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APMXXX, Rev. X
Impact of the Bundle PPS on
Home Dialysis Economics
APMXXX, Rev. X
PPS Bundle
The new Bundled Payment System is the first
major change to dialysis reimbursement in
thirty years
Puts more risk on providers by increasing
scope of services while lowering payment
Puts more risk on dialyzors by increasing co-
pay responsibility
Payment not tied to Quality Measures, yet
APMXXX, Rev. X
Unbundled vs Bundled
2010Composite Rate
Separately Billable IV Drugs
Non Composite CKD5 Labs
Non-renal Labs
Oral Medications
2011 PPSComposite Rate, IV
Medications or substitutes, ~53 renal-related labs, Vit D
Oral Medications (will be in bundle in 2014)
Non-renal Labs
~$251 $229.62
+/-case mix
= ~$242.50
+other adj
- 3.1%
transition
adjustor
APMXXX, Rev. X
The Bundle Supports Home Therapies
CMS reiterates their goal of increasing the use of home
therapy (p.155 and p154 Final Rule)
Payment is PER TREATMENT, in full bundle increments.
(p164 Final Rule) – PD remains at HD equiv daily rate
Medicare retains the ability for providers to be paid for
additional medically justified HD treatments (p790 Final
Rule).This continues CMS’s current policy.
Training is maintained outside the bundle as an add-on
to the full bundled rate. The add-on payment for patient
training rate is increased from $20 per treatment to
approximately $33 per treatment. (p148 Final Rule)
APMXXX, Rev. X
2008 Drug Payments By Modality
• Home patients may receive additional iron and vitamin D under Part D, so
costs may be understated for these items as they shift to the bundle
• The use of ESAs and other medications may decrease under bundled
payment system
• Still, the differential has been substantial to date
Confidential5
Sessions (Raw)ESA Payments Per
Session
Vitamin D Payments Per
Session
Iron Payments Per Session
Other Drug Payments Per
Session
TOTAL Drug Payments Per
Session
In-Center Hemo 34,943,584 $42.93 $10.34 $5.54 $0.91 $59.71
Home Hemo 442,793 $27.02 $0.48 $1.15 $0.33 $28.98
Source: Moran Company Analysis, 2010.
APMXXX, Rev. X
“Changes in anemia management and hemoglobin levels following revision of a bundling policy to
incorporate recombinant human erythropoietin”
Hasegawa et al; Kidney International advance online publication 20 October 2010; doi: 10.1038/ki.2010.382
Impact of Bundled Payment on
ESA/Iron Use in Japan No significant differences were found in pre- or post-policy cross-
sections for hemoglobin distributions or the percentage of patients
prescribed rHuEPO.
Among patients receiving rHuEPO, the mean dose significantly
decreased by 11.8 percent.
The percentage of patients prescribed intravenous iron over 4
months significantly increased; however, the mean dose of iron did
not significantly change.
Thus, this bundling policy was associated with reduced rHuEPO
doses, increased intravenous iron use, and stable hemoglobin levels
in Japanese patients receiving hemodialysis.
