[Federal Register Volume 88, Number 213 (Monday, November 6, 2023)]
[Rules and Regulations]
[Pages 76344-76507]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-23915]
[[Page 76343]]
Vol. 88
Monday,
No. 213
November 6, 2023
Part III
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 413 and 512
Medicare Program; End-Stage Renal Disease Prospective Payment System,
Payment for Renal Dialysis Services Furnished to Individuals With Acute
Kidney Injury, End-Stage Renal Disease Quality Incentive Program, and
End-Stage Renal Disease Treatment Choices Model; Final Rule
Federal Register / Vol. 88 , No. 213 / Monday, November 6, 2023 /
Rules and Regulations
[[Page 76344]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 413 and 512
[CMS-1782-F]
RIN 0938-AV05
Medicare Program; End-Stage Renal Disease Prospective Payment
System, Payment for Renal Dialysis Services Furnished to Individuals
With Acute Kidney Injury, End-Stage Renal Disease Quality Incentive
Program, and End-Stage Renal Disease Treatment Choices Model
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Final rule.
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SUMMARY: This final rule updates and revises the End-Stage Renal
Disease (ESRD) Prospective Payment System (PPS) for calendar year (CY)
2024. This rule also updates the payment rate for renal dialysis
services furnished by an ESRD facility to individuals with acute kidney
injury (AKI). In addition, this final rule updates requirements for the
ESRD Quality Incentive Program and the ESRD Treatment Choices Model.
DATES: These regulations are effective on January 1, 2024.
FOR FURTHER INFORMATION CONTACT:
[email protected], for issues related to the ESRD PPS and
coverage and payment for renal dialysis services furnished to
individuals with AKI.
[email protected], for issues related to applications
for the Transitional Drug Add-on Payment Adjustment (TDAPA) or
Transitional Add-On Payment Adjustment for New and Innovative Equipment
and Supplies (TPNIES).
[email protected], for issues related to the ESRD Quality
Incentive Program (QIP).
[email protected], for issues related to the ESRD Treatment
Choices (ETC) Model.
SUPPLEMENTARY INFORMATION:
Current Procedural Terminology (CPT) Copyright Notice: Throughout
this final rule, we use CPT[supreg] codes and descriptions to refer to
a variety of services. We note that CPT[supreg] codes and descriptions
are copyright 2020 American Medical Association (AMA). All Rights
Reserved. CPT[supreg] is a registered trademark of the AMA. Applicable
Federal Acquisition Regulations (FAR) and Defense Federal Acquisition
Regulations (DFAR) apply.
Table of Contents
To assist readers in referencing sections contained in this
preamble, we are providing a Table of Contents.
I. Executive Summary
A. Purpose
B. Summary of the Major Provisions
C. Summary of Cost and Benefits
II. Calendar Year (CY) 2024 End-Stage Renal Disease (ESRD)
Prospective Payment System (PPS)
A. Background
B. Provisions of the Proposed Rule, Public Comments, and
Responses to the Comments on the CY 2024 ESRD PPS
C. Transitional Add-On Payment Adjustment for New and Innovative
Equipment and Supplies (TPNIES) Clarifications and Application for
CY 2024 Payment
D. Continuation of Approved Transitional Add-On Payment
Adjustments for New and Innovative Equipment and Supplies for CY
2024
E. Continuation of Approved Transitional Drug Add-On Payment
Adjustments for CY 2024
III. Calendar Year (CY) 2024 Payment for Renal Dialysis Services
Furnished to Individuals With Acute Kidney Injury (AKI)
A. Background
B. Summary of the Proposed Provisions, Public Comments, and
Responses to Comments on CY 2024 Payment for Renal Dialysis Services
Furnished to Individuals With AKI
C. Annual Payment Rate Update for CY 2024
IV. End-Stage Renal Disease Quality Incentive Program (ESRD QIP)
A. Background
B. Updates to the Regulation Text for the ESRD QIP
C. Updates to the Requirements Beginning With the PY 2026 ESRD
QIP
D. Updates to the Requirements Beginning With the PY 2027 ESRD
QIP
V. End-Stage Renal Disease Treatment Choices (ETC) Model
A. Background
B. Summary of the Proposed Provisions, Public Comments, and
Responses to Comments on the ETC Model
VI. Collection of Information Requirements
VII. Regulatory Impact Analysis
A. Statement of Need
B. Overall Impact
C. Impact Analysis
D. Detailed Economic Analysis
E. Accounting Statement
F. Regulatory Flexibility Act Analysis (RFA)
G. Unfunded Mandates Reform Act Analysis (UMRA)
H. Federalism
I. Congressional Review Act
VIII. Files Available to the Public via the Internet
I. Executive Summary
A. Purpose
This rule finalizes changes related to the End-Stage Renal Disease
(ESRD) Prospective Payment System (PPS), payment for renal dialysis
services furnished to individuals with acute kidney injury (AKI), the
ESRD Quality Incentive Program (QIP), and the ESRD Treatment Choices
(ETC) Model. Additionally, this rule finalizes policies that reflect
our commitment to achieving equity in health care for our beneficiaries
by supporting our ability to assess whether, and to what extent, our
programs and policies perpetuate or exacerbate systemic barriers to
opportunities and benefits for underserved communities. Our policy
objectives include commitment to advancing health equity, which stands
as the first pillar of the Centers for Medicare & Medicaid Services
(CMS) Strategic Plan,\1\ and reflect the goals of the Administration,
as stated in the President's Executive Order 13985.\2\ We define health
equity as the attainment of the highest level of health for all people,
where everyone has a fair and just opportunity to attain their optimal
health regardless of race, ethnicity, disability, sexual orientation,
gender identity, socioeconomic status, geography, preferred language,
or other factors that affect access to care and health outcomes.'' \3\
In the calendar year (CY) 2023 ESRD PPS final rule, we noted that, when
compared with all Medicare fee-for-service (FFS) beneficiaries,
Medicare FFS beneficiaries receiving dialysis are disproportionately
young, male, African American, have disabilities and low income as
measured by eligibility for both Medicare and Medicaid (dual eligible
status), and reside in an urban setting (87 FR 67183). In this final
rule, we continue to address health equity for beneficiaries with ESRD
who are members of underserved communities, including but not limited
to those living in rural communities, those who have disabilities, and
racial and ethnic minorities. The term `underserved communities' refers
to populations sharing a particular characteristic, including
geographic communities, that have been systematically denied a full
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opportunity to participate in aspects of economic, social, and civic
life.\4\ Specifically, in the CY 2024 ESRD PPS proposed rule (88 FR
42431), we requested information regarding a potential payment
adjustment for geographically isolated and rural ESRD facilities,
proposed additional payment for the subgroup of Pediatric ESRD Patients
(as defined in 42 CFR 413.171), and proposed policies to further our
efforts to determine if payment to ESRD facilities treating patients
with co-morbidities such as sickle cell anemia is aligned with resource
use by such ESRD facilities. As discussed in sections II.B.1.g and
II.B.1.j of this final rule, we are now finalizing the proposed payment
adjustment for Pediatric ESRD Patients and policies to improve the
measurement of individual resource use. Additionally, we are adding
three new measures to the ESRD QIP measure set that are aimed at
promoting health equity for ESRD patients, including by enabling ESRD
facilities to identify gaps experienced by their patient populations.
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\1\ Centers for Medicare & Medicaid Services (2022). Health
Equity. Available at: https://www.cms.gov/pillar/health-equity.
\2\ 86 FR 7009 (January 25, 2021). https://www.federalregister.gov/documents/2021/01/25/2021-01753/advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government.
\3\ Centers for Medicare & Medicaid Services (2022). Health
Equity. Available at: https://www.cms.gov/pillar/health-equity.
\4\ 86 FR 7009 (January 25, 2021). https://www.federalregister.gov/documents/2021/01/25/2021-01753/advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government.
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1. End-Stage Renal Disease (ESRD) Prospective Payment System (PPS)
On January 1, 2011, we implemented the ESRD PPS, a case-mix
adjusted, bundled PPS for renal dialysis services furnished by ESRD
facilities as required by section 1881(b)(14) of the Social Security
Act (the Act), as added by section 153(b) of the Medicare Improvements
for Patients and Providers Act of 2008 (MIPPA) (Pub. L. 110-275).
Section 1881(b)(14)(F) of the Act, as added by section 153(b) of MIPPA,
and amended by section 3401(h) of the Patient Protection and Affordable
Care Act (the Affordable Care Act) (Pub. L. 111-148), established that
beginning CY 2012, and each subsequent year, the Secretary of the
Department of Health and Human Services (the Secretary) shall annually
increase payment amounts by an ESRD market basket percentage increase,
reduced by the productivity adjustment described in section
1886(b)(3)(B)(xi)(II) of the Act. This final rule updates the ESRD PPS
for CY 2024.
2. Coverage and Payment for Renal Dialysis Services Furnished to
Individuals With Acute Kidney Injury (AKI)
On June 29, 2015, the President signed the Trade Preferences
Extension Act of 2015 (TPEA) (Pub. L. 114-27). Section 808(a) of the
TPEA amended section 1861(s)(2)(F) of the Act to provide coverage for
renal dialysis services furnished on or after January 1, 2017, by a
renal dialysis facility or a provider of services paid under section
1881(b)(14) of the Act to an individual with AKI. Section 808(b) of the
TPEA amended section 1834 of the Act by adding a new subsection (r)
that provides for payment for renal dialysis services furnished by
renal dialysis facilities or providers of services paid under section
1881(b)(14) of the Act to individuals with AKI at the ESRD PPS base
rate beginning January 1, 2017. This final rule updates the AKI payment
rate for CY 2024.
3. End-Stage Renal Disease Quality Incentive Program (ESRD QIP)
The End-Stage Renal Disease Quality Incentive Program (ESRD QIP) is
authorized by section 1881(h) of the Act. The Program establishes
incentives for facilities to achieve high quality performance on
measures with the goal of improving outcomes for ESRD beneficiaries.
This final rule finalizes several updates for the ESRD QIP, including:
(1) updates that will begin with Payment Year (PY) 2026, including one
new quality measure, modifications to two current measures, and the
removal of two measures; (2) the addition of two new measures beginning
with PY 2027; (3) a revision to the regulatory definition of ``minimum
total performance score'' that more accurately captures how we
calculate the median of national ESRD facility performance on reporting
measures; and (4) the codification of our previously finalized measure
selection, retention, and removal policies.
4. End-Stage Renal Disease Treatment Choices (ETC) Model
The ETC Model is a mandatory Medicare payment model tested under
section 1115A of the Act. The ETC Model is operated by the Center for
Medicare and Medicaid Innovation (Innovation Center) and tests the use
of payment adjustments to encourage greater utilization of home
dialysis and kidney transplants, to preserve or enhance the quality of
care furnished to Medicare beneficiaries while reducing Medicare
expenditures.
The ETC Model was finalized as part of a final rule published in
the Federal Register on September 29, 2020, titled ``Medicare Program:
Specialty Care Models to Improve Quality of Care and Reduce
Expenditures'' (85 FR 61114), referred to herein as the ``Specialty
Care Models final rule.'' We revised and updated certain ETC Model
policies in the CY 2022 ESRD PPS final rule (86 FR 61874), and the CY
2023 ESRD PPS final rule (87 FR 67136). In this final rule, we are
finalizing a modification to our regulations at 42 CFR 512.390 to
acknowledge the availability of administrative review of targeted
review requests. This change will provide ETC Participants with
information about the availability of administrative review if an ETC
Participant wishes to seek additional review of its targeted review
request.
B. Summary of the Major Provisions
1. ESRD PPS
Update to the ESRD PPS base rate for CY 2024: The final CY
2024 ESRD PPS base rate is $271.02, an increase from the CY 2023 ESRD
PPS base rate of $265.57. This amount reflects the application of the
combined wage index and transitional pediatric ESRD add-on payment
adjustment (TPEAPA) budget-neutrality adjustment factor (0.999534) and
a productivity-adjusted market basket percentage increase of 2.1
percent as required by section 1881(b)(14)(F)(i)(I) of the Act,
equaling $271.02 (($265.57 x 0.999534) x 1.021 = $271.02).
Annual update to the wage index: We adjust wage indices on
an annual basis using the most current hospital wage data and the
latest core-based statistical area (CBSA) delineations to account for
differing wage levels in areas in which ESRD facilities are located.
For CY 2024, we are updating the wage index values based on the latest
available data.
Annual update to the outlier policy: We are updating the
outlier policy based on the most current data. Accordingly, we are
updating the Medicare allowable payment (MAP) amounts for adult and
pediatric patients for CY 2024 using the latest available CY 2022
claims data. We are updating the ESRD outlier services fixed dollar
loss (FDL) amount for pediatric patients using the latest available CY
2022 claims data and updating the FDL amount for adult patients using
the latest available claims data from CY 2020, CY 2021, and CY 2022.
For pediatric beneficiaries, the final FDL amount will decrease from
$23.29 to $11.32, and the MAP amount will decrease from $25.59 to
$23.36, as compared to CY 2023 values. For adult beneficiaries, the
final FDL amount will decrease from $73.19 to $71.76, and the MAP
amount will decrease from $39.62 to $36.28. The 1.0 percent target for
outlier payments was not achieved in CY 2022. Outlier payments
represented approximately 0.8 percent of total
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Medicare payments rather than 1.0 percent.
Update to the offset amount for the transitional add-on
payment adjustment for new and innovative equipment and supplies
(TPNIES) for CY 2024: The final CY 2024 average per treatment offset
amount for the TPNIES for capital-related assets that are home dialysis
machines is $10.00. This offset amount reflects the application of the
ESRD Bundled (ESRDB) productivity-adjusted market basket update of 2.1
percent ($9.79 x 1.021 = $10.00). There are no capital-related assets
set to receive the TPNIES in CY 2024 for which this offset will apply.
Clarifications to the TPNIES eligibility criteria: We are
finalizing certain clarifications regarding our evaluation of the
TPNIES eligibility criteria under Sec. 413.236(b).
TPNIES application received for CY 2024: In this final
rule, we announce our determination on the one TPNIES application under
consideration for the TPNIES for CY 2024 payment.
Modifications to the administrative process for the low-
volume payment adjustment (LVPA): We are finalizing exceptions to the
current LVPA attestation process for ESRD facilities that are affected
by disasters and other emergencies. These exceptions will allow ESRD
facilities to close and reopen in response to a disaster or other
emergency and still receive the LVPA. Additionally, the exceptions will
allow an ESRD facility to receive the LVPA even if it exceeds the LVPA
treatment volume threshold if its treatment counts increase due to
treating additional patients displaced by a disaster or emergency.
Policy to measure patient-level utilization: We are
finalizing a requirement for ESRD facilities to report the time on
machine (that is, the amount of time that a beneficiary spends
receiving an in-center hemodialysis treatment) on claims, effective
January 1, 2025. This will serve to provide more data to better inform
CMS's pursuit of equitable payment policies in the future.
Transitional Pediatric ESRD Add-on Payment Adjustment
(TPEAPA): We are finalizing the establishment of a new budget neutral
add-on payment adjustment of 30 percent of the per treatment payment
amount for renal dialysis services furnished to Pediatric ESRD Patients
effective January 1, 2024, for CYs 2024, 2025, and 2026. This will
serve to bring Medicare payments for renal dialysis services furnished
to pediatric patients more in line with their estimated relative costs
for the next 3 years until further collection and analysis of cost
report data can be conducted.
Add-on payment adjustment following the end of the
transitional drug add-on payment adjustment (TDAPA) period: We are
finalizing a new add-on payment adjustment for certain new renal
dialysis drugs and biological products in existing ESRD PPS functional
categories after the end of the TDAPA period, which we call the post-
TDAPA add-on payment adjustment. This payment adjustment will be case-
mix adjusted and set at 65 percent of expenditure levels for the given
renal dialysis drug or biological product. The post-TDAPA add-on
payment adjustment will be applied to all ESRD PPS payments and paid
for 3 years.
Reporting of discarded billing units of certain renal
dialysis drugs and biological products paid for under the ESRD PPS: We
are finalizing a new policy to require the use of the JW or JZ modifier
on claims to track discarded amounts of single-dose container and
single-use package renal dialysis drugs and biological products paid
for under the ESRD PPS, effective January 1, 2025.
2. Payment for Renal Dialysis Services Furnished to Individuals With
AKI
We are updating the AKI payment rate for CY 2024. The final CY 2024
payment rate is $271.02, which is the same as the base rate finalized
for the ESRD PPS for CY 2024.
3. ESRD QIP
We are finalizing several updates for the ESRD QIP. Beginning with
PY 2026, we are adding the Facility Commitment to Health Equity
reporting measure to the ESRD QIP measure set, modifying the COVID-19
Vaccination Coverage Among Healthcare Personnel (HCP) reporting measure
to align with updated measure specifications developed by the Centers
for Disease Control and Prevention (CDC), removing the Ultrafiltration
Rate reporting measure and the Standardized Fistula Rate clinical
measure, and updating the Clinical Depression Screening and Follow-Up
measure's scoring methodology and converting that measure to a clinical
measure. Beginning with PY 2027, we are adding the Screening for Social
Drivers of Health reporting measure and the Screen Positive Rate for
Social Drivers of Health reporting measure to the ESRD QIP measure set.
In addition, we are revising the codified definition of ``minimum total
performance score'' and codifying our previously finalized measure
selection, retention, and removal policies.
4. ETC Model
We are finalizing a modification to our regulations at Sec.
512.390 to acknowledge the ability of the CMS Administrator to review
the results of ETC Participants' targeted review requests.
C. Summary of Costs and Benefits
In section VII.D.5 of this final rule, we set forth a detailed
analysis of the impacts that the finalized changes will have on
affected entities and beneficiaries. The impacts include the following:
1. Impacts of the Final ESRD PPS
The impact table in section VII.D.5.a of this final rule displays
the estimated change in Medicare payments to ESRD facilities in CY 2024
compared to estimated Medicare payments in CY 2023. The overall impact
of the CY 2024 changes is projected to be a 2.1 percent increase in
Medicare payments. Hospital-based ESRD facilities have an estimated 3.1
percent increase in Medicare payments compared with freestanding ESRD
facilities with an estimated 2.0 percent increase. We estimate that the
aggregate ESRD PPS expenditures will increase by approximately $190
million in CY 2024 compared to CY 2023. This reflects an increase of
approximately $180 million from the payment rate update and the final
post-TDAPA add-on payment adjustment and approximately $10 million in
estimated TDAPA payment amounts for Korsuva[supreg] and Jesduvroq
(daprodustat), as further described in the following paragraphs.
Because of the projected 2.1 percent overall payment increase, we
estimate there will be an increase in beneficiary coinsurance payments
of 2.1 percent in CY 2024, which translates to approximately $40
million.
Section 1881(b)(14)(D)(iv) of the Act provides that the ESRD PPS
may include such other payment adjustments as the Secretary determines
appropriate. Under this authority, CMS implemented Sec. 413.234 to
establish the TDAPA, a transitional drug add-on payment adjustment for
certain new renal dialysis drugs and biological products and Sec.
413.236 to establish the TPNIES, a transitional add-on payment
adjustment for certain new and innovative equipment and supplies. The
TDAPA and the TPNIES are not budget neutral.
As discussed in section II.D of this final rule, the TPNIES payment
period for the Tablo[supreg] System ends on December 31, 2023. As
discussed in section II.E of this final rule, the TDAPA
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payment period for Korsuva[supreg] (difelikefalin) will continue
through March 31, 2024, and for Jesduvroq, will continue throughout
2024. As described in section VII.D.5 of this final rule, we estimate
that the overall TDAPA payment amounts in CY 2024 will be approximately
$13.3 million, of which, approximately $2.7 million will be attributed
to beneficiary coinsurance amounts. We note that these expenditures are
estimated in addition to the overall $180 million increase described in
the preceding paragraphs and are not fully represented in the detailed
impact analysis shown in Table 24.
Lastly as discussed in section II.B.1.i of this final rule, we are
finalizing a non-budget-neutral payment adjustment for certain new
renal dialysis drugs and biological products after the TDAPA period
ends, starting in CY 2024. The structure of the post-TDAPA add-on
payment adjustment for a new renal dialysis drug or biological product
will be based on the case-mix adjusted average per-treatment
expenditure for such drug or biological product. We will apply a 65
percent risk-sharing adjustment to the calculated payment amount for
the post-TDAPA add-on payment adjustment. We are finalizing a 3-year
period following TDAPA during which the drug or biological product
would be included in the post-TDAPA add-on payment adjustment. During
this period, the renal dialysis drug or biological product would be
considered for outlier payments, if it meets the definition of an ESRD
outlier service. The first drug that will meet these criteria in CY
2024 will be Korsuva[supreg], which fits into the existing ESRD PPS
functional category for antipruritic drugs and biological products. The
post-TDAPA add-on payment adjustment calculated for Korsuva[supreg]
will be $0.2493.
2. Impacts of the Final Payment Rate for Renal Dialysis Services
Furnished to Individuals With AKI
The impact table in section VII.D.5.c of this final rule displays
the estimated change in Medicare payments to ESRD facilities for renal
dialysis services furnished to individuals with AKI compared to
estimated Medicare payments for such services in CY 2023. The overall
impact of the CY 2024 changes is projected to be a 2.0 percent increase
in Medicare payments for individuals with AKI. Hospital-based ESRD
facilities have an estimated 2.1 percent increase in Medicare payments
compared with freestanding ESRD facilities that have an estimated 2.0
percent increase. The overall impact reflects the effects of the final
Medicare payment rate update and final CY 2024 ESRD PPS wage index. We
estimate that the aggregate Medicare payments made to ESRD facilities
for renal dialysis services furnished to individuals with AKI, at the
final CY 2024 ESRD PPS base rate, will increase by $1 million in CY
2024 compared to CY 2023.
3. Impacts of the Final Changes to the ESRD QIP
We estimate that the overall economic impact of the PY 2026 ESRD
QIP will be approximately $136.9 million. The $136.9 million estimate
for PY 2026 includes $120.9 million in costs associated with the
collection of information requirements and approximately $16 million in
payment reductions across all facilities. We also estimate that the
overall economic impact of the PY 2027 ESRD QIP will be approximately
$144.3 million. The $144.3 million estimate for PY 2027 includes $130.5
million in costs associated with the collection of information
requirements and approximately $13.8 million in payment reductions
across all facilities.
4. Impacts of the Final Changes to the ETC Model
The impact estimate in section VII.D.5.d of this final rule
describes the estimated change in anticipated Medicare program savings
arising from the ETC Model over the duration of the ETC Model as a
result of the changes in this final rule. We estimate that the ETC
Model will result in $28 million in net savings over the 6.5-year
duration of the ETC Model. We also estimate that the changes in this
final rule will produce no change in net savings for the ETC Model. As
the ETC Model targeted review process has already been finalized in the
Specialty Care Models final rule and ETC Participants are not required
to seek administrative review of targeted review determinations, we
expect there will be minimal additional burden associated with the
administrative review policy we are finalizing.
II. Calendar Year (CY) 2024 End Stage Renal Disease (ESRD) Prospective
Payment System (PPS)
A. Background
1. Statutory Background
On January 1, 2011, CMS implemented the ESRD PPS, a case-mix
adjusted bundled PPS for renal dialysis services furnished by ESRD
facilities, as required by section 1881(b)(14) of the Act, as added by
section 153(b) of the Medicare Improvements for Patients and Providers
Act of 2008 (MIPPA) (Pub. L. 110-275). Section 1881(b)(14)(F) of the
Act, as added by section 153(b) of MIPPA and amended by section 3401(h)
of the Patient Protection and Affordable Care Act (Affordable Care Act)
(Pub. L. 111-148), established that beginning with CY 2012, and each
subsequent year, the Secretary shall annually increase payment amounts
by an ESRD market basket percentage increase reduced by the
productivity adjustment described in section 1886(b)(3)(B)(xi)(II) of
the Act.
Section 632 of the American Taxpayer Relief Act of 2012 (ATRA)
(Pub. L. 112-240) included several provisions that apply to the ESRD
PPS. Section 632(a) of ATRA added section 1881(b)(14)(I) to the Act,
which required the Secretary, by comparing per patient utilization data
from 2007 with such data from 2012, to reduce the single payment for
renal dialysis services furnished on or after January 1, 2014, to
reflect the Secretary's estimate of the change in the utilization of
ESRD-related drugs and biologicals (excluding oral-only ESRD-related
drugs). Consistent with this requirement, in the CY 2014 ESRD PPS final
rule, we finalized $29.93 as the total drug utilization reduction and
finalized a policy to implement the amount over a 3- to 4-year
transition period (78 FR 72161 through 72170).
Section 632(b) of ATRA prohibited the Secretary from paying for
oral-only ESRD-related drugs and biologicals under the ESRD PPS prior
to January 1, 2016. Section 632(c) of ATRA required the Secretary, by
no later than January 1, 2016, to analyze the case-mix payment
adjustments under section 1881(b)(14)(D)(i) of the Act and make
appropriate revisions to those adjustments.
On April 1, 2014, the Protecting Access to Medicare Act of 2014
(PAMA) (Pub. L. 113-93) was enacted. Section 217 of PAMA included
several provisions that apply to the ESRD PPS. Specifically, sections
217(b)(1) and (2) of PAMA amended sections 1881(b)(14)(F) and (I) of
the Act and replaced the drug utilization adjustment that was finalized
in the CY 2014 ESRD PPS final rule (78 FR 72161 through 72170) with
specific provisions that dictated the market basket update for CY 2015
(0.0 percent) and how the market basket percentage increase should be
reduced in CY 2016 through CY 2018.
Section 217(a)(1) of PAMA amended section 632(b)(1) of ATRA to
provide that the Secretary may not pay for oral-only ESRD-related drugs
under the ESRD PPS prior to January 1, 2024. Section 217(a)(2) of PAMA
further amended section 632(b)(1) of ATRA by
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requiring that in establishing payment for oral-only drugs under the
ESRD PPS, the Secretary must use data from the most recent year
available. Section 217(c) of PAMA provided that as part of the CY 2016
ESRD PPS rulemaking, the Secretary shall establish a process for (1)
determining when a product is no longer an oral-only drug; and (2)
including new injectable and intravenous products into the ESRD PPS
bundled payment.
Section 204 of the Stephen Beck, Jr., Achieving a Better Life
Experience Act of 2014 (ABLE) (Pub. L. 113-295) amended section
632(b)(1) of ATRA, as amended by section 217(a)(1) of PAMA, to provide
that payment for oral-only renal dialysis drugs and biological products
cannot be made under the ESRD PPS bundled payment prior to January 1,
2025.
2. System for Payment of Renal Dialysis Services
Under the ESRD PPS, a single per-treatment payment is made to an
ESRD facility for all the renal dialysis services defined in section
1881(b)(14)(B) of the Act and furnished to individuals for the
treatment of ESRD in the ESRD facility or in a patient's home. We have
codified our definition of renal dialysis services at Sec. 413.171,
which is in 42 CFR part 413, subpart H, along with other ESRD PPS
payment policies. The ESRD PPS base rate is adjusted for
characteristics of both adult and pediatric patients and accounts for
patient case-mix variability. The adult case-mix adjusters include five
categories of age, body surface area, low body mass index, onset of
dialysis, and four comorbidity categories (that is, pericarditis,
gastrointestinal tract bleeding, hereditary hemolytic or sickle cell
anemia, myelodysplastic syndrome). A different set of case-mix
adjusters are applied for the pediatric population. Pediatric patient-
level adjusters include two age categories (under age 13, or age 13 to
17) and two dialysis modalities (that is, peritoneal or hemodialysis)
(Sec. 413.235(a) and (b)).
The ESRD PPS provides for three facility-level adjustments. The
first payment adjustment accounts for ESRD facilities furnishing a low
volume of dialysis treatments (Sec. 413.232). The second payment
adjustment reflects differences in area wage levels developed from
core-based statistical areas (CBSAs) (Sec. 413.231). The third payment
adjustment accounts for ESRD facilities furnishing renal dialysis
services in a rural area (Sec. 413.233).
There are four additional payment adjustments under the ESRD PPS.
The ESRD PPS provides adjustments, when applicable, for: (1) a training
add-on for home and self-dialysis modalities (Sec. 413.235(c)); (2) an
additional payment for high cost outliers due to unusual variations in
the type or amount of medically necessary care (Sec. 413.237); (3) a
TDAPA for certain new renal dialysis drugs and biological products
(Sec. 413.234(c)); and (4) a TPNIES for certain new and innovative
renal dialysis equipment and supplies (Sec. 413.236(d)).
3. Updates to the ESRD PPS
Policy changes to the ESRD PPS are proposed and finalized annually
in the Federal Register. The CY 2011 ESRD PPS final rule was published
on August 12, 2010, in the Federal Register (75 FR 49030 through
49214). That rule implemented the ESRD PPS beginning on January 1,
2011, in accordance with section 1881(b)(14) of the Act, as added by
section 153(b) of MIPPA, over a 4-year transition period. Since the
implementation of the ESRD PPS, we have published annual rules to make
routine updates, policy changes, and clarifications.
Most recently, we published a final rule, which appeared in the
November 7, 2022, issue of the Federal Register, titled ``Medicare
Program; End-Stage Renal Disease Prospective Payment System, Payment
for Renal Dialysis Services Furnished to Individuals With Acute Kidney
Injury, and End-Stage Renal Disease Quality Incentive Program, and End-
Stage Renal Disease Treatment Choices Model,'' referred to herein as
the ``CY 2023 ESRD PPS final rule.'' In that rule, we updated the ESRD
PPS base rate, wage index, and outlier policy for CY 2023. We also
finalized changes that included rebasing and revising the ESRD Bundled
(ESRDB) market basket to reflect a 2020 base year, refining the
methodology for outlier calculations, implementing a wage index floor
of 0.600, implementing a permanent 5 percent cap on year-over-year wage
index decreases for ESRD facilities, and modifying the definition of
``oral-only drug.'' For further detailed information regarding these
updates, see 87 FR 67136.
B. Provisions of the Proposed Rule, Public Comments, and Response to
the Comments on the CY 2024 ESRD PPS
The proposed rule, titled ``Medicare Program; End-Stage Renal
Disease Prospective Payment System, Payment for Renal Dialysis Services
Furnished to Individuals With Acute Kidney Injury, End-Stage Renal
Disease Quality Incentive Program, and End-Stage Renal Disease
Treatment Choices Model'' (88 FR 42430 through 42544), referred to
herein as the ``CY 2024 ESRD PPS proposed rule,'' appeared in the
Federal Register on June 30, 2023, with a comment period that ended on
August 25, 2023. In that rule, we proposed to make a number of annual
updates for CY 2024, including updates to the ESRD PPS base rate, wage
index, outlier policy, and the offset amount for the TPNIES. We also
proposed two new exceptions to the LVPA eligibility requirements for
ESRD facilities impacted by a disaster or other emergency, a new add-on
payment adjustment for pediatric ESRD patients, a new add-on payment
adjustment for certain new drugs and biological products after the
TDAPA period ends, a new reporting requirement for discarded billing
units of certain renal dialysis drugs or biological products, and a new
reporting requirement for time on machine data for in-center
hemodialysis treatments. We proposed clarifications regarding our
evaluation of the TPNIES eligibility criteria under Sec. 413.236(b)
and included a summary of the one CY 2024 TPNIES application that we
received by the February 1, 2023 deadline with our preliminary analysis
of the applicant's claims related to substantial clinical improvement
and other eligibility criteria for the TPNIES. In addition, the
proposed rule included a request for information regarding potential
changes to the LVPA and a potential new payment adjustment for
geographic isolation.
We received 344 public comments on our ESRD PPS proposals,
including comments from kidney and dialysis organizations, such as
large and small dialysis organizations; for-profit and non-profit ESRD
facilities; ESRD networks; and a dialysis coalition. We also received
comments from patients; healthcare providers for adult and pediatric
ESRD beneficiaries; home renal dialysis services and advocacy
organizations; provider and legal advocacy organizations;
administrators and insurance groups; a non-profit dialysis association,
a professional association, and alliances for kidney care and home
dialysis stakeholders; drug and device manufacturers; health care
systems; a health care consultant; and the Medicare Payment Advisory
Commission (MedPAC).
We received comments related to issues that we either did not
discuss in the CY 2024 ESRD PPS proposed rule or that we discussed for
the purpose of background or context, but for which we did not propose
changes in the rule. These include, for example, concerns regarding
staff training, education for kidney disease patients, access to
innovation for Medicare Advantage
[[Page 76349]]
beneficiaries, transportation for ESRD patients, nutrition for ESRD
patients, and telehealth. We also received several comments on Medicare
coverage for certain Humanitarian Use Devices. We are not providing
detailed responses to those comments in this final rule because they
are out of the scope of the CY 2024 ESRD PPS proposed rule. We thank
the commenters for their input and will consider the recommendations in
potential future rulemaking.
We received numerous comments on the potential inclusion of oral-
only drugs into the ESRD PPS bundled payment beginning January 1, 2025.
As noted in the CY 2023 ESRD PPS final rule (87 FR 67180), we expect
that the only oral-only drugs and biological products that would be
included in the ESRD bundled payment in CY 2025 are phosphate binders.
Commenters expressed concerns on potential access and health equity
issues, which could result from including oral-only drugs and
biological products in the ESRD PPS bundled payment. Some commenters
also expressed additional concerns associated with the potential
inclusion of oral-only drugs and biological products in the ESRD PPS
bundled payment, such as concerns about the following: the
administrative burden of managing a patient's dosage and combination of
phosphate lowering drugs; administration of the prescription insofar as
patients think they must go to the ESRD facility to obtain the
phosphate binders; confusion for patients, in that some patients think
the phosphate lowering drugs would only be dispensed at the ESRD
facility, and since the drugs must be taken with food, they would not
be able to take the drugs because eating during dialysis is not
allowed, or they must go to the ESRD facility to get the phosphate
binders even when they do not have a dialysis treatment; innovation of
new oral-only drugs and biological products, such as phosphate lowering
therapies, would be unavailable because of the cost of the new drugs or
biological products; and the definition of oral-only drugs and
biological products for phosphate lowering agents until an intravenous
or injectable equivalent of the drug is available. We thank the
commenters for their insight regarding the potential inclusion of oral-
only drugs and biological products in the ESRD PPS bundled payment
beginning in CY 2025; however, we did not make any proposals related to
the potential inclusion of oral-only drugs and biological products in
the ESRD PPS bundled payment in CY 2025 in the CY 2024 ESRD PPS
proposed rule. We will take commenters' insight, concerns, and
recommendations into consideration for future rulemaking on this topic.
Additionally, we received some comments from commenters including
ESRD patients and caregivers which contained details of quality-of-care
concerns or adverse quality events for which the commenters had first-
hand experience. We address these comments as they concern the
proposals in the CY 2024 ESRD PPS proposed rule, but we wish to note
that any serious adverse quality events can be reported to the CMS
ombudsman. Information on beneficiary rights and how to report quality
events can be found at https://www.cms.gov/center/special-topic/ombudsman/medicare-beneficiary-ombudsman-home.
In this final rule, we provide a summary of each proposed
provision, a summary of the public comments received and our responses
to them, and the policies we are finalizing for the CY 2024 ESRD PPS.
1. CY 2024 ESRD PPS Update
a. CY 2024 ESRD Bundled (ESRDB) Market Basket Percentage Increase;
Productivity Adjustment; and Labor-Related Share
(1) Background
In accordance with section 1881(b)(14)(F)(i) of the Act, as added
by section 153(b) of MIPPA and amended by section 3401(h) of the
Affordable Care Act, beginning in 2012, the ESRD PPS payment amounts
are required to be annually increased by an ESRD market basket
percentage increase and reduced by the productivity adjustment
described in section 1886(b)(3)(B)(xi)(II) of the Act. The application
of the productivity adjustment may result in the increase factor being
less than 0.0 for a year and may result in payment rates for a year
being less than the payment rates for the preceding year. Section
1881(b)(14)(F)(i) of the Act also provides that the market basket
increase factor should reflect the changes over time in the prices of
an appropriate mix of goods and services included in renal dialysis
services.
As required under section 1881(b)(14)(F)(i) of the Act, CMS
developed an all-inclusive ESRD Bundled (ESRDB) input price index using
CY 2008 as the base year (75 FR 49151 through 49162). We subsequently
revised and rebased the ESRDB input price index to a base year of CY
2012 in the CY 2015 ESRD PPS final rule (79 FR 66129 through 66136). In
the CY 2019 ESRD PPS final rule (83 FR 56951 through 56964), we
finalized a rebased ESRDB input price index to reflect a CY 2016 base
year. In the CY 2023 ESRD PPS final rule (87 FR 67141 through 67154),
we finalized a revised and rebased ESRDB input price index to reflect a
CY 2020 base year.
Although ``market basket'' technically describes the mix of goods
and services used for ESRD treatment, this term is also commonly used
to denote the input price index (that is, cost categories, their
respective weights, and price proxies combined) derived from a market
basket. Accordingly, the term ``ESRDB market basket,'' as used in this
document, refers to the ESRDB input price index.
The ESRDB market basket is a fixed-weight, Laspeyres-type price
index. A Laspeyres-type price index measures the change in price, over
time, of the same mix of goods and services purchased in the base
period. Any changes in the quantity or mix of goods and services (that
is, intensity) purchased over time are not measured.
(2) CY 2024 ESRD Market Basket Update
We proposed to use the 2020-based ESRDB market basket as finalized
in the CY 2023 ESRD PPS final rule (87 FR 67141 through 67154) to
compute the proposed CY 2024 ESRDB market basket percentage increase
based on the best available data. Consistent with historical practice,
we proposed to estimate the ESRDB market basket percentage increase
based on IHS Global Inc.'s (IGI) forecast using the most recently
available data at the time of rulemaking. IGI is a nationally
recognized economic and financial forecasting firm with which CMS
contracts to forecast the components of the market baskets. As
discussed in the CY 2024 ESRD PPS proposed rule (88 FR 42435 through
42436), we proposed to calculate the market basket update for CY 2024
based on the proposed market basket percentage increase and the
proposed productivity adjustment, following our longstanding
methodology.
(a) CY 2024 Market Basket Percentage Increase
Based on IGI's first quarter 2023 forecast of the 2020-based ESRDB
market basket, the proposed CY 2024 market basket percentage increase
was 2.0 percent. We also proposed that if more recent data became
available after the publication of the CY 2024 ESRD PPS proposed rule
and before the publication of the final rule (for example, a more
recent estimate of the market basket percentage increase), we would use
such data, if appropriate, to determine the CY 2024 market basket
percentage increase in this final rule.
[[Page 76350]]
(b) Productivity Adjustment
Under section 1881(b)(14)(F)(i) of the Act, as amended by section
3401(h) of the Affordable Care Act, for CY 2012 and each subsequent
year, the ESRDB market basket percentage increase shall be reduced by
the productivity adjustment described in section 1886(b)(3)(B)(xi)(II)
of the Act. The statute defines the productivity adjustment to be equal
to the 10-year moving average of changes in annual economy-wide,
private nonfarm business multifactor productivity (MFP) (as projected
by the Secretary for the 10-year period ending with the applicable
fiscal year (FY), year, cost reporting period, or other annual period)
(the ``productivity adjustment'').
The Bureau of Labor Statistics (BLS) publishes the official
measures of productivity for the United States economy. As we noted in
the CY 2023 ESRD PPS final rule (87 FR 67155), the productivity measure
referenced in section 1886(b)(3)(B)(xi)(II) of the Act previously was
published by BLS as private nonfarm business MFP. Beginning with the
November 18, 2021, release of productivity data, BLS replaced the term
``multifactor productivity'' with ``total factor productivity'' (TFP).
BLS noted that this is a change in terminology only and will not affect
the data or methodology.\5\ As a result of the BLS name change, the
productivity measure referenced in section 1886(b)(3)(B)(xi)(II) of the
Act is now published by BLS as private nonfarm business TFP; however,
as mentioned previously, the data and methods are unchanged. We
referred readers to https://www.bls.gov/productivity/ for the BLS
historical published TFP data. A complete description of IGI's TFP
projection methodology is available on CMS's website at https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/MedicareProgramRatesStats/MarketBasketResearch. In addition, in
the CY 2022 ESRD PPS final rule (86 FR 61879), we noted that effective
for CY 2022 and future years, we will be changing the name of this
adjustment to refer to it as the productivity adjustment rather than
the MFP adjustment. We stated this was not a change in policy, as we
will continue to use the same methodology for deriving the adjustment
and rely on the same underlying data.
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\5\ Total Factor Productivity in Major Industries--2020.
Available at: https://www.bls.gov/news.release/prod5.nr0.htm.
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Based on IGI's first quarter 2023 forecast, the proposed
productivity adjustment for CY 2024 (the 10-year moving average of TFP
for the period ending CY 2024) was 0.3 percentage point. Furthermore,
we proposed that if more recent data became available after the
publication of the CY 2024 ESRD PPS proposed rule and before the
publication of this final rule (for example, a more recent estimate of
the productivity adjustment), we would use such data, if appropriate,
to determine the CY 2024 productivity adjustment in this final rule.
(c) CY 2024 Market Basket Update
In accordance with section 1881(b)(14)(F)(i) of the Act, we
proposed to base the CY 2024 market basket percentage increase on IGI's
first quarter 2023 forecast of the 2020-based ESRDB market basket. We
proposed to then reduce this percentage increase by the estimated
productivity adjustment for CY 2024 based on IGI's first quarter 2023
forecast. Therefore, the proposed CY 2024 ESRDB market basket update
was equal to 1.7 percent (2.0 percent market basket percentage increase
reduced by a 0.3 percentage point productivity adjustment).
Furthermore, as noted previously, we proposed that if more recent data
became available after the publication of the CY 2024 ESRD PPS proposed
rule and before the publication of the final rule (for example, a more
recent estimate of the market basket and/or productivity adjustment),
we would use such data, if appropriate, to determine the CY 2024 market
basket percentage increase and productivity adjustment in the final
rule.
We invited public comment on our proposals for the CY 2024 ESRDB
market basket update and productivity adjustment. Approximately 150
commenters, including large dialysis organizations (LDOs); provider
advocacy organizations; nonprofit dialysis associations; a coalition of
dialysis organizations; a network of dialysis organizations;
professional organizations and several ESRD facilities, commented on
the proposed CY 2024 ESRDB market basket update. The following is a
summary of the public comments received on these proposals and our
responses.
Comment: Commenters generally supported increasing the ESRD PPS
base rate and the utilization of the most recent data available (for
example, a more recent estimate of the market basket and/or
productivity adjustment) to determine the final CY 2024 ESRD PPS
update. MedPAC recommended that the ESRD PPS base rate increase for CY
2024 should be updated by the amount determined under current law, and
commented that analysis reported in the March 2023 Report to the
Congress: Medicare Payment Policy \6\ concluded that this increase is
warranted based on its analysis of payment adequacy (which includes an
assessment of beneficiary access, supply and capacity of facilities,
facilities' access to capital, quality, and financial indicators for
the sector). Many commenters expressed concern that the CY 2024 payment
update does not adequately factor in the effects of many challenges
faced by ESRD facilities, such as the impact of the COVID-19 public
health emergency (PHE), inflationary pressure, higher patient acuity,
Federal budget sequestration, increasing labor costs due to labor
shortages, and other increased costs, such as personal protective
equipment (PPE), drugs, and supplies. Several commenters also asserted
that during the last two ESRD PPS rulemaking cycles the ESRDB market
basket updates have not kept pace with the market basket increases for
other Medicare providers, such as hospitals and Skilled Nursing
Facilities (SNFs). Commenters additionally noted that the proposed CY
2024 ESRDB market basket increase was lower than certain other
estimates of overall inflation and healthcare-specific inflation. One
commenter stated that since the ESRD PPS' inception, the annual updates
in several years have fallen far below other measures, such as general
inflation or health care inflation as measured by the Consumer Price
Index (CPI).
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\6\ https://www.medpac.gov/wp-content/uploads/2023/03/Mar23_MedPAC_Report_To_Congress_v2_SEC.pdf.
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Response: We are required to update ESRD PPS payments annually by
the market basket update adjusted for productivity, as directed by
section 1881(b)(14)(F)(i) of the Act. Specifically, section
1881(b)(14)(F)(i)(I) of the Act states that the increase factor shall
be based on an ESRD market basket percentage increase for a bundled
payment system for renal dialysis services that reflects changes over
time in the prices of an appropriate mix of goods and services included
in renal dialysis services. We believe the increase in the 2020-based
ESRDB market basket adequately reflects the average change in the price
of goods and services ESRD facilities purchase to provide ESRD medical
services and is technically appropriate to use as the ESRD payment
update factor. The ESRDB market basket is a fixed-weight, Laspeyres-
type index that measures price changes over time and would not reflect
increases in costs associated with changes in the volume or intensity
of
[[Page 76351]]
input goods and services. As such, the ESRDB market basket update would
reflect the prospective price pressures described by the commenters
(such as wage growth or higher energy prices) but would not inherently
reflect other factors that might increase the level of costs, such as
the quantity of labor used or any shifts between contract workers and
staffed employees. We note that cost changes (that is, the product of
price and quantities) would only be reflected when a market basket is
rebased, and the base year weights are updated to a more recent time
period. We finalized the 2020-based ESRDB market basket in the CY 2023
ESRD PPS final rule (87 FR 67141), and therefore, any change in the
cost structure for ESRD facilities that occurred between 2016 and 2020
is now reflected in the cost weights for the 2020-based ESRDB market
basket, which was the most recent fully complete cost data available at
the time of rulemaking. We will continue to monitor the cost share
weights and, if technically appropriate, consider rebasing the ESRDB
market basket more frequently than usual should the cost weights change
significantly. Any proposal to rebase the ESRDB market basket would
occur through notice-and-comment rulemaking. The final CY 2024 ESRDB
market basket update reflects the most recent available data regarding
prices of labor used to provide renal dialysis services. As set forth
later in section II.B.1.a.(2)(c) of this final rule, the final
productivity-adjusted CY 2024 ESRDB market basket update is 2.1
percent, representing a ESRDB market basket increase of 2.4 percent
reduced by a productivity adjustment of 0.3 percent. We note that the
final CY 2024 ESRDB market basket update is 0.4 percentage points
higher than the proposed CY 2024 ESRDB market basket update. We
recognize that this 2.1 percent productivity-adjusted ESRDB market
basket update may still be lower than some commenters believe is
appropriate; however, it reflects the most recent available data
regarding expected price inflation for inputs required to provide renal
dialysis services based on CMS's longstanding methodology.
We acknowledge commenters' claims that the CY 2024 ESRD PPS
proposed market basket increase is less than increases for other
Medicare payment systems, including the Inpatient Prospective Payment
System (IPPS) and the Hospital Outpatient Prospective Payment System
(OPPS). In response to these concerns, we note that one cause of these
differences is that the mix of inputs used to provide renal dialysis
services is different from those used for other services captured by
other CMS market baskets. For example, the ESRDB market basket labor
cost weights (reflecting those cost weights that use an Employment Cost
Index (ECI) as price proxy) are generally lower than the labor cost
weights in other CMS PPS market baskets, and the pharmaceuticals and
medical supply cost weights in the ESRDB market basket (which is based
on the ESRD Medicare cost report (Form CMS-265-11)) are higher than the
pharmaceuticals and medical supply cost weights in other CMS PPS market
baskets.\7\ The weighting together of these different mixes of inputs
can appropriately result in differential rates of increase for various
market baskets. Additionally, we acknowledge that many measures of
inflation are higher than both the proposed 1.7 percent and the final
2.1 percent productivity-adjusted ESRDB market basket update for CY
2024. We note that some of the measures of inflation that commenters
referenced in their comments are either measures of past inflation or
measures of current inflation. The ESRDB market basket update is based
on a forecast for the changes in input prices as measured by the ESRDB
market basket for CY 2024, and not a measure of inflation during CY
2023. Under section 1881(b)(14)(F)(i) of the Act, the annual market
basket update reflects the changes over time in the prices of an
appropriate mix of goods and services included in renal dialysis
services. We believe that this is a more accurate estimate of the
changes in input prices faced by ESRD facilities than less specific
measures such as overall inflation or inflation across the entire
healthcare sector. Additionally, concerns raised by commenters that the
ESRDB market basket updates have been lower than general inflation or
healthcare inflation measures are not relevant comparisons, because the
law requires that the increase be based on an index that measures input
price pressures for providing renal dialysis services. We acknowledge
that many patients, ESRD facilities, and other health care providers
believe that rising prices are a major concern in providing high
quality care; however, we project that growth in input prices for renal
dialysis services will slow in CY 2024 relative to CY 2023, which is
reflected in the productivity-adjusted ESRDB market basket update of
2.1 percent.
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\7\ Public data can be found at https://www.bls.gov/eci/home.htm
and https://www.cms.gov/data-research/statistics-trends-and-reports/cost-reports.
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Comment: Several commenters indicated a belief that the ESRDB
market basket update would have an impact on quality of care provided
by ESRD facilities. Other commenters indicated that they believe the
current quality of care that ESRD PPS beneficiaries receive is too low,
and used this belief as justification for either supporting or opposing
the ESRDB market basket update.
Response: We appreciate commenters' insight into the quality of
care which Medicare beneficiaries receive at ESRD facilities. Medicare
beneficiaries have a right to safe, appropriate, and quality health
services. For ESRD facilities, the Federal health and safety
requirements are codified at 42 CFR part 494. To determine if a
facility meets ESRD conditions for coverage, the State survey agency
(SA), or a CMS-approved national accrediting organization (AO),
performs an on-site survey of the facility. After the initial approval,
dialysis facilities have routine onsite surveys to monitor compliance
with the Federal requirements. If a dialysis facility is found to be
deficient in one or more of the standards in the conditions for
coverage, it may participate in, or be covered under, the Medicare
program only if the dialysis facility has submitted an acceptable plan
of correction for achieving compliance within a reasonable period of
time acceptable to CMS. In the case of an immediate jeopardy situation
(that is, a situation in which the facility's non-compliance with one
or more Medicare conditions for coverage has caused, or is likely to
cause, serious injury, harm, impairment, or death to a patient), we may
require a shorter time period for achieving compliance.
When poor quality or unsafe health care is furnished by any type of
Medicare-certified provider or supplier, a complaint may be filed by
anyone, including patients, family members, or staff. Dialysis facility
complaints relating to improper care, unsafe conditions, and quality of
care may be filed with the State Health Department or the ESRD
Network.\8\
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\8\ https://www.cms.gov/training-education/open-door-forums/end-stage-renal-disease-clinical-laboratories-esrd/network.
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CMS has an established complaint process to protect all patients
from abuse, neglect, exploitation, and inadequate care and supervision.
The goal of the complaints process is to establish a system that will
assist in promoting and protecting the health and safety of all
patients receiving health services in a Medicare-certified facility.
The procedures for handling complaints
[[Page 76352]]
are outlined in Chapter 5 of the State Operations Manual,\9\ and they
are followed when complaints and reported incidents, including
referrals from the public or other Federal entities, involve Medicare-
certified providers/suppliers. The evaluation, investigation, and
resolution of complaints are critical certification activities. CMS and
the SAs, or AOs, are responsible for ensuring that participating
providers/suppliers of healthcare services continually meet Federal
requirements. This requires that the SA, or AO, promptly reviews
complaints/incidents, conducts unannounced onsite investigations of
reports alleged noncompliance, and informs the CMS locations any time a
facility is found to be out of compliance with the applicable
certification requirements. We believe the resources provided by the
ESRD PPS are appropriate to enable ESRD facilities to comply with the
requirements and procedures described above.
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\9\ https://www.cms.gov/medicare/provider-enrollment-and-certification/surveycertificationgeninfo/downloads/som107c05pdf.pdf.
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Comment: One ESRD patient stated that ESRD facilities were already
being paid too much and that the quality of care provided by ESRD
facilities was insufficient given the payment amount.
