin, Texas.”
  • The health care company, Baxter International Inc., announced an investment of $500 million dollars for dialysis innovation in response to incentives for home dialysis care from the Advancing American Kidney Health Initiative.
  • The Reuters article, “U.S. Seeks to Cut Dialysis Costs with More Home Care Versus Clinics,” reports that Fresenius strives to increase their home dialysis customers “to more than 15% by 2022 from around 12% currently.”
  • The same Reuters article reports that DaVita is moving forward to improve their patients’ experience with enhanced technology including telehealth and remote monitoring.

What can patients and physicians do to advocate for reduced costs, increased access, and strengthened regulations?

With improvements on the way, there is more to be done. Patient and physician advocacy for increased kidney research funding through both the NIH and KidneyX is critical to address the public health burden of CKD. Organ procurement organizations throughout the country should be accountable and monitored with more consistent metrics. Public awareness campaigns can encourage and educate high risk populations to monitor their blood pressure, blood sugar, and kidney function through blood and urine tests, leading to earlier detection. These efforts will decrease costs and help patients manage their health, awareness, and choices.


A positive interplay between Medicare payment incentives and improved quality of dialysis care is the desired outcome. It’s been a long and winding dialysis journey since the introduction of ESRD Medicare coverage in 1972. Dialysis is a lifeline for ESRD patients. More locations for in-center dialysis clinics and/or the option of home hemodialysis expands patient choices. Yet, the skyrocketing costs of the ESRD program, and cost control measures throughout the decades, can become entangled with unintended consequences impacting quality care.

The recently enacted Advancing American Kidney Health Initiative’s new payment incentives intend to align with patient outcomes. Increased dialysis industry competition and the innovative focus of Kidney X also fuels promise for improved kidney health. Time will tell if the intended consequences yield intended results. The 37 million Americans estimated to have kidney disease and every U.S. taxpayer stand to benefit from a successful outcome.

Jennifer Cramer-Miller serves on the Board of Directors for the National Kidney Foundation Serving Minnesota, is a Donate Life Ambassador, and is an ESRD Patient who has been a two-time in-center hemodialysis patient, one-time home hemodialysis patient, and four-time kidney transplant recipient. 


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Jennifer Cramer-Miller serves on the Board of Directors for the National Kidney Foundation Serving Minnesota, is a Donate Life Ambassador, and is an ESRD Patient who has been a two-time in-center hemodialysis patient, one-time home hemodialysis patient, and four-time kidney transplant recipient.