APMXXX, Rev. X
FREEDOM* Study UpdateInterim results from the largest ongoing study of DHHD
Confidential7
TIME TO RECOVER**Reduction in post-treatment recovery from 532
to 74 minutes at 12 months
(p<0.0001)
DEPRESSIVE SYMPTOMS**29% improvement in BDI score (p<0.01), 48%
improvement for those with scores >15 at 12
months (p<0.005)
QUALITY-OF LIFE (SF-36)Physical (PCS) increased from 35.6 to 38.4
(p=0.04), Mental (MCS) increased from 46.6 to
50.7 (p=0.03)
ANTIHYPERTENSIVE MEDSAt 12 mo., # prescribed decreased by 35%
(p<0.0001), % requiring no meds increased
from 12% to 47% (p<0.002)
SLEEPSignificant improvements in General Indices,
Sleep Adequacy, Respiratory Disturbances,
and Daytime Somnolence
RESTLESS LEG (IRLS INDEX)23% reduction in global severity (p=0.03), and
26% improvement in restless leg symptoms
(p=0.006)
STANDARDIZED MORTALITY RATIO (SMR)SMR=0.53 after adjusting for age, gender, race, and primary
cause of renal failure, representing a 47% reduction in mortality
events vs. expected
* Jaber BL, et al; Am J Kid Dis: 53:310-320, 2009. The above are a priori defined interim results
** Jaber BL, et al; Am J Kid Dis: In Press 2010
APMXXX, Rev. X
Intermittency of HD and risk of deathBleyer, Kidney Int, Vol. 55 (1999), pp. 1553-9
The intermittent nature of center hemodialysis may
contribute to an increased sudden and cardiac death
rate on Monday and Tuesday for patients
enrolled in the USRDS.
Study design: USRDS data from 1977 to 1997, comprising 326,728 deaths,Note: Monday represents the 3-day interval for MWF schedules, Tuesday for TTS. No 3-day interval exists for daily therapies.
p=0.002p=0.0005
p=0.1 p=0.03
APMXXX, Rev. X
Standard mortality ratios (SMR*) for HHDDeath rates half or less of what are expected after adjustment
Therapy
Patients
# of Centers
Locations
Timing
HHD
70
NR
US
1986-92
Daily
117
2
US
2003-4
Nocturnal
72
2
Australia
2004-5
Daily
415
5
US, Europe
1982-2005
Daily
2,553
>300
US
2006-7
p<0.0001p=0.03
p<0.005p<0.05
p<0.001
*Actual/expected mortality, although methods of calculation differ slightly. NxStage mortality is adjusted for age and gender.
APMXXX, Rev. X
Cumulative Survival PD/ICHD 2000-2005
Vonesh, EF. Kidney International 2008; 70 Supplement
PD and Incenter HD Survival virtually identical in 389,000 patients
APMXXX, Rev. X
Home Economics Can be Favorable for
all Stakeholders
Patients
Ability to work
Lower Transportation $
May Reduce Meds
Waiver of 90 day wait
Payers/System
Less hospital days
Less medication expense
Lower total cost
Facilities
Higher private pay mix
Appropriate to bill for
additional needed HHD
treatments
Less brick & mortar $
Waiver of 90 day wait
APMXXX, Rev. X
Economics patient working IU Greenfield USRDS
The health and flexibility benefits of more frequent HHD allow more
patients to continue or return to work.
Percentage of Working-Age Patients Working
The ability to continue working:
Improves patients‟ personal
economic situation.
Helps patients remain
contributing members of society.
The Economics of HHD
Patient Perspective (continued)
©2009 NxStage Medical, Inc. NxStage® is a registered trademark of NxStage Medical, Inc. System One™ is a trademark of NxStage Medical, Inc. Patents and patents pending.
Detailed reference list available upon request. CAUTION: Federal law restricts this device to sale by or on the order of a physician. APM410 Rev. A
17. Borg, D et al. Home dialysis: The future is now. Hemodialysis International. 2008; 1: 132. Presented as an abstract at the 2008 Annual Dialysis Conference.
19. The Renal Network, Inc. 2005 annual statistical report. http://www.therenalnetwork.org/data/2005stat.php, retrieved June 5, 2009.
20. U.S. Renal Data System, USRDS 2007 Annual Data Report, Patient Characteristics Reference Table C.15, Percent distribution of patients, by employment status, p. 92.
21. Kraus M A, et al. Work and travel in a large short daily hemodialysis (SDHD) program. J Am Soc Nephrol. 2007; 18: 512A. Presented as a poster at American Society of Nephrology 2007 Annual
Congress.