Response: We appreciate the comments on Medicare payment amounts to
ESRD facilities. As stated previously, we are required to update ESRD
PPS bundled payments by the market basket update adjusted for
productivity under section 1881(b)(14)(F)(i) of the Act, which states
that the Secretary shall annually increase payment amounts by an ESRD
market basket percentage increase that reflects changes over time in
the prices of an appropriate mix of goods and services included in
renal dialysis services. As such, we believe that the final CY 2024
ESRDB market basket update is appropriate. We note that MedPAC states
that payment rates are adequate for the ESRD facilities. In addition,
regarding the commenter's belief that ESRD facilities are being paid
too much, and the concerns the commenter noted citing specific quality
of care issues for ESRD patients, we note that, as described earlier in
this section, CMS is actively engaged in efforts to ensure Medicare
ESRD beneficiaries receive quality care. Additionally, the ESRD QIP
actively monitors and adjusts payments to facilities under the ESRD PPS
based on their performance on several quality measures.
Comment: Several commenters, including a coalition of dialysis
organizations, stated that ESRD facilities face relatively small profit
margins when caring for Medicare beneficiaries and indicated that they
believe the ESRDB market basket increase amount would lead to lower
standards of care in CY 2024 and that to prevent this, CMS should
consider increasing payments by a larger amount. One ESRD patient
characterized the proposed CY 2024 ESRDB market basket update as being
insufficient for the extent of the financial impact of recent
inflationary events. Numerous commenters stated that a larger payment
rate increase would allow ESRD facilities to hire more staff and
increase the quality of care. Some commenters suggested that CMS
reevaluate the proposed market basket update and instead increase ESRD
PPS payments by a larger amount.
Response: We understand that commenters are concerned about the
profit margins for ESRD facilities. As stated previously, we believe
that the final CY 2024 ESRDB market basket update reflects the most
recent available data regarding the input prices required to provide
renal dialysis services. We did not propose any additional increases to
the ESRD PPS base rate to improve ESRD facility margins or otherwise
account for factors that commenters believe are not adequately
represented in the market basket update methodology, and we are not
finalizing any such increases. We will continue to monitor the adequacy
of the ESRD PPS payment amount and will consider these comments in
potential future rulemaking. In addition, as described earlier in this
section, CMS is actively engaged in efforts to ensure Medicare ESRD
beneficiaries receive quality care.
Comment: Several commenters, including a provider advocacy
organization, noted that the ESRD PPS payment rate update would have
implications for Medicare Advantage payment rates. Many of these
commenters expressed that the proposed ESRDB market basket update of
1.7 percent would lead to lower payments from Medicare Advantage.
Response: We understand that some commenters are concerned about
the impact that the proposed CY 2024 ESRDB market basket update would
have on rates for other payors, including Medicare Advantage. However,
we are required to update the ESRD PPS bundled payment by the market
basket update adjusted for productivity under section 1881(b)(14)(F)(i)
of the Act, which states that the Secretary shall annually increase
payment amounts by an ESRD market basket percentage increase that
reflects changes over time in the prices of an appropriate mix of goods
and services included in renal dialysis services. This update is not
intended to account for or direct the business practices of other
payors. We note that the final productivity-adjusted CY 2024 ESRDB
market basket update is 2.1 percent, which represents an increase to
the proposed productivity-adjusted CY 2024 ESRDB market basket update
of 1.7 percent, and we anticipate that the increase alleviates some of
the commenters' concerns. We did not propose to make any additional
methodological changes to the market basket update or ESRD PPS base
rate to account for other payors and are not finalizing any additional
methodological changes on this topic.
Comment: We received numerous other comments on potential
implications of the proposed CY 2024 ESRDB market basket update.
Several commenters claimed the proposed CY 2024 ESRD PPS base rate
update would have a negative impact on other factors including, but not
limited to, wait times for dialysis appointments, access to innovative
treatments for ESRD patients, ESRD treatments for nursing home
patients, ESRD treatments for the elderly, Medicare Part A payments,
and hospitalizations for ESRD PPS patients.
Response: We recognize that commenters are concerned about the
impact that the magnitude of the CY 2024 ESRDB market basket update has
on ESRD facilities' ability to provide quality renal dialysis services.
As stated previously, the final CY 2024 ESRDB market basket update
reflects the most recent available data regarding prices for inputs
used to provide renal dialysis services. We recognize that payment
policy within the ESRD PPS can affect the quality and accessibility of
renal dialysis services; however, the CY 2024 ESRDB market basket
update adequately reflects the average change in the price of goods and
services ESRD facilities purchase to provide renal dialysis services,
so we do not agree with commenters' claims that the ESRDB market basket
update would have a negative impact on these other factors. We did not
propose any changes to the existing ESRDB market basket update
methodology in the CY 2024 ESRD PPS proposed rule and are not
finalizing any such methodological changes in this rule. We appreciate
the insight of commenters into the implications of the ESRDB market
basket update and will keep these implications in mind in future
rulemaking.
Comment: Several commenters questioned CMS's longstanding market
basket methodology. Commenters expressed concern over the accuracy of
the forecast underlying the proposed
[[Page 76353]]
market basket update for CY 2024, including that CMS's use of the IGI
forecast for determining the market basket update does not capture the
specialized nature of ESRD facility costs. A few commenters requested
that CMS reexamine the forecasting approach or consider other methods
and data sources to calculate the final rule market basket update that
better reflect the rapidly increasing input prices and costs facing
ESRD facilities. Other commenters indicated that they believed that it
is inappropriate to continue to use the same mix of goods and services
that were used at the inception of the ESRD PPS in the CY 2011 ESRD PPS
final rule. One ESRD facility suggested that, because there has been
significant variation between the forecasted and actual ESRDB market
basket price growth, CMS should evaluate whether the market basket
methodology is inherently flawed. Several commenters believed that a
retrospective adjustment to the base rate to account for past
differences between the ESRDB market basket update for a given year and
what the ESRDB market basket update would have been for that year based
on the actual changes in prices, known as a forecast error adjustment,
could alleviate some of the perceived flaws in the market basket update
methodology.
Response: We thank commenters for providing these comments on the
ESRDB market basket update methodology. In response to the commenters'
request that we reexamine the current forecasting approach for
determining the ESRDB market basket update, we provide the following
information. IGI is a nationally recognized economic and financial
forecasting firm with which CMS contracts to forecast the price proxies
used in the market baskets. At the time of the CY 2024 ESRD PPS
proposed rule, based on the IGI first quarter 2023 forecast with
historical data through the fourth quarter of 2022, the 2020-based
ESRDB market basket update was forecasted to be 2.0 percent for CY
2024, reflecting forecasted compensation price growth of 3.7 percent
(by comparison, compensation price growth in the ESRDB market basket
averaged 2.6 percent from 2013 to 2022). In the CY 2024 ESRD PPS
proposed rule, we proposed that if more recent data became available,
we would use such data, if appropriate, to derive the final CY 2024
ESRDB market basket update for the final rule. For this final rule, we
now have an updated forecast of the price proxies underlying the market
basket that incorporates more recent historical data and reflects a
revised outlook regarding the U.S. economy and expected price inflation
for CY 2024. Based on IGI's third quarter 2023 forecast with historical
data through the second quarter of 2023, we are projecting a CY 2024
ESRDB market basket update of 2.4 percent (reflecting forecasted
compensation price growth of 4.1 percent) and a productivity adjustment
of 0.3 percentage point. Therefore, for CY 2024 a final ESRDB
productivity-adjusted market basket update of 2.1 percent (2.4 percent
less 0.3 percentage point) will be applicable, compared to the 1.7
percent productivity-adjusted market basket update that was proposed.
We note that section 1881(b)(14)(F)(i) of the Act states that the
Secretary shall annually increase payment amounts by an ESRD market
basket percentage increase that reflects changes over time in the
prices of an appropriate mix of goods and services included in renal
dialysis services. We believe that the current market basket update
methodology as finalized in the CY 2011 ESRD PPS final rule (75 FR
49151 through 49162), and most recently updated in the CY 2023 ESRD PPS
final rule (87 FR 67141 through 67157) to reflect a 2020 base year,
fulfills this statutory requirement. We support the continued use of
the current mix of goods and services to provide continuity to the
financial impacts of the ESRD PPS payment policy, and we note that the
weighting for this mix of goods and services is updated periodically
through rebasing. However, we will consider the commenter's suggestion
regarding the use of different methods or other data sources for the
ESRDB market basket for future rulemaking. We discuss the commenters'
request for a forecast error adjustment below. We did not propose any
methodological changes to the ESRDB market basket update methodology
for CY 2024, and we are finalizing the continued use of the ESRDB
market basket methodology as finalized in the CY 2023 ESRD PPS final
rule (87 FR 67141 through 67157). We do not believe that the ESRDB
market basket update is inherently flawed because the forecast errors
for CYs 2021 and 2022 were higher-than-normal due to the high inflation
during the COVID-19 PHE, which we discuss further in section
II.B.1.a.(2)(d) of this final rule. We will continue to monitor the
performance of the ESRDB market basket update, and we will keep these
comments on the market basket methodology in mind for future
rulemaking. We note that CMS engages with the public, including the
dialysis industry and associations, routinely throughout the year in
our continuing efforts to align payment with resource utilization. We
welcome continuing dialogue on the topic of improving the market basket
update methodology, and other topics pertinent to the ESRD PPS, toward
the common goal of improving care for ESRD patients.
Comment: Some commenters provided information on additional rising
costs faced by ESRD facilities that the commenters believed were not
adequately captured in the proposed CY 2024 ESRDB market basket update.
These additional costs included the following: costs associated with
compliance with additional regulations regarding infection control;
costs related to supply chain problems; rising costs for certain
supplies; and cost related to changes in labor, such as additional pay
for traveling nurses or contract nurses.
Response: We appreciate the insight into changing costs that ESRD
facilities face. As stated previously, the final CY 2024 ESRDB market
basket update reflects the most recent available data regarding prices
for inputs used to provide renal dialysis services. These costs which
commenters listed are included in the ESRDB and so the change in their
prices would be included in the CY 2024 ESRDB market basket update. If
the rising costs the commenters' mentioned are due to an increase in
quantity of the good purchased, rather than an increase in price, we
note that such cost changes would only be reflected when a market
basket is rebased, and the base year weights are updated to a more
recent time period. We finalized the 2020-based ESRDB market basket in
the CY 2023 ESRD PPS final rule (87 FR 67141); therefore, any change in
the cost structure for ESRD facilities that occurred between 2016 and
2020 is now reflected in the cost weights for the 2020-based ESRDB
market basket, which was the most recent fully complete cost data
available at the time of rulemaking. We believe that it is technically
appropriate to use the 2020-based ESRDB market basket for the CY 2024
ESRDB market basket update.
Comment: One commenter asserted that experience over the past few
years has indicated that the ESRD PPS methodology is unable to reflect
short-term and long-term impacts of an economic shock, such as the
COVID-19 PHE. The commenter noted that although CMS offers detailed
explanations of the market basket's construction and issues data
through its website, the dialysis provider community still has little
insight into the factors contributing to annual
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payment updates that the commenter believes consistently fail to
reflect increases in the cost of care delivery. The commenter urged CMS
to engage in a formal dialogue with the kidney care community outside
of the annual rulemaking process to better identify the methodology's
limitations and inform development of improvements. The commenter also
requested that IGI have representation and participation in this
dialogue.
Response: We appreciate the commenter's concerns regarding the
market basket methodology. Our longstanding ESRDB market basket update
methodology sets rates prospectively on an annual basis. We acknowledge
that over the course of a year, short term changes in economic
conditions can lead to uncertainty, which may be exacerbated by
economic shocks. Because the ESRD PPS base rate is updated annually,
the purpose of the ESRDB market basket update is to account for the
change in price of the ESRDB from year to year, not necessarily to
capture the effect of shorter term fluctuations of prices. That short
term fluctuations are not addressed by the ESRDB market basket update
is a consequence of the annual nature of the update as required by
section 1881(b)(14)(F) of the Act. We believe the ESRDB market basket
update appropriately captures the change in the price of goods and
services over time in the long term. Some commenters have suggested a
forecast error adjustment as a way to mitigate the impact of these
short-term uncertainties, which we discuss in further detail in section
II.B.1.a.(2)(d) of this final rule. CMS will continue to engage with
the public regarding ways to ensure the Medicare ESRD PPS payments are
appropriate and that the market basket price proxies and base year
weights are accurate.
Comment: We received several comments, including from a patient
organization, stating that the proposed ESRDB market basket update
would not sufficiently support innovation.
Response: We note that ESRD PPS policies to encourage the
adaptation of new innovations, such as the TDAPA and TPNIES, are add-on
payment adjustments to the base rate, and although there is only one
ESRD PPS bundled payment, these adjustments are not a part of the ESRDB
and therefore, are not included in the ESRD PPS base rate or the ESRDB
market basket update. This is similarly true for the post-TDAPA add-on
payment adjustment that we are finalizing in this rule, which is
described in further detail in section II.B.1.i of this final rule.
These add-on payment adjustments are actively supporting the adoption
of certain new and innovative drugs, biological products, equipment and
supplies by ESRD facilities, by providing additional payment to offset
the additional cost of those drugs, biological products, equipment and
supplies. We did not propose any changes to the ESRDB market basket
update methodology to account for innovation within the ESRD PPS and
are not finalizing any such changes in this final rule. We will
consider these comments on supporting innovation and access to
innovative products in potential future rulemaking.
Comment: We received approximately 90 comments related to the
nature of labor costs at ESRD facilities, including comments from large
dialysis organizations, advocacy organizations, ESRD facilities,
providers, and a coalition of dialysis organizations. Commenters
generally stated that labor costs at ESRD facilities are increasing,
which is driving overall cost increases at ESRD facilities, and that
the proposed ESRDB market basket update was insufficient to cover these
increased labor costs. Many of the commenters cited that the growth in
their labor costs has outpaced the ESRDB market basket updates or the
growth of the market basket compensation cost category in the ESRDB
market basket. Additionally, some commenters noted that labor costs
were rising across the healthcare sector, which the commenters asserted
was not appropriately reflected in the ESRDB market basket update.
Commenters described other barriers to hiring and maintaining staff
including, but not limited to, burnout, lack of resources, inability to
match competitive pay, and long travel times for staff. A coalition of
dialysis organizations commented that it was increasingly difficult for
ESRD facilities to hire new staff while competing with other health
care providers with more resources and non-healthcare employers. They
stated that this was leading to some ESRD facilities having to turn
away patients or being unable to continue operations. One LDO noted
that staffing concerns are leading to ESRD facilities using a higher
percentage of more-expensive contract labor and that contract labor
wages and benefits make up 1.9 percent and 0.5 percent of the 2020-
based ESRDB, respectively. Some commenters highlighted the COVID-19 PHE
as a significant factor in the workforce shortage that ESRD facilities
face; however, some commenters indicated that they believe this
workforce shortage has been in progress for a long time.
Some ESRD facilities and LDOs included various additional
information or data on the extent to which their labor costs have
increased over the past few years. Several commenters, including an LDO
and a non-profit dialysis organization, referenced an analysis that
showed labor costs grew at a compound average growth rate of 6.96
percent from 2018 to 2022, whereas the proxy for labor used in the
ESRDB market basket update methodology grew at a compound average
growth rate of 3.15 percent from 2018 to Q1 2022. One provider advocacy
organization commented that its analysis found that direct patient care
labor costs per dialysis treatment increased by 18.9 percent from 2017
to 2022.
Commenters also stated that the increasing labor costs were
resulting in staffing concerns at ESRD facilities. Some of these
comments highlighted access issues arising from fewer available
dialysis sessions. Some comments referenced quality issues related to
the burden placed on workers at ESRD facilities by low staffing and the
limited training of staff at ESRD facilities due to high turnover. Many
of these comments came from ESRD patients, caretakers and patient
advocates and included the commenters' personal experience on the
issues related to receiving care at ESRD facilities (for example,
difficulty finding appointments, having to travel significant distances
to get care, and how low staffing at ESRD facilities has impacted their
care). Other commenters conveyed their concern about inadequate
staffing and related many incidents of significant adverse events and
sub-standard quality care, which they attributed to low staffing. A
kidney disease patient organization included multiple testimonials from
ESRD patients regarding their issues in trying to locate dialysis
treatments.
Some commenters highlighted the impact that staffing shortages had
on home dialysis. Several patients expressed a willingness and desire
for self-dialysis training, but stated they were unable to receive
self-dialysis dialysis training due to staff shortages at their
clinics.
Response: We thank commenters for their insight into labor supply
and labor costs at ESRD facilities, and we recognize that labor costs
are a driving factor in cost increases at ESRD facilities. We
acknowledge that CY 2022 price growth for the 2016-based ESRDB market
basket was higher (5.1 percent) than was forecasted at the time of the
CY 2022 ESRD PPS final rule (2.4 percent). We note that the lower
projected CY 2024 ESRDB market basket percent increase (2.4 percent)
relative to the observed CY 2022 historical increase, as well as the
forecasted CY
[[Page 76355]]
2023 ESRDB market basket increase of 3.1 percent, reflect the
expectation that wage and price pressures will lessen in CY 2024
compared to recent years. As described previously, the ESRDB market
basket measures price changes (including changes in the prices for
wages and salaries and benefits) over time and would not reflect
increases in costs associated with changes in the volume or intensity
of input goods and services until the market basket is rebased. An
ESRD-specific compensation price index is unavailable; therefore, we
use a composite wage and benefit index of various Employment Cost
Indices (ECIs) reflecting the occupational mix of full-time equivalents
(FTE) data from ESRD Medicare Cost reports and ECIs from BLS (87 FR
67147). Health-related occupations account for 79 percent of the 2020-
based ESRDB compensation cost weight and are proxied by the ECI for All
Civilian Workers in Hospitals, reflecting similar medical occupations
used in ESRD facilities (particularly nurses) and their associated
price growth. As discussed in the CY 2023 ESRD PPS final rule, we
believe the composite weighted index for wages and salaries and
benefits to be a reasonable proxy for the compensation component of the
ESRDB market basket. We note that section 1881(b)(14)(F)(i) of the Act
states that the Secretary shall annually increase payment amounts by an
ESRD market basket percentage increase that reflects changes over time
in the prices of an appropriate mix of goods and services included in
renal dialysis services. While labor is included in the mix of goods
and services in the ESRD PPS bundled payment, the annual market basket
increase accounts for more than the price change for labor. As such, it
is possible for the market basket increase to be less than the increase
in the price of labor if the other goods and services included in the
ESRDB do not experience as large of a price increase. Our analysis of
the data used to determine the ESRDB market basket forecast indicates
that this dynamic is reflected in the market basket increases for the
past few years. For example, in 2021 the overall market basket forecast
was an increase of 1.9 percent, but the labor portion of the ESRDB
market basket was forecasted to increase by 2.5 percent. We recognize
commenters' view that the proposed ESRDB market basket increase for CY
2024 was less than ESRD facilities' reported labor increases. However,
if, as commenters have stated, labor is the driving factor for the
increase in costs for ESRD facilities, it would be expected that the
labor percentage increase would be greater than the overall ESRDB
market basket percentage increase. This is because the ESRDB market
basket increase is a weighted average of the changes in prices for the
ESRDB market basket. Labor is only one part of the ESRDB market basket,
and commenters have indicated that other components of the ESRDB market
basket have not experienced the same growth in price as labor. We
believe the 2020-based ESRDB market basket increase adequately reflects
the average change in the price of goods and services ESRD facilities
purchase to provide renal dialysis services, including labor, and is
technically appropriate to use as the ESRD PPS payment update factor.
The ESRDB market basket update will reflect the expected prospective
price pressures described by the commenters as increasing during a high
inflation period (such as faster wage growth or higher energy prices)
but inherently will not reflect other factors that might increase the
level of costs, such as the quantity of labor used. Therefore, the
final CY 2024 ESRDB market basket update reflects the most recent
available data regarding both prices and the items and services used to
provide renal dialysis services.
We thank commenters for including detailed information and data on
the changes to labor costs that ESRD facilities face. We agree that
during the COVID-19 PHE, labor costs increased more than normal.
According to our analysis, the ESRDB market basket compensation price
growth was forecasted to increase a cumulative 18.9 percent from CY
2017 to CY 2022. This is the same as the figure which one commenter
described as being the change in direct labor costs over that time. We
recognize that some comments indicated that ESRD facilities experienced
larger or smaller changes in labor costs than this over that time. We
note that the ESRDB market basket does not measure each individual ESRD
facility's own experience, but instead the ESRDB market basket cost
weights reflect the experience of the average ESRD facility. Therefore,
if one area of the country experienced an increase in labor costs at a
higher rate than other areas of the country, that would not be wholly
captured in the annual update. Instead, the relative difference in
labor cost growth should be captured in changes to the wage index for
that ESRD facility. However, we recognize that our wage index
methodology uses historical data instead of a forecast and as such
takes longer to update in response to periods of large change.
We appreciate comments from ESRD patients which highlighted their
experiences at ESRD facilities. We are concerned by the comments which
indicate access and quality concerns at ESRD facilities related to
staffing issues. We note that Sec. 494.180(b) requires that an ESRD
facility have an adequate number of qualified and trained staff;
however, the governing body of the facility has a measure of discretion
when determining staffing. The ESRD PPS provides a bundled payment that
encompasses all renal dialysis services, including labor. We recognize
that staffing shortages can pose a difficulty to ESRD patients who
desire training for self-dialysis. We note that the ESRD PPS includes
an add-on payment adjustment for self-dialysis training (42 CFR
413.235(c); 81 FR 77851 to 77856). We appreciate the comments regarding
these staffing issues and will consider them for potential future
rulemaking.
Comment: One commenter encouraged CMS to explore other changes to
the composition of the market basket to better capture evolving
dynamics in the labor force. The commenter provided as an example that
the ECI may no longer accurately capture the changing composition and
cost structure of the hospital labor market given the large increases
in short-term contract labor use and its growing costs.
Several commenters expressed concern that not all the ESRDB market
basket price proxies, particularly the labor-related price proxies,
accurately reflect ESRD facilities' faster than expected cost growth.
One commenter noted that for healthcare providers across all sectors,
the impact of the tight labor market (both in the healthcare sector and
general economy overall) has forced ESRD facilities to rely more
heavily on contracted labor. The commenter further pointed out that
under the 2020-based ESRDB market basket, contract labor wages and
benefits have 1.9 percent and 0.5 percent weights, respectively;
however, the commenter expressed concern that these weights were
derived by assuming that ESRD facilities use the same labor amount and
mix as they did more than a decade ago, which does not reflect the
current environment in which dialysis providers deliver care. They
stated that use of the U.S. Census Bureau's Services Annual Survey
(SAS) data may not reflect staffing ratio or minimum wage requirements
adopted by State and municipal governments since 2012, the recent
years' shift in labor mix, unanticipated increase in compensation
[[Page 76356]]
expenses, or the COVID-19 PHE's overall impact on the healthcare labor
force.
A few commenters stated that certain market basket components rely,
to some extent, on severely lagged data, which during times of unusual
circumstances, could limit a forecast model's ability to capture
economic shocks and the subsequent impact on health care providers'
costs. The commenters stated, for example, the BLS's ECI price proxies
generally hold the employment mix constant for several years. They
stated that the ECI's weights reflected the 2012 occupational mix until
recently (the December 2022 BLS release updated the data to reflect
2021 employment weights). The commenters noted that since ECI
employment weights are held constant for a period this would introduce
inaccuracies into the market basket updates. They stated that since the
ECI 2012 weights were used for the price proxies in the ESRDB market
basket through the CY 2022 rulemaking cycles it could have resulted in
errors in the ESRDB market basket update.
Response: We appreciate the commenters' concerns about the
composition of the ESRDB market basket and whether the price proxies
used in the market basket are accurately capturing the price pressures
experienced by ESRD facilities.
The commenters are correct that the ECI data are based on fixed
occupational weights; however, we believe these indexes continue to be
technically appropriate measures of pure compensation inflation to be
used in the ESRDB market basket. Because the market baskets are
intended to measure price changes over time, and not changes in costs
that also reflect quantity and intensity changes, the fixed
occupational distribution of the ECI is appropriate. BLS periodically
updates these distributions (in the January 2023 release of December
2022 ECI data they introduced updated 2021 fixed employment weights,
replacing the 2012 weights used through September 2022). Additionally,
the observed ECI for Wages and Salaries for All Civilian workers in
Hospitals (which accounts for 29 percent of the 2020-based ESRDB market
basket) data has reflected recent wage ``price'' pressures as growth in
2021 and 2022 accelerated relative to 2020. The projection of the ECI
also considers anticipated wage pressures due to various economic and
industry-specific factors; the hospital ECI is projected to grow faster
in 2023 compared to the historical average growth in the series,
particularly prior to 2021. We note that when developing its forecast
for the ECI for All Civilian Workers in Hospitals, IGI considers
overall labor market conditions (including rise in contract labor
employment due to tight labor market conditions) as well as trends in
contract labor wages, which both have an impact on wage pressures for
workers employed directly by the hospital. We also acknowledge the
commenters' concerns that the ECI only reflects employed labor costs;
however, we note that the alternative publicly available average hourly
earnings series also does not include contract labor costs.
Additionally, we analyzed the FTE data reported on the Medicare cost
reports and found that the share of contract labor FTEs is about 2
percent of all FTEs and has remained relatively constant in 2021 and
2022. We will continue to monitor the cost report data as it is
received to ensure that the ECI series used to proxy ESRD labor
categories continues to offer the most appropriate price proxies for
measuring compensation price growth in ESRD facilities.
Lastly, we acknowledge commenters' concern that the contract labor
cost weight in the ESRDB market basket relies on 2012 SAS data
published by the United States Census Bureau inflated to 2020-dollar
values as the basis for the contract labor cost weight. We proposed and
finalized the methodology for deriving the compensation cost share
weights in the CY 2023 ESRD PPS rulemaking cycle (87 FR 67141 through
67157). Because the Medicare cost report data does not capture the
specific costs for contract labor, we therefore must rely on other data
sources to estimate the share of contract labor costs that are reported
within Administrative and General costs on the cost reports. We have
not identified any other data source that provides specific contract
labor costs for ESRD facilities.
Final Rule Action: After consideration of the comments received, we
are finalizing a CY 2024 ESRDB productivity-adjusted market basket
increase of 2.1 percent based on the most recent data available. As
noted previously, based on the more recent data available for this CY
2024 ESRD PPS final rule (that is, IGI's third quarter 2023 forecast of
the 2020-based ESRDB market basket with historical data through the
second quarter of 2023), the CY 2024 ESRDB market basket update is 2.4
percent. Based on the more recent data available from IGI's third
quarter 2023 forecast, the current estimate of the productivity
adjustment for CY 2024 is 0.3 percentage point. Therefore, the current
estimate of the CY 2024 ESRD productivity-adjusted market basket
increase factor is equal to 2.1 percent (that is, the 2.4 percent
market basket update reduced by the 0.3 percentage point productivity
adjustment).
(d) Requests for a Forecast Error Payment Adjustment
In the CY 2024 ESRD PPS proposed rule (88 FR 42435), we discussed
that in the CY 2023 ESRD PPS final rule (87 FR 67157), many commenters
requested that CMS apply a forecast error payment adjustment to the
ESRD PPS base rate to support ESRD facilities during the inflationary
period occurring at that time, particularly accounting for what
commenters stated was an error in the forecasted payment updates for
CYs 2021 and 2022. In response to those comments, we reminded readers
that ESRDB market basket updates are set prospectively, meaning the
update relies on a mix of both historical data for part of the period
for which the update is calculated and forecasted data for the
remainder. We explained that while there is no precedent to adjust for
market basket forecast error in the annual ESRD PPS update, the
forecast error for a market basket update is calculated as the actual
market basket increase for a given year less the forecasted market
basket increase.\10\ We also explained that due to the uncertainty
regarding future price trends, forecast errors can be both positive and
negative. For example, the CY 2017 ESRDB forecast error was -0.8
percentage point, while the CY 2021 ESRDB forecast error was +1.2
percentage points. At the time of the CY 2023 ESRD PPS final rule, CY
2022 historical data was not yet available to calculate a forecast
error for CY 2022; however, based on the latest available historical
data for CY 2022, we now calculate that the CY 2022 ESRDB forecast
error was +2.7 percentage points.
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\10\ FAQ--Market Basket Definitions and General Information.
Available at: https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/medicareprogramratesstats/downloads/info.pdf.
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We further noted that, in the CY 2023 ESRD PPS final rule (87 FR
67156), we recognized that recent higher inflationary trends impacted
the outlook for price growth over the next several quarters. For that
CY 2023 ESRD PPS final rule, we used an updated forecast of the price
proxies underlying the market basket that incorporated more recent
historical data and reflected a revised outlook regarding the U.S.
economy and expected price inflation for CY 2023 for ESRD facilities.
We explained that predictability in
[[Page 76357]]
Medicare payments is important to enable ESRD facilities to budget and
plan their operations, and that forecast errors are unpredictable (87
FR 67517). Prior to the COVID-19 PHE period, the positive differences
between the actual and forecasted market basket increase in prior years
have offset negative differences over time. Therefore, we stated in the
CY 2024 ESRD PPS proposed rule that, in accordance with our
longstanding ESRDB market basket update methodology, we would not
propose to apply a forecast error adjustment to the ESRDB market basket
update for CY 2024.
Comment: We received approximately 30 comments related to CMS's
decision not to propose a forecast error adjustment for CY 2024. These
commenters, including a coalition of dialysis providers, several LDOs,
and numerous provider and patient advocacy organizations, requested
that CMS reevaluate and implement a payment adjustment to account for
past forecast errors. Many commenters requested that CMS apply a
forecast error adjustment to the ESRD PPS payment update for CY 2024.
Some specific suggestions for payment adjustments included: a CY 2024
adjustment of 10 to 20 percent per discharge; an adjustment for the
``underpayment'' of ESRD facilities since 2020; and/or the adoption a
forecast error adjustment like the one used in the SNF PPS. Several
commenters stated that absent a forecast error adjustment they may be
forced to close some of their ESRD facilities, particularly those
facilities located in areas with vulnerable populations.
The commenters stated that the forecast error was driven mainly by
unforeseen increased costs for labor (including a higher reliance on
contract labor staff), equipment, and medical supplies (including PPE
and pharmaceuticals), which resulted in increased costs to provide care
to ESRD beneficiaries that were never properly reimbursed under the
Medicare ESRD PPS payments. Commenters stated that while the growth in
these costs has begun to stabilize somewhat in 2023, they continue to
be substantially higher than pre-pandemic levels. Commenters also
pointed out that while high wage inflation and labor shortages affect
all health care providers, dialysis providers are particularly
vulnerable because there is not variation in types of services
performed or billed and due to the less variable payer mix that relies
more on Medicare and Medicaid payment than other health care provider
types.
One commenter noted that while other health care providers have
experienced similar forecast errors in CY 2022 and CY 2023, the current
cumulative underpayment error for the ESRD PPS exceeds the errors in
other payment systems such as IPPS, home health, and long-term care
hospitals.
Some commenters acknowledged that since the market basket updates
are set prospectively, they are inherently imperfect, and forecast
errors from year to year may occur in either a positive or negative
direction. However, several commenters noted that in the case of the
ESRDB market basket these differences have not offset one another over
time. The commenters stated a belief that the magnitude of the errors
in 2021 and 2022, which they state resulted from a flawed methodology
that failed to accurately forecast higher than normal inflation, are
highly unlikely to even out over time unless there is a similar, fast
moving deflationary event resulting in the same magnitude in the
forecast.
Many commenters requested CMS establish a payment adjustment
modeled after the forecast error adjustment for payments to SNFs that
was established in 2004 (68 FR 46057). These commenters responded to
CMS's view that historical negative forecast errors are offset by
positive errors by noting that over the past few years the forecast
errors have been predominantly positive, at 1.2 percent and 2.7 percent
in CYs 2021 and 2022 respectively. As such, the ESRD PPS base rate is
lower than it would have been if the forecasts had been accurate. Many
of these commenters supported a forecast error adjustment methodology
that would, like the SNF adjustment of 2004, only be applied if the
error is larger than a certain threshold. Multiple commenters supported
a threshold of 0.5 percentage point for this adjustment. Many
commenters compared the state of SNF payment in 2004 and of the ESRD
PPS today, emphasizing the similarities in the amount by which the
recent market basket updates had been incorrect, the source of the
error mainly attributable to unexpectedly large increases in the costs
of labor, and certain similar statutory language describing the SNF PPS
and the ESRD PPS. A coalition of dialysis organizations suggested that
for the CY 2024 ESRD PPS final rule CMS should adjust the ESRD PPS base
rate by the cumulative forecast error since 2019 but added that they
would also approve of adjusting the ESRD PPS base rate by the
cumulative forecast error since the inception of the ESRD PPS in 2011.
Some commenters, including an LDO, suggested in lieu of a permanent
forecast error adjustment policy for ESRDs, CMS could apply a one-time
positive adjustment to the ESRD PPS base rate to account for the
forecast error in recent years, with commenters suggesting it be
applied to the ESRD PPS base rate in a non-budget neutral manner. Some
commenters, including an LDO, recognized that CMS's view that the
market basket errors could balance out over time could be true for
small variations; however, the commenters stated that it would not hold
true for periods of significant missed forecasts due to periods of
rapid change, for example during the COVID-19 PHE. Generally,
commenters stated that they agreed with CMS on the importance of
predictability for payments but stated that payment accuracy was more
important, so a forecast error payment adjustment would be useful as it
would improve payment accuracy.
Some comments included additional information on what commenters
stated could happen with or without a forecast error adjustment. One
LDO commented that their analysis indicated that the under-forecast
would lead to a total of $1.8 billion in underpayments between CY 2021
to 2027. One patient-led dialysis organization recommended an
``Essential Worker Safety Catch'' to revise past updates to ensure
labor is adequately compensated. A provider advocacy organization
questioned CMS's use of 2020-cost reports in determining payment for CY
2024, saying it was outdated and inaccurate. One ESRD facility
commented that given the size of recent errors, they believed it was
likely that errors would continue to increase and potentially become
larger in the future.
Response: While the projected ESRDB market basket updates for CY
2021 and CY 2022 were under-forecast (that is, actual increases were
greater than forecasted), as is the preliminary CY 2023 forecast error,
this was largely due to unanticipated inflationary and labor market
pressures as the economy emerged from the COVID-19 PHE. An analysis of
the forecast error of the ESRDB market basket over a longer period
shows the forecast error has been both positive and negative. We
recognize that the COVID-19 PHE and high inflationary environment have
had an adverse impact on costs for ESRD facilities. Due to ESRD
payments being set prospectively, we rely on a projection of the ESRDB
market basket that reflects both historical and forecasted trends. Due
to the uncertainty regarding future price trends, the difference
between the projected and actual market basket increases can be both
positive and negative. We note that from CY 2012 to CY 2020, the only
year in which the forecast error of the ESRDB
[[Page 76358]]
market basket update exceeded the 0.5 percentage point threshold in
absolute terms (which is applicable for the SNF PPS forecast error
adjustment) was CY 2017. The forecasted CY 2017 ESRDB market basket
update was 0.8 percentage point higher than the actual CY 2017
percentage increase of the 2012-based ESRDB market basket based on
historical data. We also acknowledge that the ESRDB market basket
forecast errors for CY 2021 (1.2 percentage points) and CY 2022 (2.7
percentage points) exceeded the 0.5 percentage point threshold where
the forecasted ESRDB market basket updates were lower than the actual
percentage increases based on historical data. These recent forecast
errors were largely a function of uncertainty in the overall economy
and the health sector specifically due to the nature of the COVID-19
PHE and the unforeseen rapidly accelerating inflationary environment.
Rapid increase in costs during the COVID-19 PHE has led to a positive
forecast error for every Medicare PPS.
The data on which the final CY 2024 ESRDB market basket update is
based is the most recent available data. We note that the 2020 cost
report data was used for rebasing the market basket as finalized in the
CY 2023 ESRD PPS final rule (87 FR 67141 through 67154), and at the
time of CY 2023 rulemaking the 2020 cost report data was the most
recent year of complete cost report data available to develop the ESRDB
market basket cost weights. The ESRDB market basket cost weights do not
change from year to year since it is a fixed-weight Laspeyres index;
therefore, for CY 2024, we use the most recent available forecast of
the price proxies to estimate the growth in the input prices of this
mix of goods and services for providing renal dialysis services for the
coming year. The most recent forecast of the price proxies in the ESRDB
market basket for this final rule is the IGI third quarter 2023
forecast with historical data through the second quarter of 2023. This
is the established methodology as finalized in the CY 2011 ESRD PPS
final rule (75 FR 49151 through 49162). Therefore, while the weighting
of the various goods and services that make up the ESRDB market basket
did utilize 2020 data for rebasing, it is inaccurate to characterize
the CY 2024 market basket increase as being based on 2020 data
generally. We do not agree with the commenter that stated a belief that
because forecast errors have been greater in recent years it is likely
that forecast errors will be larger in the future. As we have
indicated, the larger-than-normal forecast errors in CY 2021 and CY
2022 were largely due to unanticipated inflationary and labor market
pressures as the economy emerged from the COVID-19 PHE, which we do not
anticipate will continue in CY 2024. Our preliminary estimates of the
CY 2023 ESRD PPS forecast error indicate that it was smaller than the
forecast errors in CY 2022 and CY 2021.
For these reasons, after evaluating the historical performance of
the ESRDB market basket and the financial environment unique to ESRD
facilities, we do not believe it is appropriate to include adjustments
to the ESRDB market basket update for future years based on the
difference between the actual and forecasted ESRDB market basket
increase in prior years. However, we will continue to monitor the
overall performance of the ESRDB market basket update, including
analyzing the change in the price of labor inputs for ESRD facilities
over time. We will take commenters' concerns into consideration for
potential future rulemaking.
Comment: One LDO commented that they believe that CMS has a
statutory obligation to implement a forecast error adjustment under
section 1881(b)(14)(F)(i) of the Act, which states that the Secretary
shall annually increase payment amounts by an ESRD market basket
percentage increase for a bundled payment system for renal dialysis
services that reflects changes over time in the prices of an
appropriate mix of goods and services included in renal dialysis
services. The commenter acknowledged that forecasting prices is
inherent in a PPS but indicated that they believe that the current
methodology fails to annually capture the changes over time in the
price of providing renal dialysis services. The commenter stated that
correcting for prior and future forecast errors is a step CMS can
easily implement to ensure the ESRD PPS payment, and future market
basket update factors, reflect the prices of delivering renal dialysis
services. The commenter noted that in 2004 when CMS implemented a
forecast error adjustment in the payment system for SNFs it was based
on very similar statutory language and was implemented under what the
commenter stated were ``virtually identical'' circumstances to the ESRD
PPS today.
Response: We thank the commenter for sharing their view on this
issue; however, we do not agree that CMS's position regarding an ESRD
PPS forecast error payment adjustment conflicts with any statutory
requirements for the ESRD PPS. We appreciate the commenter's
interpretation of the circumstances involved in the implementation of
the forecast error adjustment for SNF payment; however, we disagree
with the claim that the circumstance was virtually identical to the
ESRD PPS today. While the cumulative under-forecast of the SNF market
basket increases in 2004 was based on a rapid increase in the price of
labor, it was not due to a PHE as occurred with the ESRD PPS's under-
forecast in recent years. Additionally, it was an issue which only SNFs
were experiencing, unlike the current ESRD PPS environment where
multiple Medicare payment systems have faced similar forecast errors.
We note that when CMS finalized a forecast error adjustment for the SNF
payment system, we concluded that a forecast error adjustment was
appropriate for payment accuracy for SNFs; not that it was required
under the statute (68 FR 46057). For these reasons, we do not agree
with the commenter's stated belief that a forecast error adjustment
would be required to fulfill the ESRD PPS statutory requirements, and,
at this time, for the reasons discussed previously, we do not believe
that a forecast error payment adjustment would be appropriate for the
ESRD PPS.
Final Rule Action: After consideration of the comments we received,
we are finalizing a CY 2024 ESRDB productivity-adjusted market basket
increase of 2.1 percent based on the most recent data available. As
noted previously, based on the more recent data available for this CY
2024 ESRD PPS final rule (that is, IGI's third quarter 2023 forecast of
the 2020-based ESRDB market basket with historical data through the
second quarter of 2023), the CY 2024 ESRDB market basket update is 2.4
percent. Based on the more recent data available from IGI's third
quarter 2023 forecast, the current estimate of the productivity
adjustment for CY 2024 is 0.3 percentage point. Therefore, the current
estimate of the CY 2024 ESRD productivity-adjusted market basket
increase factor is equal to 2.1 percent (2.4 percent market basket
update reduced by 0.3 percentage point productivity adjustment). We are
finalizing our proposal to determine the CY 2024 ESRDB market basket
update for the final rule without an adjustment to account for past
forecast errors. Additionally, we did not propose and are not
finalizing any methodology for a forecast error payment adjustment. We
will continue to monitor the performance of the ESRDB market basket
forecasts and will consider the information provided by commenters for
potential future rulemaking.
[[Page 76359]]
(e) Labor-Related Share
We define the labor-related share as those expenses that are labor-
intensive and vary with, or are influenced by, the local labor market.
The labor-related share of a market basket is determined by identifying
the national average proportion of operating costs that are related to,
influenced by, or vary with the local labor market. For the CY 2024
ESRD PPS payment update, we proposed to continue using a labor-related
share of 55.2 percent, which was finalized in the CY 2023 ESRD PPS
final rule (87 FR 67153 through 67154).
Comment: We received three comments which acknowledged our proposal
to use the labor-related share of 55.2 percent as finalized in the CY
2023 ESRD PPS final rule. Additionally, one LDO commented on the
weights attributed to contract labor and benefits in the 2020-based
ESRDB market basket, indicating that they thought that these areas were
under-represented in the 2020-based ESRDB market basket. This LDO
recognized that CMS did not propose any changes to the labor-related
share from CY 2023. One provider advocacy organization suggested CMS
utilize a different labor-related share for ESRD facilities with low
wage index values, noting that for facilities with low wage index
values, labor likely relates to a smaller share of total costs.
Response: We thank commenters for reviewing the proposed labor-
related share. We appreciate the comment on the weights of contract
labor in the 2020-based ESRDB market basket. As stated in section
II.B.1.a.(2)(c) of this final rule, changes in both the cost and
quantity of an input are reflected when the ESRDB market basket is
rebased, and the base year weights are updated to a more recent time
period. We finalized the 2020-based ESRDB market basket in the CY 2023
ESRD PPS final rule (87 FR 67141), and, therefore, any change in the
cost structure for ESRD facilities that occurred between 2016 and 2020
is now reflected in the cost weights for the 2020-based ESRDB market
basket, which was the most recent fully complete cost data available at
the time of rulemaking. Our monitoring indicates that the 2020-based
ESRDB market basket is still appropriate for determining the cost
weights for inputs for providing renal dialysis services. Therefore,
following the methodology finalized in the CY 2011 ESRD PPS final rule
(75 FR 49116), we consider the labor related components of the ESRDB
market basket to be an appropriate basis for the labor-related share
for the CY 2024 ESRD PPS payments. We will continue to monitor the cost
share weights and, if technically appropriate, consider rebasing the
ESRDB market basket more frequently than usual should the cost weights
change significantly. We appreciate the suggestion to use a different
labor-related share for low wage index ESRD facilities. We did not
propose any methodological changes to the application of the labor-
related share, such as using a different labor-related share for
different ESRD facilities, but we will consider this comment in
potential future rulemaking.
Comment: One commenter expressed appreciation that the labor-
related share of the ESRD PPS increased from 52.3 percent to 55.2
percent in CY 2023 and stated that they believe this is a consistent
trend with the ESRD PPS, for which CMS has increased the labor-related
share of the market basket over the lifetime of the PPS. The commenter
opined that increasing the labor-related share of the market basket,
while positive, does not fully address the steep rising costs of labor
needed to deliver care to Medicare beneficiaries with ESRD, since it
only alters the percentage of ESRD PPS payments allocated to labor as
compared with other inputs required for renal dialysis services but
does not deliver more resources through the ESRD PPS to cover the
rising costs of care associated with the increases in the cost of
labor.
Response: The purpose of the labor-related share is to reflect the
proportion of the national ESRD PPS base payment rate that is adjusted
by the wage index. CMS adjusts the labor-related portion of the base
rate to account for geographic differences in the area wage levels
using an appropriate wage index, which reflects the relative level of
hospital wages and wage-related costs in the geographic area in which
the ESRD facility is located. Therefore, we include a cost category in
the labor-related share if the costs are labor intensive and vary with
the local labor market. We note that the historical increase to the
labor-related share is based on the increase to the labor-related cost-
weights in the ESRDB market basket.
As acknowledged by the commenter, the purpose of the labor-related
share is to allocate ESRD payment between labor-related costs and non-
labor costs. The labor-related share is not meant to increase payments
overall for the rising cost of labor.
Final Rule Action: We are finalizing our proposal to use the labor-
related share of 55.2 percent, as finalized in the CY 2023 ESRD PPS
final rule, for CY 2024 ESRD PPS payments.
b. CY 2024 ESRD PPS Wage Indices
(1) Background
Section 1881(b)(14)(D)(iv)(II) of the Act provides that the ESRD
PPS may include a geographic wage index payment adjustment, such as the
index referred to in section 1881(b)(12)(D) of the Act, as the
Secretary determines to be appropriate. In the CY 2011 ESRD PPS final
rule (75 FR 49200), we finalized an adjustment for wages at Sec.
413.231. Specifically, CMS adjusts the labor-related portion of the
ESRD PPS base rate to account for geographic differences in the area
wage levels using an appropriate wage index, which reflects the
relative level of hospital wages and wage-related costs in the
geographic area in which the ESRD facility is located. We use the
Office of Management and Budget's (OMB's) CBSA-based geographic area
designations to define urban and rural areas and their corresponding
wage index values (75 FR 49117). OMB publishes bulletins regarding CBSA
changes, including changes to CBSA numbers and titles. The bulletins
are available online at https://www.whitehouse.gov/omb/information-for-agencies/bulletins/.
We have also adopted methodologies for calculating wage index
values for ESRD facilities that are in urban and rural areas where
there is no hospital data. For a full discussion, see the CY 2011 and
CY 2012 ESRD PPS final rules at 75 FR 49116 through 49117 and 76 FR
70239 through 70241, respectively. For urban areas with no hospital
data, we compute the average wage index value of all urban areas within
the State to serve as a reasonable proxy for the wage index of that
urban CBSA, that is, we use that value as the wage index. For rural
areas with no hospital data, we compute the wage index using the
average wage index values from all contiguous CBSAs to represent a
reasonable proxy for that rural area. We applied the statewide urban
average based on the average of all urban areas within the State to
Hinesville-Fort Stewart, Georgia (78 FR 72173), and we applied the wage
index for Guam to American Samoa and the Northern Mariana Islands (78
FR 72172).
Under Sec. 413.231(d), a wage index floor value of 0.6000 is
applied under the ESRD PPS as a substitute wage index for areas with
very low wage index values, as finalized in the CY 2023 ESRD PPS final
rule (87 FR 67161). Currently, all areas with wage index values that
fall below the floor are in Puerto Rico and the U.S. Virgin Islands.
However, the wage index floor value is applicable for any area that may
fall
[[Page 76360]]
below the floor. A further description of the history of the wage index
floor under the ESRD PPS can be found in the CY 2019 ESRD PPS final
rule (83 FR 56964 through 56967) and the CY 2023 ESRD PPS final rule
(87 FR 67161).
An ESRD facility's wage index is applied to the labor-related share
of the ESRD PPS base rate. In the CY 2023 ESRD PPS final rule (87 FR
67153), we finalized a labor-related share of 55.2 percent. In the CY
2021 ESRD PPS final rule (85 FR 71436), we updated the OMB delineations
as described in the September 14, 2018, OMB Bulletin No. 18-04,
beginning with the CY 2021 ESRD PPS wage index. In that same rule, we
finalized the application of a 5 percent cap on any decrease in an ESRD
facility's wage index from the ESRD facility's wage index from the
prior CY. We finalized that the transition would be phased in over 2
years, such that the reduction in an ESRD facility's wage index would
be capped at 5 percent in CY 2021, and no cap would be applied to the
reduction in the wage index for the second year, CY 2022. In the CY
2023 ESRD PPS final rule (87 FR 67161), we finalized a permanent policy
under Sec. 413.231(c) to apply a 5 percent cap on any decrease in an
ESRD facility's wage index from the ESRD facility's wage index from the
prior CY. For CY 2024, as discussed in section II.B.1.a.(2)(e) of this
final rule, the labor-related share to which the wage index will be
applied is 55.2 percent.
(2) CY 2024 ESRD PPS Wage Index
For CY 2024, we proposed to update the wage indices to account for
updated wage levels in areas in which ESRD facilities are located using
our existing methodology. We proposed to use the most recent pre-floor,
pre-reclassified hospital wage data collected annually under the
inpatient PPS. The ESRD PPS wage index values are calculated without
regard to geographic reclassifications authorized under sections
1886(d)(8) and (d)(10) of the Act and utilize pre-floor hospital data
that are unadjusted for occupational mix. For CY 2024, the updated wage
data are for hospital cost reporting periods beginning on or after
October 1, 2019, and before October 1, 2020 (FY 2020 cost report data).
For CY 2024, we proposed to update the ESRD PPS wage index to use
the most recent hospital wage data. We proposed that if more recent
data become available after the publication of the proposed rule and
before the publication of the final rule (for example, a more recent
estimate of the wage index), we would use such data, if appropriate, to
determine the CY 2024 ESRD PPS wage index in the final rule.
We received several comments on our proposal to update the ESRD PPS
wage index. The comments and our responses are set forth below.
Comment: We received several comments on CMS's proposal to use the
most recent wage index data in the CY 2024 ESRD PPS final rule.
Commenters were generally supportive of the use of more recent data.
Additionally, several commenters reiterated support for the 5 percent
cap on wage index decreases that we finalized in the CY 2023 ESRD PPS
final rule (87 FR 67161).
Response: We thank the commenters for their support on the use of
more recent data and for the policy to cap wage index decreases.
Comment: One ESRD facility expressed concerns that the ESRD PPS
wage index does not reflect the realities that it faces and,
specifically, does not accurately reflect the increase in its cost of
labor over the past few years.
Response: We appreciate the concerns that the commenter raised;
however, we did not propose to change the wage index methodology for CY
2024 and are not finalizing any changes to that methodology in this
final rule. The wage data used to construct the ESRD PPS wage index are
updated annually, based on the most current data available, and are
based on OMB's CBSA delineations when applying the rural definitions
and corresponding wage index values. As discussed in CY 2011 ESRD PPS
final rule (75 FR 49200), the wage index reflects the relative level of
hospital wages and wage-related costs in the geographic area in which
the ESRD facility is located. Because the wage index is scaled relative
to the national average, it does not reflect changes over time to the
cost of labor. Rather, the market basket increase accounts for national
trends, including inflation. As discussed in the CY 2024 ESRD PPS
proposed rule (88 FR 42435), we proposed to increase the ESRD PPS base
rate for CY 2024 by the market basket increase factor in accordance
with section 1881(b)(14)(F)(i) of the Act, which provides that the
market basket increase factor should reflect the changes over time in
the prices of an appropriate mix of goods and services that reflect the
costs of furnishing renal dialysis services. As discussed in section
II.B.1.a.(2).(c) of this final rule, the final productivity-adjusted
market basket update for CY 2024 is 2.1 percent based on the latest
available data. We note that this final update is 0.4 percentage point
higher than the proposed update and reflects a revised outlook
regarding the U.S. economy and expected price inflation for CY 2024 for
ESRD facilities. We believe the final productivity-adjusted market
basket update will address some of the commenter's concerns regarding
rising wages due to inflation.
