ACO results prove good for kidney patients, Medicare; Congress must pass the Dialysis PATIENTS Act
© Greg Nash

When they were first introduced as part of the new Affordable Care Act back in 2011, the goal behind Accountable Care Organizations (ACOs) was to ensure that patients, particularly those who are chronically ill, received the right care at the right time – all while avoiding unnecessary duplication of services and preventing medical errors. For chronically ill patients with kidney disease and failure – not to mention a host of other complicating and expensive co-morbidities – ACOs seemed to be a perfect fit.

And while this seemed like an important step in trying to contain out-of-control health care costs, at the time I was extremely concerned that some of the proposed models would not have a sufficient number of kidney disease patients for ACOs to make their complex care a priority. So, for the next several months Dialysis Patient Citizens, along with others in the kidney community, urged the Innovation Center to launch a new model focused on serving kidney disease patients.


Today, almost seven years later, evaluations of CMS’ various ACO models are filtering in, and not all of the news is positive. However, as we anticipated, one program has shown unqualified success in saving money for Medicare: the Comprehensive End Stage Renal Disease Care (CEC) Model.

The CEC is an ACO solely for dialysis patients, based in dialysis clinics. Their success to date, while incredibly positive for today’s dialysis patients, also has broad implications for the future of care for the End Stage Renal Disease (ESRD) population, and perhaps for complex populations generally.

Persons with ESRD rely on thrice-weekly dialysis treatments to replace the function of their failed kidneys, unless and until they are able to obtain a kidney transplant. Some 400,000 Medicare beneficiaries, many under the age of 65, have ESRD, and while they comprise only 1 percent of beneficiaries they account for over 7 percent of fee-for-service Medicare expenditures. The majority of this spending is not on dialysis treatments but on the treatment of co-morbidities and complications. The average ESRD patient is hospitalized between once and twice each year. Because many of these complications are avoidable, and comorbidities are amenable to care coordination based in dialysis clinics, ESRD patients were thought to be good candidates for the care integration techniques applied by ACOs.

The first year results confirm this hypothesis. All 13 of the ESRD Seamless Care Organization (ESCO) sites participating in the first performance year saved Medicare money over the benchmark, averaging 5.31 percent in savings program-wide. All but the smallest participating site shared in savings: $51 million of the total $75 million saved. The evaluation report commissioned by the Center for Medicare and Medicaid Innovation revealed that the savings came largely, as hoped for, from avoided hospitalizations. There were savings in billed office visits—presumably due to the intervention of nurse practitioners employed by ESCOs whose services are not charged to Medicare. As in other ACO models, costs of post-acute institutional care also decreased.

There is no question that ESRD care is delivered differently when dialysis providers and nephrologists are responsible for the total expenditures of their patient panels. The evaluation found that the use of infection-prone catheters drops, as do complications related to dialysis access sites, probably because vascular surgeons are participating in some ESCOs Expenditures for dialysis treatments rise slightly, as clinicians take extra care that fluid overloads do not result in hospitalizations—even if it means the facility must stay open late. There is more communication between clinic personnel and hospitals, emergency department physicians, and the specialists who treat comorbidities. It should be noted that under fee-for-service, clinics are incentivized to do these things, but the stakes are so much lower—value-based payment reductions and the opportunity cost of missed appointments—that clinics can’t hire extra personnel to coordinate care.

Some care improvements can’t be accomplished through the CEC model. While nephrologists participating in an ESCO are incentivized to optimally prepare their late-stage chronic kidney disease (CKD) patients to begin dialysis safely, the model does not incentivize upstream physicians to refer CKD patients to those nephrologists. The model does not align the financial incentives of hospitals to cooperate with an ESCO, and the model has not yet moved the needle on readmissions.

A final caveat is that while 12 ESCO sites received shared savings, we don’t know how many ESCOs netted profits after accounting for the funds they advanced to improve patient care. In all likelihood about half were in the red at the end of the first performance year.

In any event, the logic of the global payment model for complex patients is compelling enough that 135 members of Congress, of both parties and both houses, have endorsed scaling up integrated care for ESRD. The Dialysis P.A.T.I.E.N.T.S. Act would couple CEC’s financial incentives and care coordination techniques with a capitated payment model to create a new option for dialysis clinics to deliver, and for dialysis patients to receive, care for ESRD.

Patients at participating clinics would be auto-enrolled with a right to opt-out. This approach would solve a key problem with the CEC model—attribution of patients to ESCOs that don’t learn of it until later, delaying interventions to improve care. Under the bill, the dialysis organization is responsible for all the beneficiary’s Medicare expenditures, but unlike other capitated models there is no network or other managed care restrictions, and beneficiaries are free to see any fee for service Medicare provider. Unlike ACO models, savings are also shared with beneficiaries. The model would also offer providers more flexibility than CEC in hopes that integrated care for ESRD, now limited to 37 ESCOs and a handful of Special Needs Plans, can spread to more (and less densely populated) geographic areas.

The first-year results of the Comprehensive ESRD Care model are a signal that care for kidney failure can, and surely will in the future, be delivered differently—already one member of the Medicare Payment Advisory Commission has floated expanding CEC as a mandatory payment model. The results are also worth reviewing as policymakers and stakeholders refine other ACO models.

Hrant Jamgochian is CEO of Dialysis Patient Citizens.