The Economics of Home Dialysis
Patient Perspective
APMXXX, Rev. X
Economics patient perspective reduced transportation medication
NxStage IDE study cost savings out-of-pocket expensesPatients on more frequent HHD may significantly reduce or
eliminate key out-of-pocket costs.*
13
* Patients should consult with their center and/or physician to see how more frequent HHD is covered by their insurance.
The Economics of HHD
Patient Perspective (continued)
©2009 NxStage Medical, Inc. NxStage® is a registered trademark of NxStage Medical, Inc. System One™ is a trademark of NxStage Medical, Inc. Patents and patents pending.
Detailed reference list available upon request. CAUTION: Federal law restricts this device to sale by or on the order of a physician. APM410 Rev. A
Reduced Medications Reduced Transportation
14. Assumptions: 20-mile round-trip distance to center; $.55/mile federal mileage rate; 142 annual trips to center (less than full 156 due to average of 14 hospitalization days).28,29
15. SDHD = Short Daily Hemodialysis. Assumptions: 20-mile round-trip distance to center; $.55/mile federal mileage rate; 12 annual trips to center (for monthly clinic visits).
16. Kraus M A, et al. A comparison of center-based vs. home-based daily hemodialysis for patients with end-stage renal disease. Hemodialysis International. 2007; 11: 468-477.
17. Borg, D et al. Home dialysis: The future is now. Hemodialysis International. 2008; 1: 132. Presented as an abstract at the 2008 Annual Dialysis Conference.
18. Assumes $15 per month patient co-payment for anti-hypertensive medications.
The Economics of Home Dialysis
Patient Perspective (continued)
APMXXX, Rev. X
Economics healthcare system savings Peter
Crooks Kumar Borg
Leading institutions have demonstrated significant savings in annual total
costs of care for dialysis patients with more frequent HHD, compared to in-
center treatment.
“At Kaiser Permanente, [Medical
Director] Dr. Peter Crooks tells AP
that their mantra is: „When you
start dialysis, you do it at home.‟
…Crooks says Kaiser statistics
suggest a reduced need for
hospitalization in home dialysis
patients, “potentially saving
$10,000 to $20,000 in annual
healthcare costs per patient29…”
— Peter Crooks, MD Medical
Director, Kaiser Permanente as
cited in MedScape Medical
News
“Our internal data here at Kaiser found that total patient
care costs were lowest for home hemodialysis patients,
followed by peritoneal dialysis patients and lastly in-
center hemodialysis patients.”30,31
— Victoria Kumar, MD Southern California
Permanente Medical Group
“Costs per patient are $10,000 to $12,000 per year
less for the HHD patients as compared to In-center HD
patients.”17
— Diane Borg, BSN, RN, CNN Greenfield Health
Systems
The Economics of HHD
Healthcare System Perspective (continued)
©2009 NxStage Medical, Inc. NxStage® is a registered trademark of NxStage Medical, Inc. System One™ is a trademark of NxStage Medical, Inc. Patents and patents pending.
Detailed reference list available upon request. CAUTION: Federal law restricts this device to sale by or on the order of a physician. APM410 Rev. A
17. Borg, D et al. Home dialysis: The future is now. Hemodialysis International. 2008; 1: 132. Presented as an abstract at the 2008 Annual Dialysis Conference.
29. Jeffery S. Media report looks at developments in trend to home hemodialysis. MedScape Medical News (WebMD), based on original reporting by the Associated Press. 2005; July 12;
http://www.medscape.com/viewarticle/538730, retrieved April 17, 2009.
30. Boggs W. Home hemodialysis cuts hospital days. Reuters Health. 2008; October 10.
31. Kumar, V A et al. Hospitalization in daily home hemodialysis versus peritoneal dialysis patients in the United States. Am J Kid Dis. 2008; 52: 4 (October): 737-744.
The Economics of Home Dialysis
Healthcare System Perspective
APMXXX, Rev. X
Healthcare system costs of care ESRD patients
dialysis reduce hospitalizations medications
Dialysis services are only a
portion of total annual costs of
care for ESRD patients.