Comment: Several commenters, including MedPAC, a coalition of
dialysis organizations and an LDO, suggested that CMS reevaluate the
wage index methodology for the ESRD PPS. MedPAC recommended we
establish an ESRD PPS wage index for all ESRD facilities using wage
data that represents all employers and industry-specific occupational
weights, rather than the hospital wage data currently used. Two ESRD
facilities and a provider advocacy organization requested CMS use the
floors and reclassifications that IPPS uses for their wage index. Some
of these commenters additionally indicated a belief that this change
would help ESRD facilities compete with hospitals for labor.
Response: We appreciate the suggestions from commenters on how to
improve the ESRD PPS wage index methodology. The use of hospital wage
data for the ESRD PPS wage index is set forth in Sec. Sec.
413.196(d)(2) and 413.231(a). As we previously discussed in the CY 2011
ESRD PPS proposed rule (74 FR 49968), the ESRD PPS wage index uses the
same wage index values used in the basic case-mix adjusted composite
payment system, which are calculated without regard to geographic
reclassifications authorized under sections 1886(d)(8) and (d)(10) of
the Act and utilize pre-floor hospital data that are unadjusted for
occupational mix. The application of the pre-floor, pre-
reclassification hospital wage index for the ESRD case-mix adjusted
composite payment system is further discussed in the CY 2009 Physician
Fee Schedule (PFS) final rule (73 FR 69726, 69758) and the CY 2007 PFS
final rule (71 FR 69624, 69685). We did not propose changes to the ESRD
PPS wage index methodology for CY 2024, and we are not finalizing any
changes to that methodology in this final rule.
As discussed in the CY 2023 ESRD PPS final rule (87 FR 67160), the
wage index is intended to be a relative measure of the value of labor
in prescribed labor market areas. There is a variety of reasons why our
longstanding ESRD PPS wage index policy has not applied the same floors
or reclassifications as applied under the IPPS, which we note, are not
applied to the ESRD PPS wage index by statute (sections 1881(b)(12)(D)
& (b)(14)(D)(iv)(II) of the Act). For example, applying
reclassifications to the ESRD PPS wage index would
[[Page 76361]]
significantly increase administrative burden, both for ESRD facilities
and for CMS, that would be associated with ESRD facilities
reclassifying from one CBSA to another, and it would significantly
increase the complexity of the methodology.
Furthermore, because floors and reclassifications would be applied
budget-neutrally under the wage index, these policies would increase
the wage index for some ESRD facilities while reducing ESRD PPS
payments for all other ESRD facilities, which would upset the long-
settled expectations with which ESRD facilities across the country have
been operating. For example, under the IPPS rural floor policy, section
4410(a) of the Balanced Budget Act of 1997 (Pub. L. 105-33) provides
that, for discharges on or after October 1, 1997, the area wage index
applicable to any hospital that is located in an urban area of a State
may not be less than the area wage index applicable to hospitals
located in rural areas in that State. Applying the IPPS rural floor to
the ESRD PPS wage index would result in increasing the wage index for
any ESRD facilities located in an urban area whose wage index is less
than the rural wage index for that State. As we discussed in the CY
2023 ESRD PPS final rule (87 FR 67164 through 67165) with respect to
the increase to the ESRD PPS wage index floor in that year, a higher
wage index floor will slightly decrease the ESRD PPS base rate for all
ESRD facilities due to the application of the budget neutrality factor.
Given that increasing the wage index floor results in a proportional
decrease in the base rate for all ESRD facilities, we established a
wage index floor value that strikes a balance between providing
increased payment to areas for which labor costs are higher than the
current wage index for the relevant CBSAs indicates, while maintaining
the accuracy of payments under the ESRD PPS and minimizing the overall
impact to all ESRD facilities.
For these reasons, we believe that the ESRD PPS wage index is the
most appropriate data to use for estimating the variation in wage
levels across the country. However, we will take these comments into
consideration to potentially inform future rulemaking.
Comment: A non-profit health insurance organization commented that
they believed a wage index floor of 0.7000 was justified and suggested
CMS reevaluate the current wage index floor of 0.6000. The commenter
indicated that CMS would find it appropriate to raise the wage index
floor to 0.7000.
Response: We appreciate the suggestion and will consider it for
potential future rulemaking. We did not propose any change to the
current wage index floor of 0.6000 specified in Sec. 413.231(d) and
are not finalizing any changes to that floor in this final rule.
Final Rule Action: We are finalizing our proposal to update the
ESRD PPS wage index for CY 2024 to use the most recent hospital wage
data, as proposed. The final CY 2024 ESRD PPS wage index is set forth
in Addendum A and is available on CMS's website at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/End-Stage-Renal-Disease-ESRD-Payment-Regulations-and-Notices. Addendum A provides a
crosswalk between the CY 2023 wage index and the CY 2024 wage index.
Addendum B provides an ESRD facility level impact analysis. Addendum B
is available on CMS's website at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/End-Stage-Renal-Disease-ESRD-Payment-Regulations-and-Notices.
c. CY 2024 Update to the Outlier Policy
(1) Background
Section 1881(b)(14)(D)(ii) of the Act requires that the ESRD PPS
include a payment adjustment for high-cost outliers due to unusual
variations in the type or amount of medically necessary care, including
variability in the amount of erythropoiesis stimulating agents (ESAs)
necessary for anemia management. Some examples of the patient
conditions that may be reflective of higher facility costs when
furnishing dialysis care are frailty and obesity. A patient's specific
medical condition, such as secondary hyperparathyroidism, may result in
higher per treatment costs. The ESRD PPS recognizes that some patients
require high-cost care, and we have codified the outlier policy and our
methodology for calculating outlier payments at Sec. 413.237.
Section 413.237(a)(1) enumerates the following items and services
that are eligible for outlier payments as ESRD outlier services: (i)
Renal dialysis drugs and biological products that were or would have
been, prior to January 1, 2011, separately billable under Medicare Part
B; (ii) renal dialysis laboratory tests that were or would have been,
prior to January 1, 2011, separately billable under Medicare Part B;
(iii) renal dialysis medical/surgical supplies, including syringes,
used to administer renal dialysis drugs and biological products that
were or would have been, prior to January 1, 2011, separately billable
under Medicare Part B; (iv) renal dialysis drugs and biological
products that were or would have been, prior to January 1, 2011,
covered under Medicare Part D, including renal dialysis oral-only drugs
effective January 1, 2025; and (v) renal dialysis equipment and
supplies, except for capital-related assets that are home dialysis
machines (as defined in Sec. 413.236(a)(2)), that receive the
transitional add-on payment adjustment as specified in Sec. 413.236
after the payment period has ended.\11\
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\11\ Under Sec. 413.237(a)(1)(vi), as of January 1, 2012, the
laboratory tests that comprise the Automated Multi-Channel Chemistry
panel are excluded from the definition of outlier services.
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In the CY 2011 ESRD PPS final rule (75 FR 49142), CMS stated that
for purposes of determining whether an ESRD facility would be eligible
for an outlier payment, it would be necessary for the ESRD facility to
identify the actual ESRD outlier services furnished to the patient by
line item (that is, date of service) on the monthly claim. Renal
dialysis drugs, laboratory tests, and medical/surgical supplies that
are recognized as ESRD outlier services were specified in Transmittal
2134, dated January 14, 2011.\12\ We use administrative issuances and
guidance to continually update the renal dialysis service items
available for outlier payment via our quarterly update CMS Change
Requests, when applicable. For example, we use these issuances to
identify renal dialysis oral drugs that were or would have been covered
under Medicare Part D prior to 2011 to provide unit prices for
determining the imputed MAP amounts. In addition, we use these
issuances to update the list of ESRD outlier services by adding or
removing items and services that we determined, based our monitoring
efforts, are either incorrectly included or missing from the list.
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\12\ Transmittal 2033 issued August 20, 2010, was rescinded, and
replaced by Transmittal 2094, dated November 17, 2010. Transmittal
2094 identified additional drugs and laboratory tests that may also
be eligible for ESRD outlier payment. Transmittal 2094 was rescinded
and replaced by Transmittal 2134, dated January 14, 2011, which
included one technical correction. https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/downloads/R2134CP.pdf.
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Under Sec. 413.237, an ESRD facility is eligible for an outlier
payment if its imputed (that is, calculated) MAP amount per treatment
for ESRD outlier services exceeds a threshold. The MAP amount
represents the average estimated expenditure per treatment for services
that were or would have been considered separately billable services
prior to January 1, 2011. The threshold is equal to the ESRD facility's
predicted MAP amount per treatment plus the FDL amount. As described in
the following paragraphs, the ESRD
[[Page 76362]]
facility's predicted MAP amount is the national adjusted average ESRD
outlier services MAP amount per treatment, further adjusted for case-
mix and facility characteristics applicable to the claim. We use the
term ``national adjusted average'' in this section of this final rule
for clarity, to distinguish the calculation of the average ESRD outlier
services MAP amount per treatment from the calculation of the predicted
MAP amount for a claim. The average ESRD outlier services MAP amount
per treatment is based on utilization from all ESRD facilities, whereas
the calculation of the predicted MAP amount for a claim is based on the
individual ESRD facility and patient characteristics of the monthly
claim. In accordance with Sec. 413.237(c), ESRD facilities are paid 80
percent of the per treatment amount by which the imputed MAP amount for
outlier services (that is, the actual incurred amount) exceeds this
threshold. ESRD facilities are eligible to receive outlier payments for
treating both adult and pediatric dialysis patients.
In the CY 2011 ESRD PPS final rule and codified in Sec.
413.220(b)(4), using 2007 data, we established the outlier percentage,
which is used to reduce the per treatment ESRD PPS base rate to account
for the proportion of the estimated total Medicare payments under the
ESRD PPS that are outlier payments, at 1.0 percent of total payments
(75 FR 49142 through 49143). We also established the FDL amounts that
are added to the predicted outlier services MAP amounts. The outlier
services MAP amounts and FDL amounts are different for adult and
pediatric patients due to differences in the utilization of separately
billable services among adult and pediatric patients (75 FR 49140). As
we explained in the CY 2011 ESRD PPS final rule (75 FR 49138 through
49139), the predicted outlier services MAP amounts for a patient are
determined by multiplying the adjusted average outlier services MAP
amount by the product of the patient-specific case-mix adjusters
applicable using the outlier services payment multipliers developed
from the regression analysis used to compute the payment adjustments.
In the CY 2023 ESRD PPS final rule, we finalized an update to the
outlier methodology to better target 1.0 percent of total Medicare
payments (87 FR 67170 through 67177). We finalized that we would
continue to follow our established methodology for the calculation of
the adult and pediatric MAP amounts, but we would prospectively
calculate the adult FDL amounts based on the historical trend in FDL
amounts that would have achieved the 1.0 percent outlier target in the
3 most recent available data years.
(2) CY 2024 Update to the Outlier Services MAP Amounts and FDL Amounts
For CY 2024, we proposed to update the MAP amounts for adult and
pediatric patients using the latest available CY 2022 claims data. We
proposed to update the ESRD outlier services FDL amount for pediatric
patients using the latest available CY 2022 claims data, and to update
the ESRD outlier services FDL amount for adult patients using the
latest available claims data from CY 2020, CY 2021, and CY 2022, in
accordance with the methodology finalized in the CY 2023 ESRD PPS final
rule (87 FR 67170 through 67174). CY 2022 claims data showed outlier
payments represented approximately 0.8 percent of total Medicare
payments (88 FR 42432 and 42438).
The impact of this final update is shown in Table 1, which compares
the outlier services MAP amounts and FDL amounts used for the outlier
policy in CY 2023 with the updated estimates for this final rule. The
estimates for the CY 2024 MAP amounts, which are included in Column II
of Table 1, were inflation adjusted to reflect projected 2024 prices
for ESRD outlier services.
BILLING CODE 4120-01-P
[[Page 76363]]
[GRAPHIC] [TIFF OMITTED] TR06NO23.003
As demonstrated in Table 1, the estimated FDL per treatment that
determines the CY 2024 outlier threshold amount for adults (Column II;
$71.76) is lower than that used for the CY 2023 outlier policy (Column
I; $73.19). The lower threshold is accompanied by a decrease in the
adjusted average MAP for outlier services from $39.62 to $36.28. For
pediatric patients, there is a decrease in the FDL amount from $23.29
to $11.32. There is a corresponding decrease in the adjusted average
MAP for outlier services among pediatric patients, from $25.59 to
$23.36.
We estimate that the percentage of patient months qualifying for
outlier payments in CY 2024 would be 4.87 percent for adult patients
and 20.86 percent for pediatric patients, based on the 2022 claims data
and methodology finalized in the CY 2023 ESRD PPS final rule. The
outlier MAP and FDL amounts continue to be lower for pediatric patients
than adults due to the continued lower use of outlier services
(primarily reflecting lower use of ESAs and other injectable drugs).
(3) Outlier Percentage
In the CY 2011 ESRD PPS final rule (75 FR 49081) and under Sec.
413.220(b)(4), we reduced the per treatment base rate by 1 percent to
account for the proportion of the estimated total payments under the
ESRD PPS that are outlier payments as described in Sec. 413.237. In
the 2023 ESRD PPS final rule, we finalized a change to the outlier
methodology to better achieve this 1 percent target (87 FR 67170
through 67174). We stated in the CY 2024 ESRD PPS proposed rule that,
based on the CY 2022 claims, outlier payments represented approximately
0.9 percent of total payments. Based on more complete CY 2022 claims
data, this figure has been updated to 0.8 percent for this final rule,
which is below the 1 percent target due to declines in the use of
outlier services. However, this is significantly closer to the 1
percent target than the outlier payments based on CY 2021 claims, which
represented approximately 0.5 percent of total payments. In the CY 2024
ESRD PPS proposed rule, we noted that we believe the update to the
outlier MAP and FDL amounts for CY 2024 would increase payments for
ESRD beneficiaries requiring higher resource utilization. This would
move us even closer to meeting our 1 percent outlier policy goal,
because we would be using more current data for computing the MAP and
FDL amounts, which is more reflective of current outlier services
utilization rates. We also noted that the proposed recalibration of the
FDL amounts would result in no change in payments to ESRD facilities
for beneficiaries with renal dialysis items and services that are not
eligible for outlier payments.
The comments and our responses to the comments on our proposed
updates to the outlier policy are set forth below.
Comment: We received several comments on CMS's proposals to update
the FDL and MAP amounts for CY 2024. Commenters were generally
supportive of the use of more recent data to determine the CY 2024 ESRD
PPS final MAP and FDL amounts. Several commenters stated that they
appreciated that the methodological changes CMS made to the outlier
policy in the CY 2023 ESRD PPS final rule resulted in the total
percentage of payments for outliers being closer to the 1 percent
target than ever before. However, some commenters noted that the ESRD
PPS base rate is reduced on the assumption that 1 percent of total
payments will be attributable to outlier payments, and if the actual
percentage is less than 1 percent it means that total payments to ESRD
facilities are less than they should be. Commenters suggested that CMS
should implement a policy to recompense ESRD facilities for
[[Page 76364]]
underpayment when total outlier payments are less than 1 percent of
total ESRD PPS payments. One commenter recommended CMS reduce the
outlier target to 0.5 percent of total payments.
Response: We appreciate the support for the proposed use of more
recent data to update the MAP and FDL amounts for the outlier policy
and the thoughtful suggestions provided by commenters. We acknowledge
that, even with annually adjusting the MAP and FDL amounts to reflect
the most recent utilization and costs of ESRD PPS eligible outlier
services according to the updated outlier methodology finalized in the
CY 2023 ESRD PPS final rule, total outlier payments have not yet
reached the 1 percent target. However, the performance of the outlier
payments has improved significantly due to the modification to the
outlier methodology finalized in CY 2023 ESRD PPS final rule, as
outlier payments represented 0.8 percent of the total payments in CY
2022. We appreciate the comments suggesting solutions for refining the
outlier policy methodology, for example, reducing the outlier
percentage, as defined at Sec. 413.220(b)(4), to less than 1 percent
or establishing a mechanism that pays back ESRD facilities those
allocated outlier amounts that were not paid out in the projected year.
We did not propose any modifications to the ESRD PPS outlier policy for
CY 2024 codified at Sec. 413.220, and we are not finalizing any
changes to the methodology in this final rule. We will consider the
commenters' suggestions regarding changes in methodology in potential
future rulemaking.
Final Rule Action: After considering the public comments, we are
finalizing the updated outlier thresholds for CY 2024 displayed in
Column II of Table 1 of this final rule based on the most current data.
d. Impacts to the CY 2024 ESRD PPS Base Rate
(1) ESRD PPS Base Rate
In the CY 2011 ESRD PPS final rule (75 FR 49071 through 49083), CMS
established the methodology for calculating the ESRD PPS per-treatment
base rate, that is, the ESRD PPS base rate, and calculating the per-
treatment payment amount, which are codified at Sec. Sec. 413.220 and
413.230. The CY 2011 ESRD PPS final rule also provides a detailed
discussion of the methodology used to calculate the ESRD PPS base rate
and the computation of factors used to adjust the ESRD PPS base rate
for projected outlier payments and budget neutrality in accordance with
sections 1881(b)(14)(D)(ii) and 1881(b)(14)(A)(ii) of the Act,
respectively. Specifically, the ESRD PPS base rate was developed from
CY 2007 claims (that is, the lowest per patient utilization year as
required by section 1881(b)(14)(A)(ii) of the Act), updated to CY 2011,
and represented the average per treatment MAP for composite rate and
separately billable services. In accordance with section 1881(b)(14)(D)
of the Act and our regulation at Sec. 413.230, the per-treatment
payment amount is the sum of the ESRD PPS base rate, adjusted for the
patient specific case-mix adjustments, applicable facility adjustments,
geographic differences in area wage levels using an area wage index,
and any applicable outlier payment, training adjustment add-on, TDAPA,
and TPNIES.
(2) Annual Payment Rate Update for CY 2024
In the CY 2024 ESRD PPS proposed rule, we proposed an ESRD PPS base
rate for CY 2024 of $269.99 (88 FR 42432). We are finalizing an ESRD
PPS base rate for CY 2024 of $271.02. This update reflects several
factors, described in more detail as follows:
Wage Index Budget-Neutrality Adjustment Factor: We compute a wage
index budget-neutrality adjustment factor that is applied to the ESRD
PPS base rate. For CY 2024, we did not propose and are not finalizing
any changes to the methodology used to calculate this factor, which is
described in detail in the CY 2014 ESRD PPS final rule (78 FR 72174).
We computed the final CY 2024 wage index budget-neutrality adjustment
factor using treatment counts from the 2022 claims and facility-
specific CY 2023 payment rates to estimate the total dollar amount that
each ESRD facility would have received in CY 2023. The total of these
payments became the target amount of expenditures for all ESRD
facilities for CY 2024. Next, we computed the estimated dollar amount
that would have been paid for the same ESRD facilities using the final
CY 2024 ESRD PPS wage index and final labor-related share for CY 2024.
As discussed in section II.B.1.b of this final rule, the ESRD PPS wage
index for CY 2024 includes an update to the most recent hospital wage
data and continued use of the 2018 OMB delineations. The total of these
payments becomes the new CY 2024 amount of wage-adjusted expenditures
for all ESRD facilities. The wage index budget-neutrality factor is
calculated as the target amount divided by the new CY 2024 amount. When
we multiplied the wage index budget neutrality factor by the applicable
CY 2024 estimated payments, aggregate Medicare payments to ESRD
facilities would remain budget neutral when compared to the target
amount of expenditures. That is, the wage index budget neutrality
adjustment factor ensures that wage index adjustments do not increase
or decrease aggregate Medicare payments with respect to changes in wage
index updates. The final CY 2024 wage index budget-neutrality
adjustment factor is 1.000031. This CY 2024 wage index budget-
neutrality adjustment factor reflects the impact of all wage index
policy changes, including the final CY 2024 ESRD PPS wage index and
labor-related share.
TPEAPA Budget-Neutrality Adjustment Factor: As explained in section
II.B.1.g.(7) of this final rule, we are finalizing a new, budget-
neutral transitional add-on payment adjustment for pediatric ESRD renal
dialysis services, which we call the TPEAPA. The final CY 2024 budget-
neutrality adjustment factor for the TPEAPA is 0.999503. The budget-
neutrality adjustment factor for the TPEAPA is discussed in section
II.B.1.g of this final rule.
Combined Wage Index and TPEAPA Budget-Neutrality Adjustment Factor:
For purposes of calculating the ESRD PPS base rate for CY 2024, we are
using one combined budget-neutrality adjustment factor includes both
the wage index budget-neutrality adjustment factor and the TPEAPA
budget-neutrality adjustment factor. The CY 2024 combined wage index
and TPEAPA budget neutrality factor is 0.999534 (1.000031 x 0.999503).
This application would yield a CY 2024 ESRD PPS base rate of $265.48
prior to the application of the CY 2024 market basket update percentage
($265.57 x 0.999534 = $265.45).
Market Basket Update: Section 1881(b)(14)(F)(i)(I) of the Act
provides that, beginning in 2012, the ESRD PPS payment amounts are
required to be annually increased by an ESRD market basket percentage
increase. As discussed previously in section II.B.1.a.(2)(a) of this
final rule, the latest CY 2024 projection of the ESRDB market basket
percentage increase is 2.4 percent. In CY 2024, this amount must be
reduced by the productivity adjustment described in section
1886(b)(3)(B)(xi)(II) of the Act, as required by section
1881(b)(14)(F)(i)(II) of the Act. As discussed previously in section
II.B.1.a.(2)(b) of this final rule, the latest CY 2024 projection of
the productivity adjustment is 0.3 percentage point, thus yielding a CY
2024 productivity-adjusted ESRDB market basket update of 2.1 percent
for
[[Page 76365]]
CY 2024. Therefore, the final CY 2024 ESRD PPS base rate is $271.02
(($265.57 x 0.999534) x 1.021 = $271.02).
The comments and our responses to the comments on our proposed
updates to the ESRD PPS base rate are set forth below.
Comment: We received several comments which characterized the
proposed CY 2024 ESRD PPS base rate as too low. Some of these
commenters requested that CMS increase the base rate. The reasoning for
this requested increase varied by commenter. Some commenters wanted an
increase to account for recent under-forecasts, whereas other
commenters wanted an increase to allow facilities to provide an
increased quality of care.
Response: The CY 2024 ESRD PPS base rate is derived from the CY
2023 ESRD PPS base rate, the CY 2024 ESRDB market basket update, and
the CY 2024 combined wage index-TPEAPA budget neutrality factor. In
accordance with section 1881(b)(14)(F) of the Act, the primary factor
in determining the ESRD PPS base rate increase from one year to the
next is the ESRDB market basket update. We believe the final CY 2024
ESRDB market basket update reflects the most recent available data
regarding the forecasted prices of labor used to provide renal dialysis
services. We discuss the CY 2024 ESRDB market basket update in more
detail in section II.B.1.a of this final rule, with detailed responses
to comments on the magnitude of the productivity-adjusted ESRDB market
basket increase in section II.B.1.a.(2)(c) of this final rule and
detailed responses to comments on previous forecast errors for the
ESRDB market basket update in section II.B.1.a.(2)(d) of this final
rule. We appreciate the concerns of the commenters, but we did not
propose any new payment adjustments to the base rate based on those
concerns. We will continue to monitor the adequacy of the ESRD PPS
payment and will consider these commenters' insights for future
rulemaking.
Final Rule Action: We are finalizing a CY 2024 ESRD PPS base rate
of $271.02. This amount reflects the combined CY 2024 wage index-TPEAPA
budget-neutrality adjustment factor of 0.999534, and the CY 2024 ESRD
PPS productivity-adjusted market basket update of 2.1 percent.
e. Update to the Average per Treatment Offset Amount for Home Dialysis
Machines
In the CY 2021 ESRD PPS final rule (85 FR 71427), we expanded
eligibility for the TPNIES under Sec. 413.236 to include certain
capital-related assets that are home dialysis machines when used in the
home for a single patient. To establish the TPNIES basis of payment for
these items, we finalized the additional steps that the Medicare
Administrative Contractors (MACs) must follow to calculate a pre-
adjusted per treatment amount, using the prices they establish under
Sec. 413.236(e) for a capital-related asset that is a home dialysis
machine, as well as the methodology that CMS uses to calculate the
average per treatment offset amount for home dialysis machines that is
used in the MACs' calculation, to account for the cost of the home
dialysis machine that is already in the ESRD PPS base rate. For
purposes of this final rule, we refer to this as the ``TPNIES offset
amount.''
The methodology for calculating the TPNIES offset amount is set
forth in Sec. 413.236(f)(3). Section 413.236(f)(3)(v) states that
effective January 1, 2022, CMS annually updates the amount determined
in Sec. 413.236(f)(3)(iv) by the ESRD bundled market basket percentage
increase factor minus the productivity adjustment factor. The TPNIES
for capital-related assets that are home dialysis machines is based on
65 percent of the MAC-determined pre-adjusted per treatment amount,
reduced by the TPNIES offset amount, and is paid for 2 CYs.
As we discussed in the CY 2024 ESRD PPS proposed rule (88 FR
42432), there are currently no capital-related assets that are home
dialysis machines set to receive TPNIES for CY2024, as the TPNIES
payment period for the Tablo[supreg] System ends on December 31, 2023,
and the only TPNIES application for CY 2024 is not for a home dialysis
machine. However, as required by Sec. 413.236(f)(3)(v), we proposed to
update the TPNIES offset amount annually according to the methodology
described previously.
We proposed a CY 2024 TPNIES offset amount for capital-related
assets that are home dialysis machines of $9.96, based on the proposed
CY 2024 ESRDB productivity-adjusted market basket update of 1.7 percent
(2.0 percent market basket percentage increase reduced by 0.3
percentage point productivity adjustment). We explained in the CY 2024
ESRD PPS proposed rule that applying the proposed update factor of
1.017 to the CY 2023 offset amount resulted in the proposed CY 2024
offset amount of $9.96 ($9.79 x 1.017 = $9.96). We proposed to update
this calculation to use the most recent data available in the CY 2024
ESRD PPS final rule.
We received three comments on this proposal to update the TPNIES
offset amount for capital related assets that are home dialysis
machines, including comments from an LDO and a device manufacturer. The
comments and our responses to the comments on the proposed update to
the TPNIES offset amount are set forth below.
Comment: A device manufacturer requested that CMS remove the TPNIES
offset for capital-related assets that are home dialysis machines. The
commenter and two others indicated that they believe that the TPNIES
offset, combined with the 65 percent reduction for risk sharing, are
leading to capital-related assets that are home dialysis machines being
undervalued. An LDO agreed that the TPNIES for capital-related assets
that are home dialysis machines should be offset by an amount currently
in the base rate.
Response: We appreciate the commenters' insight into the impacts of
the TPNIES offset for capital-related assets that are home dialysis
machines. We did not propose any methodological changes for this TPNIES
offset amount set forth at Sec. 413.236(f), and we are not finalizing
any changes. We will consider the commenters' concerns for potential
future rulemaking.
Final Rule Action: We are finalizing our proposal to calculate the
CY 2024 TPNIES offset amount using the most recent data available. The
CY 2023 TPNIES offset amount for capital-related equipment that are
home dialysis machines used in the home is $9.79. As discussed
previously in section II.B.1.a.(2)(c) of this final rule, the final CY
2024 ESRDB productivity-adjusted market basket update is 2.1 percent
(2.4 percent market basket percentage increase reduced by 0.3 percent
productivity adjustment). Applying the update factor of 1.021 to the CY
2023 TPNIES offset amount results in a final CY 2024 TPNIES offset
amount of $10.00 ($9.79 x 1.021).
f. Refinement of the Low-Volume Payment Adjustment (LVPA)
(1) Background
Section 1881(b)(14)(D)(iii) of the Act provides that the ESRD PPS
shall include a payment adjustment that reflects the extent to which
costs incurred by low-volume facilities (as defined by the Secretary)
in furnishing renal dialysis services exceed the costs incurred by
other facilities in furnishing such services, and for payment for renal
dialysis services furnished on or after January 1, 2011, and before
January 1, 2014, such payment adjustment shall not be less than 10
percent. Therefore, the ESRD PPS provides a facility-level payment
adjustment to ESRD facilities
[[Page 76366]]
that meet the definition of a low-volume facility. In this section of
the final rule, we discuss the low volume-payment adjustment (LVPA)
under the ESRD PPS.
The current amount of the LVPA is 23.9 percent. In the CY 2011 ESRD
PPS final rule (75 FR 49118 through 49125), we finalized the
methodology used to target the appropriate population of ESRD
facilities that were low-volume and to determine the treatment
threshold for those ESRD facilities identified. After consideration of
public comments, we established an 18.9 percent adjustment for ESRD
facilities that furnish less than 4,000 treatments annually and
indicated that this increase to the ESRD PPS base rate would encourage
small ESRD facilities to continue providing access to care.
In the CY 2016 ESRD PPS proposed rule (80 FR 37819), we analyzed
ESRD facilities that met the definition of a low-volume facility under
Sec. 413.232(b) as part of the updated regression analysis and found
that these ESRD facilities still had higher costs compared to other
ESRD facilities. A regression analysis of CYs 2012 and 2013 low-volume
facility claims and cost report data indicated a multiplier of 1.239
percent; therefore, we proposed an updated LVPA adjustment factor of
23.9 percent in the CY 2016 ESRD PPS proposed rule (80 FR 37819) and
finalized this policy in the CY 2016 ESRD PPS final rule (80 FR 69001).
In CY 2021, 366 ESRD facilities received the LVPA. Using the most
recent available data for CY 2022, the number of ESRD facilities
receiving the LVPA was 353.
(a) Current LVPA Methodology
Under Sec. 413.232(b), a low-volume facility is an ESRD facility
that, based on the submitted documentation: (1) furnished less than
4,000 treatments in each of the 3 cost-reporting years (based on as-
filed or final settled 12-consecutive month costs reports, whichever is
most recent, except as specified in paragraph (g)(4)) preceding the
payment year; and (2) has not opened, closed, or received a new
provider number due to a change in ownership (except where the change
in ownership results in a change in facility type) in the 3 cost-
reporting years (based on as-filed or final settled 12-consectuive
month cost reports, whichever is most recent) preceding the payment
year.
In addition, under Sec. 413.232(c), for purposes of determining
the number of treatments furnished by the ESRD facility, the number of
treatments considered furnished by the ESRD facility equals the
aggregate number of treatments furnished by the ESRD facility and the
number of treatments furnished by other ESRD facilities that are both
under common ownership with and 5 road miles or less from the ESRD
facility in question. To receive the LVPA, an ESRD facility must submit
a written attestation statement to its Medicare Administrative
Contractor (MAC) confirming that it meets all the requirements
specified in Sec. 413.232 and qualifies as a low-volume ESRD facility.
For purposes of determining eligibility for the LVPA, ``treatments''
mean total hemodialysis equivalent treatments (Medicare and non-
Medicare). For peritoneal dialysis patients, one week is considered
equivalent to three hemodialysis treatments (80 FR 68994). Section
413.232(e) generally imposes a yearly November 1st deadline for
attestation submissions unless extraordinary circumstances justify an
exception and specifies exceptions for certain years where the deadline
is in December or January. The November 1st attestation timeframe
provides 60 days for a MAC to verify that an ESRD facility meets the
LVPA eligibility criteria (76 FR 70236). The ESRD facility would then
receive the LVPA payment for all the Medicare-eligible treatments in
the payment year. Once an ESRD facility is determined to be eligible
for the LVPA, a 23.9 percent increase is applied to the ESRD PPS base
rate for all treatments furnished by the ESRD facility (80 FR 69001).
In the CY 2021 ESRD PPS final rule (85 FR 71443), we finalized a
policy to allow ESRD facilities flexibility for LVPA eligibility due to
the COVID-19 PHE. Under Sec. 413.232(g)(4), for purposes of
determining ESRD facilities' eligibility for payment years 2021, 2022,
and 2023, we will only consider total dialysis treatments for any 6
months of their cost-reporting period ending in 2020. ESRD facilities
that would not otherwise meet the number of treatments criterion
because of the COVID-19 PHE may attest that their total dialysis
treatments for those 6 months of their cost reporting period ending in
2020 are less than 2,000. The attestation must further include that
although the total number of treatments furnished in the entire year
otherwise exceeded the LVPA threshold, the excess treatments furnished
were due to temporary patient shifting resulting from the COVID-19 PHE.
MACs will annualize the total dialysis treatments for the total
treatments reported in those 6 months by multiplying by 2.
(b) Current Issues and Concerns From Interested Parties
Interested parties, including MedPAC and the Government
Accountability Office (GAO),\13\ have recommended that we make
refinements to the LVPA to better target ESRD facilities that are
critical to beneficiary access to dialysis care in remote or isolated
areas.\14\ These groups and other interested parties have also have
expressed concern that the strict treatment count introduces a ``cliff-
effect'' that may incentivize ESRD facilities to restrict their patient
caseload to remain below 4,000 treatments per year to meet the LVPA
threshold.\15\
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\13\ https://www.medpac.gov/wp-content/uploads/import_data/scrape_files/docs/default-source/reports/jun20_ch7_reporttocongress_sec.pdf.
\14\ https://www.cms.gov/files/document/end-stage-renal-disease-prospective-payment-system-technical-expert-panel-summary-report-april-2021.pdf.
\15\ https://www.cms.gov/files/document/end-stage-renal-disease-prospective-payment-system-technical-expert-panel-summary-report-april-2021.pdf.
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(2) Requests for Information on Modification of LVPA Methodology and
Development of a New Payment Adjustment Based on Geographic Isolation
In the CY 2024 ESRD PPS proposed rule (88 FR 42440 through 42441),
we explained that we recognize the importance of revising the ESRD PPS
LVPA adjustment methodology to ensure that payments accurately reflect
differences in cost and adequately target low-volume facilities, and to
strive for healthcare equity for ESRD beneficiaries. The LVPA and rural
adjusters currently result in increased payments to some geographically
isolated ESRD facilities, but these adjusters do not specifically
target geographically isolated ESRD facilities. We noted several points
of concern that interested parties have raised in the past, as well as
certain statutory limitations that could apply to some of the
methodological approaches suggested in the past. We solicited
information from the public about potential approaches to refine the
ESRD PPS methodology, which we would take into consideration for any
potential changes to the LVPA in the future.
This section addresses several RFIs regarding the LVPA and a
potential new adjustment for geographically isolated ESRD facilities.
(a) Comment Solicitation for Modifications to LVPA Methodology
In the CY 2024 ESRD PPS proposed rule, we solicited comments on
[[Page 76367]]
potential changes to the LVPA methodology (88 FR 42441 through 42444),
including maintaining a single threshold, establishing LVPA tiers, and/
or utilizing a continuous function. Any potential refinements to the
LVPA methodology that may result from our consideration of these
comments would be proposed through notice-and-comment rulemaking in the
future. We requested that commenters keep in mind that section
1881(b)(14)(D)(iii) of the Act requires the LVPA to reflect the extent
to which costs incurred by low-volume facilities in furnishing renal
dialysis services exceed the costs incurred by other facilities in
furnishing such services.
(i) Maintain a Single LVPA Threshold
As discussions about modifying the existing treatment threshold or
payment adjustment percentage have been ongoing since the beginning of
the multi-year LVPA reform efforts, we solicited comments on
maintaining a single threshold for the LVPA. ESRD facilities that fall
below the treatment threshold would continue to receive payment, and
payments would not be adjusted for those ESRD facilities above the
threshold. We stated that we were engaged in continuing monitoring
efforts to align resource use with payment. As noted in the CY 2024
ESRD PPS proposed rule (88 FR 42442), if we were to re-compute the LVPA
percentage amount using the latest available claims and cost report
data and the methodology established in the CY 2011 and CY 2016 ESRD
PPS final rules (75 FR 49118 through 49125 and 80 FR 69001), the
current treatment threshold of 4,000 treatments per year would
correspond to a 17.6 percent payment adjustment. The 4,000-treatment
threshold could be maintained, or the treatment threshold could be
recalibrated to maintain the 23.9 percent payment adjustment.
Maintaining a single threshold would not address concerns regarding the
potential for gaming or remove what commenters call the payment cliff.
Potential approaches for a single LVPA threshold are outlined in Table
2.
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(ii) Establishment of Multiple LVPA Tiers
We solicited comments on creating a tiered payment adjustment that
would include multiple thresholds, with separate payment adjustments
calibrated so that ESRD facilities in tiers with the lowest treatment
volume would receive the highest payment adjustment, and vice versa.
MedPAC has previously recommended setting LVPA treatment thresholds at
fewer than 4,000 treatments, between 4,000 and 4,999 treatments, and
between 5,000 and 6,000 treatments, with payment adjustments calibrated
so that ESRD facilities in tiers with the lowest volume would receive
the highest payment adjustment, and vice versa.\16\ Establishing
multiple thresholds, with a separate payment adjustment for ESRD
facilities under each threshold level, would reduce the potential for
gaming through reduction of the magnitude of the payment cliff.
Additionally, LVPA eligibility would be expanded to more ESRD
facilities. We solicited comments regarding the establishment of
multiple thresholds, including up to an eight-tiered structure for the
LVPA. Tables 3 through 6 outline various methodological options. Tables
3 and 4 would establish larger adjustment factors on average than the
current methodology but would require reductions to the ESRD PPS base
rate to maintain budget neutrality. Tables 5 and 6 show adjustment
factors which are scaled to maintain budget neutrality within the LVPA,
keeping the LVPA's budget at the same amount that would occur under the
current methodology without requiring reductions to the ESRD PPS base
rate. As illustrated below, scaling the adjusters while maintaining
budget neutrality within the LVPA results in lower LVPA adjusters. For
example, Tier 1 (less than 5,000 treatments) in the Four-Tiered Model
varies based on the approach to maintaining budget neutrality, as the
LVPA adjuster is 13.7 percent where budget neutrality is maintained
within the ESRD PPS (Table 3) and 5.8 percent where budget neutrality
is maintained within the LVPA (Table 5). For comparison, the Eight-
Tiered Model shows that for Tier 1 (less than 1,000 treatments), ESRD
facilities would receive a 123 percent LVPA adjuster where budget
neutrality is maintained within the ESRD PPS (Table 4) and 40.5 percent
LVPA adjuster where budget neutrality is maintained within the LVPA
(Table 6).
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(iii) Continuous Function
We also solicited comments on potentially establishing a continuous
function to adjust LVPA payments. Under this approach, ESRD facilities
with the lowest treatment volume would receive the highest payment
adjustment, and the payment adjustment would decrease continuously as
volume increases. This could include calibration of the point at which
the payment adjustment becomes zero to correspond with the existing
4,000 treatment upper bound, or establishment of a new upper bound
based on a regression analysis. Establishment of a continuous function
has the potential to significantly reduce the potential for gaming by
eliminating payment cliffs entirely. Additionally, this would increase
payment for ESRD facilities with the lowest volume, therefore better
aligning payment with resource use. Furthermore, a continuous function
would potentially expand LVPA eligibility to the most ESRD facilities.
In the CY 2024 ESRD PPS proposed rule, we noted that we are
considering several approaches to modifying the LVPA to address
concerns about its incentive structure, treatment threshold, and
administrative burden, as expressed by interested parties (including
the GAO, MedPAC, and industry representatives). We issued this RFI to
seek feedback on the suggested changes to the LVPA, as described
previously, and to solicit further input from interested parties to
inform future modifications to the methodology used to determine the
LVPA.
CMS welcomed input and responses to the following considerations,
requests, and questions:
Regarding concerns about a payment cliff in the existing
LVPA, we are considering implementing payment tiers or a continuous
adjustment, based on treatment volume, in place of the current single
tiered adjustment.
++ Comment on which payment structure would be more appropriate:
single threshold as currently employed, tiered structure, or continuous
function, and provide the reasoning behind your recommendation.
++ Comment on which option would be most effective in removing
gaming incentives and which option would bring greater congruency
between cost of providing renal dialysis services and payment.
Using the alternative methodology described previously,
under a tiered or continuous payment adjustment, the treatment
threshold for eligibility would be determined based on the median
treatment count among all ESRD facilities (approximately eight thousand
treatments per year). The resulting tiers and incremental payment
adjustments between tiers could follow several different
configurations.
++ What factors should be evaluated to best determine the treatment
count threshold, as well as the tiering structure? Specifically,
comment on the treatment volume beneath which per-treatment costs begin
to increase.
++ Enumerate any concerns you might have should the implementation
of a tiered or continuous adjustment result in an expanded set of
eligible ESRD facilities, and payment redistribution.
Interested parties have voiced concern regarding the
administrative burden involved in the current LVPA attestation process.
As such, we are considering potentially decreasing the number of years
of attestation data needed to determine LVPA eligibility.
++ Comment on the extent to which this change would alleviate
burden, and if there are other administrative changes that could be
made to simplify this process.
++ Describe any anticipated effects of decreasing the amount of
treatment volume data used to determine LVPA eligibility.
++ Describe the ways that simplifying the attestation process could
help ESRD facilities with fewer resources to promote health equity by
improving their ability to serve vulnerable and underserved
communities.
(b) Comment Solicitation on the Development of a New Payment Adjustment
Based on Geographic Isolation
CMS is striving to promote health equity by ensuring that ESRD
facilities, including both rural and low-volume facilities, are being
paid equitably for serving populations that are currently underserved.
Therefore, in the CY 2024 ESRD PPS proposed rule (88 FR 42444 through
42445), we solicited comments on potentially assisting geographically
isolated ESRD facilities and promoting access in these areas, including
labor force hiring and retention. We stated that we considered
establishing a new payment adjustment that accounts for isolation,
rurality, and other geographical factors. We also requested information
on geographic isolation to determine if ESRD facilities that are
[[Page 76370]]
currently considered rural would benefit from a geographic isolation
adjustment. The new geographically based payment adjustment may
consider local dialysis need (LDN), as explained later in this section,
instead of basing payment strictly upon a rural designation, as set
forth in Sec. 413.233 and 413.231(b)(2). We considered changes to the
eligibility criteria to address the concerns that GAO and MedPAC raised
about targeting LVPA payments to ESRD facilities that are not located
near other ESRD facilities that are necessary to protect access to
care. As noted previously, under section 1881(b)(14)(D)(iii) of the
Act, the LVPA must reflect the extent to which costs incurred by low-
volume facilities (as defined by the Secretary) in furnishing renal
dialysis services exceed the costs incurred by other facilities in
furnishing such services. We explained that our preliminary analysis
found that, in general, low-volume facilities that are rural, isolated,
or located in low-demand areas did not have higher costs than low-
volume ESRD facilities overall. Therefore, certain changes that
interested parties have suggested would not comport with the statutory
requirements and limitations for the LVPA. We solicited comments on
potential methodologies for creating a separate payment adjustment that
could potentially address GAO and MedPAC's concerns, relying upon the
authority under section 1881(b)(14)(D)(iv) of the Act, which states
that the ESRD PPS may include such other payment adjustments as the
Secretary determines appropriate.
We solicited responses to the following questions.
++ What factors should be considered in formulating a payment
adjustment for ESRD facilities in isolated geographical areas or areas
for which there is a low need for renal dialysis services?
++ What are the best ways to incentivize renal dialysis service
provision in isolated geographic areas?
++ Our analysis of the LDN methodology has shown that low LDN
census tracts intersect with areas designated as Health Professional
Shortage Areas. What impact would a payment adjustment based on
geographic isolation have on the ability of ESRD facilities in isolated
areas to recruit and retain health care professionals?
++ Comment on the appropriateness of maintaining the rural facility
adjustment under Sec. 413.233 if we were to establish an LDN payment
adjustment in conjunction with a modified LVPA.
++ Comment on the relationship between geographic isolation and
cost. Please provide any data that could further inform CMS's
understanding of the relationship between geographic isolation and cost
for low volume facilities.
++ Comment on the appropriateness of utilizing driving time between
current beneficiary address and treatment location as the appropriate
metric for travel time.
++ Are there ways in which the suggested methodology for this
potential payment adjustment could fail in targeting isolated ESRD
facilities, or ESRD facilities in areas with low LDN?
++ Are there ways in which the determination of LDN might be
subject to gaming?
++ Would a payment adjustment for ESRD facilities in areas with low
LDN improve health equity? Are there specific recommendations to change
the LDN methodology described above to promote quality access to care
for all ESRD beneficiaries?
++ Comment on the favorability of CMS's implementation of a new
payment adjustment for ESRD facilities in areas with low LDN as
described above.
++ Are there any other considerations we should keep in mind when
considering proposing a new payment adjustment based on an LDN
methodology?
(c) Summary of Request for Information on Potential Modification to
LVPA Methodology and Information Received From Commenters
As discussed above, in the CY 2024 ESRD PPS proposed rule (88 FR
42430), we sought comment on several approaches to modifying the LVPA
to address concerns about its incentive structure, treatment threshold,
and administrative burden. We issued an RFI to seek feedback from the
public on potential changes to the LVPA methodology, including
maintaining a single threshold, establishing LVPA tiers, and/or
utilizing a continuous function to ensure that payments accurately
reflect differences in cost and adequately target low-volume
facilities. We also solicited comments on the establishment of an add-
on payment adjustment for geographic isolation of ESRD facilities. We
asked commenters whether a payment adjustment for geographic isolation
of ESRD facilities in areas with low local dialysis need would improve
health equity.
We received 23 public comments in response to our RFI, including
from large, small, and non-profit dialysis organizations; an advocacy
organization; a coalition of dialysis organizations; a large non-profit
health system; and MedPAC. A high-level description of these comments
is included in the following subsections of this CY 2024 ESRD PPS final
rule.
We thank the commenters for their detailed and thoughtful comments.
While we will not respond to these comments in this CY 2024 ESRD PPS
final rule, we intend to take them into consideration for future
rulemaking and future policy development. We will provide more detailed
information about the commenters' recommendations in a future posting
on CMS's website located at the following link: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Educational_Resources.
(i) Responses on Criteria for Receiving LVPA Status
We received a wide range of responses to the RFI. Many commenters
supported MedPAC's proposal of implementing a two-tier low-volume and
isolated (LVI) adjustment in place of the LVPA so that facilities can
expand services to meet patient needs without substantial payment
decreases while limiting administrative burden. Some commenters
supported maintaining a single threshold with varying recommendations
for adjusted treatment counts. Other commenters supported establishing
varying numbers of tiers at varying treatment counts. Some commenters
also supported establishing a continuous function as described in the
CY 2024 ESRD PPS proposed rule. Many comments included general concerns
regarding the administrative burden and transparency of the various
methodologies described. While we are not providing a detailed response
to these comments in this final rule, we thank the commenters for their
input and will consider the recommendations in potential future
rulemaking.
(ii) Responses on the Local Dialysis Need (LDN) Methodology
Commenters generally believed that the LDN methodology was overly
complicated and lacked transparency. Several commenters expressed
renewed support for incorporating geographic isolation directly into
the LVPA formula, using a methodology such as the LVI adjustment that
MedPAC suggested. While we are not providing a detailed response to
these comments in this final rule, we thank the commenters for their
input and will consider the recommendations in potential future
rulemaking.
[[Page 76371]]
(3) Exception to the Current LVPA Attestation Process for Disasters and
Other Emergencies
Under our current regulations at Sec. 413.232(b), a low-volume
facility is an ESRD facility that, based on the submitted documentation
(1) furnished less than 4,000 treatments in each of the 3 cost
reporting years (based on as-filed or final settled 12-consecutive
month cost reports, whichever is most recent, except as specified in
Sec. 413.232(g)(4)) preceding the payment year; and (2) has not
opened, closed, or received a new provider number due to a change in
ownership (except where the change in ownership results in a change in
facility type) in the 3 cost reporting years (based on as-filed or
final settled 12 consecutive month cost reports, whichever is most
recent) preceding the payment year. When we first established these
requirements in the CY 2011 ESRD PPS final rule, we explained that
looking across data for three years provided us with sufficient
information to view consistency in business operations (79 FR 49123).
In the CY 2019 ESRD PPS final rule (83 FR 56949) and the CY 2021 ESRD
PPS proposed rule (85 FR 42165), we acknowledged commenters' concerns
that the eligibility criteria in the LVPA regulations are very explicit
and leave little room for flexibility during disasters or other
emergency situations like the COVID-19 PHE. Commenters have emphasized
that low-volume facilities rely on the LVPA, and that loss of the
payment adjustment could result in beneficiary access issues.
As discussed in the CY 2021 ESRD PPS proposed rule (85 FR 42165),
the COVID-19 PHE caused ESRD facilities to have to shift patients among
ESRD facilities to provide uninterrupted care to their Medicare ESRD
population. In some cases, this patient shifting increased dialysis
treatments at some low-volume ESRD facilities, putting the ESRD
facility temporarily over the LVPA treatment threshold. This increase
in dialysis treatments, resulting from the COVID-19 PHE, disqualified
some ESRD facilities that would have otherwise received the LVPA of
23.9 percent per treatment. In the CY 2021 ESRD PPS final rule (85 FR
71485), we established a policy that ESRD facilities would be held
harmless from increases in treatment counts due to temporary patient
shifting because of the COVID-19 PHE. To be held harmless, ESRD
facilities must follow the attestation process for the exception set
forth in Sec. 413.232(g)(4) and are expected to provide supporting
documentation to the MACs upon request. Interested parties have
expressed support for CMS's swift response to the COVID-19 PHE's impact
on ESRD facilities, with an association of dialysis providers stating
that holding harmless LVPA status for these ESRD facilities will better
ensure that ESRD patients can continue to access the life-sustaining
dialysis treatment they need, particularly in rural and underserved
areas where low-volume facilities heavily depend on the LVPA to remain
open and provide treatment for patients.
In the CY 2024 ESRD PPS proposed rule, we stated that we recognize
there could be future circumstances, potentially like the circumstances
of the COVID-19 PHE, in which it would be appropriate to provide
flexibilities with respect to certain LVPA requirements (88 FR 42446).
Commenters have previously expressed concerns about the strict
attestation requirements for ESRD facilities to remain eligible for the
LVPA, particularly when faced with a disaster or other emergency, such
as a local or national emergency, natural disaster, catastrophic event,
or public health emergency. We noted that during disasters or other
emergencies, low-volume facilities could be forced to close, or could
experience increases in their treatment counts if they treat patients
who are displaced from a nearby ESRD facility that is impacted by such
an event. For example, in August of 2021, an ESRD facility in Louisiana
sustained significant damage because of Hurricane Ida, which required
the ESRD facility to close for repairs and temporarily stop furnishing
renal dialysis services. The ESRD facility served a rural community and
for over 10 years received the LVPA due to the low number of dialysis
treatments it furnished each year. This ESRD facility sought recourse
to maintain its eligibility for the LVPA when it resumed operations
following the required repairs to the ESRD facility, however, recourse
was unavailable due to the limitations set forth in Sec. 413.232(b).
We explained that when we established the LVPA in the CY 2011 ESRD PPS
final rule, we stated that we believed the LVPA should encourage small
ESRD facilities to continue to provide access to care to an ESRD
patient population where providing that care would otherwise be
problematic (75 FR 49118). Given that these requirements for low-volume
facilities were created to protect access to care for the vulnerable
patient population that these ESRD facilities serve, we noted, adding
certain flexibilities during disasters or other emergencies would
promote our commitment to ensuring access to care for ESRD patients.
(a) Changes to the LVPA
We proposed to make two changes to the LVPA regulation at Sec.
413.232 to allow for more administrative flexibilities during disasters
or other emergencies. First, we proposed to create a new exception to
the attestation process for disasters and other emergencies. Second, we
proposed to establish a process that would allow low-volume facilities
to close and reopen in response to a disaster or other emergency and
still receive the LVPA. CMS would assess whether a particular situation
is a disaster or other emergency based on the totality of the
circumstances that could result in disruption of or inability to
furnish renal dialysis services at one or more ESRD facilities, thus
affecting the ESRD facility or facilities' ability to qualify for the
LVPA. For purposes of the proposal, disasters or other emergencies
would include, but not be limited to, the below examples:
A public health emergency declared by the Secretary due to
a significant outbreak of infectious disease or bioterrorist attacks.