Dialysis services only account for 24% of
total annual costs of care.24
• Hospitalization and drug costs account
for over 45% of total annual costs of
care.24
• More frequent HHD has been shown to
reduce hospitalizations and the need
for drugs.16,17,27,28,29,30
The Economics of HHD
Healthcare System Perspective (continued)
©2009 NxStage Medical, Inc. NxStage® is a registered trademark of NxStage Medical, Inc. System One™ is a trademark of NxStage Medical, Inc. Patents and patents pending.
Detailed reference list available upon request. CAUTION: Federal law restricts this device to sale by or on the order of a physician. APM410 Rev. A
16. Kraus M A, et al. A comparison of center-based vs. home-based daily hemodialysis for patients with end-stage renal disease. Hemodialysis International. 2007; 11: 468-477.
17. Borg, D et al. Home dialysis: The future is now. Hemodialysis International. 2008; 1: 132. Presented as an abstract at the 2008 Annual Dialysis Conference.
24. U.S. Renal Data System, USRDS 2008 Annual Data Report, Reference Table K.e (supplement), Medicare payments ($) per person per year: 2006, by claim type (model 1).
27. Bohan S. Home dialysis offers new lease on life. San Mateo Daily News. 2008; February 24.
28. Schiller B. Daily home hemodialysis clinical experience. Satellite WellBound Healthcare; presentation at 2008 Annual Dialysis Conference.
29. Jeffery S. Media report looks at developments in trend to home hemodialysis. MedScape Medical News (WebMD), based on original reporting by the Associated Press. 2005; July 12;
http://www.medscape.com/viewarticle/538730, retrieved April 17, 2009.
30. Boggs W. Home hemodialysis cuts hospital days. Reuters Health. 2008; October 10.
The Economics of Home Dialysis
Healthcare System Perspective
APMXXX, Rev. X
Economics healthcare system perspective
patient hospitalizations reductions Kaiser
Wellbound
Leading institutions that are experienced with more frequent HHD have
demonstrated 40% to 50% reduction in patient hospitalizations for HHD
patients.*
*Compared to their in-center counterparts.
The Economics of HHD
Healthcare System Perspective (continued)
©2009 NxStage Medical, Inc. NxStage® is a registered trademark of NxStage Medical, Inc. System One™ is a trademark of NxStage Medical, Inc. Patents and patents pending.
Detailed reference list available upon request. CAUTION: Federal law restricts this device to sale by or on the order of a physician. APM410 Rev. A
27. Bohan S. Home dialysis offers new lease on life. San Mateo Daily News. 2008; February 24.
28. Schiller B. Daily home hemodialysis clinical experience. Satellite WellBound Healthcare; presentation at 2008 Annual Dialysis Conference.
The Economics of Home Dialysis
Healthcare System Perspective
APMXXX, Rev. X
Top 10 reasons for hospitalizationTable G.12.1 (supplement)
Total hospital discharges, by detailed Diagnostic Related Group2005, period prevalent patients
DIAGNOSTIC RELATED GROUPS Type Discharges
127 Heart failure & shock Medical 46,913
144 Other circulatory system diagnoses w
complication/comorbidity
Medical 42,056
316 Renal failure Medical 40,833
416 Septicemia age >17 Medical 26,569
478 Other vascular procedures w complication/comorbidity Procedure 23,166
089 Simple pneumonia & pleurisy age >17 w
complication/comorbidity
Medical 21,985
182 Esophagitis, gastroenteritis & miscellaneous digestive
disorders age >17 w complication/comorbidity
Medical 19,632
120 Other circulatory system operating room procedures Procedure 19,530
296 Nutritional & miscellaneous metabolic disorders age
>17 w complication/comorbidity
Medical 18,888
331 Other kidney & urinary tract diagnoses age >17 w
complication/comorbidity
Medical 16,409
Source: 2007 USRDS ADR (2005 data)
6 of top 10 reasons for hospitalization directly addressed by daily dialysis
APMXXX, Rev. X
Anticipated Revenue Change by
Modality Under the Bundle
Confidential18 Rev A
12/14/2007
-20
-10
0
10
20
30
40
50
60
Incenter Home Hemo PD
Revenues based on: ESRD Bundled Rate of $230/treatment - (ave composite rate of $142/tx +
medication add-on + historic avg $ medications and supplies billed per treatment by modality).