Natural disasters including winter storms, floods,
tornados, hurricanes, wildfires, earthquakes, or any combination
thereof.\17\
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Catastrophic events outside of an ESRD facility's control
that disrupt operations and result in an ESRD facility's closure, for
example, loss of operations or patient shifting due to a local
emergency such as fire, floods, earthquakes, or tornadoes.
Other disasters or emergency conditions under which a
waiver could be granted pursuant to section 1135 of the Act.
We stated that these policy changes could help displaced ESRD
patients maintain access to renal dialysis services by preventing ESRD
facilities from permanently closing due to the loss of their LVPA. It
is important that ESRD facilities that are receiving the LVPA can
maintain LVPA eligibility despite the impacts caused by a disaster or
other emergency. This policy could potentially protect other ESRD
facilities that need to maintain the LVPA to remain open from
potentially losing their LVPA by exceeding the treatment threshold
because they accepted displaced patients. We noted that we do not want
the fear of losing the LVPA due to increased treatments exceeding the
threshold to disincentivize ESRD facilities from accepting patients
from
[[Page 76372]]
other ESRD facilities experiencing a disaster or other emergency. It is
also important that ESRD facilities that are forced to close due to a
disaster or other emergency can maintain their LVPA eligibility upon
reopening to ensure continued access in areas that otherwise may lack
sufficient ESRD facilities. This policy could also help those ESRD
facilities affected by the disaster or other emergency potentially
resume operations and avoid permanent closure if they would be allowed
to receive the LVPA upon reopening despite the closure or disruption of
operations.
(i) Exception to the LVPA Treatment Threshold for ESRD Facilities That
Accept Patients From an ESRD Facility Affected by a Disaster or Other
Emergency
We proposed in the CY 2024 ESRD PPS proposed rule to create an
exception to the LVPA treatment threshold requirements set forth in
Sec. 413.232(b)(1) under a new provision in Sec. 413.232(g)(5), which
would allow an ESRD facility to receive the LVPA even if it exceeds the
LVPA threshold if its treatment counts increase due to treating
additional patients displaced by a disaster or other emergency.
Qualification for the exception would require an ESRD facility to
absorb those displaced patients from an outside or adjacent ESRD
facility that experienced a temporary closure or operational disruption
(such as a water shut off). If an ESRD facility accepts the patients of
the ESRD facility affected by the disaster or other emergency, causing
that ESRD facility to meet or exceed the 4,000-treatment count for all
dialysis patients, it would attest to its MAC that it furnished
treatments equal to or in excess of 4,000 in the cost reporting year
due to temporary patient-shifting as a result of the closure or
operational disruption of an ESRD facility due to a disaster or other
emergency. We proposed to define temporary patient-shifting in the
context of the LVPA in the ESRD PPS as providing renal dialysis
services to one or more patient(s) at any time through the end of the
CY following the 12-month period beginning when an ESRD facility first
begins providing renal dialysis services to the displaced patient(s).
The ESRD facility would be required to request this exception from CMS
by writing to the ESRD Payment Mailbox ([email protected]) no
later than the annual attestation deadline of November 1st. CMS would
review the exception request within 30 days to determine if the ESRD
facility qualifies for the exception. If approved by CMS, the ESRD
facility would be paid the LVPA for Medicare beneficiaries for up to
the first 4,000 dialysis treatments in the payment year in which the
temporary patient-shifting occurred. Under this exception, the ESRD
facility would be held harmless for meeting or exceeding the 4,000-
treatment threshold during one or more cost reporting years within the
3-year lookback for LVPA eligibility as long as their 4,000-treatment
threshold was exceeded as a result of temporary patient-shifting from
the ESRD facility that experienced the disaster or other emergency. If
CMS does not approve the request, CMS would notify the ESRD facility
and the MAC, and the ESRD facility would be disqualified from receiving
the LVPA until it meets all the LVPA criteria (including the 3-year
lookback). The ESRD facility receiving this exception must maintain
documentation of the number of displaced patients treated and
information about the ESRD facility or facilities that previously
treated those patients and closed or experienced an operational
disruption due to a disaster or other emergency and must provide such
documentation to CMS and the MAC upon request. The ESRD facility
requesting this exception would have to repeat the process for
requesting an exception for each cost reporting year in which its
treatment volume meets or exceeds 4,000 due to temporary patient-
shifting from the ESRD facility that experienced the disaster or other
emergency. Additionally, the ESRD facility requesting this exception
would have to follow the attestation process as described at Sec.
413.232(e) for the two payment years following the last cost reporting
year in which its treatment volume meets or exceeds 4,000 due to
treating displaced patients from the ESRD facility that experienced the
disaster or other emergency and attest that the ESRD facility meets the
criteria established at Sec. 413.232.
We provided the following example: if a disaster occurs on June 1,
2024, which results in ESRD facility X's closure or operational
disruption resulting in ESRD facility Y (an existing low-volume
facility) treating additional patients from ESRD facility X that puts
ESRD facility Y's total renal dialysis treatments for cost reporting
year 2024 over the 4,000 treatment threshold, ESRD facility Y would be
required to request an exception to Sec. 413.232(b)(1) from CMS by
November 1, 2024 to continue receiving the LVPA. Since ESRD facility Y
began treating the displaced patients in CY 2024, the window for
temporary patient shifting would extend until December 31, 2025. To be
approved for the exception under the proposed provision in Sec.
413.232(g)(5), CMS would determine that ESRD facility Y furnished
treatments equal to or more than 4,000 in the cost reporting year due
to temporary patient-shifting because of the closure or operational
disruption of ESRD facility X resulting from a disaster or other
emergency. Should the exception be approved by CMS, ESRD facility Y
would receive the LVPA for up to the first 4,000 treatments it
furnished in 2024. Additionally, ESRD facility Y would not be
disqualified from receiving the LVPA for payment years (PYs) 2025 and
2026 due to exceeding the treatment volume threshold in cost reporting
year 2024, assuming the temporary patient-shifting from ESRD facility X
occurred only in cost reporting year 2024. For PY 2025 and PY 2026,
ESRD facility Y would have to attest that it meets all the criteria for
the LVPA because it furnished treatments equal to or more than 4,000 in
the cost reporting year due to temporary patient-shifting as a result
of the closure or operational disruption of an ESRD facility resulting
from a disaster or other emergency and received an exception for cost
reporting year 2024. This would be the same attestation process as if
ESRD facility Y did not furnish any excess treatments and was attesting
that it continued to meet the criteria for the LVPA for those payment
years. If the closure or operational disruption of ESRD facility X
causes the treatment volume for ESRD facility Y to meet or exceed the
4,000-dialysis treatment threshold in cost reporting year 2025, ESRD
facility Y would have to submit another request for an exception by
November 1, 2025. Should this exception be approved, ESRD facility Y
would receive the LVPA for up to the first 4,000 treatments it
furnished in cost reporting year 2025 and would not be disqualified
from receiving the LVPA for PYs 2026 and 2027 due to exceeding the
treatment volume threshold in cost reporting year 2024 and cost
reporting year 2025. If ESRD facility Y continued to treat displaced
patients from ESRD facility X in cost reporting year CY 2026, it would
only be considered temporary patient-shifting if ESRD facility Y
treated those patients before January 1, 2026, and if patients treated
after January 1, 2026 cause ESRD facility Y to exceed the 4,000-
treatment volume threshold in cost reporting year 2026 then the ESRD
facility would be disqualified from receiving the LVPA under Sec.
413.232(b)(1). Under this example, ESRD facility Y would still have to
meet the other eligibility requirements to
[[Page 76373]]
receive the LVPA in any PY in which the ESRD facility would receive the
LVPA.
(ii) Exception to the LVPA Closure Provision for ESRD Facilities
Affected by a Disaster or Other Emergency
In addition to the proposed exception to the treatment threshold
requirement under Sec. 413.232(b)(1) and (g)(5), we proposed an
exception under Sec. 413.232(g)(6) that would allow an ESRD facility
to still receive the LVPA if it temporarily closes. That is, if an ESRD
facility temporarily ceases to operate and the patients must go to
another ESRD facility to receive renal dialysis services due to a
disaster or other emergency, and the ESRD facility subsequently
reopens, we proposed to create an exception to the requirement in Sec.
413.232(b)(2) that an ESRD facility ``has not opened, closed, or
received a new provider number'' in the 3 cost reporting years
preceding the payment year. If an ESRD facility is affected by a
disaster or other emergency and the ESRD facility is forced to close
and re-open later, the ESRD facility would need to request an exception
from CMS in writing at the ESRD Payment Mailbox at
[email protected] within 60 days of the closure and inform the
MAC of the request. CMS would review the request within 30 days of
receipt and either approve the request based on a determination that
the ESRD facility closed due to a disaster or other emergency, or deny
the request, and would inform both the ESRD facility and the MAC of its
decision.
Under the proposal, upon reopening and providing renal dialysis
services, the ESRD facility would be required notify CMS and the MAC in
writing within 30 days of its reopening. CMS would acknowledge receipt
of the written notification within 30 days. If the exception is
approved and CMS is duly informed of the ESRD facility's reopening, the
ESRD facility would remain eligible for the LVPA and the MAC would
process payment accordingly. To continue receiving the LVPA the ESRD
facility would still have to meet all the other eligibility
requirements for the LVPA. The exception to Sec. 413.232(b)(2) would
be applicable for a period of 2 cost reporting years following the date
of closure of the ESRD facility. After a period of 2-cost reporting
years the ESRD facility would follow the normal attestation process for
the LVPA specified in paragraphs (e) and (g) of Sec. 413.232. The ESRD
facility would be required to maintain documentation regarding its
closure, and to provide such supporting documentation to CMS and/or the
MAC upon request.
We provided the following example: If a disaster occurs on June 1,
2024, which results in an ESRD facility experiencing a closure, the
ESRD facility would request an exception to Sec. 413.232(b)(2) from
CMS within 60 days of June 1, 2024 (that is, on or before July 31,
2024). CMS would review the request and notify the ESRD facility and
the MAC within 30 days if the exception is approved or denied. If the
ESRD facility then reopens on September 1, 2024, the ESRD facility
would notify CMS and the MAC in writing within 30 days of reopening
(that is, on or before October 1, 2024). CMS would notify the ESRD
facility and the MAC of its receipt of the reopening notification
within 30 days. If the exception was approved by CMS, the ESRD facility
would remain eligible for the LVPA for the rest of payment year 2024
and for the entirety of payment year 2025 and payment year 2026,
provided the ESRD facility continues to meet the other eligibility
requirements for the LVPA.
We received 10 public comments on our proposals to modify the LVPA
regulation at Sec. 413.232 to allow for more administrative
flexibilities during disasters or other emergencies. These comments
came from three LDOs, a non-profit dialysis organization, a coalition
of dialysis organizations, a non-profit advocacy organization, and a
non-profit kidney organization. The comments on our proposals and our
responses are set forth below.
Comment: All of the comments supported CMS's proposal to establish
exceptions to the LVPA requirements for ESRD facilities impacted by a
disaster or other emergency.
Response: We appreciate the support for our proposed exceptions to
the LVPA requirements for ESRD facilities that are impacted by a
disaster or other emergency.
Comment: One LDO requested that CMS reevaluate the attestation
deadline for ESRD facilities that exceed the LVPA treatment volume
threshold due to accepting displaced patients from an ESRD facility
that closes or experiences an operational disruption due to a disaster
or other emergency. This LDO noted that if the disaster were to occur
late in the year, it might be difficult for an ESRD facility to meet
the November 1st attestation deadline.
Response: We thank the commenter for the thoughtful suggestion on
how to improve the proposed exception for ESRD facilities that exceed
the 4,000-treatment volume threshold due to treating patients displaced
by a disaster or other emergency. We note that Sec. 413.232(e)
currently states that ``to receive the low-volume adjustment an ESRD
facility must provide an attestation statement, by November 1st of each
year preceding the payment year, to its Medicare Administrative
Contractor (MAC) that the facility meets all the criteria established
in this section,'' except as otherwise specified. We did not propose to
change the attestation deadline for ESRD facilities impacted by a
disaster or other emergency. In the CY 2012 ESRD PPS final rule (76 FR
70236), we finalized a yearly November 1st deadline for attestation
submission, and noted that this timeframe provides 60 days for a MAC to
verify that an ESRD facility meets the LVPA eligibility criteria. It is
important that all ESRD facilities have the same attestation deadline
for the LVPA to allow adequate verification time for the MACs and so
that those ESRD facilities eligible for LVPA are able to receive it
timely. In the past when we have extended the LVPA attestation
deadline, we have done so for all ESRD facilities (85 FR 71442).
However, we believe that a November 1st deadline is necessary so that
the LVPA attestations can be properly processed, and payments can begin
on January 1st of the next CY. In response to the concern for ESRD
facilities which are impacted by a disaster late in the year, we are
modifying the proposed regulation language at Sec. 413.232(g)(5) to
allow an ESRD facility to request the exception to the 4,000-treatment
volume threshold requirement up to 30 days after the end of the cost
reporting year for which they are attesting. Although the ESRD facility
would still have to submit an attestation by the November 1st deadline,
this will allow additional flexibility for ESRD facilities that
experience temporary patient shifting late in the year if their cost-
reporting year ends within 30 days of the attestation deadline. We
clarify that under this exception, an ESRD facility would have to
submit the exception request by either the attestation deadline or 30
days after the end of the ESRD facility's cost reporting year,
whichever is later, but would not be required to have received the
exception by the attestation deadline. Then, in the event that the ESRD
facility does not receive approval for the exception from CMS, the MAC
would follow the current process. Specifically, as noted in Sec.
413.232(h)(2), if the MAC determines an ESRD facility does not meet the
definition of a low-volume facility, the MAC reprocesses claims and
recoups
[[Page 76374]]
low-volume adjustments paid during the payment year.
Comment: A coalition of dialysis organizations requested that the
exception to the attestation process for ESRD facilities that treat
displaced patients be extended to ESRD facilities that treat displaced
patients from ESRD facilities that closed for reasons not related to a
disaster or other emergency. This commenter noted that between 2020 and
2023, 383 ESRD facilities closed, which impacted an estimated 21,000
patients.
Response: At this time, we do not agree that it is appropriate to
allow ESRD facilities to exceed the LVPA treatment volume threshold due
to treating displaced patients from ESRD facilities that close for
reasons unrelated to disasters or other emergencies. If an ESRD
facility closes due to a disaster or other emergency, the ESRD facility
could re-open or another ESRD facility could open in its place, which
would lead to the accepting ESRD facility returning to a lower
treatment volume. However, if an ESRD facility closes for reasons
unrelated to a disaster or other emergency, such as lack of demand or
profitability, it is less likely that the ESRD facility would re-open
or that a new ESRD facility would replace it. Additionally,
implementing this commenter's suggestion could lead to perverse
incentives. For example, an ESRD facility that does not receive the
LVPA and closes temporarily has its patients receive treatment at
another affiliated ESRD facility, which usually receives the LVPA (and
therefore, a higher payment rate). If the commenter's suggestion were
to be implemented, with the influx of new patients, the ``accepting''
ESRD facility could strategically surpass the 4,000-treatment level and
still receive the LVPA.
Final Rule Action: We are finalizing our proposals to establish an
exception process to allow a facility to close and reopen in response
to a disaster or emergency and still receive the LVPA, and to allow a
facility to receive the LVPA even if it exceeds the LVPA threshold if
its treatment counts increase due to treating additional patients
displaced by a closure or operational disruption caused by a disaster
or other emergency, as proposed, with two modifications. First, as
noted above, we are finalizing one modification to Sec.
413.232(g)(5)(ii) to change the deadline by which the ESRD facility
must request the exception to Sec. 413.232(b)(1) to be the later of
the attestation deadline or 30 days after the end of the cost reporting
year for which the ESRD facility is attesting. Specifically, we are
finalizing Sec. 413.232(g)(5) which states that if an ESRD facility
exceeds the 4,000-treatment volume threshold due to temporary patient
shifting from an ESRD facility that experiences a closure or
operational disruption due to a disaster or other emergency, the
accepting ESRD facility would be able to apply for an exception to the
requirement at 413.232(b)(1) and, if the exception is approved, the
ESRD facility would not be disqualified from receiving the LVPA on the
basis of 413.232(b)(1) due to exceeding the 4,000-treatment volume
threshold in that cost reporting year. The deadline for requesting this
exception would be either the attestation deadline or 30 days after the
end of the cost reporting year for which the ESRD facility is
attesting, whichever is later. We are finalizing a definition of
temporary patient shifting in the context of the ESRD PPS LVPA as
providing renal dialysis services to one or more patient(s) at any time
through the end of the CY following the 12-month period beginning when
an ESRD facility first begins providing renal dialysis services to the
displaced patient(s). We are finalizing a second modification of the
proposed regulation text at Sec. 413.232(g)(5)(iv) to indicate that we
will not limit the LVPA payment to 4,000 treatments for the payment
year in which the temporary patient-shifting occurred due to a disaster
or other emergency. We proposed that if an exception is approved under
Sec. 413.232(g)(5), the ESRD facility would be paid the low-volume
adjustment on claims for Medicare beneficiaries for up to the first
4,000 dialysis treatments during the payment year in which the
temporary patient-shifting occurred, so long as all other requirements
for the low-volume adjustment are met. The intent of this proposed
limit was to support stability of payments for ESRD facilities
experiencing temporary patient-shifting due to an emergency at a level
commensurate with their historical treatment volumes, while protecting
the Medicare program against the risk of paying the LVPA for a large
number of treatments. After further consideration of the operational
and payment implications of this policy, we are making this change to
be consistent with our historical practice of not limiting payment of
the LVPA in the year in which the LVPA threshold is exceeded. We are
concerned that limiting LVPA payment to 4,000 treatments for facilities
would create operational confusion for facilities and could limit the
ability of these ESRD facilities to take on patients who are displaced
by a disaster or emergency. Furthermore, we considered that low-volume
ESRD facilities generally receive the LVPA on fewer than 4,000
treatments per year, since the 4,000 treatment threshold includes all
treatments that the facility provides. We therefore do not believe it
is necessary to apply the proposed limit, since ESRD facilities
operating under an exception would be unlikely to exceed 4,000
treatments paid under the ESRD PPS. We intend to monitor the use of
these new exceptions to ensure that they are being applied
appropriately and do not create opportunities for gaming.
Additionally, we are finalizing Sec. 413.232(g)(6), which states
that if an ESRD facility has closed and reopened in response to a
disaster or other emergency, it would be able to apply for an exception
to the requirement at 413.232(b)(2) and, if the exception is approved,
the ESRD facility would not be disqualified from receiving the LVPA on
the basis of 413.232(b)(2) due to closing in that year. The deadline
for requesting this exception is 60 days after ESRD facility's closure.
(4) Technical Correction to Sec. 413.232(g)
We proposed a technical correction at Sec. 413.232(g) to replace
``their'' with ``its,'' to clarify the regulation language.
Final Rule Action: We did not receive comments regarding the
technical correction to the regulations text for the LVPA, and we are
finalizing this revision as proposed.
g. Transitional Pediatric ESRD Add-On Payment Adjustment for Pediatric
Patients With ESRD Receiving Renal Dialysis Services
(1) Background
Section 1881(b)(14)(D)(iv)(I) of the Act provides that the ESRD PPS
may include such payment adjustments as the Secretary determines
appropriate, including a payment adjustment for pediatric providers of
services and renal dialysis facilities. Determining such a payment
adjustment has been historically difficult due to the consistent lack
of data. The Medicare pediatric ESRD patient population receiving
dialysis is small compared to the adult ESRD population, representing
approximately 0.14 percent of the total ESRD patient population in
2022. In the past, CMS has considered various payment adjustments for
pediatric patients with ESRD, including different Medicare payments by
sex or comorbidities (74 FR 49984 through 49986). However, many of
these considered adjustments were not used as we were unable to get
acceptable
[[Page 76375]]
precision due to the small sample size of pediatric patients with ESRD.
Prior to the establishment of the ESRD PPS, payment for pediatric
ESRD renal dialysis services was generally the same rate as adult ESRD
renal dialysis services, unless the ESRD facility qualified for an
exception to the composite rate. Section 1881(b)(7) of the Act stated
that, subject to section 422(a)(2) of the Medicare, Medicaid, and SCHIP
Benefits Improvement and Protection Act of 2000 (Pub. L. 106-554)
(BIPA), the Secretary shall provide for exceptions as may be warranted
by unusual circumstances (including the special circumstances of sole
facilities located in isolated, rural areas and of pediatric
facilities). During this time, CMS received many comments and concerns
regarding the payment rate for renal dialysis services furnished to
pediatric patients with ESRD. Section 623(b) of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L.
108-173) later amended section 422(a)(2) of BIPA to provide that any
pediatric ESRD facility would be eligible for an exception to the
composite rate, effective October 1, 2002. This statute defined
pediatric ESRD facilities as facilities with at least 50 percent
patients under the age of 18. This enabled pediatric ESRD facilities to
obtain payments that specifically recognized the higher cost associated
with treating these patients (69 FR 47530).
We finalized a basic case-mix adjustment to the composite payment
rate in the CY 2005 Physician Fee Schedule (PFS) final rule published
on November 15, 2004 (69 FR 66327). This included a 62 percent
pediatric payment increase (that is, an adjustment factor of 1.62)
applied to the composite payment rate per treatment for any facility
when furnishing outpatient renal dialysis services to pediatric
patients with ESRD. This factor was derived from the average exception
amounts for 20 ESRD facilities that had received exceptions for
pediatric patients. This was intended to be a temporary measure, which
would be eliminated once we developed the case-mix methodology that
would apply for the ESRD PPS bundled payment. The use of this
methodology allowed CMS to provide additional payment for the pediatric
ESRD population under the composite rate in a data-driven manner to
account for the higher costs pediatric patients faced (69 FR 66327).
Section 153(b) of MIPPA added section 1881(b)(14) of the Act, which
required CMS to implement an ESRD bundled PPS beginning January 1,
2011, under which a single payment for renal dialysis services is made
in lieu of any other payment. Renal dialysis services generally include
items and services included in the composite rate for renal dialysis
services as of December 31, 2010, and services furnished to individuals
for treatment of ESRD, which were formerly separately billable,
including drugs and biological products and laboratory tests. In the CY
2011 ESRD PPS proposed rule, we proposed a single composite rate
modifier of 1.199 for all Pediatric ESRD Patients receiving dialysis
(74 FR 49982 through 49983). A ``Pediatric ESRD Patient'' is defined as
an individual less than 18 years of age who is receiving renal dialysis
services (Sec. 413.171). We also proposed an eight-group system for
separately billable renal dialysis services furnished to Pediatric ESRD
Patients with two subdivisions for each of the following factors: age
(under 13, 13 to 17), modality (hemodialysis, peritoneal dialysis) and
number of comorbidities (none, one or more) (74 FR 49983 through
49987). The CY 2011 ESRD PPS proposed rule then calculated an
``expanded bundle'' modifier, which combined the composite rate and
separately billable modifiers for each of the eight groups (74 FR
44987). These expanded bundle modifiers were the proposed pediatric
patient-specific case-mix adjustment factors that would be applied to
the base rate under the ESRD PPS. These modifiers were based on a
regression of costs for all renal dialysis services furnished to
Pediatric ESRD Patients. Comments on this proposed rule indicated that
many interested parties believe the expanded bundle modifier was
insufficient (75 FR 49128). In the CY 2011 ESRD PPS final rule, we
responded to those comments by implementing the first iteration of the
current four-group system for both the expanded bundle and the
separately billable services. This methodology was data driven, but
unlike the simple regression for composite rate costs, allowed for
different Medicare payment amounts based on two sets of two
characteristics: age of the patient (under 13 or 13 to 17) and modality
of the treatment (hemodialysis or peritoneal dialysis). Additionally,
this methodology used the same groups for the expanded bundle and
separately billable modifiers (75 FR 49134).
We codified the Pediatric ESRD Patient payment adjustment in Sec.
413.235(b), which states that CMS adjusts the per treatment base rate
for pediatric patients in accordance with section 1881(b)(14)(D)(iv)(I)
of the Act, to account for patient age and treatment modality. These
multipliers were updated in the CY 2016 ESRD PPS final rule using the
same methodology (80 FR 69001 through 69002). The current expanded
bundle case mix adjusters are presented in Table 7.
[GRAPHIC] [TIFF OMITTED] TR06NO23.009
As we discussed in the CY 2024 ESRD PPS proposed rule (88 FR
42449), despite these changes intended to improve payment accuracy for
renal dialysis services furnished to Pediatric ESRD Patients, we
continue to receive comments and concerns from interested parties that
the payment amounts for renal dialysis services furnished to Pediatric
ESRD Patients are too low. In addition to comments received through the
annual ESRD PPS rulemaking, we have also solicited comments from
interested parties on several occasions. During the December 2020 TEP,
we queried a panel of experts on how to improve payment for pediatric
dialysis care under the ESRD PPS. Panelists \18\ generally preferred
creating more refined case-mix adjusters over creating
[[Page 76376]]
an entirely new pediatric ESRD PPS, citing the costs of creating an
entirely new system both on CMS and the ESRD facilities and the need
for new legislation to be able to increase payment through a separate
pediatric ESRD PPS. Panelists also pointed to labor costs as a major
reason for higher costs among pediatric dialysis clinics because these
patients need more nursing attention and specialized pediatric
nutritionists.
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\18\ https://www.cms.gov/files/document/end-stage-renal-disease-prospective-payment-system-technical-expert-panel-summary-report-april-2021.pdf.
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We noted that, in the CY 2023 ESRD PPS proposed rule (87 FR 38529),
we issued a request for information regarding health equity for
pediatric patients with ESRD. Many commenters asserted that Medicare
payments for Pediatric ESRD Patients are too low and that the ESRD PPS
bundled payment does not target the unique issues facing ESRD
facilities furnishing renal dialysis services to Pediatric ESRD
Patients.
As we explained in the CY 2024 ESRD PPS proposed rule, we are
committed to improving health equity for Pediatric ESRD Patients
receiving renal dialysis services by improving payment equity through
more efficient Medicare payments. Ensuring Medicare payments are
appropriate and reflect costs for renal dialysis services furnished to
Pediatric ESRD Patients would allow more ESRD facilities to provide
quality care to this vulnerable population. The main barrier to payment
equity is the lack of sufficient data to determine the relative costs
associated with furnishing renal dialysis services to Pediatric ESRD
Patients. To improve payment rate accuracy for Pediatric ESRD Patients,
CMS has issued changes to the cost reports for both freestanding ESRD
facilities and hospital-based ESRD facilities effective January 1,
2023.19 20 21 These changes include separate categories for
labor and supplies used in furnishing renal dialysis services to
Pediatric ESRD Patients. These updates are intended to provide data for
CMS to more comprehensively estimate the additional costs associated
with furnishing renal dialysis services to Pediatric ESRD Patients.
However, we estimated it would take approximately 3 years to obtain and
analyze the granular data provided by the stratified cost reports data
from these changes that we need to consider proposing a more finely
tuned payment adjustment.
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\19\ https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/Transmittals/r7p242.
\20\ https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/Transmittals/r18p240i.
\21\ 87 FR 26760 (May 5, 2022). https://www.federalregister.gov/documents/2022/05/05/2022-09581/agency-information-collection-activities-submission-for-omb-review-comment-request.
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(2) Alternative Methodology for Estimating Relative Costs for
Furnishing Renal Dialysis Services to Pediatric ESRD Patients
As discussed in the CY 2024 ESRD PPS proposed rule, payment
accuracy has been historically difficult for pediatric ESRD dialysis
because of the small sample size of Pediatric ESRD Patients receiving
renal dialysis services paid for under the ESRD PPS. Pediatric ESRD
dialysis treatments are also furnished differently from adult ESRD
dialysis treatments in several crucial ways. For example, pediatric
ESRD facilities are more likely to be hospital-based and, on average,
have lower treatment volume and are in higher wage index areas. These
systematic differences in treatment, when combined with the small
sample size, make it very difficult to obtain low variance estimates of
the differences in costs between pediatric and adult ESRD dialysis
patients. Even if simple cost models show statistically significant
estimates, it is possible that the systematic differences between
pediatric and adult ESRD facilities can bias these estimates. Obtaining
a reliable estimate of the additional costs that Pediatric ESRD
Patients incur would allow us to create a payment adjustment to bring
relative Medicare payments more in line with relative costs.
One can account for this bias by selecting a specific sample of
ESRD facilities that have similar characteristics except for proportion
of dialysis treatments furnished to Pediatric ESRD Patients. This would
help to show the additional costs of furnishing dialysis to Pediatric
ESRD Patients based on the variation in costs across the ESRD
facilities. To achieve this, we would use propensity score matching
(PSM).
PSM is a technique that uses regression analysis to account for
systematic differences between two populations to isolate the effects
of a single variable, in this case percentage of Pediatric ESRD
Patients. The PSM regression includes a wide range of ESRD facility-
level characteristics including facility type, size, geographic
location, and the pediatric ESRD dialysis population nearby the ESRD
facility to make a propensity score. This propensity score represents
the probability that a given ESRD facility treats a high volume of
Pediatric ESRD Patients given its facility-level characteristics.
Once the propensity score for each ESRD facility is determined,
each ESRD facility with a significant percentage of Pediatric ESRD
Patients (high-pediatric) is matched with the ESRD facility without a
significant percentage of Pediatric ESRD Patients (low-pediatric) with
the most similar propensity score. We can then compare the relative
per-treatment costs of those ESRD facilities to estimate the additional
costs an ESRD facility faces when it furnishes renal dialysis services
to a higher proportion of Pediatric ESRD Patients, controlling for some
important facility-level characteristics. The dependent variable of
this regression is the log of the cost per treatment for the ESRD
facility. The independent variables are the percent of dialysis
treatments that are furnished to Pediatric ESRD Patients, the log of
the facility size, the type of ESRD facility (hospital-based,
children's hospital-based or freestanding), the log of the wage index
for the ESRD facility and the year for the cost report data. The
regression equation for cost per treatment given a certain percentage
of dialysis treatments furnished to Pediatric ESRD Patients is:
[GRAPHIC] [TIFF OMITTED] TR06NO23.010
This cost regression should be unbiased due to the use of PSM.
However, PSM also requires a reduction in sample size, because there
are relatively few ESRD facilities with a significant number of
treatments furnished to Pediatric ESRD Patients that could be matched
using PSM. This smaller sample size inherently results in an increase
in margin of error. We stated that we believe this is a necessary
tradeoff because a biased estimate cannot be relied upon, but we must
be cautious while using high-error estimates. The result of this
regression is that ESRD facilities that solely serve Pediatric ESRD
Patients incur costs that are 40 percent higher per patient for
furnishing renal dialysis services than similar ESRD facilities that
serve no Pediatric ESRD Patients. The confidence
[[Page 76377]]
interval of this estimate is 20 percent to 60 percent. Therefore, on
average, furnishing renal dialysis services to a Pediatric ESRD Patient
costs 40 percent more than furnishing renal dialysis services to an
adult patient with ESRD.
(3) Current Medicare Payments for Renal Dialysis Services Furnished to
Pediatric ESRD Patients
As discussed in the CY 2024 ESRD PPS proposed rule, the ESRD PPS
already accounts for some of the higher costs that ESRD facilities
incur while furnishing renal dialysis services to Pediatric ESRD
Patients through the case-mix adjusters. Because the analysis described
previously uses cost report data, it does not incorporate either the
current case-mix adjusters or payment rates for Pediatric ESRD Patients
receiving renal dialysis services. We noted that our most recent
estimates showed that payments for dialysis treatments furnished to
Pediatric ESRD Patients were approximately 10 percent higher than for
adult patients with ESRD in CY 2022.
We explained that we are striving for payment accuracy, which is
achieved when relative Medicare payments are proportional to relative
costs. There are several ways we could adjust ESRD PPS payments to
achieve payment accuracy, including calculating the unaccounted-for
cost differential, which is the amount by which ESRD PPS payments for
pediatric ESRD renal dialysis services must be increased to achieve
payment accuracy. We could do this by reducing the cost differential
estimate of 40 percent by a factor 1.1 to account for the current
payment differential of 10 percent. This would yield an unaccounted-for
cost differential of approximately 30 percent (1.4 divided by 1.1 is
1.27 which we are rounding to 1.3). This is a reasonable estimate of
the additional labor and supply costs, which are not accounted for by
the current case-mix adjusters, incurred by ESRD facilities furnishing
renal dialysis services to Pediatric ESRD Patients.
(4) Transitional Pediatric ESRD Add-On Payment Adjustment
As we stated in the CY 2024 ESRD PPS proposed rule, despite the
high margin of error of the cost regression using PSM, we believe that
30 percent cost is the most reasonable estimate of the unaccounted-for
costs incurred in treating Pediatric ESRD Patients compared to adult
ESRD patients. Creating a new add-on payment adjustment using this
figure would provide pediatric ESRD facilities with Medicare payments
proportional to their estimated costs for a temporary period while we
collect additional data. However, due to the high margin of error of
the model, increasing Medicare payments to ESRD facilities such that
payments are 40 percent higher for Pediatric ESRD Patients compared to
all patients would risk making payments higher than appropriate. We
noted that when we conduct the analysis with the more comprehensive
cost report data provided by the cost report changes implemented for CY
2023, we might find that our analysis overestimated the cost of
furnishing renal dialysis services to Pediatric ESRD Patients (that is,
that the additional 30 percent payment adjustment was too large). We
further stated that if we finalized the transitional add-on payment
adjustment for Pediatric ESRD Patients as proposed, pediatric ESRD
facilities should be prepared for the possibility that the payment rate
for Pediatric ESRD Patients could decrease in the future, should that
be indicated by future data analysis and finalized through notice-and-
comment rulemaking. We discussed the alternative to propose a smaller,
more cautious add-on payment adjustment based on the 20 percent lower
bound of the confidence interval, leading to an additional 10 percent
transitional add-on payment adjustment after accounting for the current
payment rate. This option would still represent a significant increase
in Medicare payments to ESRD facilities for Pediatric ESRD Patients
without much risk of making payments higher than appropriate. However,
this alternative option may lead to underpayment to ESRD facilities
serving Pediatric ESRD Patients, which is contrary to our goal of
aligning resource use with payment. We invited comments on the most
appropriate amount for the proposed transitional add-on payment
adjustment.
We proposed in the CY 2024 ESRD PPS proposed rule a new
transitional add-on payment adjustment of 30 percent (adjustment factor
of 1.3) for dialysis treatments furnished to Pediatric ESRD Patients
for 3 CYs, effective January 1, 2024. We stated that based on the time
lag for cost report data, 3 years should allow for enough time for CMS
to get more detailed data from the changes to the cost reports
described previously. After that period, we would evaluate the more
comprehensive cost report data from the first year of cost reporting
periods beginning on or after January 1, 2023, to refine our
methodology for determining the payment rate for pediatric ESRD
dialysis. As proposed, this would be a separate, additional add-on
payment adjustment of 30 percent of the per treatment payment amount
under Sec. 413.230, which reflects the other patient and facility
level adjustments. This adjustment would not be part of the case-mix
adjusters. This payment adjustment would only apply to the ESRD bundled
payment and not to any outlier adjustments. Due to the multiplicative
nature of the case-mix adjusters it would function similarly to a 30
percent increase to the expanded bundle case-mix adjusters. For
comparison, the effective case-mix adjusters are presented in Table 8.
[GRAPHIC] [TIFF OMITTED] TR06NO23.011
[[Page 76378]]
We noted that the exact magnitude of the increase in payment would
vary based on the age of the patient and the wage index of a given
area; we estimated approximately $80 for (hemodialysis-equivalent)
peritoneal dialysis treatments and $100 for hemodialysis treatments.
This would represent a substantial increase in payment for renal
dialysis services furnished to Pediatric ESRD Patients and would
account for the extra costs that this population incurs temporarily
until additional cost data is available. This payment adjustment would
apply for all dialysis treatments furnished to ESRD patients under the
age of 18, not solely treatments furnished in pediatric ESRD
facilities. This is warranted because many of the additional costs
related to the treatment of Pediatric ESRD Patients are not specific to
treatments furnished in pediatric ESRD facilities.
We proposed to call this the Transitional Pediatric ESRD Add-on
Payment Adjustment (TPEAPA) and make this adjustment budget neutral. We
explained that, in general, add-on payment adjustments under section
1881(b)(14)(D)(iv) of the Act are not statutorily required to be budget
neutral under the ESRD PPS, but we stated that we believed in this
instance that budget neutrality is appropriate, due to the way this
adjustment is derived. We noted that other non-budget neutral add-on
payment adjustments that we have established under this authority
generally account for costs that were not used for the construction of
the ESRD PPS bundled payment, such as the TDAPA for calcimimetics (80
FR 69013 through 69027). We explained that we have also established
certain non-budget neutral add-on payment adjustments for items or
services that were not commonplace, and therefore not adequately
represented in cost reports, such as home dialysis training (75 FR
49063). However, we noted that we have implemented other payment
adjustments under this authority in a budget neutral manner; for
example, the changes to the wage index in the CY 2023 ESRD PPS final
rule were implemented in a budget neutral manner as they represented a
shifting of cost allocations, rather than new costs not originally
included in the ESRD PPS bundled payment (87 FR 67157). We stated that
this TPEAPA is primarily for costs that would have been included in the
cost reports used in the analysis conducted when we created the ESRD
PPS bundled payment in the CY 2011 ESRD PPS final rule. We explained
that the methodology used both in that analysis, and when updating the
case-mix adjusters, attributed pediatric ESRD renal dialysis services
costs to the general population. Therefore, we explained, it would be
appropriate to reduce the ESRD PPS base rate to account for the new
allocation of costs. Furthermore, we stated that any changes to the
case-mix adjustments are required by section 1881(b)(14)(A)(ii) of the
Act to be budget neutral, which means that any future modifications to
the pediatric case-mix adjusters would be budget neutral. The proposed
budget neutrality adjustment factor for the proposed TPEAPA consisting
of 30 percent of the per treatment payment amount was 0.999532. We
explained that applying this budget neutrality factor to the proposed
ESRD PPS base rate would reduce the ESRD PPS base rate by an estimated
$0.12. We stated that under the alternative 10 percent TPEAPA discussed
in the proposed rule (88 FR 42464), the budget neutrality factor
adjustment would be 0.999847. We explained that applying this budget
neutrality factor to the proposed ESRD PPS base rate would reduce the
ESRD PPS base rate by an estimated $0.04.
To establish this new TPEAPA, we proposed to amend Sec. 413.235 by
splitting current paragraph (b) into paragraphs (b)(1) and (2).
Paragraph (b)(1) would set forth the established age and modality of
treatment case mix adjustment methodology as currently stated in
paragraph (b). Paragraph (b)(2) would state that beginning January 1,
2024, we will provide a per-treatment transitional add-on payment
adjustment of 30 percent of the per treatment payment amount under
Sec. 413.230 for renal dialysis services furnished to Pediatric ESRD
Patients during CYs 2024, 2025, and 2026. We also proposed to revise
the current language of Sec. 413.235(b) to use the term ``Pediatric
ESRD Patients,'' which is defined at Sec. 413.171, to improve clarity
for this section.
(5) Costs and Benefits for a Transitional Pediatric ESRD Add-On Payment
Adjustment (TPEAPA)
As we explained in the CY 2024 ESRD PPS proposed rule, we believe
CMS could better align the resource use of pediatric ESRD renal
dialysis services with payment. Our analysis using the methodology
outlined previously found that costs for Pediatric ESRD Patients
receiving renal dialysis services are estimated to be 40 percent higher
than for adult patients and that the current payment adjusters account
for 10 percent higher costs. Implementing a transitional 30 percent
add-on payment adjustment for renal dialysis services furnished to
Pediatric ESRD Patients would improve payment equity for these patients
by increasing payments to align with the estimated costs of treatment
more closely. A 30 percent increase in ESRD PPS payments for pediatric
ESRD renal dialysis services would represent approximately $80 to $100
per pediatric ESRD dialysis treatment, although the exact magnitude of
the increase would depend on age, modality, and the wage index of the
area. This payment increase would have beneficial health equity impacts
on this population by improving access to care and quality of care.
Some ESRD facilities may not be able to absorb the additional expense
of the Pediatric ESRD Patient population. Patients may need to travel
to a limited number of primarily hospital-based ESRD facilities where
pediatric ESRD dialysis is performed. As a result, this population may
be underserved and disadvantaged with respect to access to ESRD care.
We stated that additional payment to those ESRD facilities treating
Pediatric ESRD Patients would thereby benefit this potentially
underserved and disadvantaged population of Pediatric ESRD patients.
Additionally, this would have a beneficial financial impact on the ESRD
facilities, both pediatric and non-pediatric, that serve this pediatric
population.
We proposed that this payment adjustment be budget neutral, which
would lead to an estimated decrease of $0.12 to the ESRD PPS base rate,
corresponding to a budget neutrality factor of 0.99954. This relatively
small adjustment would represent less than a twentieth of a percent of
the total ESRD PPS base rate. However, we recognized that any decrease
in the ESRD PPS base rate would represent a monetary loss to ESRD
facilities. As stated previously, our analysis indicated that this
transfer would be reasonable given the likelihood that the methodology
used in the case-mix adjusters attributed some pediatric costs to the
general population. However, we noted, should future analysis of the
stratified pediatric cost data indicate that pediatric ESRD renal
dialysis services costs are less than 40 percent higher than adult
costs, this budget neutral decrease would mean that the treatments for
adult patients with ESRD were slightly underpaid during this 3-year
period. In either case there would be a risk of underpayment for one
group of patients. We stated that we believe using the mean estimate of
the analysis will provide us with the best approach for achieving
payment accuracy while we collect additional data. Additionally, the
health equity
[[Page 76379]]
implications of potentially underpaying for Pediatric ESRD Patients
receiving dialysis by 20 percent would be significantly higher than the
implications of potentially underpaying for adult patients by less than
0.1 percent. We noted that in CY 2021 there were 116 ESRD facilities
that furnished more than 2 percent of their dialysis treatments to
Pediatric ESRD Patients, out of 7882 total ESRD facilities. These ESRD
facilities are a relatively small group, but they are critical for the
care of Pediatric ESRD Patients. For these reasons, we stated that we
believe the expected benefits for the TPEAPA would outweigh the costs.
We explained that we believe providing this 30 percent TPEAPA for
CYs 2024, 2025, and 2026 would be the best approach for improving
payment accuracy until more precise data is available. However, we
acknowledged that in any case there is a risk of making payments which
are higher or lower than appropriate. Therefore, in the CY 2024 ESRD
PPS proposed rule we requested comments on our proposal, including on
(1) the alternative adjustment amount; and (2) the budget neutrality of
the proposal.
We received 30 comments in response to our proposed Transitional
Pediatric ESRD Add-on Payment Adjustment (TPEAPA) for pediatric ESRD
patients receiving renal dialysis services. Respondents included large
and small dialysis organizations, non-profit organizations, an advocacy
organization, a coalition of dialysis organizations, a large non-profit
health system, and individual providers. The comments on our proposal
and our responses are set forth below.
Comment: We received several comments that supported CMS
establishing an add-on payment adjustment for pediatric ESRD patients.
Most commenters expressed their belief that an add-on payment
adjustment of this nature is necessary to support the higher costs
associated with providing for the unique care needs and specialized
support required for renal dialysis services in the ESRD PPS pediatric
population. Physician commenters cited the unique challenges in caring
for this population that are not reflected in the current ESRD PPS
payment models. Numerous commenters expressed their support for using
an ESRD PPS add-on payment adjustment to improve patient access and
equity among this vulnerable subpopulation of patients with ESRD. A
pediatric ESRD facility noted that money invested in this population
lowers avoidable adverse outcomes and complications from ESRD and
facilitates a faster path towards transplantation, ultimately yielding
both cost savings and healthier adults.
Response: We thank the commenters for their support and dedication
to improving access and equity for the pediatric patient population
with ESRD receiving renal dialysis services.
Comment: We received several comments regarding the proposed TPEAPA
payment amount, calculation, and length of payment period. Most
commenters supported the implementation of the 30 percent add-on
payment adjustment as a reasonable estimate of the unaccounted-for
costs incurred in treating pediatric ESRD patients. An LDO expressed
concern that PSM does not provide for an accurate computation of the
costs incurred in providing specialized pediatric care; while a
pediatric nephrology society agreed that in the absence of accurate
pediatric cost data, the PSM methodology seems reasonable. A pediatric
nephrology society reported the 30 percent add-on to be consistent with
anecdotal cost data collected by the society from around the country.
An LDO urged CMS to implement a three-year period of analysis after the
proposed 30 percent adjustment. Another LDO requested more transparency
on the data and assumptions used to calculate the pediatric adjustment.
Response: We thank the commenters for their support and
suggestions. Payment accuracy has been historically difficult for
pediatric ESRD dialysis because of the small sample size of pediatric
patients receiving renal dialysis services paid for under the ESRD PPS.
Obtaining reliable data on the additional costs that pediatric patients
with ESRD incur would facilitate the creation of a permanent payment
adjustment based on resource use to bring relative Medicare payments
more in line with relative costs. We recognize that while our use of
PSM unavoidably leads to larger variance in parameter estimates because
only a small subset of the broader provider population is utilized in
the estimation, this approach is useful because it provides a means of
comparison with less biased estimates and as suggested by commenters
the 30 percent estimate is in line with anecdotal data. We plan to
share data and assumptions through notice-and-comment rulemaking for
potential future pediatric payment adjustments to ESRD facilities.
Comment: Most commenters urged CMS to reconsider implementing the
payment adjustment as a budget neutral add-on. An LDO expressed that it
would be inappropriate to cut payment rates for service provided to
adult patients, whose population is comprised of a significant
percentage of patients from racial or ethnic minority groups, of low-
socioeconomic status, and living in medically underserved areas. A
health system expressed concerns that the add-on payment adjustment
would shift funding away from ESRD facilities exclusively providing
adult services. An LDO expressed that applying the add-on in a budget-
neutral manner would effectively penalize all ESRD facilities for the
inability of existing cost report data to improve payment accuracy. A
nephrology society expressed concerns that while younger patients
require more support, that does not mean that adults requiring dialysis
require less support than they are already receiving. A non-profit
dialysis association expressed that the budget neutral application of
the adjustment is contrary to the Administration's stated health equity
goals, because it would cut payments for one medically vulnerable group
to increase payments for another medically vulnerable group.
Response: We examined the potential impact of the proposed TPEAPA
as a budget neutral adjustment. As we noted in the CY 2024 ESRD PPS
proposed rule, add-on payment adjustments under section
1881(b)(14)(D)(iv) of the Act are not statutorily required to be budget
neutral under the ESRD PPS, but we believe in this instance that budget
neutrality is appropriate due to the way this adjustment is derived. As
explained in section II.B.1.g.(4) of this final rule, this TPEAPA is
primarily for costs that would have been included in the cost reports
used in the analysis conducted when we created the ESRD PPS bundled
payment in the CY 2011 ESRD PPS final rule. We explained that the
methodology used both in that analysis, and when updating the case-mix
adjusters, attributed pediatric ESRD renal dialysis services costs to
the general population. CMS has therefore determined it to be
appropriate to reduce the ESRD PPS base rate to account for the new
allocation of costs. We note that the adjustment would decrease the
ESRD PPS base rate by a budget neutrality factor of 0.999503, a sum
total of $0.14, due to the application of the budget neutrality factor.
We further note that the adjustment does not rely on any assumption
that resource use by adult patients has decreased over time; rather it
assumes that the ESRD PPS payment rate as applied to adults has since
its inception incorporated some amount of costs that were more properly
attributable to treatment of pediatric
[[Page 76380]]
ESRD patients. The TPEAPA therefore makes the ESRD PPS payment more
reflective of relative costs by reallocating payments associated with
those costs from the payment amounts for adults to pediatric ESRD
patients.
Comment: An ESRD facility urged CMS to extend the add-on payment
adjustment to pediatric AKI patients to ensure these patients receive
the same additional support.
Response: We appreciate the suggestion to apply the TPEAPA to
pediatric AKI patients. As we discussed in the CY 2017 ESRD PPS final
rule, we have determined that treatment for AKI is substantially
different from treatment for ESRD and the case-mix adjustments applied
to ESRD patients may not be applicable to AKI patients. Therefore, we
have not historically applied these ESRD PPS adjustments and policies
to AKI payments (81 FR 77959). We did not propose to apply the TPEAPA
to pediatric AKI patients for the same reason.
Comment: We received several additional comments regarding the
TPEAPA implementation. Commenters suggested that CMS create and
implement pediatric ESRD-specific metrics for the pediatric ESRD
programs. A pediatric nephrology society requested CMS utilize means of
communication such as the Medicare Learning Network to educate
children's hospitals on completing costs reports. A professional
nursing association urged CMS to promote a shift towards pediatric ESRD
dialysis care moving towards home-based settings. The association also
urged investment into the field of pediatric nephrology, as there are
limited qualified health care providers and recommended the inclusion
(we assume in cost reports) of pediatric nurse practitioners. The
association also recommended CMS consider direct patient labor
categories when determining costs for pediatrics, as there are
additional training and requirements necessary for the pediatric
population. As an extension of labor categories, the association noted
the shortage of pediatric nephrologists and suggested that CMS include
pediatric nurse practitioners who can assist in meeting the needs of
the youngest and most vulnerable individuals on dialysis. These
commenters did not specify how CMS should include pediatric nurse
practitioners or how such inclusion would relate to the ESRD PPS
bundled payment.
Response: We thank the commenters for their input. As the TPEAPA is
a temporary adjustment until we can fully analyze the costs associated
with pediatric dialysis, we did not include any proposals regarding
shifts to home-based settings, or the inclusion of a pediatric nurse
practitioner in the CY 2024 ESRD PPS proposed rule. However, as we
continue to analyze how best to collect pediatric specific metrics and
the payment for Pediatric ESRD Patients to facilitate future
refinements, we will consider these comments for potential future ESRD
PPS payment policies. We appreciate the suggestion about using Medicare
Learning Networks to educate children's hospitals on completing costs
report. CMS is considering a number of options on how best to provide
educational outreach on this topic.
Final Rule Action: We did not receive any comments on our proposal
to revise the language of Sec. 413.235(b) to use the term ``Pediatric
ESRD Patients'' to improve clarity. As such we are finalizing this
change as proposed. In addition, after consideration of the comments
received and for reasons outlined in the CY 2024 ESRD PPS proposed rule
and previously in this section of the final rule, we are finalizing our
proposal to establish this new TPEAPA on a budget-neutral basis. Under
our authority at section 1881(b)(14)(D)(iv) of the Act, we will adjust
the per treatment base rate for Pediatric ESRD Patients to provide a
per-treatment transitional add-on payment adjustment of 30 percent of
the per treatment payment amount under Sec. 413.230 for renal dialysis
services furnished to Pediatric ESRD Patients during CYs 2024, 2025,
and 2026. CMS is codifying this payment adjustment in the regulations
at Sec. 413.235(b)(2). The budget-neutrality factor for the CY 2024
TPEAPA is 0.999503. This change will be effective January 1, 2024, as
proposed.
h. Reporting Policy for Discarded Amounts of Renal Dialysis Drugs and
Biological Products Paid for Under the ESRD PPS
(1) Background
As discussed in the CY 2023 PFS final rule (87 FR 69710), many
drugs and biological products that are payable under Medicare Part B
are dosed in a variable manner such that the entire amount identified
on the vial or package is not administered to the patient. For example,
many drugs are dosed based on the patient's body weight or body surface
area (BSA). Often, these drugs are available only in single-dose
containers. As stated in U.S. Food and Drug Administration (FDA)
guidance for
[[Page 76381]]
industry,\22\ a single-dose container is designed for use with a single
patient as a single injection or infusion. The labeling for a drug
packaged in a single-dose container typically includes statements
instructing users to discard unused portions. When the labeling
instructs a health care provider to discard the amount of drug that was
unused (that is, the discarded amount) from a single-dose container or
other single-use package of a drug after administering a dose to a
Medicare beneficiary, the program provides payment for the unused and
discarded amount, as well as the dose administered, up to the amount of
the drug indicated on the vial or package labeling. On a Medicare Part
B claim, the JW modifier (drug amount discarded/not administered to any
patient) is a Healthcare Common Procedure Coding System (HCPCS) Level
II modifier used to report the amount of a drug that is discarded and
eligible for payment.
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\22\ https://www.fda.gov/media/117883/download.
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Beginning on January 1, 2017, CMS revised the Medicare Part B JW
modifier policy to require the uniform use of the modifier for all
claims for separately payable drugs with discarded drug amounts from
single-dose containers or single-use packages payable under Part B, in
order to more effectively identify and monitor billing and payment for
discarded amounts of drugs.23 24 The policy does not apply
to drugs that are not separately payable, such as packaged hospital
outpatient prospective payment system (OPPS) drugs or those
administered in federally qualified health centers (FQHCs) or rural
health clinics (RHCs).
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\23\ CR6603: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/Downloads/R3538CP.pdf.
\24\ MLN Matters[supreg] Number MM9603: https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/mm96033.pdf.
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In the CY 2023 PFS final rule (87 FR 69718 through 69719), we
codified our existing policy as discussed in the prior paragraph in
Chapter 17 of the Medicare Claims Processing Manual,\25\ and required
that billing providers report the JW modifier for all separately
payable drugs with discarded drug amounts from single-dose containers
or single-use packages payable under Part B, beginning January 1, 2023.
These changes were promulgated in connection with the implementation of
the discarded drug refund program under section 90004 of the
Infrastructure Investment and Jobs Act (Pub. L. 117-9, November 15,
2021). In that same CY 2023 PFS final rule (87 FR 69722), we responded
to commenters who requested we exempt drugs paid for under the ESRD PPS
bundled payment from the discarded drug refund policy. One commenter
expressed concern regarding how implementation of the discarded drug
refund might inadvertently impact ESRD products, including those used
by home dialysis patients. In response to those comments, we clarified
that units for drugs that are packaged under the Medicare ESRD PPS were
not subject to the JW modifier policy or the discarded drug refund.
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\25\ https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/clm104c17.pdf.
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In the same CY 2023 PFS final rule, CMS also finalized a proposal
to require billing providers to report the JZ modifier for all such
drugs with no discarded drug amounts, beginning no later than July 1,
2023. Specifically, as discussed in the CY 2023 PFS proposed rule (87
FR 46058), we proposed to require the use of a separate modifier, the
JZ modifier, to attest that there were no discarded amounts. We stated
that to align with the JW modifier policy, the JZ modifier would be
required when there are no discarded amounts from single-dose
containers or single-use packages payable under Part B for which the JW
modifier would be required if there were discarded amounts. Table 9
provides additional information about these modifiers.
[GRAPHIC] [TIFF OMITTED] TR06NO23.012
We explained that on all claims for single-dose containers or
single-use packages payable under Part B, either the JW modifier would
be used (on a separate line) to identify any discarded amounts or the
JZ modifier (on the claim line with the administered amount) would be
present to attest that there were no discarded amounts. We noted that
we believed the JZ modifier requirement would not increase burden on
the provider, because under the current JW modifier policy, the
provider already needs to determine whether there are any discarded
units from a single-dose container or single-use package, record
discarded amounts in the patient medical record, and specify
administered and discarded amounts on the claim form. We finalized the
JZ modifier requirement in the CY 2023 PFS final rule. Lastly, we noted
in the CY 2023 PFS final rule that we would begin claims edits for both
the JW and JZ modifier beginning October 1, 2023 (87 FR 69179).
Additional details can be found in Chapter 17 of the Medicare Claims
Processing Manual and the JW/JZ modifier frequently asked questions
(FAQ) document.\26\
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\26\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/JW-Modifier-FAQs.pdf.
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(2) Current Reporting of the JW Modifier Under the ESRD PPS
As we discussed in the CY 2024 ESRD PPS proposed rule, the Medicare
Part B JW modifier policy generally does not apply to drugs that are
not separately payable. The ESRD PPS statute generally requires a
single bundled payment for renal dialysis services. Specifically,
section 1881(b)(14)(A)(i) requires the Secretary to implement a payment
system under which a single payment is made to a provider of services
or a renal dialysis facility for renal dialysis services in lieu of any
other payment. The only exception is
[[Page 76382]]
for oral-only drugs, as defined at Sec. 413.234(a), which are
currently paid separately under Medicare Part D. Section 204 of ABLE
amended section 632(b)(1) of ATRA, as amended by section 217(a)(1) of
PAMA, to provide that payment for oral-only renal dialysis drugs and
biological products cannot be made under the ESRD PPS bundled payment
prior to January 1, 2025. We noted that although the ESRD PPS includes
certain add-on payment adjustments such as the TDAPA and TPNIES, these
are adjustments to the ESRD PPS base rate and therefore part of the
single payment made under the ESRD PPS; these payment adjustments are
not separate payments. For example, as described in our TDAPA
implementation guidance issued August 4, 2017, and updated January 10,
2018, available on the CMS website at https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R1999OTN.pdf, the
methodology used to calculate the per treatment payment amount
incorporates the cost of the drugs that are paid for using the TDAPA.
Although renal dialysis drugs and biological products paid for
under the ESRD PPS are not considered ``separately billable'' and are
not subject to the general Part B JW modifier policy discussed in the
prior paragraph, CMS has previously issued guidance on the use of the
JW modifier on ESRD PPS claims for certain circumstances. Chapter 8,
section 60.4.5.1 of the Medicare Claims Processing Manual pertains to
self-administered supplies of ESAs.\27\ Under current guidance, when
billing for discarded amounts of drugs in accordance with the policy in
chapter 17 of this manual, section 40.1, the provider must bill for
discarded amounts on a separate line item with the modifier JW. The
line-item date of service should be the date of the last covered
administration according to the plan of care or, if the patient dies,
use the date of death. More specifically, in Chapter 17, section 40.1
of the Medicare Claims Processing Manual,\28\ we state that multi-use
vials are not subject to payment for discarded amounts of drug or
biological products, with the exception of self-administered ESAs by
Method I home dialysis patients, for whom an ESRD facility furnishes
and bills for renal dialysis services.\29\ Current guidance in Chapter
17, section 40.1 of the Medicare Claims Processing Manual states that
the ESRD facility must bill the program using the JW modifier for the
amount of ESAs appropriately discarded if the home dialysis patient
must discard a portion of the ESA supply due to expiration of a vial,
because of interruption in the patient's plan of care, or unused ESAs
on hand after a patient's death. We noted that separate payment is not
made for ESAs under the ESRD PPS; however, ESAs are eligible for
outlier payments when the criteria in Sec. 413.237 are met.
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\27\ https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c08.pdf.
\28\ https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/clm104c17.pdf.
\29\ Prior to the ESRD PPS, a Medicare ESRD beneficiary could
elect to obtain home dialysis equipment and supplies from a supplier
that was not a Medicare approved dialysis facility. This was
referred to as Method II home dialysis. In the CY 2011 ESRD PPS
final rule (75 FR 49061), we stated that all costs associated with
home dialysis services (both Method I and Method II) are included in
the composite portion of the two equation model, and we stated that
effective January 1, 2011, all home ESRD patients would be
considered Method I home patients and all Medicare payments for home
dialysis services would be made to the ESRD facility.
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Most recently, the March 15, 2022, Change Request \30\ that
established the TDAPA for Korsuva[supreg] (difelikefalin) instructs
facilities to use the JW modifier to report the amount of difelikefalin
that is discarded and eligible for payment under the ESRD PPS. We noted
that based on the latest available data at the time of the CY 2024 ESRD
PPS proposed rule, nearly 40 percent of the TDAPA expenditures for
those drugs that were reported in 2022 represented discarded amounts
reported using the JW modifier, which represented approximately $1.3
million in TDAPA expenditures for discarded amounts of difelikefalin.
Overall, our analysis of Medicare claims data from 2017 to 2021 found
that approximately 2 percent of ESRD PPS claims indicate discarded or
unused portions of drugs or biological products through use of the JW
modifier. We estimated that the total amount of unused product billed
from 2017 to 2021 and paid for under the ESRD PPS is approximately $22
million.
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\30\ https://www.cms.gov/files/document/r11295CP.pdf.
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We explained in the CY 2024 ESRD PPS proposed rule that, under our
current policy, we do not reduce the single payment under the ESRD PPS
for any discarded amounts of renal dialysis drugs or biological
products that are reported with the JW modifier. Furthermore, when
calculating any adjustments to the ESRD PPS base rate for the TDAPA or
outlier payments, we include all units of renal dialysis drugs and
biological products billed on the claim for which an adjustment is
made, including any discarded amounts of such drugs and biological
products. Additionally, we have previously established in the CY 2012
ESRD PPS final rule (76 FR 70243 through 70244) that ESRD facilities
may only report units and charges for drugs and biological products
purchased and may not bill for overfill units of drugs and biological
products which exceed the amount indicated on the vial or package
labeling.\31\ Additionally, we explained that consistent with prior
rulemaking, under our authority in section 1881(b)(14)(D)(ii) of the
Act, we were adopting the average sales price (ASP) policy on overfill
for purposes of calculating the outlier payment. That is, we adopted a
policy to exclude overfill units of drugs and biological products which
exceed the amount indicated on the vial or package labeling from
consideration for the purposes of calculating outlier payments. We
stated we believe the use of the ASP policy for purposes of calculating
the outlier payment is appropriate because we believe overfill does not
represent a cost to the ESRD facility; thus, overfill should not factor
into our determination of outlier payments.
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\31\ We explained in the CY 2011 PFS final rule (75 FR 73466)
that we had become aware of situations where manufacturers
intentionally included a small amount of overfill in drug
containers, and that this overfill is provided at no extra charge to
the provider. We also noted that we understood the intent of the
intentional overfill was to compensate for product loss during the
proper preparation and administration of a drug. We explained that
ASP calculations are based on data reported by manufacturers,
including ``volume per item''. Therefore, providers may only bill
for the amount of drug product actually purchased and the cost that
the product represents (75 FR 73467).
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In summary, our longstanding policy for payment under the ESRD PPS,
including the calculation of the TDAPA and outlier payment adjustments,
includes payment for units of renal dialysis drugs and biological
products billed with the JW modifier, but does not allow payment for
overfill units. That is, the current ESRD PPS payment policy is
consistent with the broader Medicare Part B policy to pay for the
unused and discarded amount, as well as the dose administered, up to
the amount of the drug indicated on the vial or package labeling.
(3) ESRD PPS Policy for Reporting of Discarded Amounts of Renal
Dialysis Drugs and Biological Products
As discussed in the CY 2024 ESRD PPS proposed rule (88 FR 42464)
and in section II.B.1.j of this final rule, we are undertaking analysis
of ESRD PPS claims and cost report data to better understand the
patient-specific costs associated with furnishing renal dialysis
services to Medicare beneficiaries. We
[[Page 76383]]
stated in the proposed rule that in considering potential refinements
to the ESRD PPS case-mix adjustments in the future, it is important to
understand and have consistent data about the costs associated with the
quantities of the renal dialysis drugs and biological products that are
used by ESRD beneficiaries. This is consistent with our longstanding
policy principles, which are reflected by our policy for billing for
unused amounts of renal dialysis drugs and biological products under
the ESRD PPS. In the CY 2016 ESRD PPS final rule (80 FR 69033), we
discussed our existing policy since the inception of the ESRD PPS that
all renal dialysis service drugs and biological products prescribed for
ESRD patients, including the oral forms of renal dialysis injectable
drugs, must be reported by ESRD facilities, and the units reported on
the monthly claim must reflect the amount expected to be taken during
that month. We stated that ESRD facilities should use the best
information they have in determining the amount expected to be taken in
a given month, including fill information from the pharmacy and the
patient's plan of care. We noted that any billing system changes to
effectuate this change needed to be made as soon as possible, as this
requirement had been in effect since the ESRD PPS began in 2011. This
policy is also discussed in the Medicare Benefits Policy Manual, Pub.
100-02, Chapter 11, section 20.3.C.\32\
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\32\ https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/bp102c11.pdf.
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Consistent with our longstanding billing policies for unused
amounts of drugs and biological products and consistent with the
requirements for the uniform use of the JW modifier for all claims for
separately payable drugs under Part B since 2017, to more effectively
identify and monitor billing and payment for discarded amounts of
drugs, in the CY 2024 ESRD PPS proposed rule, we proposed to require
ESRD facilities to report accurate and consistent data about discarded
amounts of single-dose renal dialysis drugs and biological products
paid under the ESRD PPS. Further, section 1881(b)(2)(B) of the Act
requires the Secretary to prescribe in regulations any methods and
procedures to determine the costs incurred by ESRD facilities in
furnishing renal dialysis services to beneficiaries with ESRD, and to
determine payment amounts for Part B services furnished by such ESRD
facilities.
We noted that, under our longstanding policy, payment is made under
the ESRD PPS bundled payment for discarded amounts of renal dialysis
drugs and biological products, and such discarded amounts are included
in the calculation of the ESRD PPS base rate and any applicable
adjustments, such as the TDAPA and the outlier adjustment. Therefore,
consistent with the current JW and JZ reporting requirements that were
finalized in the CY 2023 PFS final rule for separately payable Part B
drugs, we proposed to require that beginning no later than January 1,
2024, ESRD facilities must report information on ESRD PPS claims about
the total number of billing units of any discarded amount of a renal
dialysis drug or biological product from a single-dose container or
single-use package that is paid for under the ESRD PPS, using the JW
modifier (or any successor modifier that includes the same data). We
also proposed that ESRD facilities must document any discarded amounts
in the beneficiary's medical record. Additionally, we proposed to
require ESRD facilities to report the JZ modifier for all such renal
dialysis drugs and biological products with no discarded amounts,
beginning no later than January 1, 2024. We proposed to codify these
reporting requirements in regulation at Sec. 413.198(b)(5) and (6).
We proposed the amount of a renal dialysis drug or biological
product from a single-dose container or single-use package that is
administered would be billed on one line (reflected as billing units in
the unit field) and any discarded amounts would be billed on a separate
line with the JW modifier (reflected as billing units in the unit
field). If a renal dialysis drug or biological product from a single-
dose container or single-use package is administered and there are no
discarded amounts, then we proposed that a single line would be billed
on the claim form with the JZ modifier and the billing units in the
unit field. Therefore, on all claims for renal dialysis drugs and
biological products from single-dose containers or single-use packages
payable under the ESRD PPS, we proposed that either the JW modifier
would be used (on a separate line) to identify any discarded amounts or
the JZ modifier (on the claim line with the administered amount) would
be present to attest that there were no discarded amounts. We proposed
that claims for renal dialysis drugs and biological products from
single-dose containers or single-use packages that do not report either
the JW or JZ modifier may be returned as un-processable until claims
are properly resubmitted.\33\ We also stated that if this proposal is
finalized, CMS would publish information about which HCPCS codes would
be identified as single-dose containers or single-use package renal
dialysis drugs and biological products subject to required reporting of
the JW or JZ modifier. We also stated that we would plan to issue
guidance regarding additional operational considerations and billing
instructions specific to the reporting requirements for these products.
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\33\ Under the basic requirements for all claims at Sec.
424.32(a)(1), a claim must be filed with the appropriate
intermediary or carrier on a form prescribed by CMS in accordance
with CMS instructions. Chapter 1 of the Medicare Claims Processing
Manual, section 70.2.3.1 states that submissions that are found to
be incomplete or invalid are returned to the provider (RTP).
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We further clarified that, under our proposal, ESRD facilities
would not be required to document in the beneficiary's medical record
when there are no discarded amounts. We reiterated in the CY 2024 ESRD
PPS proposed rule that, as discussed in the CY 2023 PFS final rule (87
FR 69722), units for renal dialysis drugs and biological products that
are bundled under the Medicare ESRD PPS would not be subject to the
Medicare Part B discarded drug refund program and would continue to be
exempted from the Medicare Part B discarded drug refund. We also
clarified that for any oral-only drugs, as defined in Sec. 413.234(a),
to the extent that any such drugs are produced in single-dose
containers or single-use packaging, this proposed reporting requirement
would not apply until such drugs are paid for under the ESRD PPS.
We stated that we believe this reporting requirement would enable
CMS to obtain more reliable information about the extent to which the
costs of providing renal dialysis drugs and biological products
represent amounts that beneficiaries use as well as amounts that are
discarded. We explained that we believe this is particularly important
because under Medicare Part B, beneficiaries are responsible for paying
a 20 percent coinsurance. As noted previously, nearly 40 percent of
TDAPA expenditures in CY 2022 represented discarded amounts of renal
dialysis drugs and biological products. Medicare beneficiaries,
therefore, paid approximately $260,000 in copayments for these
discarded amounts. While this currently represents a small amount of
payments overall, the cost for discarded renal dialysis drugs and
biological products is borne by a very small population of
beneficiaries. We stated that it is important for CMS to
[[Page 76384]]
understand the full scope of expenditures, including expenditures that
may be incurred by beneficiaries, for discarded amounts of renal
dialysis drugs and biological products in the future, which may be more
expensive or more widely used than the current drug that is being paid
for using the TDAPA under the ESRD PPS. Thus, we did not propose in the
CY 2024 ESRD PPS proposed rule to alter payments to ESRD facilities
based on the amounts of discarded renal dialysis drugs and biological
products reported, but noted that data collected through adoption of
the JW and JZ modifier reporting requirements discussed in that section
of the proposed rule may inform future payment policies, which would be
proposed through future notice and comment rulemaking if appropriate.
Based on our analysis of ESRD PPS claims, as well as the billing
guidance in sections 8 and 17 of the Medicare Claims Processing Manual,
we stated that we believe the JW modifier requirement reflects current
practices for ESRD facilities and would not significantly increase
burden for ESRD facilities. Additionally, we stated that we believe the
JZ modifier requirement would not increase burden on ESRD facilities,
because under the current guidance provided regarding use of the JW
modifier, the ESRD facility should already have processes in place to
determine, in the case of certain drugs and biological products,
whether or not there are any discarded units from a single-dose
container or single-use package, record discarded amounts in the
patient medical record, and specify administered and discarded amounts
on the claim form. Furthermore, we noted that while renal dialysis
drugs and biological products that are paid under the ESRD PPS are not
considered separately payable, ESRD facilities are permitted to bill
and receive separate payment using the AY modifier for drugs and
biological products that are not related to the treatment of ESRD.
Although we noted that renal dialysis drugs and biological products
paid under the ESRD PPS are not subject to the Medicare Part B drug
refund program or the current JW or JZ reporting requirements, any
separately payable drugs, or biological products that ESRD facilities
bill for using the AY modifier would be subject to such policies under
Medicare Part B. Therefore, we explained that we believe most ESRD
facilities should already be reporting the JW and JZ modifiers in such
circumstances and would reasonably be able to report these modifiers
for renal dialysis drugs and biological products as well. We invited
comments on this assumption and on the proposed JW and JZ reporting
requirements for the ESRD PPS.
We received public comments on our proposal to require the
reporting of the JW and JZ modifiers on ESRD PPS claims. The comments
on our proposal and our responses are set forth below.
Comment: Several commenters raised concerns about the lead time
needed to operationalize the proposed changes to report the JW and JZ
modifiers on ESRD PPS claims. Commenters expressed that a minimum of
six months after the publication of detailed guidance would be needed
to reprogram systems and train staff to comply with the proposed
requirements. Other commenters noted that, especially for independent
ESRD facilities, a longer lead time of one year may be appropriate.
Specifically, commenters expressed that ESRD facilities would need to
implement extensive changes to their policies and procedures, including
aligning information from numerous independent medical record systems,
and that such activities could not begin in earnest until detailed
guidance about these reporting requirements is available. Several
commenters urged CMS to commit to publishing guidance by January 1,
2024, and to modify the effective date of the proposed JW and JZ
modifier reporting requirement to begin no earlier than January 1,
2025.
Response: We thank commenters for their detailed comments regarding
the operational changes needed to comply with the proposed reporting
requirement. As commenters pointed out, although ESRD facilities may
have processes in place to track amounts of discarded drugs, these
processes may not be uniformly applied to all drugs. We recognize the
importance of providing ESRD facilities the appropriate amount of time
to adjust systems and train staff to expand the scope of drugs to which
existing processes are applied. In light of the operational needs that
commenters described, we are modifying the effective date of this
reporting requirement to begin January 1, 2025, instead of January 1,
2024. Commenters indicated that for certain independent facilities, 1
year would provide sufficient time to train staff and update systems as
needed to comply with the reporting requirements we are finalizing in
this final rule. We believe extending the effective date of the
requirement by 1 year strikes an appropriate balance between the need
to collect this data and ESRD facilities' need to make operational
changes. We intend to publish detailed operational guidance regarding
this requirement no later than January 1, 2024.
Comment: Many commenters stated that although they understand and
agree with CMS's need to better understand patient-specific costs
associated with furnishing renal dialysis services to Medicare
beneficiaries, they did not agree that the proposed collection of
information about the JW and JZ modifiers on claims was appropriate or
relevant. Several commenters expressed their belief that Medicare
beneficiaries do not incur additional coinsurance for renal dialysis
drugs and biological products that are paid under the ESRD PPS bundled
payment, and therefore information about discarded amounts would not be
relevant to ESRD PPS payment. Several commenters encouraged CMS to
withdraw the proposed reporting requirement.
Response: We appreciate the concerns raised by commenters. We are
not withdrawing the proposed reporting requirement. We do not agree
with the commenters' assertion that discarded amounts of renal dialysis
drugs and biological products paid under the ESRD PPS have no impact on
payment, or that Medicare beneficiaries do not incur additional
coinsurance for such discarded amounts. As we discussed in the CY 2024
ESRD PPS proposed rule, certain ESRD PPS payment adjustments,
specifically the outlier adjustment and the TDAPA, are dependent upon
the amount of renal dialysis drugs and biological products billed on an
ESRD PPS claim. For renal dialysis drugs and biological products from
single-dose containers or single-use packaging which are eligible for
such payment adjustments, discarded amounts contribute directly to
increased ESRD PPS payment as well as increased beneficiary copays.
Furthermore, because the ESRD PPS base rate includes payment for renal
dialysis drugs and biological products, discarded amounts of renal
dialysis drugs and biological products from single-dose containers and
single-use packaging contribute to overall increases in the ESRD PPS
base rate and the amount of beneficiary coinsurance.
Comment: Several commenters expressed concerns about the
application of the proposed reporting requirements for home dialysis
patients and for any oral-only drugs from single-dose containers or
single-use packaging that may, after January 1, 2025, be paid under the
ESRD PPS. Commenters expressed concern about ESRD facilities' ability
to accurately document the discarded amounts of such drugs and
biological products that are not administered at the ESRD facility. One
[[Page 76385]]
commenter noted that CMS's current policy applies to a very limited
number of patients and ESAs, but the proposed expansion of this policy
could apply to a broader range of ESAs, calcimimetics, intravenous
iron, and more products. The same commenter noted that most home
dialysis patients use multi-use vials, to which the current JW
requirement does not apply. Commenters urged CMS to exempt oral-only
drugs and renal dialysis drugs and biological products used by home
dialysis patients from the proposed reporting requirements or clarify
that ESRD facilities can report the amount of such drugs in good faith.
Response: We thank commenters for their detailed comments regarding
the applicability of the proposed reporting requirement for renal
dialysis drugs and biological products paid under the ESRD PPS that are
administered outside of an ESRD facility. Consistent with our
longstanding policy discussed in the CY 2016 ESRD PPS final rule (80 FR
69033), all renal dialysis service drugs and biological products
prescribed for ESRD patients, including the oral forms of renal
dialysis injectable drugs, must be reported by ESRD facilities, and the
units reported on the monthly claim must reflect the amount expected to
be taken during that month. Accordingly, with respect to reporting
discarded amounts of renal dialysis drugs and biological products that
are administered to home dialysis patients and oral forms of renal
dialysis drugs and biological products, ESRD facilities should use the
best information they have in determining the amount expected to be
discarded in a given month, including fill information from the
pharmacy and the patient's plan of care. Consistent with current
guidance in Chapter 17, section 40.1 of the Medicare Claims Processing
Manual, ESRD facilities must bill the program using the JW modifier for
the amount of ESAs appropriately discarded if the home dialysis patient
must discard a portion of the ESA supply due to expiration of a vial,
because of interruption in the patient's plan of care, or unused ESAs
on hand after a patient's death. In response to the commenter's
statement about the use of multi-use vials by home dialysis patients,
we are reiterating that discarded amounts should only be reported for
drugs and biological products from single-dose containers or single-use
packaging. ESRD facilities should not report discarded amounts of renal
dialysis drugs or biological products from multi-use vials. Discarded
amounts of renal dialysis drugs and biological products from multi-use
vials should not be billed on ESRD PPS claims.
Comment: Many commenters requested that CMS provide additional
clarity about how information about discarded drug amounts may be used
in the future to inform payment policy. Commenters pointed out that
packaging for drugs and biological products is controlled by
manufacturers and FDA, rather than by ESRD facilities, and expressed
concern that data collected under this proposed reporting policy would
be used in the future to reduce ESRD PPS payments. Commenters stated
that ESRD facilities are already incentivized, by the nature of the
ESRD PPS, to minimize the amount of discarded renal dialysis drugs and
biological products to the extent possible. One commenter stated that
the underlying issue of waste can only be solved by holding the
manufacturers responsible. Some commenters requested clarification on
whether CMS intends to apply penalties for non-compliance with the JW
and JZ modifier reporting requirements.
Response: As we noted in the CY 2024 ESRD PPS proposed rule, we did
not propose any reduction to ESRD PPS payments based on the amounts of
discarded renal dialysis drugs and biological products reported using
the JW modifier. As we noted in the CY 2024 ESRD PPS proposed rule, we
intend to analyze information about discarded amounts in the broader
context of changes to the ESRD PPS case-mix adjustments and may propose
changes in future rulemaking if appropriate. We appreciate and agree
with commenters' assertions that ESRD facilities have limited control
over the amount of discarded renal dialysis drugs and biological
products, and that ESRD facilities are required to discard any
remaining amounts from a single-dose container or single-use packaging
that are not used by the patient. As we discussed in the CY 2024 ESRD
PPS proposed rule, we have previously established in the CY 2012 ESRD
PPS final rule (76 FR 70243 through 70244) that ESRD facilities may
only report units and charges for drugs and biological products
purchased and may not bill for overfill units of drugs and biological
products which exceed the amount indicated on the vial or package
labeling. We recognize that manufacturers of renal dialysis drugs and
biological products are ultimately responsible for decisions about
packaging, which drive the magnitude of discarded amounts. As some
commenters noted, current provisions at Sec. Sec. 414.902 and 414.940,
which require refunds from manufacturers for discarded amounts of
drugs, apply only to separately payable drugs and biological products
and do not apply to drugs and biological products paid for under the
ESRD PPS. We believe that collecting more complete information about
discarded amounts of renal dialysis drugs and biological products from
single-dose containers and single-use packaging will help CMS to more
fully evaluate the impact that such discarded amounts have on both
Medicare payments and beneficiary copayments.
Lastly, we are reiterating that we are not applying any penalties
for noncompliance with this reporting requirement for discarded
amounts; however, as we noted in the CY 2024 ESRD PPS proposed rule (88
FR 42455), claims for renal dialysis drugs and biological products from
single-dose containers or single-use packages that do not report either
the JW or JZ modifier may be returned as un-processable until the
claims are properly resubmitted.
Final Rule Action: We are finalizing the proposed reporting
requirement for discarded amounts of renal dialysis drugs and
biological products from single-dose containers and single-use
packaging, with a modified effective date of January 1, 2025.
Therefore, consistent with the current JW and JZ reporting requirements
that were finalized in the CY 2023 PFS final rule for separately
payable Part B drugs, we are finalizing that beginning no later than
January 1, 2025, ESRD facilities must report information on ESRD PPS
claims about the total number of billing units of any discarded amount
of a renal dialysis drug or biological product from a single-dose
container or single-use package that is paid for under the ESRD PPS,
using the JW modifier (or any successor modifier that includes the same
data). We are also finalizing that ESRD facilities must document any
discarded amounts in the beneficiary's medical record. Additionally, we
are finalizing that ESRD facilities must report the JZ modifier for all
such renal dialysis drugs and biological products with no discarded
amounts, beginning no later than January 1, 2025. We are finalizing a
modification to the proposed regulation text to clarify that for renal
dialysis drugs and biological products from single-dose containers and
single-use packaging that are administered to home dialysis patients or
that are oral forms of renal dialysis injectable drugs, the ESRD
facility should report the amount of such drugs and biological products
expected to be discarded. We are finalizing our
[[Page 76386]]
proposal to codify these reporting requirements in regulation at Sec.
413.198(b)(5) and (6), with changes to indicate that the January 1,
2025, effective date applies to each of these requirements.
i. New Add-On Payment Adjustment for Certain New Renal Dialysis Drugs
and Biological Products After the TDAPA Period Ends
(1) Background on the TDAPA
Section 217(c) of PAMA required the Secretary to establish a
process for including new injectable and intravenous (IV) products into
the ESRD PPS bundled payment as part of the CY 2016 ESRD PPS
rulemaking. Therefore, in the CY 2016 ESRD PPS final rule (80 FR 69013
through 69027), we finalized a process based on our longstanding drug
designation process that allowed us to include new injectable and
intravenous products into the ESRD PPS bundled payment and, when
appropriate, modify the ESRD PPS payment amount. We codified this
process in our regulations at Sec. 413.234. We finalized that the
process is dependent upon the ESRD PPS functional categories,
consistent with the drug designation process we have followed since the
implementation of the ESRD PPS in 2011. As we explained in the CY 2016
ESRD PPS final rule (80 FR 69014), when we implemented the ESRD PPS,
drugs and biological products were grouped into functional categories
based on their action. This was done to add new drugs or biological
products with the same functions to the ESRD PPS bundled payment as
expeditiously as possible after the drugs are commercially available,
so beneficiaries have access to them. As we stated in the CY 2011 ESRD
PPS final rule, we did not specify all the drugs and biological
products within these categories, because we did not want to
inadvertently exclude drugs that may be substitutes for drugs we
identified, and we wanted the ability to reflect new drugs and
biological products developed or changes in standards of practice (75
FR 49052).
In the CY 2016 ESRD PPS final rule, we finalized the definition of
an ESRD PPS functional category in Sec. 413.234(a) as a distinct
grouping of drugs or biologicals, as determined by CMS, whose end
action effect is the treatment or management of a condition or
conditions associated with ESRD (80 FR 69077). We finalized a policy in
the CY 2016 ESRD PPS final rule that if a new renal dialysis injectable
or IV product falls within an existing functional category, the new
injectable drug or IV product is considered included in the ESRD PPS
bundled payment and no separate payment is available. The new
injectable or IV product qualifies as an outlier service. We noted in
that rule that the productivity-adjusted ESRDB market basket update is
used to increase the ESRD PPS base rate annually and accounts for price
changes of the drugs and biological products. We also finalized in the
CY 2016 ESRD PPS final rule that, if the new renal dialysis injectable
or IV product does not fall within an existing functional category, the
new injectable or IV product is not considered included in the ESRD PPS
bundled payment and the following steps occur. First, an existing ESRD
PPS functional category is revised or a new ESRD PPS functional
category is added for the condition that the new injectable or IV
product is used to treat or manage. Next, the new injectable or IV
product is paid for using the TDAPA codified in Sec. 413.234(c).
Finally, the new injectable or IV product is added to the ESRD PPS
bundled payment following payment of the TDAPA.
In the CY 2016 ESRD PPS final rule, we finalized a policy in Sec.
413.234(c) to pay the TDAPA until sufficient claims data for rate
setting analysis for the new injectable or IV product are available,
but not for less than 2 years. The new injectable or IV product is not
eligible as an outlier service during the TDAPA period. We established
that following the TDAPA period, the ESRD PPS base rate will be
modified, if appropriate, to account for the new injectable or IV
product in the ESRD PPS bundled payment.
In the CYs 2019 and 2020 ESRD PPS final rules (83 FR 56927 through
56949 and 84 FR 60653 through 60677, respectively), we made several
revisions to the drug designation process regulations at Sec. 413.234.
In the CY 2019 ESRD PPS final rule, we revised the regulations at Sec.
413.234(a), (b), and (c) to reflect that the process applies for all
new renal dialysis drugs and biological products that are FDA approved
regardless of the form or route of administration. In addition, we
revised Sec. 413.234(b) and (c) to expand the TDAPA to all new renal
dialysis drugs and biological products, rather than just those in new
ESRD PPS functional categories. In the CY 2020 ESRD PPS final rule, we
revised Sec. 413.234(b) and added paragraph (e) to exclude from TDAPA
eligibility generic drugs approved by FDA under section 505(j) of the
Federal Food, Drug, and Cosmetic Act and drugs for which the new drug
application (NDA) is classified by FDA as Type 3, 5, 7, or 8, Type 3 in
combination with Type 2 or Type 4, or Type 5 in combination with Type
2, or Type 9 when the ``parent NDA'' is a Type 3, 5, 7, or 8, effective
January 1, 2020.
Under our current TDAPA policy at Sec. 413.234(c), a new renal
dialysis drug or biological product that falls within an existing ESRD
PPS functional category is considered included in the ESRD PPS base
rate and is paid the TDAPA for 2 years. After the TDAPA period, the
ESRD PPS base rate will not be modified. If the new renal dialysis drug
or biological product does not fall within an existing ESRD PPS
functional category, it is not considered included in the ESRD PPS base
rate, and it will be paid the TDAPA until sufficient claims data for
rate setting analysis is available, but not for less than 2 years.
After the TDAPA period, the ESRD PPS base rate will be modified, if
appropriate, to account for the new renal dialysis drug or biological
product in the ESRD PPS bundled payment.
As discussed in the CY 2019 and CY 2020 ESRD PPS final rules, for
new renal dialysis drugs and biological products that fall into an
existing ESRD PPS functional category, the TDAPA helps ESRD facilities
to incorporate new drugs and biological products and make appropriate
changes in their businesses to adopt such products, provides additional
payments for such associated costs, and promotes competition among the
products within the ESRD PPS functional categories, while focusing
Medicare resources on products that are innovative (83 FR 56935; 84 FR
60654). For new renal dialysis drugs and biological products that do
not fall within an existing ESRD PPS functional category, the TDAPA is
a potential pathway toward a potential ESRD PPS base rate modification
(83 FR 56935). For the complete history of the TDAPA policy, including
the pricing methodology, see the CY 2016 ESRD PPS final rule (80 FR
69023 through 69024), CY 2019 ESRD PPS final rule (83 FR 56932 through
56948), and CY 2020 ESRD PPS final rule (84 FR 60653 through 60681).
(2) Request for Information in the CY 2023 ESRD PPS Proposed Rule
In the CY 2023 ESRD PPS proposed rule (87 FR 38522 through 38523),
we summarized the concerns of interested parties and issued a request
for information about methods that could be used to develop an add-on
payment adjustment for certain new renal dialysis drugs and biological
products after the end of the TDAPA. We explained that since 2019,
dialysis associations and pharmaceutical representatives have expressed
concerns
[[Page 76387]]
to CMS about payment following the TDAPA period for new renal dialysis
drugs and biological products that are paid for using the TDAPA. We
noted that these interested parties have asserted that unless money is
added to the ESRD PPS base rate for these drugs and biological
products, like what occurred with calcimimetics (85 FR 71406 through
71410), then it is unlikely that ESRD facilities would be able to
sustain the expense of these drugs and biological products when the
TDAPA period ends. Further, these interested parties cautioned that
uncertainty about payment could affect ESRD facility adoption of these
drugs and biological products during the TDAPA period. We noted that to
date, calcimimetics are the only renal dialysis drugs or biological
products that have been paid for using the TDAPA and incorporated into
the ESRD PPS bundled payment following the TDAPA payment period. We
stated that there have been no other renal dialysis drugs or biological
products that have completed their TDAPA payment period, and as a
result, CMS does not yet have data on other drugs or biological
products to evaluate the specific risks and access challenges that
interested parties have raised.
We also discussed that, as mentioned in the CY 2019 (83 FR 56941)
and CY 2020 (84 FR 60672 and 60693) ESRD PPS final rules, many
commenters have suggested a rate-setting exercise at the end of the
TDAPA period for all new renal dialysis drugs and biological products.
We responded to those comments by noting that we do not believe adding
dollars to the ESRD PPS base rate would be appropriate for new drugs
that fall into the ESRD PPS functional categories, given that the
purpose of the TDAPA for these drugs is to help ESRD facilities
incorporate new drugs and biological products and make appropriate
changes in their businesses to adopt such products, provide additional
payments for such associated costs, and promote competition among the
products within the ESRD PPS functional categories. In addition, we
explained that the ESRD PPS base rate already includes money for renal
dialysis drugs and biological products that fall within an existing
ESRD PPS functional category. We stated that under a PPS, Medicare
makes payments based on a predetermined, fixed amount that reflects the
average patient, and that there would be patients whose treatment costs
at an ESRD facility would be more or less than the ESRD PPS payment
amount. We noted that a central objective of the ESRD PPS and of
prospective payment systems in general is for ESRD facilities to be
efficient in their resource use.
We also noted that price changes to the ESRD PPS bundled payment
are updated annually by the productivity-adjusted ESRDB market basket
update, which includes a pharmaceutical cost category weight. In
addition, we explained that our analysis of renal dialysis drugs and
biological products paid for under the ESRD PPS has found costs and
utilization to have decreased over time for some high volume formerly
separately billable renal dialysis drugs, relative to overall ESRDB
market basket growth. Therefore, we stated that we believe that any
potential methodology for an add-on payment adjustment in these
circumstances should adapt to changes in price and utilization over
time.
We noted that section 1881(b)(14)(D)(iv) of the Act provides that
the ESRD PPS may include such other payment adjustments as the
Secretary determines appropriate, such as a payment adjustment--(1) for
pediatric providers of services and renal dialysis facilities; (2) by a
geographic index, such as the index referred to in section
1881(b)(12)(D), as the Secretary determines to be appropriate; and (3)
for providers of services or renal dialysis facilities located in rural
areas. Regarding the patient access concerns that we discussed in the
CY 2023 ESRD PPS proposed rule, we stated that we were considering
whether it would be appropriate to establish an add-on payment
adjustment for certain renal dialysis drugs and biological products in
existing ESRD PPS functional categories after their TDAPA period ends.
We noted that any add-on payment adjustment would be subject to the
Medicare Part B beneficiary coinsurance payment under ESRD PPS.
In the CY 2023 ESRD PPS proposed rule, we presented four potential
methods that we were considering, which we noted could be used to
develop an add-on payment adjustment for these drugs and biological
products. We noted that the methods presented differed in terms of
which formerly separately billable renal dialysis drugs and biological
products would be considered for methodological inclusion in a
potential add-on payment adjustment. We further noted that under the
potential options presented, we would apply a reconciliation
methodology only when an add-on payment adjustment would align resource
use with payment for a renal dialysis drug or biological product in an
existing ESRD PPS functional category.
Following the discussion in the CY 2023 ESRD PPS proposed rule
about these potential methodologies, we issued a request for
information within that proposed rule (87 FR 38523) to seek feedback
from the public on the need for an add-on payment adjustment of this
kind and the potential methodologies for calculating such an add-on
payment adjustment. We noted that while we would not be responding to
specific comments submitted in response to this RFI, we intended to use
this input to inform future policy development. We stated that any
potential payment policies related to this RFI would be proposed
through a separate notice and comment rulemaking.
We provided a high-level summary of responses to this RFI in the CY
2023 ESRD PPS final rule (87 FR 67219 through 67220) and noted that we
would publish more detailed information about the commenters'
recommendations in a future posting on the CMS website located at the
following link: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Educational_Resources. We noted that we received 27
public comments regarding our RFI, including from large, small, and
non-profit dialysis organizations; an advocacy organization; a
coalition of dialysis organizations; a large, non-profit health system;
and MedPAC.
In the CY 2023 ESRD PPS final rule, we stated that most commenters
expressed their belief that an add-on payment adjustment of this nature
is necessary to support the adoption of new renal dialysis drugs and
biological products, and that most commenters stated that they
supported CMS allowing all new renal dialysis drugs and biological
products to be eligible to receive an add-on payment adjustment after
the TDAPA period ends. However, we noted that MedPAC opposed this type
of add-on payment adjustment by stating that it would undermine
competition with existing drugs in the ESRD PPS bundled payment and
encourage higher launch prices. We also noted that MedPAC recommended
that CMS limit the add-on payment adjustment to new renal dialysis
drugs and biological products that show a substantial clinical
improvement compared with existing products reflected in the ESRD PPS
bundled payment.
We further noted in the CY 2023 ESRD PPS final rule that several
commenters stated they supported reconciling the expenditure of the new
renal dialysis drug or biological product with any reduction in
expenditures for other formerly separately billable renal
[[Page 76388]]
dialysis drugs that are clinically or statistically related to the
introduction of the new renal dialysis drug in the bundle. Several
commenters expressed their belief that the FDA-approved label should be
used to determine the primary indication and clinical association,
rather than end-action effect. MedPAC expressed opposition to
calculating any add-on payment adjustment for new renal dialysis drugs
and biological products in existing ESRD PPS functional categories
after the TDAPA period ends but noted that if an add-on payment
adjustment were applied, it would be appropriate to use an offset, like
the approach used with the TPNIES, to avoid duplicative payment for
renal dialysis services already included in the ESRD PPS base rate.
(3) Add-On Payment Adjustment for Certain New Renal Dialysis Drugs and
Biological Products After the TDAPA Period Ends
As discussed previously, section 1881(b)(14)(D)(iv) of the Act
provides that the ESRD PPS may include such other payment adjustments
as the Secretary determines appropriate. Based on the public comments
received regarding the RFI in the CY 2023 ESRD PPS proposed rule,\34\
we stated in the CY 2024 ESRD PPS proposed rule (88 FR 42458) that we
believe it is appropriate to propose, beginning January 1, 2024, an
add-on payment adjustment for new renal dialysis drugs and biological
products in existing ESRD PPS functional categories after the end of
the TDAPA period. We noted that this proposed payment adjustment would
not apply to new renal dialysis drug or biological products used to
treat or manage a condition for which there is not an ESRD PPS
functional category, because we have already established a policy to
modify the ESRD PPS base rate for such products, if appropriate, after
the TDAPA period ends, to account for the products in the ESRD PPS
bundled payment (Sec. 413.234(c)(2)(i)).
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\34\ https://www.cms.gov/files/document/cy-2023-esrd-pps-payment-after-tdapa-rfi-summary-comments.pdf.
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We stated that we agreed with commenters who expressed concerns
that the ESRD PPS' current mechanisms may not fully account for the
costs of these new drugs. We noted that several commenters asserted
that the outlier adjustment and the ESRDB market basket updates cannot
adequately account for these costs, and several organizations noted
that if renal dialysis drugs and biological products with significant
costs were adopted under the outlier policy, the threshold to qualify
for outlier payments would increase dramatically, thus adversely
affecting access to products traditionally eligible for the outlier
payment adjustment. We described comments which expressed that this
increase in the outlier threshold may also raise health equity concerns
because, as we noted in the CY 2023 ESRD PPS final rule (87 FR 67170
through 67171), the outlier adjustment protects access for
beneficiaries whose care is unusually costly. We stated that we
recognize that if the outlier threshold were to increase significantly
due to significant use of a new renal dialysis drug or biological
product after the end of the TDAPA, then ESRD facilities might be
incentivized to avoid treating costlier beneficiaries. Additionally, we
described several comments that raised concerns about the ability of
the ESRDB market basket update to account for the cost of new renal
dialysis drugs and biological products. These commenters referred to a
Moran study \35\ suggesting that the drug price proxies used in the
ESRDB market basket have not adequately accounted for the costs of non-
ESA drugs under existing functional categories. We explained that while
we continue to believe that the market basket price proxies are the
best available information for projecting the future price growth of
renal dialysis drugs and biological products, and that they provide an
adequate mechanism for projecting future ESRD PPS price growth, we
recognize that there is additional uncertainty about future trends in
the expenditures for new renal dialysis drugs and biological products,
including trends in pricing and utilization of such drugs and any
functionally equivalent substitutes such as generic drugs.\36\ We
stated that we believe these trends could be more effectively analyzed
by collecting additional ESRD facility cost data following the 2-year
TDAPA period. We stated that we recognize that although the TDAPA for
drugs and biological products in existing ESRD PPS functional
categories enables ESRD facilities to incorporate new renal dialysis
drugs and biological products into their businesses, additional support
may be needed to assure continued access to such drugs and biological
products for Medicare beneficiaries and to support ESRD facilities'
long-term planning and budgeting. We also recognized the importance of
providing an appropriate pathway for ESRD facilities to incorporate new
renal dialysis drugs and biological products into their business
operations. We noted that in the CY 2019 ESRD PPS final rule in which
we first established the 2-year TDAPA period for new renal dialysis
drugs and biological products in an existing ESRD PPS functional
category (83 FR 56934), we acknowledged that ESRD facilities have
unique circumstances regarding incorporation of new drugs and
biological products into their standards of care. For example, we
stated that when new drugs are introduced to the market, ESRD
facilities need to analyze their budget and engage in contractual
agreements to accommodate the new therapies in their care plans. We
noted that newly launched drugs and biological products can be
unpredictable regarding their uptake and pricing, which makes these
decisions challenging for ESRD facilities. Furthermore, we stated that
practitioners should have the ability to evaluate the appropriate use
of a new product and its effect on patient outcomes. We noted that we
agreed this uptake period would be best supported by the TDAPA pathway
because it would help ESRD facilities transition or test new drugs and
biological products in their businesses under the ESRD PPS. In the CY
2024 proposed rule, we stated that we continue to believe the 2-year
TDAPA period is appropriate and achieves its stated goals. However, we
also recognized that continuity and predictability is an integral part
of ESRD facilities' ongoing business operations. We stated that we
agree with commenters' concerns that a sudden decrease in payments
after the end of the TDAPA for these products could result in a
decrease in access for these new renal dialysis drugs and biological
products. We therefore proposed to establish a new transitional add-on
payment adjustment that would provide an appropriate transition of the
level of payment following the TDAPA period for these drugs. For ease
of reference, we proposed to refer to this add-on payment adjustment as
the post-TDAPA add-on payment adjustment. We stated that our goals for
the post-TDAPA add-on payment adjustment are to support Medicare
beneficiaries' access to new renal dialysis drugs or biological
products that are used to treat or manage a condition for which there
is an ESRD PPS functional category and that are therefore considered
included in the ESRD PPS bundled payment. We
[[Page 76389]]
also stated that we want to support ESRD facilities' long-term planning
with respect to continuing to budget and plan for new renal dialysis
drugs and biological products that ESRD facilities have incorporated
into their businesses during the TDAPA period. In addition, we
explained that in accordance with the goals of prospective payment
under the ESRD PPS, our goal for the post-TDAPA add-on payment
adjustment is to incentivize ESRD facilities to be efficient in the use
of resources.
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\35\ Kidney Care Partners. August 4, 2022. Comment Letter.
https://kidneycarepartners.org/wp-content/uploads/2022/08/KCP-PPS-Comment-Letter-Part-1-Final.pdf. Accessed May 16, 2023.
\36\ https://www.fda.gov/drugs/frequently-asked-questions-popular-topics/generic-drugs-questions-answers.
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We proposed to calculate the post-TDAPA add-on payment adjustment
following the methodology described in the following subsections for
any new renal dialysis drug or biological product that is paid for
using the TDAPA under Sec. 413.234(c)(1). We proposed that the post-
TDAPA add-on payment adjustment would be applied for a period of 3
years following the end of the TDAPA period for those products. We
stated that we believe a 3-year payment period would provide sufficient
time for CMS to analyze cost reports that include costs for the new
renal dialysis drug or biological product paid for using the TDAPA
under the ESRD PPS, to incorporate changes as appropriate to the ESRDB
market basket price proxies. The ESRDB market basket is a fixed-weight,
Laspeyres-type price index. A Laspeyres-type price index measures the
change in price, over time, of the same mix of goods and services
purchased in the base period. We stated that the proposed 3-year
payment period for the post-TDAPA add-on payment adjustment would allow
CMS to evaluate how the new drug or biological product affects the
overall mix of renal dialysis drugs and biological products in the
ESRDB market basket and to determine the appropriate price proxies for
such new drug or biological product. We noted that for new renal
dialysis drugs and biological products that are not considered included
in the ESRD PPS base rate, the TDAPA is paid until sufficient claims
data for rate setting analysis for the new renal dialysis drug or
biological product is available, but not for less than 2 years.
Similarly, as described earlier in this paragraph, we proposed a 3-year
payment period for the post-TDAPA add-on payment adjustment, which
would enable the collection and analysis of sufficient Medicare cost
report information and would address the concerns that commenters
raised about the effectiveness of the ESRDB market basket price proxies
to reflect the prices of new renal dialysis drugs and biological
products going forward by allowing CMS to incorporate data showing
trends in use over an adequate period of time. Additionally, we stated
that we believe a 3-year period for the post-TDAPA add-on payment
adjustment would be appropriate and consistent with the transition
period that we finalized at the beginning of the ESRD PPS, when ESRD
facilities were transitioned from receiving payments under the
composite rate payment system to receiving payments under the ESRD PPS
(79 FR 49162). We finalized the transition period for CY 2011 through
CY 2013 to comply with the requirement of section 1881(b)(14)(E)(i) of
the Act to provide a 4-year phase-in of the payment amount under the
ESRD PPS, where full implementation of the ESRD PPS payment would occur
beginning in the fourth year, CY 2014. We proposed a similar timeline
to provide an appropriate transition for new renal dialysis drugs and
biological products in existing ESRD PPS functional categories, which
are not eligible for a modification to the ESRD PPS base rate. Based on
the experience of ESRD facilities during the 4-year phase-in from CY
2011 to CY 2014, ESRD facilities would be familiar with this timeline
for phasing in major changes that impact their long-term planning and
budgeting. Lastly, in the interest of transparency, we noted that this
3-year period would provide time for analysis of utilization data for
public awareness about the potential need for refinements to the ESRD
PPS. Therefore, we proposed to calculate and apply the post-TDAPA add-
on payment adjustment for a period of 3 years following the end of the
TDAPA period, with no post-TDAPA add-on payment adjustment calculated
beginning in the 4th year.
We proposed that this post-TDAPA add-on payment adjustment would
not be budget neutral, as discussed later in this section of the final
rule. We noted that this post-TDAPA add-on payment adjustment, if
finalized, would be calculated for Korsuva[supreg], the only renal
dialysis drug currently receiving the TDAPA, and that payment of this
post-TDAPA add-on payment adjustment, if finalized, would begin April
1, 2024, at the end of the TDAPA period for Korsuva[supreg].
We received several public comments on our proposal to establish a
post-TDAPA add-on payment adjustment beginning in CY 2024. The comments
on our proposal and our responses are set forth below.
Comment: Many commenters, including LDOs, drug manufacturers,
patient advocacy organizations, coalitions of dialysis organizations,
and patients, expressed support for establishing a post-TDAPA add-on
payment adjustment. Commenters expressed that adequate payment is
necessary to support Medicare beneficiaries' access to both current and
future new and innovative renal dialysis drugs and biological products.
Response: We appreciate the support for the proposed post-TDAPA
add-on payment adjustment. We agree with commenters about the
importance of adequate payment. As we discussed in the CY 2024 ESRD PPS
proposed rule and in the following section of this final rule, we
believe the proposed payment methodology provides a significant level
of payment that adequately supports beneficiaries' access to drugs and
biological products after the TDAPA period ends, while sharing a
significant portion of the cost with ESRD facilities, thereby
incentivizing ESRD facilities to allocate resources efficiently.