Per
treatm
ent
And, centers will be responsible for more services under bundle
than they are now covering in the baseline revenues shown.
APMXXX, Rev. X
Why Home Will Increase Under Bundle
More patients will choose to go home
– KDE Benefit
– Conditions for coverage
Home Therapy can be more cost effective for
center and for patients (PD and HHD)
Potential for less medication use
More likely to remain working and insured
APMXXX, Rev. X
Conclusions
CMS stresses repeatedly a goal to encourage more
home therapy and the clinical benefits of home dialysis
CMS states a desire for innovation
HHD per treatment revenue is up ~$40, whereas
incenter revenues decline
PD revenue is increased for adult patients
Training and retraining add-on is increased by 60% ($20-
$33)
Important provisions, such as medical justification for
additional HD treatments remain
APMXXX, Rev. X
Questions
439 South Union Street, Lawrence, MA 01843
www.nxstage.com tel: 978-687-4700
Back-up Material
APMXXX, Rev. X
Comparison of current LCD’sICD-9 Code Code Description TrailBlazer PGBA FCSO
275.3 HyperphoshatemiaX
276.61 and 276.69 Fluid overload; fluid retention X X X
276.7 Hyperkalemia X X X
420.0 Acute pericarditis X X X
428.0 Congestive Heart Failure, Unspecified X X X
428.1 Left Heart Failure X X
458.8 Hypotensive cardiomyopathy without overt CHFX
518.4 Acute edema of lung X X X
588.9 Other specified disorders resulting from impaired renal functionX
649.9 Complications of pregnancy, unspecified X X X
782.3 Edema X X
V23.89 Supervision of other high-risk pregnancy X X X
Other non-ICD-9 Mechanical failure (ie. Access impairment, electrical/equipment failure or
inadequacy would justify an additional treatment)X
*NxStage SAB members were surveyed and weighed in on the % of their current HHD population were described by each of the
codes in the various LCDs.
Members of the NxStage Scientific Advisory Board indicated that at least one of
the diagnoses included the three current LCD’s would be present in 80% of the
patients historically determined to be candidates for the daily home therapy .
APMXXX, Rev. X
Volume Overload definitions
TrailBlazer/PGBA Volume Overload: Extra dialysis
sessions may be necessary if the patient has evidence of volume
overload such as marked daily weight gain in excess of five pounds
per day, congestive heart failure, marked edema, pulmonary edema
as evidenced by blood gases (hypoxemia), chest x-ray or physical
examination, which responds to fluid removal (improves with
dialysis), or evidence that volume loads cannot be reduced by other
means such as ultrafiltration, and must be removed by dialysis.
FCSO: Volume overload-daily weight gain greater than five
pounds per day Or an elevated hemoglobin and hemotocrit Or
physical examination with findings indicative of volume overload
Source: LCD L30566 (FCSO), LCD L28224 (PGBA), LCD L26781 (TrailBlazer)
APMXXX, Rev. X
Comments from MAC Medical directors
In the case of Highmark, LCDs are not
contemplated unless we see that a service or
item is being used in medically inappropriate
ways. The LCD would then set limits/
boundaries for payment, as needed. Highmark
does not have an LCD on frequency of dialysis.– Dr. Larry Clarke, Medical Director for Highmark MAC
The MAC has the flexibility to pay for >3/week
and to determine medical necessity.– Dr. Elaine Jeter, Medical Director, PGBA J11 MAC
Recommended