Comment: MedPAC reiterated several concerns that it previously
raised in response to the RFI on this topic in the CY 2023 ESRD PPS
proposed rule. First, MedPAC reiterated its strong opposition to the
establishment of a post-TDAPA add-on payment adjustment as proposed,
stating that such a payment adjustment would be duplicative of payment
under the ESRD PPS base rate. MedPAC specifically identified that when
Mircera[supreg] (an ESA) became available in 2015, beneficiary access
to the new drug was not impeded when the agency included it in the ESRD
PPS bundled payment (in a budget-neutral manner). Between 2015 and
2020, use of Mircera[supreg] significantly and steadily increased.
MedPAC further noted that, with respect to Mircera[supreg], one LDO
announced its intent to have more than 70 percent of the company's ESA
patients (110,000 patients) switched to Mircera[supreg] (from epoetin
alfa) by the end of the first quarter of 2016, and sources suggest that
this LDO reduced its total ESA costs. In addition, MedPAC also
reiterated its concerns that CMS would not apply a clinical superiority
standard when implementing the post-TDAPA payment adjustment policy and
stated that beneficiaries and taxpayers would pay for a new drug
without evidence that the new product is an advance in medical
technology that substantially improves beneficiaries' outcomes relative
to technologies in the ESRD PPS.
Response: We thank MedPAC for its comments. We recognize and agree
with MedPAC about the importance of avoiding making payments under a
post-TDAPA add-on payment adjustment that would be duplicative of
payment under the ESRD PPS base rate
[[Page 76390]]
or that would undermine competition between new and existing renal
dialysis services. We anticipate that the post-TDAPA add-on payment
adjustment will provide appropriate payment that supports Medicare
beneficiaries' access to new renal dialysis drugs and biological
products, create stability in payments to ESRD facilities after the end
of the TDAPA, and appropriately align incentives to promote competition
between new and existing renal dialysis services. The proposed post-
TDAPA add-on payment adjustment would not be duplicative of payment
under the ESRD PPS base rate, because it would specifically support
access to new renal dialysis services at the level observed during the
most recent 12 months, providing a glidepath for new renal dialysis
drugs and biological products in existing functional categories
following the TDAPA, since under Sec. 413.234(c)(1), there is no
modification to the ESRD PPS base rate. As further discussed below, the
proposed application of a risk-sharing methodology would account for
existing substitute drugs and biological products included in the ESRD
PPS.
There are several important distinctions between the historical
inclusion of Mircera[supreg] into the ESRD PPS bundled payment and the
inclusion of renal dialysis drugs and biological products in existing
ESRD PPS functional categories that receive TDAPA payment, for which we
have proposed to calculate the post-TDAPA add-on payment adjustment
beginning in CY 2024. First, when Mircera[supreg] was incorporated into
the ESRD PPS bundled payment, CMS had not yet established any TDAPA
policies, which are integral to the current ESRD PPS drug designation
process. As we previously stated, section 217(c) of PAMA required the
Secretary to establish a process for including new injectable and
intravenous products into the ESRD PPS bundled payment, which CMS
finalized in the CY 2016 ESRD PPS final rule (80 FR 69013 through
69027) and codified in our regulations at Sec. 413.234. Under current
law, new renal dialysis drugs and biological products in existing
functional categories which qualify for TDAPA payment are generally
paid for using the TDAPA for a period of 2 years, after which such
drugs and biological products are considered included in the ESRD PPS
base rate with no modification to the base rate. As we stated in the CY
2024 ESRD PPS proposed rule, we recognize continuity and predictability
are integral parts of ESRD facilities' ongoing business operations. We
stated that we agree with commenters' concerns that a sudden decrease
in payments after the end of the TDAPA for these products could result
in a decrease in access for these new renal dialysis drugs and
biological products. We therefore proposed to establish a new
transitional add-on payment adjustment that would provide an
appropriate transition of the level of payment following the TDAPA
period for these drugs.
Importantly, we note that under current regulations at Sec.
413.234, Mircera[supreg] would not have been eligible for payment under
the TDAPA, because it was approved under an NDA type that is excluded
from TDAPA eligibility under Sec. 413.234(e). In contrast to renal
dialysis drugs and biological products that are paid for using the
TDAPA, Mircera[supreg] was seen as a direct and less expensive
substitute for existing renal dialysis drugs included in the ESRD PPS,
specifically Amgen's anemia management drug Epogen[supreg].\37\
Accordingly, as MedPAC noted in its comment letter, ESRD facilities
broadly adopted Mircera[supreg] into their business practices without
the need for additional payment. However, as explained earlier, we do
not consider Mircera[supreg] to be an appropriate comparison to new
renal dialysis drugs and biological products for which we propose to
calculate the post-TDAPA add-on payment adjustment, because under
current regulation Mircera[supreg] would not be eligible to receive
either the TDAPA or a post-TDAPA add-on payment adjustment.
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\37\ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4090042/.
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As we stated in the CY 2024 ESRD PPS proposed rule, we anticipate
that the structure of the proposed post-TDAPA payment methodology will
serve to incentivize the use of drugs that represent a substantial
improvement over existing drugs, which will promote competition between
new and existing renal dialysis drugs and biological products and drive
down prices of such new renal dialysis drugs and biological products
over time. We expect that our methodology for the post-TDAPA add-on
payment adjustment will incentivize ESRD facilities' efficient use of
resources, because payment for an individual claim will not be
dependent on individual utilization of the new renal dialysis drug or
biological product. Accordingly, we anticipate that under our
methodology, for new renal dialysis drugs and biological products that
are not a substantial clinical improvement over existing renal dialysis
drugs and biological products, utilization will diminish over time and
the amount of the post-TDAPA add-on payment adjustment will decline
accordingly.
In addition, we stated in the CY 2024 ESRD PPS proposed rule that
we recognize that continuity and predictability is integral to ESRD
facilities' operations, and we do not think that this principle applies
only to renal dialysis drugs and biological products that show a
substantial clinical improvement. As we previously explained in the CY
2023 ESRD PPS final rule (87 FR 67189), the intent of the ESRD PPS
functional category framework is to be broad and to facilitate adding
new drugs to the therapeutic armamentarium of the treating physician.
As we further explained in the CY 2023 ESRD PPS final rule, the
functional category structure helps to ensure the ESRD patient has
broad access to all renal dialysis service drugs, which is a distinct
benefit to the patient. In addition, the structure of the functional
categories helps to ensure the treating physician has a broad array of
drugs to meet the specific, individual needs of each ESRD patient,
including differing pharmaceutical profiles, comorbidities, contra-
indications with other drugs the patient may be taking, and personal
patient preference (87 FR 67189). We do not think that limiting the
post-TDAPA add-on payment adjustment based on CMS's determination of
substantial clinical improvement would align with this stated intent of
the ESRD PPS functional category framework to support broad access to
all renal dialysis service drugs. We further note that the current
TDAPA exclusion criteria under Sec. 413.234(e) consider FDA's
determination of the drug's NDA type or approval under section 505(j)
of the Federal Food, Drug, and Cosmetic Act, which is less subjective
than a determination of substantial clinical improvement. Therefore, we
continue to be of the view that the proposed methodology most
appropriately balances the need to provide adequate payment with the
concerns that MedPAC raised regarding duplicative payment and clinical
superiority or substantial clinical improvement.
Comment: Many commenters expressed concerns about the proposed 3-
year duration for the post-TDAPA add-on payment adjustment. Several
commenters stated that the 3-year period would create a new payment
cliff at the end of the 3-year post-TDAPA period and advocated for a
permanent, non-budget neutral payment adjustment.
Response: We appreciate the concerns that commenters raised about
the
[[Page 76391]]
proposed 3-year period for the post-TDAPA add-on payment adjustment. We
recognize that the policy would not permanently maintain increased
payments for new renal dialysis drugs and biological products that
receive the TDAPA, and we do not believe that such a permanent increase
in payments would be appropriate. The TDAPA for renal dialysis drugs
and biological products in existing functional categories is inherently
transitional in nature and therefore not permanent. As we discussed in
the CY 2019 and CY 2020 ESRD PPS final rules (83 FR 56935; 84 FR
60654), for new renal dialysis drugs and biological products that fall
into an existing ESRD PPS functional category, the TDAPA helps ESRD
facilities to incorporate the new drugs and biological products and
make appropriate changes in their businesses to adopt such products. We
also explained that the TDAPA provides additional payments for such
associated costs and promotes competition among the products within the
ESRD PPS functional categories, while focusing Medicare resources on
products that are innovative. Accordingly, we proposed a post-TDAPA
add-on payment adjustment beginning in CY 2024 that is similarly
transitional in nature and which provides a glidepath for inclusion of
such new renal dialysis drugs and biological products into the ESRD
PPS. In the CY 2024 ESRD PPS proposed rule, we stated that a 3-year
period for the post-TDAPA add-on payment adjustment would be consistent
with the transition period that was finalized at the beginning of the
ESRD PPS, when ESRD facilities were transitioned from receiving
payments under the composite rate payment system to receiving payments
under the ESRD PPS (79 FR 49162). We finalized the transition period
for CY 2011 through CY 2013, with full implementation in CY 2014, to
comply with the requirement of section 1881(b)(14)(E)(i) of the Act to
provide a 4-year phase-in of the payment amount under the ESRD PPS. We
proposed a similar timeline for the post-TDAPA add-on payment
adjustment to provide an appropriate transition for new renal dialysis
drugs and biological products in existing ESRD PPS functional
categories, which are not eligible for a modification to the ESRD PPS
base rate.
Comment: MedPAC encouraged CMS to clarify why an additional period
of 3 years is appropriate for the proposed post-TDAPA add-on payment
adjustment, as compared to the established 2-year TDAPA period for new
renal dialysis drugs and biological products in existing functional
categories. MedPAC stated that a post-TDAPA period is not needed to
collect and analyze cost report data, and that if CMS has concerns
about the price proxies for ESRD drugs used in the ESRDB market basket,
CMS can conduct the necessary analyses, without creating the post-TDAPA
add-on payment adjustment policy. In addition, MedPAC questioned the
utility of current cost reports to evaluate whether the ESRDB market
basket accounts for price changes of new ESRD drugs, since Medicare
cost reports do not require providers to report the cost of each new
item or product paid under a TDAPA or a TPNIES.
Response: As we previously discussed, we proposed to pay the post-
TDAPA add-on payment adjustment for a period of 3 years following the
payment of TDAPA for 2 years, to allow more complete cost reporting
information to become available. CMS routinely rebases and revises the
ESRDB market basket and price proxies, usually every four to five
years, incorporating more recent cost report information. We agree with
MedPAC that a post-TDAPA period is not strictly necessary to collect
more recent cost report information. However, as we stated in the CY
2024 ESRD PPS proposed rule, we think that providing a post-TDAPA add-
on payment adjustment during this period would provide stability in
ESRD PPS payments while CMS analyzes such information.
The existing 2-year TDAPA period provides useful information about
ESRD facilities' spending on drugs and biological products paid for
using the TDAPA, but due to lags in the timing of when ESRD facilities
submit their cost reports, such data would not become available in ESRD
facilities' cost report information until after the end of the TDAPA
period. For example, CMS generally uses Medicare cost report data that
lags by approximately 3 to 4 years prior to the rulemaking year.
Therefore, complete Medicare cost report data for CY 2023 or CY 2024
could be used to consider changes to market basket cost categories,
cost weights, and price proxies for the CY 2026 or CY 2027 rulemaking
cycle. As proposed, the post-TDAPA add-on payment adjustment would
begin to be paid on April 1, 2024, based on utilization of
Korsuva[supreg], the only renal dialysis drug currently receiving the
TDAPA, and would end no later than March 31, 2027. CMS would be able to
analyze Medicare cost report data for CY 2023 and CY 2024 to consider
changes to the ESRDB market basket for CY 2027 rulemaking, if
appropriate. The proposed post-TDAPA add-on payment adjustment would
provide appropriate payment stability for ESRD PPS payments to ESRD
facilities during the intervening years, which would support
beneficiaries' continued access to new renal dialysis drugs and
biological products.
With respect to the question of the utility of Medicare cost report
data, we think that more recent cost reports, which would include
information about total drug spending across categories, would provide
meaningful information about how new renal dialysis drugs and
biological products affect ESRD facilities' costs. Although TDAPA and
TPNIES costs are not reported separately, if spending for new renal
dialysis drugs and biological products is driving significant increases
in ESRD facilities' costs, more recent Medicare cost report data will
inform CMS's understanding of how such spending affects the ESRDB
market basket composition. We would also evaluate Part B spending data
to determine the mix of the types of drugs and the appropriate price
proxy based on changes to the relative mix of drugs used in the ESRD
facility setting. Nevertheless, we recognize the limitations of the
current Medicare cost reports that MedPAC identified, and we may
consider changes in the future to improve the data that we collect
through the Medicare cost report.
Final Rule Action: After consideration of the comments, we are
finalizing as proposed to establish, beginning for CY 2024, a post-
TDAPA add-on payment adjustment for any new renal dialysis drug or
biological product that is considered included in the ESRD PPS base
rate that is paid for using the TDAPA under Sec. 413.234(c)(1). This
post-TDAPA add-on payment adjustment will be applied for a period of 3
years following the end of the TDAPA period for those products.
(a) Calculation of the Post-TDAPA Add-On Payment Adjustment
As discussed earlier in this section of the final rule, we proposed
to establish a new add-on payment adjustment for certain new renal
dialysis drugs and biological products in existing ESRD PPS functional
categories after the end of the TDAPA period. In the CY 2024 ESRD PPS
proposed rule, we proposed to apply the post-TDAPA add-on payment
adjustment to all ESRD PPS payments beginning at the end of a new renal
dialysis drug or biological product's TDAPA period. Specifically, we
proposed that the post-TDAPA add-on payment adjustment would begin 8
calendar quarters after the beginning of
[[Page 76392]]
the first calendar quarter in which TDAPA payment is made for the new
renal dialysis drug or biological product in an existing ESRD PPS
functional category and would end no later than the 12th calendar
quarter after the last calendar quarter in which TDAPA payment is made.
We stated that we believe our calculation of the post-TDAPA add-on
payment adjustment would be the most appropriate to address the patient
access concerns we discussed in the CY 2023 ESRD PPS proposed rule and
in this section of the final rule, and the most consistent with the
principles of prospective payment. We stated that this proposal would
apply the patient-level adjustment factors to the post-TDAPA add-on
payment adjustment amount paid on each claim, which would ensure that
ESRD PPS payment would support access to new renal dialysis drugs and
biological products for beneficiaries with conditions that are costlier
to treat, in alignment with our goals as stated earlier in this final
rule. We proposed to codify the payment of the post-TDAPA add-on
payment adjustment as part of the per treatment payment amount at Sec.
413.230(f). We proposed to codify the methodology for calculating the
post-TDAPA add-on payment adjustment at Sec. 413.234(g). We proposed
to make additional changes under Sec. 413.234(b) and (c) to address
payment of the post-TDAPA payment adjustment.
In determining the calculation of the post-TDAPA add-on payment
adjustment, we considered the comments that we received regarding the
RFI in the CY 2023 ESRD PPS proposed rule. Some commenters expressed
that new and innovative drugs may only be used by a small percentage of
the dialysis population and suggested that an add-on payment adjustment
should address patient-specific needs to support access.
First, we considered calculating the post-TDAPA add-on payment
adjustment as the average cost for patients that used the new renal
dialysis drug or biological product that was previously paid for using
the TDAPA under the ESRD PPS and applying the post-TDAPA add-on payment
adjustment only to claims that include the new renal dialysis drug or
biological product. However, we were concerned that such an approach
would not align with the principles of prospective payment under the
ESRD PPS. As we noted previously, a central objective of the ESRD PPS
(and of prospective payment systems in general) is for ESRD facilities
to be efficient in their resource use. Under a PPS, Medicare makes
payments based on a predetermined, fixed amount that reflects the
average patient, and CMS acknowledges there will be patients whose
treatment costs at an ESRD facility will be more or less than the ESRD
PPS payment amount. Additionally, we were concerned that such an
approach would result in a substantial cost burden for beneficiaries
who use the new renal dialysis drug or biological product, because they
incur a 20 percent coinsurance under Part B for renal dialysis
services. We stated that we do not believe this approach would align
with our priorities to reduce drug costs for Medicare beneficiaries. In
contrast, our proposed methodology would apply the post-TDAPA add-on
payment adjustment to all ESRD PPS payments, which would result in a
minimal increase in per-treatment coinsurance amounts for all
beneficiaries. As discussed later in this section, we proposed to apply
the ESRD PPS patient-level adjustments to the post-TDAPA add-on payment
adjustment for each treatment.
Next, we considered applying the post-TDAPA add-on payment
adjustment based only on claims from ESRD facilities that used the new
renal dialysis drug or biological product during the TDAPA period.
However, like the previous option, we stated that we believe limiting
application of this add-on payment adjustment to claims from ESRD
facilities that include the new renal dialysis drug or biological
product would be inconsistent with the principles of prospective
payment. As we discussed in the CY 2011 ESRD PPS final rule, there are
patients whose medical treatment results in more costly care as well as
those with less costly care, and the ESRD PPS bundled base rate
reflects Medicare payment for the average ESRD patient (75 FR 49045).
Further, we were concerned that limiting the post-TDAPA add-on payment
adjustment to claims from ESRD facilities that use the new renal
dialysis drug or biological product could result in substantial
overestimation of the post-TDAPA add-on payment adjustment, if more
ESRD facilities begin using the new renal dialysis drug or biological
product. As we discuss later in this final rule, we proposed to apply
this post-TDAPA add-on payment adjustment in a non-budget neutral
manner. Therefore, we stated in the CY 2024 ESRD PPS proposed rule that
we were concerned that an overestimation of the post-TDAPA add-on
payment adjustment could result in an inappropriate increase in
Medicare expenditures. As we discussed in the CY 2019 and CY 2020 ESRD
PPS final rules (83 FR 56935; 84 FR 60654), for new renal dialysis
drugs and biological products that fall into an existing ESRD PPS
functional category, the TDAPA helps ESRD facilities to incorporate the
new drugs and biological products and make appropriate changes in their
businesses to adopt such products, provides additional payments for
such associated costs, and promotes competition among the products
within the ESRD PPS functional categories, while focusing Medicare
resources on products that are innovative. We stated that we believe
after the end of the TDAPA period, ESRD facilities will have made
appropriate changes in their business models to adopt such products,
and therefore any approach to a post-TDAPA add-on payment adjustment
should apply equally to all ESRD PPS treatments, in order to apply the
appropriate incentive structures for ESRD facilities' utilization of
renal dialysis drugs and biological products and to continue to promote
competition among the products within the ESRD PPS functional
categories, including the new renal dialysis drug or biological product
that was previously paid for using the TDAPA under the ESRD PPS.
Furthermore, we stated that we believe that such an approach would help
to support access to new renal dialysis drugs and biological products
to the widest scope of beneficiaries. This is in line with CMS's
commitment to advance health equity by supporting access to renal
dialysis services.
Accordingly, we proposed to apply the post-TDAPA add-on payment
adjustment to each ESRD PPS treatment, and to adjust it for patient
characteristics. In other words, the post-TDAPA add-on payment
adjustment would be multiplied by the ESRD PPS patient-level
adjustments under Sec. 413.235. We stated that we believe this
approach would appropriately adjust aggregate ESRD PPS payment to
account for the new renal dialysis drugs and biological products in a
way that is consistent with the principles of prospective payment and
would support beneficiary access to new renal dialysis drugs and
biological products by recognizing the additional patient-specific
needs associated with the existing ESRD PPS case-mix adjusters. We
noted that to calculate an appropriate post-TDAPA add-on payment
adjustment, we would apply a case-mix standardization factor to the
post-TDAPA add-on payment adjustment amount as discussed in the
following paragraphs.
In addition, we explained that we considered the public comments
regarding the need to reconcile
[[Page 76393]]
estimated expenditures for a new renal dialysis drug or biological
product with the declines in expenditures for related drugs. We noted
that commenters expressed support for establishing a methodology that
would consider the decline in estimated expenditures for drugs that are
clinically or empirically related to the new renal dialysis drug or
biological product. We explained that such a methodology would be
highly complex and less transparent than other potential options that
commenters suggested. We also explained that commenters in the past
noted various ideas that CMS would need to consider when attempting to
establish the offsetting financial effects of drugs and biological
products that are either clinically or empirically related to the new
renal dialysis drug or biological product. For example, most commenters
suggested that CMS use drugs with the same FDA clinical indication to
offset the payment adjustment, in the interest of transparency and
objectivity. However, some commenters, including MedPAC, noted that
they do not believe that FDA determinations or ESRD PPS functional
categories should be the basis of eligibility for the post-TDAPA
payment adjustment, as CMS should make these determinations based on
the specific needs of the Medicare population. We stated that we
believe such considerations based on specific population needs could be
less transparent than alternative approaches, especially in situations
when there could, in the future, be multiple new renal dialysis drugs
or biological products for which we would be calculating multiple
offset adjustments. We stated that we anticipate it would be
challenging for CMS to determine, within the annual rulemaking
timeframes, the extent to which changes in the utilization of existing
renal dialysis drugs and biological products are clinically or
empirically related to utilization of a new renal dialysis drug or
biological product paid for using the TDAPA. We noted that the latest
available data at the time of the proposed rulemaking included less
than a full year of TDAPA utilization. We explained that we anticipate
that as additional data are collected, CMS will be able to analyze
trends and may be able to retrospectively determine the extent of any
substitution effects between new and existing renal dialysis drugs and
biological products. Furthermore, we noted that the calculation of
these offsets could involve multiple overlapping periods of time, which
would further increase complexity and reduce transparency. As an
alternative, we explained that we considered MedPAC's suggestion to
align the methodology closer to that of the ESRD PPS TPNIES, wherein
CMS pays a reduced percentage of the estimated incremental cost of a
new product as a risk-sharing mechanism with ESRD facilities and to
provide a disincentive for significant increases in drug prices. Under
the TPNIES, CMS calculates the TPNIES amount as 65 percent of the MAC-
determined price for certain new and innovative equipment and supplies
(Sec. 413.236(f)). We stated that we believe this approach would have
the same general effect of accounting for declines in other drug
expenditures, while being significantly less complex and more
transparent. In the CY 2020 ESRD PPS final rule that established the 65
percent cost-sharing proportion for the TPNIES, we stated that the goal
of the TPNIES was to support ESRD facility use of new and innovative
renal dialysis equipment and supplies (84 FR 60692). In that same CY
2020 ESRD PPS final rule, we further stated in response to comments
that we believe that we need to balance this goal with sharing risk for
the new product (84 FR 60697). We noted that one goal of the post-TDAPA
add-on payment adjustment is to support continued access to new renal
dialysis drugs and biological products and to support ESRD facilities'
long-term planning and budgeting for such drugs after the TDAPA period.
Additionally, we stated that our goal is also to incentivize efficient
use of resources, consistent with the principles of prospective payment
under the ESRD PPS. We explained that we believe applying a cost-
sharing proportion of 65 percent to the post-TDAPA add-on payment
adjustment would effectively achieve these goals, because it would
provide a significant level of payment that supports access for
beneficiaries and long-term planning for ESRD facilities, while
incentivizing ESRD facilities to efficiently allocate resources by
sharing a significant portion of the cost with ESRD facilities.
Furthermore, we stated that this 65 percent cost-sharing factor would
serve to further reduce the minimal cost-sharing burden of new renal
dialysis drugs and biological products for beneficiaries, under the
post-TDAPA add-on payment methodology. Lastly, we noted that for home
dialysis machines that are capital-related assets that qualify for the
TPNIES, our policy is to apply an offset to account for such capital-
related assets in the ESRD PPS base rate. As we discussed previously,
we considered applying an offset to the post-TDAPA add-on payment
adjustment; however, we believe that considerations based on specific
population needs could be less transparent than applying a simple 65-
percent risk-sharing percentage. Additionally, we noted that in the
future, there could be multiple new renal dialysis drugs or biological
products for which we would be calculating multiple offset adjustments,
which would further increase complexity and reduce transparency. We
solicited comments on whether there are other ways CMS could consider
calculating an offset amount for the post-TDAPA payment adjustment.
Alternatively, we sought comment on if there are other ways CMS could
ensure any growth in post-TDAPA add-on payment adjustment amounts is
reasonable, such as not allowing increases to exceed inflation or other
relevant metrics.
We proposed to calculate the post-TDAPA add-on payment adjustment
annually, based on the latest available full calendar quarter of
average sales price (ASP) data, which would be consistent with the
current policy for determining the basis of payment for the TDAPA. We
stated that under current policy, finalized in the CY 2020 ESRD PPS
final rule (84 FR 60679), we pay the TDAPA based on 100 percent of ASP.
If ASP is not available, we base the TDAPA payment adjustment on
wholesale acquisition cost (WAC), and if WAC is not available, then we
base payment on invoice pricing. As we stated in the CY 2020 ESRD PPS
final rule, we continue to believe that after the TDAPA period,
calculating the post-TDAPA add-on payment adjustment for new renal
dialysis drugs based on ASP, as compared to WAC or invoice pricing,
would be the most appropriate choice for the ESRD PPS, and would strike
the right balance in supporting ESRD facilities in their uptake of
innovative, new renal dialysis drugs and biological products and
limiting increases to Medicare expenditures. We proposed to address the
annual calculation of the post-TDAPA add-on payment adjustment in the
annual proposed and final ESRD PPS rules for future years.
As discussed in the CY 2024 ESRD PPS proposed rule (88 FR 42472),
under current TDAPA policy, if CMS stops receiving ASP during the TDAPA
period, then CMS will stop paying the TDAPA after 2 calendar quarters.
Similarly, we explained that if drug manufacturers were to stop
submitting ASP data for products that are included in the calculation
of the post-TDAPA add-on payment adjustment, and we had to revert to
basing calculation of the post-TDAPA add-on payment
[[Page 76394]]
adjustment on WAC or invoice pricing, we believe we would be overpaying
for the add-on payment adjustment. Therefore, we proposed to make
payment of the post-TDAPA add-on payment adjustment conditional on
receiving ASP data. Because the post TDAPA add-on payment adjustment
would be calculated annually rather than quarterly, we proposed that if
CMS does not receive the latest full calendar quarter of ASP data for a
drug that would be included in the calculation of the post-TDAPA add-on
payment adjustment, then CMS would not include that drug in the
calculation of the post-TDAPA add-on payment adjustment for any future
years. We also proposed that if CMS stops paying the TDAPA for a drug
or biological product because CMS stops receiving the latest full
calendar quarter of ASP data, then we would not include that drug or
biological product in the calculation of the post-TDAPA add-on payment
adjustment for the next CY or any future CY. Consistent with our policy
for calculating the TDAPA, as discussed in section II.B.1.k of the
proposed rule, we proposed that in situations when a manufacturer
reports zero or negative sales, we would consider CMS to have received
the latest full calendar quarter of ASP data, but we would calculate
the post-TDAPA payment adjustment based on WAC, or if WAC is not
available, on invoice pricing, in such circumstances.
Finally, we proposed that for each of the 3 years for which this
post-TDAPA add-on payment adjustment would be paid, we would update the
amount of the post-TDAPA add-on payment adjustment by the productivity-
adjusted ESRDB market basket update to account for estimated future
input price changes faced by ESRD facilities. We solicited comment on
whether it would be more appropriate to consider using the growth in
the price proxy for the pharmaceuticals cost category in the ESRDB
market basket, rather than the productivity-adjusted ESRDB market
basket update. We also provided a detailed set of steps for calculating
the amount of the proposed post-TDAPA add-on payment adjustment for CY
2024, which we calculated at $0.0961 for the proposed rule. We
solicited comments on this proposed methodology for a post-TDAPA add-on
payment adjustment and its appropriateness for CY 2024 and future
years.
We received public comments on our proposed methodology for
calculating the post-TDAPA add-on payment adjustment. The comments on
our proposal and our responses are set forth below.
Comment: Many commenters, including LDOs, drug manufacturers, and
patient advocacy organizations, expressed concerns that the proposed
methodology would not support access to new and innovative renal
dialysis drugs and biological products. Commenters stated that the
proposed amount would provide a level of funding that supports the
provision of drugs and biological products currently paid for using the
TDAPA to only a small proportion of patients and would not support
expanded access to such drugs. One commenter stated that CMS policy
must recognize that practice follows payment and provided an example of
certain payment policy changes in the SNF PPS, specifically the recent
transition from the SNF Resource Utilization Group payment system to
the Patient-Driven Payment Model (83 FR 39162), which the commenter
stated drove subsequent utilization patterns in that system by reducing
incentives for overutilization of certain rehabilitative therapies.
Response: We disagree with commenters who stated that the amount of
the proposed post-TDAPA add-on payment adjustment would not support
access to new and innovative renal dialysis drugs and biological
products. Because the proposed methodology is based on the latest
available price and utilization information, we believe it provides an
adequate level of funding to maintain access to new renal dialysis
drugs and biological products after the end of the TDAPA period. We
note that the proposed amount of the post-TDAPA add-on payment
adjustment for CY 2024 reflects utilization of current TDAPA drugs by a
small proportion of ESRD beneficiaries, amounting to less than 1
percent of all treatments. Although the payment per treatment is a
relatively small amount, an ESRD facility's aggregate payments under
the proposed post-TDAPA add-on payment adjustment methodology would
nonetheless help to support the utilization for new renal dialysis
drugs and biological products at the level of utilization observed
during the TDAPA period. We note that, as discussed later in this final
rule, we are calculating the final amount of the post-TDAPA add-on
payment adjustment for CY 2024 to be significantly higher than the CY
2024 ESRD PPS proposed rule, based on the latest available price and
utilization data.
Lastly, we appreciate the concerns that the commenter raised
regarding utilization patterns as the result of payment policies, and
we are acutely aware of the importance of establishing payment
adjustments in the ESRD PPS that are aligned with the principles of
prospective payment. We anticipate that the post-TDAPA payment
methodology that we are finalizing will provide an appropriate level of
funding to support access to new renal dialysis drugs and biological
products after the end of the TDAPA, without providing a direct
incentive to use any particular new drug or biological product, which
we anticipate could result in overutilization.
Comment: MedPAC stated that although it strongly disagrees with the
implementation of a post-TDAPA add-on payment adjustment, it recognizes
that CMS's proposed per claim add-on payment approach provides better
incentives for more judicious use of a new renal dialysis drug rather
than a per use add-on payment approach. MedPAC reiterated that paying
on a per unit basis for a drug incentivizes its use (to the extent
clinically possible) and recommended that if CMS finalizes the post-
TDAPA add-on payment adjustment, the agency should proceed with a per
claim add-on payment. MedPAC also expressed support for the proposed 65
percent risk-sharing percentage as an incentive for price competition.
Response: We appreciate MedPAC's qualified support for the proposed
methodology. We agree with MedPAC that the proposed per-treatment
methodology would appropriately align incentives for ESRD facilities to
be efficient with their resources, and as a result it would foster
competition between new and existing renal dialysis drugs and
biological products. We also agree that the proposed application of a
risk-sharing percentage would provide a further incentive for price
competition between drugs within an ESRD PPS functional category. As we
discussed in the CY 2024 ESRD PPS proposed rule (88 FR 42462), we
anticipate that the proposed risk sharing percentage of 65 percent
would be appropriate, as it would provide a significant level of
payment that supports access for beneficiaries and long-term planning
for ESRD facilities, while incentivizing ESRD facilities to allocate
resources efficiently.
Comment: Several commenters advocated for an alternative
methodology that would calculate an add-on payment adjustment based on
the average cost for patients that use the new renal dialysis drug or
biological product. Commenters stated that the proposed methodology for
the post-TDAPA add-on payment adjustment, and the structure of the ESRD
PPS overall, do not address the needs of the non-average patient.
Several
[[Page 76395]]
commenters drew parallels to the comprehensive ambulatory payment
classification (C-APC) complexity adjustment in the Hospital OPPS as an
example of a payment policy that adjusts payment based on patient
characteristics.
Response: We appreciate the suggested methodology for which these
commenters advocated but do not agree that such a methodology would be
appropriate, because it would directly incentivize utilization of a
particular drug or biological product, which can result in
overutilization. As we discussed earlier in this final rule, we believe
that the proposed methodology provides the most appropriate incentives
for ESRD facilities to be efficient with resources, while providing an
appropriate level of payment that supports access to new renal dialysis
drugs and biological products.
Additionally, we disagree with several of the premises that
commenters offered with respect to the proposed methodology for
calculating the post-TDAPA add-on payment adjustment. Specifically,
commenters stated that both the proposed post-TDAPA methodology and the
ESRD PPS are designed to meet the needs of the average patient and do
not meet the needs of the non-average patient. In fact, the ESRD PPS
base rate is not constructed to address the needs of the average
patient, but rather to provide a level of payment that reflects the
average per-treatment costs of renal dialysis services. As we discussed
in the CY 2011 ESRD PPS final rule (75 FR 49037), in response to
concerns that bundling payment for drugs like EPO and oral medications
would limit nephrologists from prescribing what is necessary, we stated
that the ESRD PPS would establish a bundled payment system based on the
average cost of care with adjustments that target more payment to more
resource intensive ESRD patients. We further explained that in
situations where costs for treating patients exceed an established
threshold, the outlier policy would apply. Later in the same CY 2011
ESRD PPS final rule (75 FR 49047) we explained that the ESRD PPS
provides an opportunity for ESRD facilities to make financially sound
decisions while providing necessary care, recognizing that some
patients may utilize less renal dialysis items and services while
others may use more. In other words, while some patients cost more than
average and others cost less, an ESRD facility's aggregate payments
under the ESRD PPS are reflective of the overall cost of providing
renal dialysis services to its patients. The ESRD PPS includes patient-
level and facility-level adjustments that better align payment with
resource use for facilities that incur higher costs due to their
patient population or geographic location.
We do not believe that the OPPS C-APC complexity adjustment is an
appropriate comparison to the proposed post-TDAPA payment amount, which
as we previously noted will be applied in a non-budget-neutral manner
and is intended to provide a transitional level of payment that
supports ESRD facilities' long-term planning and budgeting and supports
beneficiaries' access to new renal dialysis drugs and biological
products. In contrast, the OPPS C-APC complexity adjustment is budget
neutral under the OPPS and is intended to provide increased payment
when certain service combinations represent a complex, costly, or more
resource-intensive version of the primary service. As an example, we
believe a more appropriate payment mechanism to recognize the
additional costs of treating ESRD patients with pruritus may be a
patient-level adjustment under the ESRD PPS. As we discuss in section
II.B.1.j of this final rule, we are collecting additional information
on dialysis duration and may consider future revisions to the ESRD PPS
case-mix adjustments, if appropriate.
Comment: Several commenters responded to our comment solicitation
on the methodology for applying the productivity-adjusted ESRDB market
basket update, or an alternative update factor, to the proposed post-
TDAPA add-on payment adjustment. Commenters generally advocated for
applying a pharmaceutical price proxy, rather than the productivity-
adjusted ESRDB market basket update, stating that a pharmaceutical
price proxy would be more representative of anticipated future price
growth for new renal dialysis drugs and biological products. Commenters
requested clarification about whether CMS would recalculate the post-
TDAPA add-on payment adjustment annually for each of the three years,
in addition to applying an update factor as proposed. Several
commenters requested that CMS calculate the post-TDAPA add-on payment
adjustment at the end of the TDAPA period, and then annually update
that amount based on an update factor such as a pharmaceutical price
proxy. MedPAC expressed concern about a payment methodology in which
the payment amount would only increase and suggested alternative
approaches to update the amount of the post-TDAPA add-on payment
adjustment annually.
Response: We thank commenters for their comments regarding the
proposed update methodology for the post-TDAPA add-on payment
adjustment. We proposed to use the most recent available price and
utilization information to determine a per-treatment amount for each of
the three years during which a post-TDAPA add-on payment adjustment
would apply. We are clarifying in this rule that we would annually
recalculate the post-TDAPA add-on payment adjustment, based on the most
recent available price and utilization information at the time of
rulemaking. Accordingly, the post-TDAPA add-on payment adjustment
amount could increase or decrease from year to year, depending on
changes in pricing and utilization. We note that although we proposed
to apply the productivity-adjusted ESRDB market basket update, we
proposed to do so only for the purpose of updating the post-TDAPA add-
on payment adjustment to reflect anticipated prices in the target year.
We did not propose, and are not finalizing, the application of an
update factor to update the amount of the post-TDAPA add-on payment
adjustment from one payment year to the next.
We appreciate the comments recommending the use of the
pharmaceutical price proxy rather than the productivity-adjusted market
basket update. We agree with commenters that a pharmaceutical price
proxy would more effectively track the change in prices for new renal
dialysis drugs and biological products than would the market basket
update. We are finalizing that for each year that we calculate a post-
TDAPA add-on payment adjustment, we will apply the projected growth in
the ESRDB market basket price growth for pharmaceuticals, which
reflects the weighted blend of the ESA and non-ESA price proxies in the
2020-based ESRDB market basket, to reflect anticipated pricing for the
target year. We refer readers to the CY 2023 ESRD PPS final rule (87 FR
67149) for a detailed discussion of the construction of this price
proxy.
Comment: Several commenters opposed the application of a 65 percent
risk sharing percentage and urged CMS to instead calculate and apply an
offset based on actual utilization of related drugs. Many commenters
suggested that CMS limit the calculation of an offset to the post-TDAPA
add-on payment adjustment that accounts for the actual spending for
products that are in the same ESRD PPS functional category as the new
renal dialysis drug or biological
[[Page 76396]]
product and are directly impacted by the drug or biological product.
Response: As we discussed in the CY 2024 ESRD PPS proposed rule, we
did not propose to calculate an offset based on utilization, because we
are concerned that this approach would be more burdensome and less
transparent than the proposed 65 percent risk-sharing percentage. We do
not believe it would be appropriate to limit the calculation of an
offset to just drugs and biological products in the same functional
category, because we recognize that utilization of drugs in one
functional category can affect the utilization of drugs in other
functional categories. For example, utilization of drugs in the bone
and mineral metabolism functional category can indirectly affect the
incidence of itching among dialysis patients. However, if we were to
apply a per-treatment offset based on changes in spending for all
formerly separately billable drugs and biological products, it would be
difficult to determine definitively which reductions in spending were
related to a new renal dialysis drug or biological product.
Comment: One commenter pointed out that the CY 2024 ESRD PPS
proposed rule does not indicate whether the ESRD PPS outlier adjustment
would apply to products for which a post-TDAPA add-on payment
adjustment is calculated.
Response: We appreciate the request for clarification regarding
outlier eligibility for drugs and biological products during the post-
TDAPA period. Under current policy, after the end of the TDAPA period,
a drug or biological product is considered an eligible outlier service
only if it meets the requirements of Sec. 413.237(a)(1). We are
clarifying that any renal dialysis drug or biological product included
in the calculation of the post-TDAPA add-on payment adjustment would be
considered an eligible ESRD outlier service only if it meets the
requirements of Sec. 413.237(a)(1). However, we are further clarifying
that under current policy, Korsuva[supreg], the only renal dialysis
drug whose TDAPA period will end in CY 2024, will not be considered an
eligible outlier ESRD service after the end of its TDAPA period,
because it is a substitute for diphenhydramine hydrochloride, which was
included in the composite rate prior to 2011, and therefore does not
meet the requirements of Sec. 413.237(a)(1) (that is, it would not
have been, prior to January 1, 2011, separately billable under Medicare
Part B).
Final Rule Action: After considering the comments, we are
finalizing as proposed the methodology to calculate the amount of the
post-TDAPA add-on payment adjustment, except that, as noted previously,
we will apply the price growth of the pharmaceutical cost category,
reflecting a weighted blend of the ESA and non-ESA price proxies in the
2020-based ESRDB market basket, to adjust the amount of the post-TDAPA
add-on payment adjustment to reflect anticipated pricing for the target
year rather than using the productivity-adjusted ESRDB market basket
update. Therefore, we will use the following calculation to determine
the amount of the post-TDAPA add-on payment adjustment to be applied to
each ESRD PPS treatment.
Step 1, using the most recent available 12 months of
claims data, calculate the total expenditure of the new renal dialysis
drug or biological product being paid for using the TDAPA under the
ESRD PPS. Total expenditure is calculated by multiplying the latest
available full calendar quarter of ASP data for the new renal dialysis
drug or biological product by the quantity of units billed. If CMS does
not receive the latest available calendar quarter of ASP data for a
drug or biological product, then CMS would not apply the post-TDAPA
add-on payment adjustment for that drug or biological product. As we
noted earlier, if the latest available full calendar quarter of ASP
data reflects zero or negative sales, CMS will calculate the post-TDAPA
add-on payment adjustment based on WAC, or if WAC is not available,
invoice pricing.
Step 2, divide the total expenditure of the new renal
dialysis drug or biological product from Step 1 by the total number of
ESRD PPS treatments furnished during the same 12-month period as used
in Step 1. The resulting quotient from Step 2 is the post-TDAPA add-on
payment adjustment amount for each treatment, before applying the
reduction factor to account for case-mix standardization, as described
in Step 4.
Step 3, calculate the dollar amount of the total aggregate
case-mix adjusted post-TDAPA add-on payment adjustment amount by
multiplying the post-TDAPA add-on payment adjustment amount from Step 2
by the applicable patient-level adjustments for each ESRD PPS treatment
furnished during the 12-month period.
Step 4, divide the aggregate case-mix adjusted add-on
payment adjustment amount from Step 3 by total expenditure from Step 1.
The resulting quotient is the reduction factor applied to the post-
TDAPA add-on payment adjustment amount to account for case-mix
standardization.
Step 5, apply the reduction factor from Step 4 to the
post-TDAPA add-on payment adjustment amount from Step 2.
Step 6, apply the 65 percent risk-sharing factor to the
amount from Step 5 to calculate the case-mix adjusted post-TDAPA add-on
payment adjustment amount.
Step 7, multiply the case-mix adjusted post-TDAPA add-on
payment adjustment amount by the growth in the ESRDB market basket
price proxy for pharmaceuticals to account for anticipated price growth
to the target year.
We are amending Sec. 413.234 by revising Sec. 413.234(c)(1)(i)
and adding regulations at Sec. 413.234(b)(1)(iii), (c)(1)(ii), (c)(3),
and (g) that describe the post-TDAPA add-on payment adjustment and the
calculation we will use to determine the post-TDAPA add-on payment
adjustment amount, as described previously. In addition, we are
amending Sec. 413.230 by adding reference to the post-TDAPA add-on
payment adjustment in the calculation of the ESRD PPS per treatment
payment amount.
We will follow these steps to calculate the case-mix adjusted post-
TDAPA add-on payment adjustment amount for CY 2024 and future years,
when appropriate. We will include in the calculation of the case-mix
adjusted post-TDAPA add-on payment adjustment amount any new renal
dialysis drugs and biological products in existing ESRD PPS functional
categories that are eligible for payment using the TDAPA described in
Sec. 413.234(c). We will begin making payment under this new post-
TDAPA add-on payment adjustment 8 calendar quarters after the beginning
of the TDAPA payment period for the new renal dialysis drug or
biological product. Payment of the post-TDAPA add-on payment adjustment
will end no later than 12 calendar quarters after the end of the TDAPA
payment period for the new renal dialysis drug or biological product.
(b) Example of the Final Post-TDAPA Add-On Payment Adjustment
Calculation for CY 2024
Following the methodology finalized in the previous section, we
will apply a post-TDAPA add-on payment adjustment to all ESRD PPS
treatments beginning April 1, 2024, when the TDAPA payment period for
Korsuva[supreg] ends. We will calculate the amount of this post-TDAPA
add-on payment adjustment based on the most recent available 12 months
of utilization data for Korsuva[supreg] and the most recent
[[Page 76397]]
available 12 months of ESRD PPS claims data for this final rule. As we
proposed, we will use updated data for this ESRD PPS final rule. We
will apply the ESRD PPS patient-level adjustment factors for
determining the amount of the post-TDAPA add-on payment adjustment for
each ESRD PPS claim.
Based on the latest available data, which includes utilization of
Korsuva[supreg] from July 2022 through June 2023, we estimate that
total expenditure for Korsuva[supreg] is $11,948,389 and that
28,450,178 total ESRD PPS treatments were furnished during the same
time period. In addition, as discussed earlier in this final rule, we
are finalizing the application of the growth in the ESRDB market basket
price proxy for pharmaceuticals to adjust the amount of the post-TDAPA
add-on payment adjustment to reflect anticipated pricing for CY 2024.
The ESRDB pharmaceutical price proxy used for this CY 2024 ESRD PPS
final rule is 1.3 percent. Accounting for the existing ESRD PPS
patient-level adjustment factors and the TPEAPA as discussed in section
II.B.1.g of this final rule, the reduction to the post-TDAPA add on
payment adjustment to account for case-mix standardization for this
time period is 0.901653. Accordingly, we will calculate a case-mix
adjusted post-TDAPA add-on payment adjustment for CY 2024 equal to
(($11,948,389)/(28,450,178)) x (0.901653) x (0.65) x (1.013) = $0.2493.
Estimates for the impact of this post-TDAPA add-on payment adjustment
for CY 2024 are included in section VII.D.5 of this final rule.
(c) Considerations Related to Budget Neutrality for the Post-TDAPA Add-
On Payment Adjustment
As discussed in the CY 2024 ESRD PPS proposed rule and earlier in
this final rule, the ESRD PPS includes other add-on payment adjustments
based on the authority in section 1881(b)(14)(D)(iv) of the Act, which
are not statutorily required to be budget neutral. In the case of
existing add-on payment adjustments under the ESRD PPS, these generally
account for costs that were not included in cost reports used for the
construction of the ESRD PPS bundled payment. These include items that
either did not exist at the time of the construction of the ESRD PPS
bundled payment, like new drugs and equipment, or services that were
not commonplace that the add-on payment adjustment is meant to
encourage, like home dialysis training. In the proposed rule, we stated
that we expect this increased payment would support ESRD facilities in
providing the new renal dialysis drug or biological product to all
beneficiaries for whom it is reasonable and medically necessary. We
noted that we believe it is also important to support access to new
renal dialysis drugs and biological products while minimizing the
financial impact to beneficiaries, who incur a 20 percent coinsurance
for renal dialysis services under the ESRD PPS.
As discussed previously, we considered and proposed this new post-
TDAPA add-on payment adjustment in response to concerns that a sudden
decrease in payment for certain new renal dialysis drugs and biological
products after the end of the TDAPA period could negatively affect
Medicare beneficiaries' access to such new renal dialysis drugs and
biological products. Although we have noted that the ESRD PPS base rate
already includes money for renal dialysis drugs and biological products
that fall within an existing ESRD PPS functional category, we stated
that proposing a budget neutral payment adjustment would not be
appropriate for the post-TDAPA add-on payment adjustment. Because we
proposed to apply the post-TDAPA add-on payment adjustment to every
ESRD PPS treatment, budget neutralizing this final add-on payment
adjustment would effectively undo the adjustment and leave aggregate
payments at the same level they would have been without an adjustment,
which as we previously noted could negatively affect beneficiaries'
access to such drugs and biological products. In contrast, applying
this add-on payment adjustment in a non-budget neutral manner would
increase aggregate ESRD PPS expenditures to a level that reflects the
most recent 12 months' utilization of the new renal dialysis drug or
biological product, which we believe would support beneficiary access.
By applying the post-TDAPA add-on payment adjustment in a non-budget
neutral way, we would effectively maintain expenditures for these new
renal dialysis drugs and biological products at 65 percent of the level
of expenditures paid during the TDAPA period. We stated that we believe
this approach would provide consistency and predictability in a way
that would support beneficiaries' continued access to new renal
dialysis drugs and biological products, while appropriately reducing
expenditures for such drugs after the TDAPA period ends both for the
Medicare program and for individual beneficiaries, as discussed earlier
in this section. Accordingly, we proposed that this post-TDAPA add-on
payment adjustment would not be budget neutral. We invited comments on
the budget neutrality aspect of this proposal.
Comment: Several commenters expressed support for applying the
post-TDAPA add-on payment adjustment in a non-budget neutral way. These
commenters agreed with CMS that calculating the post-TDAPA add-on
payment budget neutrally would be counterproductive, as it would
effectively undo the impact of the proposed adjustment.
Response: We agree, and we thank the commenters for their support.
Final Rule Action: After considering the comments we received, we
are finalizing the application of the post-TDAPA add-on payment
adjustment as a non-budget neutral payment adjustment, beginning for CY
2024.
j. Requirement of ``Time on Machine'' Hemodialysis Treatment Data as a
Recordkeeping and Cost Reporting Requirement for Outpatient Maintenance
Dialysis
We proposed certain new recordkeeping and cost reporting
requirements for outpatient maintenance dialysis at proposed Sec.
413.198(b)(5). Specifically, we proposed to require patient-level
reporting on resource use involved in furnishing hemodialysis treatment
in-center in ESRD facilities that would serve to apportion composite
rate costs for use in the case-mix adjustment. Importantly, this new
data would be used to disaggregate facility-level composite rate costs
(as obtained from the cost reports) and assign them to the patient-
month level, which would enable a refined single-equation estimation
methodology. The integrity of the ESRD PPS is dependent on our ability
to monitor payment accuracy and make refinements to the payment system,
as needed. Under this proposal, CMS would require ESRD facilities to
report information on ESRD PPS claims for renal dialysis services about
the duration of time in minutes that ESRD beneficiaries spend in center
receiving hemodialysis treatment (hereafter referred to in this section
as ``time on machine''). We would use time on machine data to help us
evaluate and monitor the accuracy of our payments for patient-level
adjustment factors. CMS would also evaluate whether the data could be
used to inform future refinements to the existing patient-level
adjustment factors set forth at Sec. 413.235(a), which include patient
age, body mass index (BMI), body surface area (BSA), and co-morbidities
such as sickle cell anemia. Finally, CMS would review the data for its
potential to
[[Page 76398]]
identify any disparities from a health equity perspective that may
support proposing in future rulemaking new patient-level adjustment
factors, including potential social determinants of health (SDOH)
factors. As described in section II.B.1.h of this final rule, we
proposed the addition of Sec. 413.198(b)(5), which states that ESRD
facilities must submit data and information in the formats established
by CMS for the purpose of estimating patient-level and facility level
variation in resource use. Under this paragraph, we proposed to require
ESRD facilities to report ``time on machine'' as when a patient the
begins dialysis treatment and ends dialysis treatment. We proposed to
require ESRD facilities to report this information using the D6 value
code on ESRD PPS claims.
(1) Background
(a) Statutory Authorities for Recordkeeping, Cost Reporting, and Case-
Mix Adjustments Under the ESRD PPS
Section 1881(b)(2)(B) of the Act generally directs the Secretary to
prescribe in regulations any methods and procedures to determine the
costs incurred by providers of services and renal dialysis facilities
in furnishing covered services to individuals with ESRD, and to
determine, on a cost-related or other economical and equitable basis,
payment amounts for Medicare part B services furnished by such
providers and facilities to individuals with ESRD. To that end, CMS
promulgated Sec. 413.198,\38\ which specifies certain recordkeeping
and cost reporting requirements for ESRD facilities that meet the
conditions for coverage under 42 CFR part 494.\39\ The recordkeeping
and cost reporting requirements at Sec. 413.198 enable CMS to
determine the costs incurred in furnishing outpatient maintenance
dialysis and support the two-equation payment model that is currently
used as the basis for the ESRD PPS.
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\38\ We note that Sec. 413.198 was promulgated prior to the
establishment of the ESRD PPS. It was initially set forth in 1983 at
42 CFR 405.441 (48 FR 21254), to implement section 2145 of the
Omnibus Budget Reconciliation Act of 1981 (Pub. L. 97-35). Section
405.441 was later redesignated in 1986 as 42 CFR 413.174 (51 FR
34790-01), and the requirements were moved again, from Sec. 413.174
to Sec. 413.198, in a reorganization of subpart H of part 413 (62
FR 43657).
\39\ Likewise, under section 1881 of the Act, CMS established
related data and information requirements at 42 CFR 494.180(h).
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Section 1881(b)(14)(D)(i) of the Act requires that the ESRD PPS
include a payment adjustment based on case-mix that may consider
patient weight, BMI, comorbidities, length of time on dialysis, age,
race, ethnicity, and other appropriate factors. We implemented this
statutory requirement in Sec. 413.235, which sets forth certain
patient characteristics for which the per treatment ESRD PPS base rate
may be adjusted, specifically where those patient characteristics
result in higher costs for ESRD facilities. The patient characteristics
at Sec. 413.235(a) include: patient age, BSA, low BMI, onset of renal
dialysis (new patient), and co-morbidities. The Secretary is also
authorized, under section 1881(b)(14)(D)(iv) of the Act, to apply such
other payment adjustments under the ESRD PPS as the Secretary
determines appropriate. Per Sec. 413.196, we publish notice of any
proposed changes to payment adjustments, including adjustments to the
composite rate,\40\ in the Federal Register. We last updated the
payment multipliers for the ESRD PPS patient-level adjustment factors
in the CY 2016 ESRD PPS final rule (80 FR 68968, at 68973 through
68984), for age, BSA, low BMI, sex, four co-morbidity categories (that
is, pericarditis; gastrointestinal tract bleeding with hemorrhage;
hereditary hemolytic or sickle cell anemias; and myelodysplastic
syndrome), and the onset of renal dialysis. We also established payment
adjustments for pediatric patients and for facilities treating a low
volume of patients with ESRD.
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\40\ As explained in the CY 2011 ESRD PPS final rule (75 FR
49030 at 49032), the composite rate is the method by which CMS
determines prospectively the amounts of payments for renal dialysis
services furnished by providers of services and by renal dialysis
facilities to individuals in a facility and to such individuals at
home. The composite rate is a single composite weighted formula that
is combined with separately billable services under a single
payment, adjusted to reflect patient differences in resource needs
or case-mix.
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Finally, the collection of data from ESRD claims, cost reports and
record keeping, has been instrumental in identifying underserved
populations and establishing that ESRD disproportionately affects
African American/Black men relative to their share of the total
population. The proposal to collect and evaluate time on machine data
would provide additional information concerning resource use to enable
CMS to identify, assess, and address potential health disparities. This
proposal therefore may support the Secretary's efforts to evaluate race
and ethnicity data and provide recommendations for improving the
quality of the data, as required under section 1809 of the Act,
previously discussed in the CY 2011 ESRD PPS final rule (75 FR 49030 at
49108 through 49113).
In the CY 2024 ESRD PPS proposed rule (88 FR 42464 through 42472),
we noted that, if the proposed requirement to collect time on machine
data were to be finalized, we would issue corresponding guidelines. We
stated that such guidance would provide instructions regarding the
applicable administrative requirements for reporting a value code on an
electronic claim, here value code D6, connected to the number of
minutes of hemodialysis treatment provided in-center in an ESRD
facility. We further noted that the National Uniform Billing Committee
(NUBC) has approved and is prepared for ESRD facilities' use of value
code D6 on claim form CMS-1450 (UB-04) (OMB-0938-0997) to report the
total number of minutes of hemodialysis provided during the billing
period.
(b) Case-Mix Adjustments Background and the Two-Equation ESRD PPS Model
The ESRD PPS includes patient-level adjustments that adjust the
ESRD PPS base rate for certain patient characteristics. The current
ESRD PPS case-mix adjustments are derived from a case-mix adjustment
model involving two equations. In the CY 2011 ESRD PPS final rule (75
FR 49083), we discussed the two-equation methodology used to develop
the adjustment factors that would be applied to the ESRD PPS base rate
to calculate each patient's case-mix adjusted payment per treatment.
The two-equation approach used to develop the ESRD PPS included a
facility-based regression model for services historically paid for
under the composite rate as indicated in ESRD facility cost reports,
and a patient-month-level regression model for services historically
billed separately. One significant limitation, which in large part
drove the development of the two-equation model, was that there was no
way to reliably identify, using claims data, the costs for composite
rate services--that is, items and services such as staff labor,
dialysate, capital-related assets such as renal dialysis machines, and
certain drugs and laboratory tests that are used in the provision of
outpatient maintenance dialysis for the treatment of ESRD and that were
included in the composite payment system established under section
1881(b)(7) of the Act and the basic case-mix adjusted composite payment
system established under section 1881(b)(12) of the Act.
In the CY 2016 ESRD PPS final rule, we updated the payment
multipliers for the ESRD PPS patient-level adjustment factors for age,
BSA, low BMI, sex, four co-morbidity categories (that is,
[[Page 76399]]
pericarditis; gastrointestinal tract bleeding with hemorrhage;
hereditary hemolytic or sickle cell anemias; and myelodysplastic
syndrome), and the onset of renal dialysis. We also established payment
adjustments for pediatric patients and for ESRD facilities treating a
low-volume of ESRD patients (80 FR 68968 at 68973 through 68984). In
that CY 2016 ESRD PPS final rule, we discussed and responded to several
public comments in which commenters expressed concerns about the
continued use of the two-equation model (80 FR 68974 through 68976).
One comment from MedPAC suggested that CMS develop a one-equation model
for the ESRD PPS. In response, we noted that the ESRD PPS is not
currently able to utilize a one-equation method, because ESRD
facilities do not report charges associated with the components of
renal dialysis treatment costs that vary across patients such as time
on machine. In other words, patient-level claims provide line-item
detail on the use of the formerly separately billable services but do
not provide any information regarding variation across patients in the
use of the formerly composite rate services. In addition, we stated
that we believed that capturing the resource cost for furnishing renal
dialysis services is complex since Medicare has historically paid an
ESRD PPS base rate (that is, composite rate payment) to account for
those costs that were never itemized on a claim but were reported
through the cost report (80 FR 68975 through 68976).
(c) Background on CMS Efforts To Explore the Use of ``Time on Machine''
Data To Refine the Case-Mix Adjustment Model
Interested parties, including MedPAC, have long expressed concerns
about the complexity of the two-equation model underpinning the ESRD
PPS and have questioned the validity of assuming that the composite
rate costs for all patients at an ESRD facility are the same.
Interested parties have encouraged CMS to develop a patient cost model
that is based on a single patient-level cost variable that accounts for
all composite rate and formerly separately billable services.
Additionally, interested parties have expressed concerns that the
existing case-mix adjustors might not correlate well with the current
cost of renal dialysis treatment and have encouraged CMS to explore a
refinement.
In response, CMS has explored the feasibility of collecting time on
machine data on patient claims from ESRD facilities and the potential
for using such data. These efforts include: a Technical Expert Panel
(TEP) held on December 6, 2018, a Request for Information (RFI)
published in the ESRD PPS CY 2020 ESRD PPS proposed rule (84 FR 38399),
and more recently, an RFI published in the ESRD PPS CY 2022 proposed
rule (86 FR 36322, 36399 through 36400). In addition, CMS issued sub-
regulatory guidance in Transmittal 10368, from September 24, 2020, to
begin collecting time on machine data, but it later rescinded that
guidance.
(i) Technical Expert Panel (TEP) December 2018
As we discussed in the CY 2020 ESRD PPS proposed rule (84 FR 38396
through 38400), a TEP was held on December 6, 2018, to discuss options
for improving data collection to refine the ESRD PPS case-mix
adjustment model. In that CY 2020 ESRD PPS proposed rule, we discussed
the purpose of the TEP and the topics that were discussed, including
several data collection options.\41\
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\41\ The final TEP report from December 2018 and other materials
can be found at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Educational_Resources.
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In the CY 2020 ESRD PPS proposed rule, we noted that CMS's data
contractor's pre-TEP analysis of CY 2016 cost report data showed that
composite rate costs comprise nearly 90 percent of average total
treatment costs, with capital, direct patient care labor, and
administrative costs representing approximately 88 percent of total
average composite rate cost per treatment. The data contractor provided
examples of ways that longer duration of renal dialysis time might be
associated with increased treatment costs, including utility costs,
accelerated depreciation on equipment, and lower daily census counts,
which, among other things, would result in increased per-treatment
capital costs. The analysis suggested that additional labor hours for a
patient with longer treatments on average could increase per-treatment
labor costs, and that patients with increased use of dialysate and
water treatment supplies or equipment likely have higher average per-
treatment supply costs. We noted that, under current reporting
practices, there are no data on the patient-and treatment-level
variation in the cost of composite rate items and services. We
explained that these findings underscore the importance of identifying
variation in these costs to inform the development of a refined case-
mix adjustment model.
CMS published the findings from the December 2018 TEP in a report
dated June 2019.\42\ The 2018 TEP report provided examples of ways that
extended treatment duration could affect cost components. First, an
imputed cost per treatment was calculated using a combination of
treatment duration data from CROWNWeb \43\ (now the ESRD Quality
Reporting System, or EQRS) and facility cost per-minute data from cost
reports to infer differences in costs reported across patient-months.
An average interquartile range of 34.6 minutes was observed from
CROWNWeb duration data, indicating significant within-facility
variation in dialysis treatment time. Significant variation in average
imputed cost per hemodialysis sessions also was observed, with an
across-facility interquartile range of $62.62. Overall, it was found
that costs increased with longer treatment times, and this pattern was
consistent for the individual cost report components as well.
Facilities with a higher proportion of beneficiaries receiving
treatments >= 4.5 hours duration were found to have higher average
costs for each cost component, except for cost report drugs.\44\
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\42\ The final TEP report from December 2018 is found directly
at: https://www.cms.gov/medicare/medicare-fee-for-service-payment/esrdpayment/downloads/esrd-pps-tep-summary-report-june-2019.pdf.
\43\ In 2008, CMS introduced an electronic Web-based data
collection system, Consolidated Renal Operations in a Web-enabled
Network (CROWNWeb) which was designed to collect clinical
performance measures data from dialysis facilities (73 FR 20370, at
20372). CrownWeb is now ``EQRS''--that is, the ESRD Quality
Reporting System (OMB Control Number 0938-1289).
\44\ Acumen LLC. ESRD PPS Case-Mix Adjustment Technical Expert
Panel (TEP). Slide Presentation Slide 42. December 2018. See https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Downloads/ESRD-PPS-TEP-Presentation.pdf.
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CMS presented further discussion into collection of time on machine
data for each dialysis session in the CY 2020 ESRD PPS proposed rule
(84 FR 38396 through 38400), where we further identified this potential
data set as a singular option that would provide sufficient data to
develop a refined case-mix adjustment model. If renal dialysis session
time were reported for each renal dialysis treatment, cost report and
treatment-level data could be integrated to infer differences in
composite rate costs across patients. In this paradigm, patient-level
differences in composite rate costs could be attributed to two discrete
categories: differences due to renal dialysis treatment duration
(measured in units of time); and differences unrelated to treatment
duration. To alleviate concerns from interested parties, we noted that
time on machine data would not be used to
[[Page 76400]]
directly adjust ESRD PPS payment, rather, it would be used to apportion
composite rate costs (currently only observable at the facility level
to the patient or treatment level) for use in the case-mix adjustment.
Time on machine data would allow for a higher proportion of composite
rate costs to be allocated to patients with longer renal dialysis
treatment times, and ultimately inform CMS refinements to existing
patient-level adjusters, including age and comorbidities.
We further explained that, in the December 2018 TEP, the data
contractor proposed two approaches to collect time on machine data: (1)
Use existing data from Consolidated Renal Operations in a Web-Enabled
Network (CROWNWeb) (now EQRS) on delivered renal dialysis minutes
during the monthly session when a laboratory specimen is drawn to
measure blood urea nitrogen (BUN); or (2) have ESRD facilities report
time on machine data on Medicare claims. For the latter, we suggested
that time on machine data could be reported by using a new HCPCS or
revenue center code to indicate units of treatment time for each renal
dialysis treatment or by updating the definition of the existing
revenue center code for renal dialysis treatments so that the units
correspond to treatment time instead of the number of treatments. We
noted that ESRD facilities already reported to CMS a single monthly
treatment time in CROWNWeb for in-facility treatments, indicating that
ESRD facilities currently collect time on machine data.\45\ Moreover,
we stated that we were aware that many ESRD facilities' electronic
health records (EHR) systems automatically collect this information for
every renal dialysis treatment, minimizing additional burden of
reporting this metric on claims.
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\45\ Centers for Medicare & Medicaid Services (CMS) End-Stage
Renal Disease Quality Incentive Program (ESRD QIP) Payment Year (PY)
2021 Measure Technical Specifications. Page 23. Available at:
https://www.cms.gov/files/document/cy-2021-final-technical-specifications-20201130.pdf.
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The December 2018 TEP participants preferred that the data be
collected on Medicare claims (84 FR 38398). They did not support using
the then-existing CROWNWeb data for time on machine data, as there were
too many questions about its completeness and timeliness. They agreed
that if time on machine data is collected on claims that it should be
reported in actual minutes dialyzed and not, for example, in 15-minute
increments. We explained that the TEP participants cautioned that
reporting time on renal dialysis on the claims would place additional
burden on ESRD facilities. However, we stated that we believed that,
for ESRD facilities with EHRs, the burden associated with the
collection of renal dialysis treatment time is expected to be small and
temporary, because the information is already being collected. We noted
that collecting time on machine data could be difficult to accomplish
for ESRD facilities that do not use EHRs. Lastly, we stated that some
participants maintained that certain factors related to patient
complexity--such as comorbidities and mental health status--that are
associated with treatment costs are unrelated to treatment duration.
(ii) Request for Information (RFI) in the CY 2020 ESRD PPS Proposed
Rule
In addition to presenting the findings from the December 2018 TEP,
we solicited comments in the CY 2020 ESRD PPS proposed rule (84 FR
38399) on the option of collecting time on machine data. As discussed
in the CY 2020 ESRD PPS final rule (84 FR 60648, 60782), commenters
responding to the RFI opposed the use of time on machine data,
maintaining that other factors were more directly related to cost of
treatment. Commenters claimed that many subgroups of patients are
challenged to stay on renal dialysis for the prescribed treatment time
because of their physical status or other limitations, leading to more
frequent treatment and/or higher costs related to patients' special
circumstances and comorbidities and not to treatment duration.
Regarding patient-level factors contributing to high costs of care,
commenters expressed that patient-level adjusters should be based on
sound, empirical evidence of their contribution to cost of care and
opposed the use of time on machine data as a single, patient-level
factor to estimate variation in composite rate costs. Some commenters
expressed the objection that use of this measure would not be
productive because there was great homogeneity in treatment times
across patients.
(iii) CMS Sub-Regulatory Guidance in Transmittal 10368 (September 24,
2020) (Now Rescinded)
In Transmittal 10368, published September 24, 2020, CMS instructed
the MACs to implement a new value code D6, which reflects the total
number of minutes of dialysis provided during the billing period. See
Transmittal 10368, CR 11871 (Changes to the End Stage Renal Disease
(ESRD) PRICER to Accept the New Outpatient Provider Specific File
Supplemental Wage Index Fields, the Network Reduction Calculation and
New Value Code for Time on Machine), effective January 1, 2021. At the
same time, CMS announced a new requirement for ESRD facilities to
report value code D6 on ESRD claims, for in-facility or home
hemodialysis maintenance, training, or retraining treatments. Shortly
after making these contractor directions public, CMS issued a Medicare
Learning Network (MLN) Matters guidance document (MLN Matters No.
MM11871) advising ESRD facilities of the new requirement to include
treatment time on claims. However, after a large dialysis organization
submitted a petition \46\ pursuant to the HHS Good Guidance Practices
Regulation,\47\ HHS issued a finding that notice-and-comment rulemaking
was required for CMS to impose such a requirement. Consequently, CMS
rescinded Transmittal 10368 and replaced it with Transmittal 10576,
dated January 20, 2021, withdrawing the requirement for reporting time
on the dialysis machine with value code D6. Although the guidance to
report time on machine data was rescinded, the value code D6 for the
time on machine in minutes remains approved by the NUBC and remains on
CMS's claim form CMS-1450 (UB-04) (OMB-0938-0997), in a deactivated
status.
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\46\ The petition (dated December 23, 2020) is attached as
Exhibit A to HHS's petition response (January 8, 2021) which can be
found at https://www.hhs.gov/sites/default/files/davita-petition-response-and-exhibit.pdf.
\47\ The HHS ``Good Guidance Practices'' final rule appeared in
the Federal Register on December 7, 2020 (85 FR 78770) and was later
rescinded July 25, 2022 (87 FR 44002).
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(iv) Request for Information (RFI) in the CY 2022 ESRD PPS Proposed
Rule
CMS revisited the topic of time on machine in the 2020 TEP and
discussed the case-mix adjusters.\48\ Interested parties continued
expressing concerns that the existing case-mix adjustors might not
align with resource-intensive patient-level services such as isolation
rooms, behavioral issues, or neurocognitive issues. We sought
additional public input in the ESRD PPS CY 2022 proposed rule,
requesting information on the methodology used to calculate the case-
mix adjustment (86 FR 36322, 36399 through 36400) and the methodology
to collect data to reflect patient-level differences in composite rate
costs, including the use of a value
[[Page 76401]]
code to collect time on machine on the claim.\49\
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\48\ https://www.cms.gov/files/document/end-stage-renal-disease-prospective-payment-system-technical-expert-panel-summary-report-april-2021.pdf.
\49\ We published a summary of the responses to the CY 2022 ESRD
PPS RFI (86 FR 36322, 36399 through 36400) for the current case-mix
methodology in the ESRD PPS CY 2022 final rule (86 FR 61874, 61997)
and provided greater detail on CMS's website at https://www.cms.gov/files/document/cy-2022-esrd-pps-rfi-summary-comments.pdf.
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We received similar comments on this RFI to those expressed in
response to the CY 2020 ESRD PPS proposed rule. As discussed in the CY
2022 ESRD PPS final rule, commenters cited concerns that apportioned
composite rate costs (such as labor and capital related costs) from the
cost reports, used in the case-mix adjustments, were currently only
observable at the facility-level and did not include patient or
treatment-level variations.
Like previously mentioned concerns regarding the collection of time
on machine data, commenters suggested this data element would be
burdensome and complex (especially for those dialyzing at home) and
would not identify high-cost patients. They stated that what little
variation might be identified would not be worth the burden of
collecting the information. In addition, these commenters stated that
ESRD facilities' staffing is based on prescribed time, not on the
actual time a patient is on the machine. They stated that the
prescription approach is the most rational way to determine staffing
levels, because ESRD facilities do not have time on machine in advance.
According to these commenters, ESRD facilities would only have the
prescribing physician's prescription to use.
A provider advocacy organization opposed the use of time on machine
data for purposes of ESRD PPS primarily because certain patients
benefit from shorter, more frequent dialysis, such as patients with
catheter-related access issues, non-compliant patients, patients with
chronic pain or diarrhea, and patients suffering from certain
comorbidities. They expressed significant concern that use of time on
machine data for differentiating treatment cost variability creates
inappropriate incentives for certain ESRD facilities to ``game the
system'' by: (1) putting patients on renal dialysis longer than
necessary; or (2) placing patients on the cheapest dialyzer and keeping
them on it for all five possible hours of dialysis. Another small renal
dialysis organization agreed, pointing out that most renal dialysis
treatments, regardless of time, will have similar composite rate costs.
In other words, they asserted that if a treatment is 3.5 hours compared
to 5 hours, the composite rate costs for those treatments will be very
similar. The only difference in cost between those two treatments would
be 1.5 hours more use of utilities, dialysate and bicarbonate solution,
machine depreciation, and a small amount of labor to check on the
patient. Most of the labor for renal dialysis treatments is putting the
patient on and taking the patient off dialysis. Therefore, in both
previously described scenarios, the commenter asserted that cost would
remain the same. Further, they pointed out that some patients will not
remain for their full renal dialysis treatment, and they generally
cannot force a patient to remain for their full prescribed treatment
time. Therefore, in their view, using actual treatment time for cost
allocation is not realistic.
A small renal dialysis organization within a large non-profit
health system commented that reporting treatment times would be
difficult and confusing and identified many factors that would need to
be addressed by CMS, including: identifying renal dialysis start time,
early removal from renal dialysis, inadvertent lack of time on machine
information, data inclusion on a claim form, and staff training. They
also expressed concern about the reporting of time on machine creating
opportunities for ESRD facilities to game the system by having the
renal dialysis run a few extra minutes to move into the next highest
level.
Several commenters recommended changes or removal of the case-mix
adjusters, including refinement of the age and weight (BSA and BMI)
adjustments and removal of the comorbidity adjustments, based on
declining frequency of claims containing comorbidities. Some comments
recommended removal of the comorbidity adjustments, because they report
the adjustments are not utilized. They recommended CMS refine the age
and weight (BSA and BMI) adjusters to better capture and designate
higher cost patients. Many commenters expressed the belief that the
comorbidity categories no longer protect beneficiary access and no
longer correlate with increased costs. A non-profit renal dialysis
association recommended that CMS minimize resources devoted to
adjusters. The commenters suggested including only the minimum needed
to deliver quality patient care, restore significant funding to the
ESRD PPS base rate for the benefit and care of all beneficiaries, and
focus retained adjusters only on those that are clearly linked to
patient cost of care or clear barriers to access. Specifically, they
recommended that CMS: retire the remaining comorbid case mix adjusters;
revise the weight adjusters to maintain a low-BMI adjuster; create a
high-BMI adjuster; eliminate the BSA adjuster; retire the age adjuster
(which they believe is not methodologically sound and does not resonate
with clinician or renal dialysis facility experience of care); maintain
the adjuster for low volume facilities; consider expanding the adjuster
to a second tier of facilities providing fewer than 6,000 treatments
per year; eliminate the rural adjuster; and maintain the onset of renal
dialysis adjuster to support the resource intensive needs of patients
starting dialysis. Other commenters stated it would be too preliminary
to eliminate the case-mix adjusters entirely, and instead they
recommended that CMS initiate a discussion of the adjusters that are
true drivers of high costs and how the use of adjusters can be
operationalized for practical purposes. One payment adjustment that was
universally supported by commenters was the onset adjustment.
MedPAC recommended that CMS develop a one-equation regression model
in place of the two-equation model currently used as the basis for the
ESRD PPS. MedPAC also recommended that CMS consider removing the
comorbidity adjustments and revise the body size adjustment. MedPAC
further recommended that CMS address the inherent correlation between
BSA and BMI by jointly estimating the association of BSA and BMI with
treatment cost. Both BSA and BMI are calculated based on patient height
and weight. MedPAC's analyses found that BSA and BMI values are
correlated such that patients with low BMI also tend to have low BSA,
and that these variables have a joint effect on treatment costs that is
different from the sum of independent effects as currently implemented.
We reiterated in the CY 2022 ESRD PPS final rule our current inability
to implement such a model given the absence of data on the charges
associated with the components of renal dialysis treatment costs that
vary across patients in the use of the formerly composite rate
services. A non-profit renal dialysis association agreed with MedPAC.
(2) Health Equity Considerations Supporting the Proposed Collection of
Time on Machine Data
In the CY 2024 ESRD PPS proposed rule (88 FR 42468), we stated that
CMS prioritizes expansion of the collection, reporting, and analysis of
standardized data as a key means to advance health
[[Page 76402]]
equity.\50\ We explained that by increasing our understanding of the
needs of those we serve, CMS aims to ensure all individuals have access
to equitable care and coverage. We noted that CMS's proposal to collect
time on machine data supports these priorities. We stated that we
believe the proposed data reporting requirements would support our
ability to assess whether, and to what extent, our programs and
policies may perpetuate or exacerbate systemic barriers to
opportunities and benefits for underserved communities.
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\50\ https://www.cms.gov/about-cms/agency-information/omh/health-equity-programs/cms-framework-for-health-equity.
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As noted previously, as part of CMS's December 2018 TEP and in the
ESRD PPS CY 2020 final rule, CMS's EQRS data (formerly collected under
CROWNWeb) is reported once per patient-month. CMS's proposal to collect
time on machine data, which would require duration of treatment data
reported for every renal dialysis treatment, would provide a more
granular set of standardized data for analyzing (and potentially
apportioning) composite rate costs for use in the case-mix adjustment.
We noted that we would also look to time on machine data as a source to
monitor claims data and identify disparities in care that could be
mitigated by potential future adjustments that would incentivize
equitable care within the framework of the ESRD PPS.
As we noted in the CY 2024 ESRD PPS proposed rule, ESRD PPS reform
is an ongoing multi-year effort to refine payment adjustments and
methodologies under the ESRD PPS. Section 1881(b)(2)(B) of the Act
provides that the Secretary shall prescribe in regulations any methods
and procedures to determine the amounts of payments to be made for part
B services (which include renal dialysis services), on a cost-related
basis or other economical and equitable basis. Section 1881(b)(14)(D)
of the Act requires the ESRD PPS to include a payment adjustment based
on case mix that may consider various patient characteristics and other
appropriate factors.
Since the establishment of the ESRD PPS in the CY 2011 ESRD PPS
final rule (75 FR 49030), CMS has been engaged in ongoing monitoring
and analysis of the ESRD PPS. CMS publishes these monitoring results
regularly.\51\ CMS's monitoring activities have involved analysis of
ESRD facility cost reports and patient claims to determine the most
accurate adjustments and methodologies as well as to identify trends in
beneficiary health outcomes. Similarly, we noted that the proposal in
the CY 2024 ESRD PPS proposed rule to collect more-detailed
standardized data (that is, the proposed time on machine reporting)
than is presently available for analysis supports our ability to
evaluate potential disparities in health care provided to our
beneficiaries.
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\51\ Since the implementation of the ESRD PPS in January 2011,
CMS has monitored outcomes, through a claims-based monitoring
program, for Medicare beneficiaries receiving outpatient maintenance
dialysis. See https://www.cms.gov/medicare/medicare-fee-for-service-payment/esrdpayment/esrd-claims-based-monitoring.
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Presently, CMS adjusts the per-treatment ESRD PPS base rates to
account for variation in the case mix, as set forth in Sec. 413.235.
These adjustments account for patient age, BSA, low BMI, onset of renal
dialysis (new patient), and comorbidities (for example, sickle cell
anemia), as specified by CMS. We explained in the CY 2024 ESRD PPS
proposed rule that the data and information that inform these
adjustments are derived from cost reports, which are submitted to CMS
on the facility level. However, we noted that time on machine data
would be provided to CMS at the patient level on patient claims. This
change would shift CMS's focus to a more patient-centered paradigm. We
stated that we believe time on machine data would provide the insights
we need to develop (and propose) potential amendments to the payment
multipliers for the current, and potential future, patient-level
adjustments, including new SDOH factors or health conditions (such as
profound post-dialytic exhaustion) as patient-level adjustments. More
immediately, however, time on machine data would significantly enhance
CMS's insight into whether our current payment adjusters are
appropriately aligning with actual resource use for individuals and
communities who are underserved or disadvantaged and who may have
multiple patient-level characteristics that necessitate longer renal
dialysis times.
For example, CMS is aware of anecdotal evidence and published
studies showing that patients with the comorbidity of sickle cell
anemia may need a longer renal dialysis treatment time as well as
additional resources from medical staff to attend to the manifestations
of sickle cell that occur during dialysis. In fact, renal dialysis
patients with sickle cell anemia may have frequent pain attacks during
the actual renal dialysis treatment.\52\ Such an attack, known as a
vaso-occlusive pain crisis, precipitates a series of medical
interventions involving intravenous fluids, analgesia, as well as the
treatment of any precipitant and/or acute comorbid state.\53\ CMS would
be able to use time on machine data for patients with sickle cell
anemia to evaluate its alignment with the patient-level adjuster for
the corresponding co-morbidity.
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\52\ Benjamin Jacob et al. Management of the Dialysis Patient
with Sickle Cell Disease (Seminars in Dialysis 14 July 2015, https://doi.org/10.1111/sdi.12403).
\53\ Derebail VK, Lacson EK Jr, Kshirsagar AV, Key NS, Hogan SL,
Hakim RM, et al.: Sickle trait in African American hemodialysis
patients and higher erythropoiesis-stimulating agent dose. J Am Soc
Nephrol 25: 819-826, 2014.
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In addition to re-evaluating and potentially updating the payment
multiplier for the patient-level adjuster for the co-morbidity of
sickle cell anemia, we noted that we anticipate that there could be
other instances where patients need more time on renal dialysis to
avoid uncomfortable post-dialytic sequela, such as profound post-
dialytic exhaustion. In instances of profound post-dialytic exhaustion,
for example, CMS would evaluate the forthcoming time on machine data
for the potential correlations between additional hemodialysis
treatment time and decreased incidence of profound post-dialytic
exhaustions, which may have cost implications. We stated that we are
aware there may be a need for a future patient-level payment adjuster
associated with post-dialysis fatigue.
(3) Requirement for Reporting Time on Machine Data To Evaluate Accuracy
of Current Payment Adjusters Aligned With Resource Use
In the CY 2024 ESRD PPS proposed rule (88 FR 42469), we proposed to
require patient-level reporting on resource use involved (time on
machine) in furnishing in-center hemodialysis treatment in ESRD
facilities, which would serve as a proxy to apportion composite rate
costs (capital, labor, and administrative costs, as well as drugs,
laboratory tests, and supplies necessary to administer the dialysis
treatment) for use in the case-mix adjustment. This would allow us to
more precisely estimate the average costs of the various earlier-
mentioned components of a renal dialysis treatment that cannot
currently be captured because payment for these items is bundled, and
claims data do not contain detail on the use of these items and
services. We stated that CMS would review the patient-level resource
use data, including time on machine data, to evaluate and monitor the
accuracy of the methods and procedures, including the payment
methodology for the patient-level adjustment factors,
[[Page 76403]]
enhancing the integrity of the ESRD PPS. In addition, we stated that
CMS would evaluate whether the data could be used to inform future
refinements to the existing patient-level adjustment factors set forth
at Sec. 413.235(a), which may include age, BMI, BSA, and co-
morbidities such as sickle cell anemia. Finally, we stated that CMS
would review the data for its potential to identify any disparities
from a health equity perspective and to support the future proposal of
any new patient-level adjustment factors, including potential SDOH
factors. We noted that such data may also be used to inform potential
future refinements to the facility-level adjustment factors, if
appropriate. We stated that per Sec. 413.196, we would publish notice
of any proposed changes to payment adjustments, including adjustments
to the composite rate, in the Federal Register.
(a) Changes to 42 Sec. 413.198
We proposed to amend Sec. 413.198 by adding language at Sec.
413.198(b)(5) that would require each ESRD facility to submit data and
information, under existing paragraph Sec. 413.198(b)(3) describing
allowable costs, of the types and in the formats established by CMS,
for the purpose of estimating patient-level and facility-level
variation in resource use, such as data and information on the duration
of hemodialysis treatment (that is, time on machine data) involved in
furnishing hemodialysis treatment in center in an ESRD facility. For
additional context, we noted that, under Sec. 413.198(b)(3), allowable
cost is the reasonable cost related to renal dialysis treatments.
Reasonable cost includes all necessary and proper expenses incurred by
the ESRD facility in furnishing the renal dialysis treatments, such as
administrative costs, maintenance costs, and premium payments for
employee health and pension plans. Reasonable cost includes both direct
and indirect costs and normal standby costs.
We also proposed to update Sec. 413.198(a) by adding a reference
to section 1881(b)(14) of the Act to acknowledge the statutory
provisions for the ESRD PPS.
(b) Additional Background Considerations for, and Comments and
Responses Thereto on, the Proposed Reporting of Time on Machine Data
As we noted in the CY 2024 ESRD PPS proposed rule, CMS reviewed
past comments from its TEPs and RFIs and considered the approach of our
now-rescinded sub-regulatory guidance in Transmittal 10368 and the
complexities of reporting the number of minutes of hemodialysis
treatment on patient claims. With this background in mind, we further
refined our proposed requirements at Sec. 413.198(b)(5) in a way that
would result in the reporting of the most useful, high value data.
Considering past comments questioning the feasibility and accuracy
of time on machine reporting for home dialysis patients, we proposed a
reporting requirement that would only apply to patients receiving an
in-center hemodialysis treatment. We explained that we believe this
approach would ensure greater uniformity to the recording process and
thus greater consistency in the data reported.
CMS also considered past comments responding to its RFI in the CY
2020 ESRD PPS final rule (84 FR 60648, 60782) regarding patient-level
factors that contribute to high costs of care. We stated that we agree
with commenters that expressed that patient-level adjusters should be
based on sound, empirical evidence of their contribution to cost of
care.
We noted in the CY 2024 ESRD PPS proposed rule that we agree that
the payment multipliers for patient-level adjusters should be grounded
in strong evidence, and we recognize that each patient will have unique
needs, with some being more costly to treat and others with fewer
costs, given their medical backgrounds. We emphasized and again
clarified that time on machine data would not be directly used to
determine payment for renal dialysis services, nor would higher
payments be made for longer treatments.
We also considered comments suggesting that a ``time on machine''
data element would not identify high-cost patients and comments
suggesting such a data element would not be productive as described
earlier in this section. We stated that we agree with commenters that
treatment times and costs may be similar across most patients based on
our analysis and the comments of TEP participants. However, we would
not expect to find that ESRD facilities are treating ESRD patients in a
homogeneous fashion, but on a case-by-case basis determined by patient-
centered plans of care. We noted that a review of CY 2016 cost report
data, conducted as part of the December 2018 TEP,\54\ showed that
overall costs of renal dialysis services (within the ESRD facility cost
reports) increased with longer treatment times, and that this pattern
was consistent for the individual cost report components.
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\54\ As presented on Slide 42 from the December 2018 TEP,
overall costs of renal dialysis services (within the ESRD facility
cost reports) increased with longer treatment times. See https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Downloads/ESRD-PPS-TEP-Presentation.pdf.
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We stated in the CY 2024 ESRD PPS proposed rule that we anticipate
that the data that would become available under the proposed
requirement, if finalized, for reporting time on machine data would
provide insight into meaningful, measurable variabilities in certain
costs associated with patient-level characteristics.
We stated that the significance of the time on machine data is
dependent upon the collection of data from a preponderance of patient
claims for in-facility hemodialysis. We further noted that while most
patient claims may come from patients with similar profiles and
treatment plans, the needs of the more complex and resource-intensive
patients can only be identified by CMS through the collection of
patient-level data from across the ESRD PPS patient population. We
stated that complex and resource-intensive patients are frequently
encountered in the ESRD dialysis treatment setting, but it is not
possible to obtain precise estimates of the higher costs of these
patients' hemodialysis treatments from currently reported data. We
identified that cost reports and claims are the two data sources from
which per treatment costs can be estimated. Since cost reports
aggregate data at the facility level, we explained that patient-level
differences in resource use are not detectable as higher medical needs,
and related costs are masked by averages. Further, analysis of claims
data from 2016 found that roughly 99 percent of ESRD facilities
reported 10 or fewer distinct charge values across all patients and
treatment modalities.\55\ Routinely collected, ESRD patient population-
based data on time on machine for each in-facility hemodialysis
treatment would enable CMS to assess variation in the use of composite
rate items and services at the patient level and to identify high-need
and high-cost patients. In addition, the time on machine data set would
enable CMS to further determine what trends or causal relationships may
exist between certain patient-level characteristics and the
[[Page 76404]]
number of minutes of hemodialysis treatment received by such patients.
CMS would evaluate whether specific patient characteristics are
associated with increased length of dialysis treatment, which
contribute to cost.
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\55\ See page 9 of the December 2018 TEP Report at https://
www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/
Downloads/ESRD-PPS-TEP-Summary-Report-June-2019.pdf. See also Slide
27 from the December 2018 TEP Presentation at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Downloads/ESRD-PPS-TEP-Presentation.pdf.
And see Slide 30 from the December 2019 TEP Presentation at
https://www.cms.gov/files/document/end-stage-renal-disease-prospective-payment-system-technical-expert-panel-presentation-december-2019.pdf.
---------------------------------------------------------------------------
We also considered comments that the costs to ESRD facilities for
providing dialysis treatment could be better measured by looking at
costs based on prescribed time, and not on the actual time a patient is
on the dialysis machine. The commenters stated their view that looking
to prescribed time(s) would be the most rational way to determine
staffing levels (and costs), because ESRD facilities plan for dialysis
session length based on the prescribed time. Although CMS recognizes
ESRD facilities' labor practices to align staffing with the stated
prescription times, CMS is concerned that, for some patients, their
prescription times are not aligning with actual usage and thus may not
be the best predictor of ESRD facilities' costs. For example, we noted
that we are aware that patients who experience severe itching or have
certain psychological disorders may be less likely to receive dialysis
for the full prescribed time. For such patients, only the collection of
time on machine data for the number of minutes of hemodialysis
treatment received would facilitate CMS's understanding of their
complex needs and the implications for the ESRD PPS. For such patients,
a pattern of shorter treatment times may ultimately result in worse
patient outcomes and higher patient costs to the ESRD facility as well
as to Medicare. We stated that CMS is also aware that patients with
certain characteristics, such as higher BSA quartiles, may be more
likely to need longer dialysis times.\56\ Additionally, CMS has been
made aware of instances in which ESRD facilities may avoid treating
complex patients or patients with higher costs generally (thereby
favoring average or lower cost patients). We noted that prescribed
dialysis times would not provide insight into costs for dialysis
sessions for patients whose individual needs or circumstances might
necessitate a dialysis treatment time that differs in practice from the
prescribed dialysis time. Therefore, identifying actual resource usage,
as correlated with the needs, health outcomes, and patient-level
characteristics of complex patients would enable CMS to better align
the payment multipliers with resource use within the ESRD PPS.
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\56\ See slide 31 from the 2020 ESRD TEP presentation, which can
be found here: https://www.cms.gov/files/document/end-stage-renal-disease-prospective-payment-system-technical-expert-panel-presentation-december-2020.pdf.
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We stated that we anticipate that our proposed requirement would
generate the data we would need to evaluate a potential adjustment of
the payment multipliers for patient level adjustments, thereby allowing
us to counteract possible financial disincentives to serving those
patients. We noted that we expect that such adjustments may thereby
enhance access to renal dialysis services for such resource-intensive
patients. We also believe that collecting time on machine data is
preferable to collecting prescribed times, since we recognize that
patients' actual experiences do not always align with their doctors'
orders.
We recognized that a new reporting requirement would require
uniformity in its implementation across ESRD facilities. We noted that
the proposed ``time on machine'' requirement is for the reporting of
the number of minutes of hemodialysis treatment a beneficiary receives,
and it refers to only the minutes (reported in whole minutes) spent
dialyzing, while the patient is connected to the dialysis machine. We
stated that we would address such details in operational guidance.
We received numerous public comments on our proposal in the CY 2024
ESRD PPS proposed rule to require reporting of time on machine data
from a broad array of interested parties. Commenters included
professional associations, advocacy organizations, large dialysis
organizations, independent and regional dialysis providers, individual
physicians, other healthcare providers, and patients.
The majority of the commenters generally opposed the requirement,
but some commenters expressed support. Many commenters were supportive
of CMS's effort to develop a patient cost model and to pursue future
refinements that would advance health equity in the ESRD PPS. However,
commenters questioned the utility of time on machine data and expressed
concern for the additional administrative burden collecting and
reporting the data would entail. Commenters expressed concerns about
the adverse effects on specific populations. The comments on our
proposal and our responses are set forth below.
Comment: Some commenters expressed support for establishing a
patient cost model that is based on a single patient-level cost
variable. MedPAC reiterated its support for collection of time on
machine data, which the commission previously noted in their comments
on the CY 2022 ESRD PPS proposed rule. MedPAC agreed with CMS that
these data could be used in the future to apportion composite rate
costs (including labor and capital-related costs) that are currently
only observable at the facility-level to the patient- or treatment-
level for use in case-mix adjustment. One large dialysis organization
expressed appreciation for CMS's acknowledgement that the current two-
equation payment model has intricacies that can be mitigated by moving
toward a single patient-level cost variable. This commenter asserted
that using a patient-level cost variable would more accurately align
treatment cost to payment. Further, the commenter urged transparency
and inclusion of the dialysis community in moving forward with the
development of a patient-level cost variable.
Response: CMS appreciates the support expressed by MedPAC and other
commenters for moving toward a patient cost model. As we discussed in
the CY 2024 ESRD PPS proposed rule and reiterate in this final rule,
the proposed requirement for reporting time on machine data is the
first step toward creating the kind of patient cost model that
commenters acknowledged would have advantages over the current cost
model. As we discuss later in this final rule, we intend to analyze
time on machine data for the purposes of creating a patient-level cost
variable for potential future refinement to the ESRD PPS case mix
adjusters. We intend to undertake further rulemaking in subsequent
years to address various considerations, including the methodology for
allocating composite rate costs to patients for the development of a
patient-level cost variable. Interested parties would have the
opportunity to comment on the methodology used in CMS's analysis to
support such development at that time. We look forward to actively
engaging with the public throughout that process in the future.
Comment: Several commenters, including a network of dialysis
organizations, State regional offices, a non-profit organization of
ESRD networks, an individual commenter, a national organization of
patients and kidney health care professionals, MedPAC, an ESRD
facility, and patients advocated for evaluating disparities in the ESRD
PPS, to refine case-mix adjusters in a way that would improve payment
accuracy, promote health equity, and ensure quality of patient care. A
national organization of patients and kidney health care professionals
voiced support for aligning patient characteristics and co-morbidities
more accurately to case-mix adjusters to
[[Page 76405]]
establish that patients are receiving patient-centered care.
One commenter explained that his research has demonstrated that
slower, longer dialysis sessions have a positive impact on patient
health and mortality. In addition, several commenters described serious
issues with shortened dialysis treatments contributing to reduced
quality of care. One patient reported an incident in which they lost
consciousness during treatment and no staff member responded. Several
patients indicated they did not receive education regarding home
modalities for years after beginning dialysis treatment. Two patients
reported disregard and lack of education by physicians. Several
patients reported additional quality of care issues, including starting
dialysis treatment late or being removed from dialysis treatment early,
being requested to move their treatment time frequently, being moved to
another ESRD facility for treatment, and even being requested to skip
dialysis treatment.
Response: We appreciate the support for advancing health equity and
quality of care through refinements to the ESRD PPS case mix adjusters.
We believe that time on machine data, which we proposed to collect
beginning January 1, 2025, would support CMS's analysis of disparities
and support potential future refinements to advance health equity. Time
on machine data can help inform CMS's understanding of the relationship
between resource use and many of the issues reported by patients
related to lack of staff time to address education or side effects of
dialysis treatments. Monitoring time on machine data will enable CMS to
address patient concerns about the possibility of being removed from
treatment early or started late and receiving shortened treatments. Any
potential new case-mix adjusters or changes to the case-mix adjusters
would be the subject of separate rulemaking, and as we noted earlier in
this final rule, interested parties would have the opportunity to
comment on the methodology used in CMS's analysis to support such
development at that time.
Comment: MedPAC recommended that CMS consider the collection of
time on machine data for Medicare Advantage (MA) dialysis
beneficiaries, as the share of dialysis beneficiaries enrolled in MA
plans now exceeds 40 percent. Doing so, MedPAC explained, would enable
the agency to identify, assess, and address potential health
disparities among both FFS and MA beneficiaries.
Response: We appreciate the recommendation from MedPAC to collect
time on machine data for MA beneficiaries, but we note that the
collection of data related to services provided to beneficiaries
enrolled in MA is outside the scope of this final rule.
Comment: Several commenters, including a coalition of dialysis
organizations, a non-profit kidney care alliance, and a non-profit
dialysis organization, raised various concerns about the validity and
sufficiency of time on machine data for the purpose of measuring
patient resource use. One large dialysis organization requested details
about how CMS would validate the time on machine data it proposes to
collect. Several commenters claimed that shorter time on machine does
not correlate with lower costs, and that time on machine data is not an
accurate predictor of facility-level composite rate costs, since time
on machine does not capture the full scope of services rendered.
Specifically, commenters noted that time on machine fails to capture
services provided before and after the actual dialyzing time, such as
time spent working with social workers. Commenters expressed concern
that use of such data would misinform payment model refinements.
Commenters also noted that patient characteristics such as pain,
co-morbidities, or an inability to adhere to the prescribed length of
dialysis time, all contribute to variation in time on machine. A
coalition of dialysis organizations asserted that the costs of all
these patients would remain the same regardless of their time on
machine. Several commenters expressed concern regarding the accuracy of
data for patients that require the dialysis treatment to be suspended
or for dialysis treatment to be ended early due to medical or other
needs. One non-profit treatment and research center expressed that some
patients may have personal needs that require working with staff while
they are not connected to a dialysis machine, that some patients may
need to have dialysis treatment interrupted for a variety of needs,
such as mechanical issues, bathroom breaks, and blood pressure issues;
therefore, some patients do not complete the full dialysis treatment
ordered by the physician.
Various commenters, including a professional organization of
nephrologists, a non-profit dialysis association, and a large dialysis
organization, suggested that CMS exclude certain types of dialysis from
the proposed reporting requirement because of concerns about data
quality. Commenters suggested excluding time on machine data collection
for home dialysis patients, AKI patients, and nocturnal dialysis
patients. Furthermore, several commenters expressed their concern that
underserved or disadvantaged populations would be allocated fewer
resources because of inaccuracies in time on machine data.
Specifically, commenters noted that pediatric patients require highly
individualized prescription time due to patient size and blood volume,
which would not be indicative of health disparities. Lastly, one large
dialysis organization requested that CMS track disasters and remove any
data related to shortened treatments from the data.
Response: We appreciate the concerns that commenters raised
regarding the validity and sufficiency of the data. Many of the
concerns that commenters raised about potential issues of data quality
can be addressed through CMS's analysis of the data. We note that
methodological considerations related to allocating costs based on time
on machine data or any other data would be addressed in future notice
and comment rulemaking.
First, regarding the question about how CMS intends to validate the
data, it is not clear whether the commenter is referring to validating
that ESRD facilities are reporting accurate and complete information,
or ensuring the statistical validity of aggregated data CMS uses for
analysis. In the former case, as we noted in the CY 2024 ESRD PPS
proposed rule, requiring reporting of time on machine data on a claim,
by definition, would involve an attestation that the information
submitted is correct and that the items represent expenses for
medically necessary services. CMS reserves the right to request
documentation from the provider validating the time on machine data,
and to recoup payment if this documentation is not provided or
supportable, as well as to take other administrative actions, as
appropriate. We note that prescription data and historically reported
monthly time on machine data is available in EQRS and can be used for
the purposes of comparison. In the case of ensuring the statistical
validity of data used for future analysis, we note that CMS has
historically applied statistical trims to remove outlier values and
erroneous data and could employ similar methods for future analyses.
As commenters rightly pointed out, time on machine data does not
account for costs that ESRD facilities incur before and after the time
spent dialyzing. As we previously discussed in the CY 2020 ESRD PPS
proposed rule (84 FR 38396 through 38400), patient-level differences in
composite rate costs could be attributed to two discrete
[[Page 76406]]
categories: differences due to renal dialysis treatment duration
(measured in units of time); and differences unrelated to treatment
duration. The collection of time on machine data for each dialysis
session would support the development of a patient-level cost model,
with respect to the portion of composite rate costs that are
attributable to dialysis duration. We would consider additional data
and information to inform our allocation of costs that are not related
to dialysis duration, such as time spent with social workers.
Importantly, however, without a measure of dialysis duration, which we
have proposed to collect as time on machine data reported on claims, it
would not be possible to develop a comprehensive patient-level cost
model in the future.
We disagree with the commenter that the cost to care for patients
is unchanged regardless of pain, co-morbidities, or adherence to
prescribed dialysis treatment schedule based on time on machine. CMS
published the findings from the December 2018 TEP in a report dated
June 2019.\57\ The 2018 TEP report provides clear evidence that in
general, longer treatment duration is associated with higher costs.
First, as discussed in the 2018 TEP report, an imputed cost per
treatment was calculated using a combination of treatment duration data
from CROWNWeb \58\ (now EQRS) and facility cost per-minute data from
cost reports to infer differences in costs across patient-months. An
average interquartile range of 34.6 minutes was observed from CROWNWeb
duration data, indicating significant within-facility variation in
dialysis treatment time. Significant variation in average imputed cost
per hemodialysis sessions also was observed, with an across-facility
interquartile range of $62.62. Overall, it was found that costs
increased with longer treatment times, and this pattern was consistent
for the individual cost report components as well. Facilities with a
higher proportion of beneficiaries receiving treatments >=4.5 hours
duration were found to have higher average costs for each cost
component, except for cost report drugs.\59\
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\57\ The final TEP report from December 2018 is found directly
at: https://www.cms.gov/medicare/medicare-fee-for-service-payment/esrdpayment/downloads/esrd-pps-tep-summary-report-june-2019.pdf.
\58\ In 2008, CMS introduced an electronic Web-based data
collection system, Consolidated Renal Operations in a Web-enabled
Network (CROWNWeb) which was designed to collect clinical
performance measures data from dialysis facilities (73 FR 20370, at
20372). CROWNweb is now ``EQRS''--that is, the ESRD Quality
Reporting System (OMB Control Number 0938-1289).
\59\ Acumen LLC. ESRD PPS Case-Mix Adjustment Technical Expert
Panel (TEP). Slide Presentation Slide 42. December 2018. See https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Downloads/ESRD-PPS-TEP-Presentation.pdf.
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Lastly, we recognize that the unique needs of particular
subpopulations such as pediatric patients, AKI patients, nocturnal
patients, and patients with social needs may affect time on machine
data. We intend to consider such patient characteristics when proposing
a methodology for allocating composite rate costs in the future. We do
not believe it would be appropriate to exclude these subpopulations
from the analysis entirely, because doing so would result in
refinements to the ESRD PPS that in no way account for the unique needs
of these subpopulations. Rather, we intend to look for ways to analyze
and understand the impacts of such patient characteristics on treatment
duration. For example, because commenters have indicated time on
machine may be shortened due to social factors, we would encourage ESRD
facilities to use Z codes when submitting ESRD PPS claims as
appropriate to note when social factors affect treatment time or other
aspects of treatment. For instance, if a patient has transportation
issues necessitating removal from treatment early, the ESRD facility
could include Z59.82 (Transportation insecurity), or if the patient has
difficulty in understanding the education provided related to the
importance of completing treatments the ESRD facility could use Z55
(Problems related to education and literacy) to indicate the
psychosocial need to be addressed. The coding of this type of
information, when clinically appropriate, would support CMS's efforts
to understand the impact of social determinants of health, and other
factors, on treatment duration and patient-level cost.
Comment: Many commenters stated that collecting time on machine
data would place a significant administrative burden on ESRD
facilities, including for facilities that utilize EHR systems, but
especially for smaller facilities and facilities that lack EHR
capabilities. Commenters expressed that the time-consuming task of
reporting time on machine would add to ESRD facilities' costs and would
have a negative impact on time available for patient care during a
prolonged period of workforce shortage.
Several commenters suggested alternative data sources that CMS
could consider using in order to avoid the burden associated with the
proposed collection of time on machine on claims. Some commenters
suggested that existing CrownWeb (now EQRS) clinical data on time on
machine, collected once monthly in conjunction with blood urea nitrogen
(BUN) laboratory testing, could be used instead, reducing the burden on
providers to collect data for each treatment. A non-profit kidney care
alliance indicated while time on machine data may be interesting, there
may be superior alternatives as a proxy to apportion composite rate
costs; however, they did not provide any alternatives to time on
machine as a proxy. Some commenters encouraged the use of physician
prescribed time, rather than actual time on machine, as it reflects how
ESRD facilities are staffed. One commenter suggested defining time on
machine as blood volume processed >0, as this would enable CMS to
capture resources expended on sequential ultrafiltration.
Several other commenters suggested limiting the scope of the
proposed data collection to reduce burden. Some commenters suggested
limiting time on machine data collection to a subset of dialysis
facilities or treatments. MedPAC urged CMS to be mindful of the
potential for increased administrative burden on ESRD facilities and
consider collecting these data for a finite period of time, only as
long as needed to explore refining the payment adjustment factors.
Response: We acknowledge that collecting time on machine data will
increase administrative burden for ESRD facilities, especially those
for whom the collection of such data will have to be done manually.
However, we do not agree that the proposed reporting requirement will
substantially impact time available for patient care, as some
commenters suggested. We anticipate that ESRD facilities will employ
medical records technicians or similar non-direct-care staff to
aggregate time on machine data and report it on claims. Furthermore, as
we stated in the CY 2024 ESRD PPS proposed rule (88 FR 42466), for
facilities that have already automated the collection of machine-
generated data directly into the patient electronic medical record,
this burden should be minimal. CMS will work to provide timely
operational guidance about the reporting requirement for time on
machine information so that facilities may prepare their information
technology (IT) or EHR systems or other processes to collect and report
complete time on machine data by January 1, 2025. We have revised our
burden estimate in the regulatory impact
[[Page 76407]]
analysis in section VII.D.2.a of this final rule to reflect the
additional burden associated with aggregating time on machine data from
the patient record and reporting it on the claim.
We appreciate commenters' suggestions regarding alternative sources
of data. As we discuss earlier in this final rule, we believe time on
machine is the most appropriate source of data for our proposed
purpose. In contrast to the sources that commenters suggested, time on
machine data would provide more comprehensive information about the
actual quantity of dialysis that a patient receives each month. As we
have previously noted, past analysis has demonstrated a statistically
significant relationship between a patient's total time on machine and
resource utilization.
In addition, we appreciate the suggestion to limit time on machine
data collection to a subset of dialysis facilities to drive the
revision of case-mix adjusters. However, we believe this would be
counterproductive, because analysis of a subset of facilities could
skew the data and impact the accuracy of case-mix adjusters for the
ESRD PPS in its entirety. We also appreciate the recommendation from
MedPAC to limit the duration of data collection to the length of time
necessary to develop methodology to use for case-mix adjustment.
Without collection, review, and assessment of the time on machine data,
we cannot provide an estimate of the length of time CMS will need to
collect the data. We will consider the recommendation from MedPAC and
the level of burden that reporting places on ESRD facilities in the
future. We intend to monitor and potentially propose modifications to
this policy, as appropriate, through future notice and comment
rulemaking.
(c) Using a Medicare Claims Data Field To Report Time on Machine Data
In the CY 2024 ESRD PPS proposed rule (88 FR 42471), we proposed
that ESRD facilities report the number of minutes of hemodialysis
treatment received in center in an ESRD facility using the D6 value
code on the Medicare 72X type of bill (TOB) that is part of CMS's claim
form CMS-1450 (UB-04) (OMB-0938-0997). While our proposal limited the
time on machine reporting requirement to in-center claims, to address
the concerns previously raised by interested parties about the burden
and complexity of home dialysis reporting, we noted that time on
machine for home dialysis data could nonetheless be voluntarily
reported using the D6 value code on claims.
This approach would address long-standing concerns, including such
concerns raised by MedPAC and other interested parties, that CMS should
move to a one-equation model. We stated that we agree with interested
parties that a single-equation model, to be constructed at the patient
level, would reduce the complexity of the current model, and would
better align payment with costs. The current two-equation model's
payment adjusters are derived using weighted averages of the
coefficients from the facility-level and patient-level equations.
Because the composite rate items currently comprise roughly 90 percent
of the payment, we stated that we are seeking a more detailed
understanding of patients' utilization of such treatment resources. We
noted that we anticipate that the time on machine data would provide a
useful proxy for these composite rate items.
Furthermore, we noted that the proposal to collect time on machine
data on patient claims would address past comments on whether such a
reporting requirement could create perverse incentives for ESRD
facilities to amend actual reported time on machine. Another past
commenter expressed concern about whether an ESRD facility might have
the renal dialysis run a few extra minutes to increase the payment.
However, we noted that requiring the reporting of time on machine data
on a claim, by definition, would involve an attestation that the
information submitted is correct and that the items presented represent
medically necessary expenses. The False Claims Act (31 U.S.C. 3729 to
3733) establishes civil liability for knowingly presenting a false or
fraudulent claim to the government for payment.
We noted that if the requirement to report time on machine
information on claims is finalized, we would issue operational guidance
in support of the requirement. We stated that such guidance would
describe the applicable instructions for reporting a value code (in
this case, the D6 \60\ value code) connected to the number of minutes
of hemodialysis treatment provided to a patient in center.
---------------------------------------------------------------------------
\60\ Value code D6 on claim form CMS-1450 (UB-04) (OMB-0938-
0997), for reporting the total number of minutes of dialysis
provided during the billing period.
---------------------------------------------------------------------------
The majority of the commenters expressed concerns about the need
for specific operational guidance and about exclusions and missing
data. The comments on our proposal and our responses are set forth
below.
Comment: Several commenters, including a non-profit kidney care
alliance, a coalition of dialysis providers, and large dialysis
organizations requested clarification about the scope and
specifications of the proposed reporting requirement. Commenters
requested CMS to clarify its proposed definition of time on machine and
how ESRD facilities would be expected to collect and report such data
under the proposed requirement. A coalition of dialysis providers
stated that there are inconsistencies in the methodology used across
health care providers for the collection of time on machine data and
that CMS will need to provide guidance to ensure data is accurately
provided. Two large dialysis organizations recommended CMS define time
on machine data collection using an approach like that used in the ESRD
Measures Specification Manual associated with the ESRD QIP.\61\ One
large dialysis organization recommended using ``clock time'' to measure
time on machine. We note that the commenter did not specify a meaning
for the term ``clock time''; however, we interpret this to mean the
total number of minutes between the beginning of dialysis and the end
of dialysis, without accounting for any interruptions. Clock time, the
commenter suggested, could be utilized by all ESRD facilities, since it
would not require networked electronic medical records. Another large
dialysis organization requested confirmation that ESRD facilities would
be required to report time on machine for all in-center dialysis
treatments, including those provided under special circumstances for
patients who normally perform dialysis treatments at home.
---------------------------------------------------------------------------
\61\ https://www.cms.gov/files/document/cy-2023-final-technical-specifications-20230613.pdf.
---------------------------------------------------------------------------
Response: We appreciate these requests for clarification from the
commenters. Although we intend to publish detailed operational
guidance, we are taking the opportunity in this final rule to respond
directly to the questions that commenters posed. First, while we
appreciate the recommendation that we use the ESRD Measures
Specification Manual as a guide to define data collection, we note that
the manual does not define time on machine in a way that is useful for
our purposes. Rather, for the purposes of this reporting requirement,
we are clarifying that we generally define time on machine as the total
number of minutes between the beginning of dialysis and the end of
dialysis, without accounting for any interruptions, which
[[Page 76408]]
we believe one commenter referred to as ``clock time'', as noted
earlier. We do not intend for ESRD facilities to track minutes for
interruption during dialysis due to frequent alarms or when a patient
is removed from dialysis treatment to go to the bathroom, nor do we
expect facilities to subtract those minutes of interruption from the
time on machine that is reported. We expect these episodes to be
infrequent and time-limited, and generally not a significant driver of
aggregate variation in total time on machine between patients. Thus,
time on machine for each dialysis treatment can be calculated by
subtracting the time the dialysis treatment started from the time the
treatment ended. For each ESRD PPS claim, the ESRD facility should
report in the D6 value code the total number of minutes across all
treatments provided to the patient during the billing period, which is
typically a month. Lastly, regarding the comment about in-center
dialysis treatments provided under special circumstances for patients
who normally perform dialysis treatments at home, we are clarifying
that time on machine data must be reported for all dialysis treatments
that are provided in-center, even if the patient usually uses a home
modality. In such circumstances, the ESRD facility should be billing
for in-center dialysis treatments on a separate claim from any home
dialysis treatments, with the appropriate indicators to reflect that
the treatment is being provided in-center.
Comment: Several commenters requested clarification about how to
report time on machine in various exceptional circumstances. One large
dialysis organization stated that CMS should provide guidance regarding
how to report time on machine during certain infrequent anomalous
circumstances such as power outages, network failures, mechanical
issues or failures, or emergency circumstances when treatments must be
shortened. One large dialysis organization requested CMS to
differentiate between when time on machine data is captured manually
and when it is captured electronically. Commenters also expressed
concern about whether ESRD facilities would be paid for treatments for
which time on machine was missing and requested that payment should not
be withheld for missing time on machine data (that is, claims with no
D6 value). One large dialysis organization requested CMS consider
allowing an error rate of ten percent of total treatments to allow for
unforeseen circumstances.
Response: We appreciate the concerns that commenters raised about
exceptional circumstances. We recognize that circumstances such as
power outages, network failures, mechanical issues or failures,
emergency circumstances, and human error can result in disruptions to
standard workflows and consequently, missing time on machine data for
individual dialysis treatments. We are clarifying that since data for
time on machine is reported as an aggregate value for all dialysis
treatment sessions in one month, we will not return claims that lack
reporting of individual sessions. We will only return claims that have
nothing reported in the D6 value code. Therefore, although we
appreciate the suggestion to allow a ten percent error rate, we believe
it is neither necessary nor appropriate to do so.
At this time, we have not established any specific indicators to
differentiate between time on machine that is collected manually versus
electronically. Nor have we established any identifiers for
circumstances when a patient needs to end his or her dialysis session
earlier than the prescribed time; however, as we discussed earlier in
this final rule, we believe additional information already reported on
claims, such as ICD-10 codes, could provide relevant context for such
circumstances. We may consider developing additional indicators to
identify circumstances like the ones that commenters described, and we
would discuss any such changes in future notice and comment rulemaking.
(d) Use of Time on Machine Data for the ESRD PPS
In our CY 2024 ESRD PPS proposed rule (88 FR 42470), we emphasized
and again clarified that time on machine data would not be directly
used to determine payment for renal dialysis services, nor would higher
payments be made for longer treatments. Rather, we stated that time on
machine data would allow for patient-specific calculation of costs for
composite rate services, including labor costs, costs for the use of
renal dialysis machines and related equipment, and costs for such items
as dialysate and other essential supplies. We noted that, in this way,
time on machine data would be used to disaggregate facility-level
composite rate costs (as obtained from the cost reports) and assign
them to the patient-month level, which would enable a refined, single-
equation estimation methodology. The refined, single-equation
regression analysis (currently under development) would still be used
to determine the inclusion/exclusion and magnitude of payment
multipliers for patient-level case-mix flags that are associated with
higher costs. We wrote that final payment adjustments would still only
depend on existing patient-level case-mix adjustors, rather than a
factor directly derived from time on machine data.
Several of the commenters expressed concerns about how the
resultant time on machine data would be used in the model refinement
process to potentially determine payment. The comments on our proposal
and our responses are set forth below.
Comment: Several commenters requested further clarification about
how CMS intends to use the time on machine data. A not-for-profit
dialysis organization expressed concern that reporting time on machine
data would lead to a payment methodology based on minutes of dialysis
provided.
Response: In the proposed rule and this final rule, we have clearly
stated how data collected from time on machine will be used. We will
use time on machine data to help us evaluate and monitor the accuracy
of our payments for patient-level adjustment factors. CMS will also
evaluate whether the data could be used to inform future refinements to
the existing patient-level adjustment factors set forth at Sec.
413.235(a), which include patient age, BMI, BSA, and co-morbidities
such as sickle cell anemia. Finally, CMS will review the data for its
potential to identify any disparities from a health equity perspective
that may support proposing, in future rulemaking, new patient-level
adjustment factors, including potential SDOH factors.
(e) Request for Information About Effective Date
In the CY 2024 ESRD PPS proposed rule, we proposed a January 1,
2025, effective date for this new reporting requirement. We stated that
we are aware that all ESRD facilities record the time a patient has
received hemodialysis treatment into a patient's medical record, and
that, for most ESRD facilities, this time is automatically recorded
into the patient's EHR. We noted that we further understand that ESRD
facilities can transfer data from EHRs into the patient-specific claims
that are submitted to Medicare for payment. However, we recognized that
some ESRD facilities with limited resources may need to make
modifications to their record keeping and reporting systems to
facilitate the transfer of a patient's recorded hemodialysis treatment
time in the patient's medical record to the Medicare claim. Although we
did receive a past comment indicating that a facility's
[[Page 76409]]
implementation time would involve training staff on how to count and
track time, we stated that we do not expect that the manual recording
of a patient's hemodialysis treatment time into their health record is
widespread. Finally, we noted that ESRD facilities are already
reporting extensive information from patient EHRs into Medicare
institutional claim form CMS-1450 (UB-04) (OMB-0938-0997), and we would
not expect implementation to be overly burdensome to ESRD facilities.
We stated that we recognize that some ESRD facilities would need to
establish a new pathway from patient EHRs to the Medicare claim form,
in addition to making simpler programming updates to add a field for
the total number of minutes of dialysis provided during the billing
period. Based on our findings in the TEP from December 2018, we noted
that we anticipate that the implementation challenges that ESRD
facilities might experience would be small and temporary, as a
patient's time receiving dialysis treatment is already collected for
the patient's medical record. We solicited comment on whether an
earlier effective date, such as January 1, 2024, would be feasible and
would provide ESRD facilities with adequate time to implement this new
reporting requirement.
The majority of the commenters expressed concerns about the ability
to make the necessary changes to internal IT systems by a January 1,
2024, reporting requirement. The comments on our proposal and our
responses are set forth below.
Comment: Commenters expressed strong opposition to any start date
earlier than January 1, 2025. A large dialysis organization expressed
that making the necessary operational changes to report time on machine
data would require considerable effort and would not be possible prior
to January 1, 2025. Several commenters called for CMS to allow for at
least one year before implementation for ESRD facilities, including
large dialysis organizations, to program the new requirements into
their IT and EHR systems, and to provide comprehensive guidance before
finalizing this policy. A few commenters also suggested that
operational guidance be issued in conjunction with the CY 2024 ESRD PPS
final rule, and that implementation of the proposed time on machine
reporting requirement be delayed until interested parties have an
opportunity to comment on such guidance.
Response: CMS understands the concerns that commenters raised
regarding lead time needed to develop IT systems and processes in order
to collect and report accurate and complete time on machine data. As we
noted in the CY 2024 ESRD PPS proposed rule, we have proposed an
implementation date of January 1, 2025, for this reporting requirement
to provide what we believe will be sufficient lead time for ESRD
facilities to make these necessary changes to their systems and
operations. Commenters indicated that it would take 1 year for ESRD
facilities to update their systems after the provision of operational
guidance due to systems updates and staff education. We believe that
the 1 year implementation timeline strikes a balance between the need
to collect this data and ESRD facilities' need to make operational
changes.
We also appreciate the concerns of commenters who requested
specific operational guidance, and the opportunity to comment on such
guidance, before the effective date of the proposed reporting
requirement. In this final rule, we have addressed many of the
operational questions that commenters posed. Additionally, as we noted
earlier in this final rule, we intend to issue detailed operational
guidance no later than January 1, 2024. This operational guidance will
address topics such as instructions for the collection and reporting of
time on machine data, detailed billing requirements, including the
types of ESRD PPS claims subject to required reporting of the D6 value
code, and guidance on how to proceed when time on machine for a
qualifying treatment is missing or otherwise unavailable. The proposed
1-year lead time between the issuance of detailed operational guidance
and the effective date of the proposed reporting requirement will
afford CMS the opportunity to engage in further dialogue with
interested parties about such guidance during the CY 2025 rulemaking
cycle. CMS has responded to specific concerns about operational
guidance earlier in this section of this final rule. Further guidance
will be provided by the MACs. Additionally, interested parties may
reach out to CMS to request meetings to discuss and resolve specific
concerns.
Final Rule Action: We are finalizing our proposal to require the
reporting of in-center hemodialysis duration on ESRD PPS claims,
beginning January 1, 2025. Specifically, we are finalizing our proposal
to require ESRD facilities to report ``time on machine,'' with certain
changes to clarify that ESRD facilities are required to report the
number of minutes between the start and end of hemodialysis treatment,
without accounting for interruptions, a beneficiary receives during the
billing period in center in an ESRD facility. We are finalizing our
proposal to require ESRD facilities to report this information using
the D6 value code on ESRD PPS claims. We are codifying this requirement
in regulation at Sec. 413.198(b)(5)(i). As discussed in section
II.B.1.h of this final rule, we are finalizing the addition of Sec.
413.198(b)(5), which states that ESRD facilities must submit data and
information in the formats established by CMS for the purpose of
estimating patient-level and facility level variation in resource use.
(4) Technical Change to Sec. 413.198
We proposed to fix a typographical error in Sec.
413.198(b)(3)(iii), which currently refers to ``luxury items or
servicess''. We proposed to change this to ``luxury items or
services''. CMS did not receive any comments regarding correcting this
typographical error in Sec. 413.198(b)(3)(iii). We are finalizing our
proposal to revise the typographical error in Sec. 413.198(b)(3)(iii),
which currently refers to ``luxury items or servicess'' to ``luxury
items or services''.
k. Clarification to TDAPA Average Sales Price (ASP) Policy
In the CY 2020 ESRD PPS final rule, we finalized a conditional
policy for TDAPA payment based on the availability of ASP data (84 FR
60679). In that final rule, we explained that if drug manufacturers
were to stop submitting full quarters of ASP data for products that are
eligible for the TDAPA, and we had to revert to basing the TDAPA on the
wholesale acquisition cost (WAC) or invoice pricing, we believed we
would be overpaying for the TDAPA for those products. We stated that we
would no longer apply the TDAPA for a new renal dialysis drug or
biological product if a drug manufacturer submits a full calendar
quarter of ASP data into CMS within 30 days after the last day of the
3rd calendar quarter after the TDAPA is initiated for the product, but
at a later point during the applicable TDAPA period specified in Sec.
413.234(c)(1) or (2), stops submitting a full calendar quarter of ASP
data into CMS. We explained that once we determine that the latest full
calendar quarter of ASP is not available, we would stop applying the
TDAPA for the new renal dialysis drug or biological product within the
next 2-calendar quarters. For example, we stated that if we began
paying the TDAPA on January 1, 2021 for an eligible new renal dialysis
drug or biological product, and a full calendar quarter of ASP data is
made available to CMS by October 30, 2021 (30 days after
[[Page 76410]]
the close of the 3rd quarter of paying the TDAPA), but a full calendar
quarter of ASP data is not made available to CMS as of January 30, 2022
(30 days after the close of the 4th quarter of paying the TDAPA), we
would stop applying the TDAPA for the product no later than June 30,
2022 (2 quarters after the 4th quarter of paying the TDAPA).
We adopted this conditional policy to avoid overpaying for the
TDAPA on an ongoing basis and to ensure that TDAPA payment is based on
the most appropriate data, that is, ASP. Specifically, we explained in
the CY 2020 ESRD PPS proposed rule (84 FR 38349) and final rule (84 FR
60680) that we were concerned about (1) increases to Medicare
expenditures due to the TDAPA for calcimimetics; (2) drug manufacturers
not reporting ASP data for products eligible for TDAPA; and (3) our
TDAPA policy potentially incentivizing drug manufacturers to withhold
ASP data from CMS.
In the CY 2024 ESRD PPS proposed rule (88 FR 42472), we discussed
that our existing regulation at Sec. 413.234(c) does not specifically
address the application of the TDAPA conditional policy in situations
in which the manufacturer of the new renal dialysis drug or biological
product submitted ASP data to CMS and reported zero or negative sales.
Zero or negative sales may occur for a variety of reasons, including no
sales, recalls of a product, or repurchases of sold products. In the CY
2012 PFS final rule (76 FR 73296), CMS clarified that zero or negative
values are valid for ASP, ASP units, and WAC. Therefore, when such a
scenario occurs for separately payable Medicare Part B drugs, we
consider the submission of zero or negative sales to fulfill the
reporting requirements of manufacturer ASP data to CMS as set forth in
sections 1927(b)(3)(A)(iii) and 1847A(f) of the Act. We noted that in
situations when zero sales are submitted, CMS guidance \62\ instructs
the manufacturer to report ``0.000'' for the ASP and the number of ASP
units. The payment allowance limits for drugs and biologicals that are
not included in the ASP Medicare Part B Drug Pricing File or Not
Otherwise Classified Pricing File, other than new drugs that are
produced or distributed under a new drug application (or other
application) approved by the U.S. FDA, are based either on the
published WAC or invoice pricing (except under OPPS, where the payment
allowance limit is 95 percent of the published average wholesale price
(AWP)). In determining the payment limit based on WAC, the contractors
follow the methodology specified in Publication 100-04, Chapter 17,
section 20.4 Drugs and Biologicals, for calculating the AWP, but
substitute WAC for AWP. The payment limit is 106 percent of the lesser
of the lowest-priced brand or median generic WAC.\63\ Therefore, for
purposes of the TDAPA conditional policy, in circumstances where a
manufacturer submitted ASP data reflecting zero or negative sales
during the TDAPA period, we clarified that we consider CMS to have
received the latest full calendar quarter of ASP data, and we would not
discontinue TDAPA payment under the conditional policy in Sec.
413.234(c). Consistent with the pricing methodologies for separately
payable Medicare Part B drugs, we would set the TDAPA payment amount
based on WAC, or if WAC is not available, invoice pricing, for the
quarter in which zero or negative sales were reported.
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\62\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Part-B-Drugs/McrPartBDrugAvgSalesPrice/Downloads/ASP_Data_Collection_Validation_Macro_User_Guide.pdf.
\63\ Medicare Claims Processing Manual Chapter 17, section
20.1.3 https://www.cms.gov/Regulations-and-Guidance/Guidance/
Manuals/Downloads/clm104c17.pdf.
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Comment: We received two comments on our proposal to clarify the
ASP data submission requirement. Both commenters, a coalition of
dialysis organizations and a drug manufacturer, agreed with CMS that a
submission reflecting zero or negative sales should not lead to a
discontinuation of TDAPA payment. Both commenters supported this
clarification. The comment from the coalition of dialysis organizations
stated that this policy would support continued patient access to a
drug or biological product that is in the TDAPA period. The comment
from the drug manufacturer expressed further support for the use of
WAC, or if WAC is not available, invoice pricing, when ASP data is not
usable for the purposes of determining the TDAPA payment amount and
post-TDAPA payment amount.
Response: We thank commenters for their support and for their
insight into the importance and impact of this policy.
Final Rule Action: We are finalizing the clarification to the TDAPA
ASP payment policy as proposed; for purposes of the TDAPA conditional
policy, in circumstances where a manufacturer submitted ASP data
reflecting zero or negative sales during the TDAPA period, we consider
CMS to have received the latest full calendar quarter of ASP data, and
we will not discontinue TDAPA payment under the conditional policy in
Sec. 413.234(c). Consistent with the pricing methodologies for
separately payable Medicare Part B drugs, in such circumstances, we
will set the TDAPA payment amount based on WAC, or if WAC is not
available, invoice pricing, for the quarter in which zero or negative
sales were reported.
C. Transitional Add-On Payment Adjustment for New and Innovative
Equipment and Supplies (TPNIES) Clarifications and Application for CY
2024 Payment
1. Background
In the CY 2020 ESRD PPS final rule (84 FR 60681 through 60698), CMS
established the transitional add-on payment adjustment for new and
innovative equipment and supplies (TPNIES) under the ESRD PPS, under
the authority of section 1881(b)(14)(D)(iv) of the Act, to support ESRD
facility use and beneficiary access to these new technologies. We
established this add-on payment adjustment to help address the unique
circumstances experienced by ESRD facilities when incorporating new and
innovative equipment and supplies into their businesses and to support
ESRD facilities transitioning or testing these products during the
period when they are new to market. We added Sec. 413.236 to establish
the eligibility criteria and payment policies for the TPNIES.
In the CY 2020 ESRD PPS final rule (84 FR 60650), we established in
Sec. 413.236(b) that for dates of service occurring on or after
January 1, 2020, we would provide the TPNIES to an ESRD facility for
furnishing a covered equipment or supply only if the item: (1) has been
designated by CMS as a renal dialysis service under Sec. 413.171; (2)
is new, meaning granted marketing authorization by the FDA on or after
January 1, 2020; (3) is commercially available by January 1 of the
particular CY, meaning the year in which the payment adjustment would
take effect; (4) has a Healthcare Common Procedure Coding System
(HCPCS) application submitted in accordance with the official Level II
HCPCS coding procedures by September 1 of the particular CY; (5) is
innovative, meaning it meets the substantial clinical improvement
criteria specified in the Inpatient Prospective Payment System (IPPS)
regulations at Sec. 412.87(b)(1) and related guidance; and (6) is not
a capital-related asset that an ESRD facility has an economic interest
in through ownership (regardless of the manner in which it was
acquired).
[[Page 76411]]
Regarding the innovation requirement in Sec. 413.236(b)(5), in the
CY 2020 ESRD PPS final rule (84 FR 60690), we stated that we would use
the following criteria to evaluate substantial clinical improvement for
purposes of the TPNIES under the ESRD PPS based on the IPPS substantial
clinical improvement criteria in Sec. 412.87(b)(1) and related
guidance:
A new technology represents an advance that substantially improves,
relative to renal dialysis services previously available, the diagnosis
or treatment of Medicare beneficiaries. First, CMS considers the
totality of the circumstances when making a determination that a new
renal dialysis equipment or supply represents an advance that
substantially improves, relative to renal dialysis services previously
available, the diagnosis or treatment of Medicare beneficiaries.
Second, a determination that a new renal dialysis equipment or supply
represents an advance that substantially improves, relative to renal
dialysis services previously available, the diagnosis or treatment of
Medicare beneficiaries means one of the following:
The new renal dialysis equipment or supply offers a
treatment option for a patient population unresponsive to, or
ineligible for, currently available treatments; or
The new renal dialysis equipment or supply offers the
ability to diagnose a medical condition in a patient population where
that medical condition is currently undetectable, or offers the ability
to diagnose a medical condition earlier in a patient population than
allowed by currently available methods, and there must also be evidence
that use of the new renal dialysis service to make a diagnosis affects
the management of the patient; or
The use of the new renal dialysis equipment or supply
significantly improves clinical outcomes relative to renal dialysis
services previously available as demonstrated by one or more of the
following: (1) a reduction in at least one clinically significant
adverse event, including a reduction in mortality or a clinically
significant complication; (2) a decreased rate of at least one
subsequent diagnostic or therapeutic intervention; (3) a decreased
number of future hospitalizations or physician visits; (4) a more rapid
beneficial resolution of the disease process treatment including, but
not limited to, a reduced length of stay or recovery time; (5) an
improvement in one or more activities of daily living; an improved
quality of life; or (6) a demonstrated greater medication adherence or
compliance; or,
The totality of the circumstances otherwise demonstrates
that the new renal dialysis equipment or supply substantially improves,
relative to renal dialysis services previously available, the diagnosis
or treatment of Medicare beneficiaries.
Third, evidence from the following published or unpublished
information sources from within the United States or elsewhere may be
sufficient to establish that a new renal dialysis equipment or supply
represents an advance that substantially improves, relative to renal
dialysis services previously available, the diagnosis or treatment of
Medicare beneficiaries: Clinical trials, peer reviewed journal
articles; study results; meta-analyses; consensus statements; white
papers; patient surveys; case studies; reports; systematic literature
reviews; letters from major healthcare associations; editorials and
letters to the editor; and public comments. Other appropriate
information sources may be considered.
Fourth, the medical condition diagnosed or treated by the new renal
dialysis equipment or supply may have a low prevalence among Medicare
beneficiaries.
Fifth, the new renal dialysis equipment or supply may represent an
advance that substantially improves, relative to services or
technologies previously available, the diagnosis or treatment of a
subpopulation of patients with the medical condition diagnosed or
treated by the new renal dialysis equipment or supply.
In the CY 2020 ESRD PPS final rule (84 FR 60681 through 60698), we
also established a process modeled after IPPS's process of determining
if a new medical service or technology meets the substantial clinical
improvement criteria specified in Sec. 412.87(b)(1). As we discussed
in the CY 2020 ESRD PPS final rule (84 FR 60682), we believe it is
appropriate to facilitate access to new and innovative equipment and
supplies through add-on payment adjustments similar to the IPPS New
Technology Add-On Payment and to provide stakeholders with standard
criteria for both inpatient and ESRD facility settings. In Sec.
413.236(c), we established a process for our announcement of TPNIES
determinations and a deadline for consideration of new renal dialysis
equipment or supply applications under the ESRD PPS. We would consider
whether a new renal dialysis equipment or supply meets the eligibility
criteria specified in Sec. 413.236(b) and summarize the applications
received in the annual ESRD PPS proposed rules. Then, after
consideration of public comments, we would announce the results in the
Federal Register as part of our annual updates and changes to the ESRD
PPS in the ESRD PPS final rule. In the CY 2020 ESRD PPS final rule, we
also specified certain deadlines for the application requirements. We
noted that we would only consider a complete application received by
February 1 prior to the particular CY. In addition, we required that
FDA marketing authorization for the equipment or supply must occur by
September 1 prior to the particular CY. We also stated in the CY 2020
ESRD PPS final rule (84 FR 60690 through 60691) that we would establish
a workgroup of CMS medical and other staff to review the materials
submitted as part of the TPNIES application, public comments, FDA
marketing authorization, and HCPCS application information and assess
the extent to which the product provides substantial clinical
improvement over current technologies.
In the CY 2020 ESRD PPS final rule, we established Sec. 413.236(d)
to provide a payment adjustment for certain new and innovative renal
dialysis equipment or supplies. We stated that the TPNIES is paid for
two CYs. Following payment of the TPNIES, the ESRD PPS base rate will
not be modified, and the new and innovative renal dialysis equipment or
supply will become an eligible outlier service as provided in Sec.
413.237.
Regarding the basis of payment for the TPNIES, in the CY 2020 ESRD
PPS final rule, we finalized at Sec. 413.236 that the TPNIES is based
on 65 percent of the price established by the MACs, using the
information from the invoice and other specified sources of
information.
In the CY 2021 ESRD PPS final rule (85 FR 71410 through 71464), we
made several changes to the TPNIES eligibility criteria at Sec.
413.236. First, we revised the definition of new at Sec. 413.236(b)(2)
as within 3 years beginning on the date of the FDA marketing
authorization. Second, we changed the deadline for TPNIES applicants'
HCPCS Level II code application submission from September 1 of the
particular CY to the HCPCS Level II code application deadline for
biannual Coding Cycle 2 for durable medical equipment, orthotics,
prosthetics, and supplies (DMEPOS) items and services as specified in
the HCPCS Level II coding guidance on the CMS website prior to the CY.
In addition, a copy of the applicable FDA marketing authorization must
be submitted to CMS by the HCPCS Level II code application deadline for
biannual Coding Cycle 2 for DMEPOS items and services as specified in
the HCPCS Level II coding guidance on the
[[Page 76412]]
CMS website in order for the equipment or supply to be eligible for the
TPNIES the following year. Third, we revised Sec. 413.236(b)(5) to
remove a reference to related guidance on the substantial clinical
improvement criteria, as the guidance had already been codified.
Finally, in the CY 2021 ESRD PPS final rule, we expanded the TPNIES
policy to include certain capital-related assets that are home dialysis
machines when used in the home for a single patient. We explained that
capital-related assets are defined in the Provider Reimbursement Manual
(chapter 1, section 104.1) as assets that a provider has an economic
interest in through ownership (regardless of the manner in which they
were acquired). We noted that examples of capital-related assets for
ESRD facilities are dialysis machines and water purification systems.
We explained that, although we stated in the CY 2020 ESRD PPS proposed
rule (84 FR 38354) that we did not believe capital-related assets
should be eligible for additional payment through the TPNIES because
the cost of these items is captured in cost reports, they depreciate
over time, and are generally used for multiple patients, there were a
number of other factors we considered that led us to consider expanding
eligibility for these technologies in the CY 2021 ESRD PPS rulemaking.
We explained that, following publication of the CY 2020 ESRD PPS final
rule, we continued to study the issue of payment for capital-related
assets under the ESRD PPS, taking into account information from a wide
variety of stakeholders and recent developments and initiatives
regarding kidney care. For example, we considered various HHS home
dialysis initiatives, Executive Orders to transform kidney care, and
how the risk of COVID-19 for particularly vulnerable ESRD beneficiaries
could be mitigated by encouraging home dialysis.
After closely considering these issues, we proposed a revision to
Sec. 413.236(b)(6) in the CY 2021 ESRD PPS proposed rule to provide an
exception to the general exclusion for capital-related assets from
eligibility for the TPNIES for capital-related assets that are home
dialysis machines when used in the home for a single patient and that
meet the other eligibility criteria in Sec. 413.235(b), and finalized
the exception as proposed in the CY 2021 ESRD PPS final rule. We
finalized the same determination process for TPNIES applications for
capital-related assets that are home dialysis machines as for all other
TPNIES applications; that we will consider whether the new home
dialysis machine meets the eligibility criteria specified in Sec.
413.236(b) and announce the results in the Federal Register as part of
our annual updates and changes to the ESRD PPS. In accordance with
Sec. 413.236(c), we will only consider, for additional payment using
the TPNIES for a particular CY, an application for a capital-related
asset that is a home dialysis machine received by February 1 prior to
the particular CY. If the application is not received by February 1,
the application will be denied and the applicant is able to reapply
within 3 years beginning on the date of FDA marketing authorization to
be considered for the TPNIES, in accordance with Sec. 413.236(b)(2).
In the CY 2021 ESRD PPS final rule, at Sec. 413.236(f), we
finalized a pricing methodology for capital-related assets that are
home dialysis machines when used in the home for a single patient,
which requires the MACs to calculate the annual allowance and the
preadjusted per treatment amount. The pre-adjusted per treatment amount
is reduced by an estimated average per treatment offset amount to
account for the costs already paid through the ESRD PPS base rate.\64\
We finalized that this amount would be updated on an annual basis so
that it is consistent with how the ESRD PPS base rate is updated.
---------------------------------------------------------------------------
\64\ The CY 2023 TPNIES offset amount was $9.79. CMS finalized a
CY 2024 TPNIES offset amount of $10.00, as discussed in section
II.B.1.e of this final rule.
---------------------------------------------------------------------------
We revised Sec. 413.236(d) to reflect that we would pay 65 percent
of the pre-adjusted per treatment amount minus the offset for capital-
related assets that are home dialysis machines when used in the home
for a single patient.
We revised Sec. 413.236(d)(2) to reflect that following payment of
the TPNIES, the ESRD PPS base rate will not be modified, and the new
and innovative renal dialysis equipment or supply will be an eligible
outlier service as provided in Sec. 413.237, except a capital-related
asset that is a home dialysis machine will not be an eligible outlier
service as provided in Sec. 413.237.
In summary, under the current eligibility requirements in Sec.
413.236(b), CMS provides for a TPNIES to an ESRD facility for
furnishing a covered equipment or supply only if the item: (1) has been
designated by CMS as a renal dialysis service under Sec. 413.171; (2)
is new, meaning within 3 years beginning on the date of the FDA
marketing authorization; (3) is commercially available by January 1 of
the particular CY, meaning the year in which the payment adjustment
would take effect; (4) has a complete HCPCS Level II code application
submitted in accordance with the HCPCS Level II coding procedures on
the CMS website, by the HCPCS Level II code application deadline for
biannual Coding Cycle 2 for DMEPOS items and services as specified in
the HCPCS Level II coding guidance on the CMS website prior to the CY;
(5) is innovative, meaning it meets the criteria specified in Sec.
412.87(b)(1); and (6) is not a capital-related asset, except for
capital-related assets that are home dialysis machines.
2. Clarifications Regarding CMS's Evaluation of the TPNIES Eligibility
Criteria
This section of the final rule discusses clarifications to our
policies for evaluating the TPNIES eligibility criteria under Sec.
413.236(b).
a. Sequential Order of CMS Review of the TPNIES Eligibility Criteria
(Sec. 413.236(b))
As stated previously, we consider whether a new renal dialysis
supply or equipment meets the TPNIES eligibility criteria as part of
the annual ESRD PPS rulemaking and announce the results in ESRD PPS
final rule. To qualify for the TPNIES, an applicant must meet each of
the TPNIES eligibility criteria set forth in Sec. 413.236(b)(1)
through (6). An applicant that fails to demonstrate that it meets each
of the six eligibility criteria is not eligible for the TPNIES.
In the CY 2021 ESRD PPS final rule, we focused our analysis of the
TPNIES eligibility criteria on those that were not met. That is, for
the Theranova Dialyzer, we included our analysis of how the applicant
did not meet the innovation criterion under Sec. 413.236(b)(5), and
for the Tablo[supreg] cartridge, we included our analysis of how the
applicant did not meet the newness criterion under Sec. 413.236(b)(2)
and innovation criterion under Sec. 413.236(b)(5) (85 FR 71444 through
71464). In the CY 2022 and CY 2023 ESRD PPS final rules, we expanded
our analysis to include our determination as to whether the applicants
met each of the six criteria. In doing so, we analyzed the TPNIES
eligibility criteria in the sequence that is provided in Sec.
413.236(b)(1) through (6) (86 FR 61889 through 61906 and 87 FR 67193
through 67216).
In the CY 2024 ESRD PPS proposed rule (88 FR 42475 through 42476),
we stated that we are clarifying that our analysis of the TPNIES
eligibility criteria would continue to proceed in sequential order.
Specifically, in the annual ESRD PPS proposed rule, we would continue
to summarize the information from the application regarding each of the
six eligibility criteria and include any questions or
[[Page 76413]]
concerns that we identify during our analysis of the application.
Based on information provided by the applicant and from public
comments during the annual ESRD PPS rulemaking cycle, we would continue
to analyze the TPNIES eligibility criteria in sequential order in the
annual ESRD PPS final rule. However, the change that we proposed is
that once it has been established that one criterion has not been met,
we would not discuss or make specific determinations on the subsequent
criteria for that item in the annual ESRD PPS final rule. We noted that
the criteria set forth in Sec. 413.236(b) are intentionally listed in
the order in which they appear. The first criterion is foundational in
that an equipment or supply that is not a renal dialysis service would
not be paid for under the ESRD PPS and therefore would not fit within
the TPNIES payment pathway. As such, it would not be pertinent to
evaluate the remaining TPNIES criteria for that item. TPNIES criteria
two through four are objective and not subject to interpretation in
that they each require date evidence to demonstrate newness, commercial
availability, and the submission of a HCPCS application, respectively.
The TPNIES innovation criterion under Sec. 413.236(b)(5) requires the
most significant CMS evaluation. We explained that, under our TPNIES
policy and Sec. 412.87(b)(1)(i), CMS is required to consider the
totality of the circumstances when making a determination that a new
renal dialysis equipment or supply represents an advance that
substantially improves, relative to renal dialysis services previously
available, the diagnosis or treatment of Medicare beneficiaries. In
doing so, we consider various non-objective circumstances in our review
of the TPNIES applications, including the state of the ESRD landscape
and the particular challenges and vulnerabilities of patients with ESRD
(86 FR 61905). We noted that we believe it is prudent to reserve our
in-depth analysis of the TPNIES innovation criterion only for
applications that provide the necessary evidence to demonstrate that
they meet the earlier foundational and objective TPNIES criteria.
As described previously in the background section of this final
rule, the TPNIES innovation criterion in Sec. 413.236(b)(5)
incorporates the substantial clinical improvement criteria in the IPPS
regulations at Sec. 412.87(b)(1) for the new technology add-on payment
(NTAP). This sequential approach for reviewing eligibility criteria is
also in place for the NTAP pathway. The FY 2009 IPPS final rule (73 FR
48561 through 48563) discussed the way in which CMS evaluates the NTAP
eligibility criteria for new medical service or technology add-on
payment applications. That is, we first determine whether a medical
service or technology meets the newness criterion, and only if so, do
we then make a determination as to whether the technology meets the
cost threshold and represents a substantial clinical improvement over
existing medical services or technologies. The NTAP cost criterion is
not applicable in analyzing TPNIES eligibility. However, consistent
with our approach under NTAP, we stated that we believe that the most
prudent use of CMS resources would be to reserve our analysis and
determination regarding whether a new equipment or supply meets the
TPNIES innovation criterion by representing a substantial clinical
improvement over existing technologies until after we determine the new
equipment or supply meets the earlier criteria.
Under this proposal, we would first determine whether an equipment
or supply meets the renal dialysis service criterion in Sec.
413.236(b)(1) and present our analysis of this first criterion in the
final rule. In instances where CMS determines that Sec. 413.236(b)(1)
has been met, we would proceed in assessing the newness criterion in
Sec. 413.236(b)(2) and present our analysis of this second criterion
in the final rule. In instances where CMS determines that Sec.
413.236(b)(2) has been met, we would proceed in assessing whether the
commercial availability criterion in Sec. 413.236(b)(3) has either
been met or the applicant expects that it will be met by January 1 of
the particular CY and present our analysis of this third criterion in
the final rule. In instances where CMS determines that Sec.
413.236(b)(3) has been met or the applicant expects that it will be met
by January 1 of the particular CY, we would proceed in assessing the
HCPCS Level II code application criterion in Sec. 413.236(b)(4) and
present our analysis of this fourth criterion in the final rule. In
instances where CMS determines that Sec. 413.236(b)(4) has been met,
we would proceed in assessing the innovation criteria in Sec. Sec.
413.236(b)(5) and 412.87(b)(1) and present our analysis of this fifth
criterion in the final rule. In instances where CMS determines that
Sec. 413.236(b)(5) has been met, we would proceed in assessing the
non-capital-related asset (except home dialysis machines) criterion in
Sec. 413.236(b)(6) and present our analysis of this sixth criterion in
the final rule. In instances where CMS determines that Sec.
413.236(b)(6), as well as each of the five preceding criteria in Sec.
413.236(b)(1) through (5) as discussed previously have been met, the
equipment or supply would qualify for and would be paid for under the
ESRD PPS using the TPNIES per Sec. 413.236(d) beginning in the year
that is the subject of the rulemaking.
In summary, we proposed to clarify that as CMS proceeds through the
sequential analysis of the six TPNIES eligibility criteria in the ESRD
PPS final rule for a particular equipment or supply, once we determine
that the item has failed to demonstrate having met one of the
eligibility criteria, the item would be ineligible for the TPNIES. We
would limit our analysis in the final rule to the TPNIES criterion that
is not met and any preceding criteria that have been determined to have
been met. We would not include the analysis of the remaining criteria
in the final rule. This policy would be effective January 1, 2024 and
would apply to our analysis of TPNIES applications for CY 2025 payment.
We received six comments regarding our proposed clarification of
the sequential order of CMS review of the TPNIES eligibility criteria
at Sec. 413.236(b). These comments and CMS's responses are set forth
below.
Comment: One commenter supported our proposal with the
understanding that all criteria would be discussed in full in the
annual ESRD PPS proposed rule. Other commenters requested CMS
confirmation that we would continue to summarize the information from
each TPNIES application, including any questions and concerns regarding
each of the six eligibility criteria, in the annual CY ESRD PPS
proposed rule. Commenters also requested clarification that in the
annual CY ESRD PPS final rule, CMS would limit its analysis to the
criterion not met as well as any preceding criteria that are met.
Several other commenters expressed concern that our proposal would deny
applicants CMS's analysis of each criterion, eliminating the
opportunity for the public to review the latter eligibility criteria
and limiting applicants' ability to correct deficiencies prior to the
next TPNIES application cycle.
Response: We thank the commenters for their input and confirm that
we will continue to include our analysis of each TPNIES eligibility
criterion in sequential order in the annual CY ESRD PPS proposed rule.
We believe that identifying our comments or concerns with each of the
eligibility criteria in the proposed rule provides the public with
sufficient information and ample opportunity to review and respond to
[[Page 76414]]
our analysis and provides the applicant with the opportunity to correct
deficiencies, as needed.
If a TPNIES applicant who is denied reapplies in a later
application cycle, we will continue to provide a full analysis of all
the eligibility criteria once again in the annual ESRD PPS proposed
rule to allow the applicant an opportunity to correct any additional
deficiencies for all the eligibility criteria, as needed.
As stated in the CY 2024 ESRD PPS proposed rule (88 FR 42475), an
applicant that fails to demonstrate that it meets each of the six
eligibility criteria is not eligible for the TPNIES. Therefore, we
believe that reviewing the TPNIES eligibility criteria in sequential
order allows CMS to reserve our in-depth analysis of the TPNIES
innovation criterion only for applications that provide the necessary
evidence to demonstrate that they meet the earlier foundational and
objective TPNIES criteria. This approach is consistent with the way
that NTAP applications are assessed in the annual IPPS rule.
Final Rule Action: After consideration of the public comments
received, we are finalizing our clarification regarding the sequential
order of CMS review of the TPNIES eligibility criteria as proposed. In
the annual ESRD PPS proposed rule, we will continue to summarize the
information from the application regarding each of the six eligibility
criteria and include any questions or concerns that we identify during
our analysis of the application. As CMS proceeds through the sequential
analysis of the six TPNIES eligibility criteria in the ESRD PPS final
rule for a particular equipment or supply, once we determine that the
item has failed to demonstrate having met one of the eligibility
criteria, the item will be ineligible for the TPNIES. We will limit our
analysis in the final rule to the TPNIES criterion that is not met and
any preceding criteria and will not include the analysis of the
remaining criteria in the final rule. This policy will be effective
January 1, 2024 and will apply to our analysis of TPNIES applications
for CY 2025 payment.
b. Clarifications Regarding the TPNIES Newness Criterion (Sec.
413.236(b)(2))
As stated previously, applicants must meet the newness criterion in
Sec. 413.236(b)(2) to qualify for the TPNIES. CMS defines the TPNIES
newness criterion at Sec. 413.236(b)(2) as within 3 years beginning on
the date of the FDA marketing authorization. In the CY 2024 ESRD PPS
proposed rule (88 FR 42476), we clarified two distinct aspects of the
criterion that are consistent with our current TPNIES policies and
would not represent any changes to the eligibility criteria: (1) the 3-
year newness period and (2) FDA marketing authorization.
First, with respect to the 3-year newness period, we stated in the
CY 2021 ESRD PPS final rule that by defining new as within 3 years
beginning on the date of the FDA marketing authorization, we limit
eligibility for the TPNIES to new technologies but allow prospective
TPNIES applicants 3 years beginning on the date of FDA marketing
authorization in which to submit their applications (85 FR 71410
through 71464).
To further clarify the timeframe during which a prospective TPNIES
applicant is eligible to apply, in the CY 2024 ESRD PPS proposed rule
(88 FR 42476), we proposed to modify our regulation to specify that the
applicant would have 3 years from the date of FDA marketing
authorization to apply for the TPNIES, based on the date the
application is submitted. We noted that this modification is consistent
with current policy, and while it is not a change in policy, we believe
that clarifying the regulation text would help to eliminate any
confusion about the 3-year newness period. As indicated in Sec.
413.236(c), February 1 prior to the particular CY is the annual TPNIES
application submission deadline. We proposed to clarify that the 3-year
newness period is only for submission of the complete application. An
applicant does not have to ensure that CMS renders its determination
through notice and comment rulemaking within the 3-year newness period.
Specifically, we proposed to revise Sec. 413.236(b)(2) to clarify that
the equipment or supply is new if a complete application has been
submitted to CMS under Sec. 413.236(c) within 3 years of the date of
the FDA marketing authorization.
Second, with respect to the requirement in Sec. 413.236(b)(2) that
the equipment or supply must have FDA marketing authorization, we
proposed to clarify that an equipment or supply with FDA Exempt status
would not meet the newness criterion and therefore would not be
eligible for the TPNIES. As described on the FDA website, the Medical
Device Amendments of 1976 to the Federal Food, Drug, and Cosmetic Act
established three regulatory classes for medical devices: Class I,
Class II, and Class III. The three classes are based on the degree of
control necessary to assure the various types of devices are safe and
effective.\65\ Most Class 1 and some Class II devices, as noted on
FDA's website, are exempt from premarket notification (510(k))
requirements, subject to certain limitations.\66\ As we stated in the
CY 2023 ESRD PPS final rule (87 FR 67202 through 67023), devices that
receive FDA marketing authorization have met regulatory standards that
provide a reasonable assurance of safety and effectiveness for the
devices. For exempt devices, FDA has determined that a premarket
notification is not required to provide a reasonable assurance of
safety and effectiveness for the devices. However, generally a Class I
or Class II device that is exempt from 510(k) requirements still must
comply with certain regulatory controls (known as ``general controls'')
to provide a reasonable assurance of safety and effectiveness for such
devices. In limiting the TPNIES policy to items that have received FDA
marketing authorization, we intended to exclude devices that lack FDA
marketing authorization (87 FR 38511). In the absence of evidence that
the renal dialysis equipment or supply is new, meaning a complete
application has been submitted to CMS under Sec. 413.236(c) within 3
years of the date of the FDA marketing authorization, the equipment or
supply would not meet the TPNIES newness criterion under Sec.
413.236(b)(2).
---------------------------------------------------------------------------
\65\ Food & Drug Administration. Learn if a Medical Device Has
Been Cleared by FDA for Marketing. Available at: https://www.fda.gov/medical-devices/consumers-medical-devices/learn-if-medical-device-has-been-cleared-fda-marketing. Accessed on March 14,
2023.
\66\ Food & Drug Administration. Class I and Class II Device
Exemptions. Available at: https://www.fda.gov/medical-devices/classify-your-medical-device/class-i-and-class-ii-device-exemptions.
Accessed on May 30, 2023.
---------------------------------------------------------------------------
We received 11 comments on our proposed clarifications regarding
the TPNIES newness criterion at Sec. 413.236(b)(2). These comments and
CMS's responses are set forth below.
Comment: In general, commenters supported both TPNIES
clarifications. Commenters supported our proposal to revise Sec.
413.236(b)(2) to clarify that the equipment or supply is new if a
complete application has been submitted to CMS under Sec. 413.236(c)
within 3 years of the date of the FDA marketing authorization and
stated that basing the three-year newness period on the date of the
TPNIES application submission, and not the date of CMS's determination
through notice and comment rulemaking would ensure that months of
eligibility are not taken up by the determination process.
With respect to our proposal that an equipment or supply with FDA
Exempt status would not meet the newness criterion and therefore would
not be
[[Page 76415]]
eligible for the TPNIES, one commenter stated that this policy would
limit access to the TPNIES. The commenter stated that because exempt
devices must still comply with general controls to provide a reasonable
assurance of safety and effectiveness, these devices have no need to
apply for FDA marketing authorization, and an FDA determination should
not exclude these devices from the TPNIES. This commenter asserted that
CMS should incentivize innovation in the ESRD space by allowing all
relevant and appropriate technologies an opportunity to apply for the
TPNIES.
Response: We appreciate the commenters' overall support for our
clarifications regarding the TPNIES newness criterion. Regarding our
proposed clarification that an equipment or supply with FDA Exempt
status would not meet the newness criterion, we emphasize that for the
purposes of the TPNIES, we rely on FDA marketing authorization to
ensure that devices have met regulatory standards that provide a
reasonable assurance of safety and effectiveness. While a Class I or
Class II device that is exempt from 510(k) requirements still must
comply with certain regulatory controls (known as ``general controls'')
to provide reasonable assurance of safety and effectiveness for such
devices, we do not believe devices with Exempt status offer the level
of assurance that is provided with FDA marketing authorization. As
such, we maintain that our original intent was to exclude devices that
lack FDA marketing authorization (87 FR 38511).
Final Rule Action: After considering public comments, we are
finalizing as proposed our proposal to revise Sec. 413.236(b)(2) to
clarify that the equipment or supply is new if a complete application
has been submitted to CMS under Sec. 413.236(c) within 3 years of the
date of the FDA marketing authorization. We are also finalizing as
proposed our proposed clarification that an equipment or supply with
FDA Exempt status would not meet the newness criterion and therefore
would not be eligible for the TPNIES. In the absence of evidence that
the renal dialysis equipment or supply is new, meaning a complete
application has been submitted to CMS under Sec. 413.236(c) within 3
years of the date of the FDA marketing authorization, the equipment or
supply would not meet the TPNIES newness criterion under Sec.
413.236(b)(2).
We received one application for the TPNIES for CY 2024. A
discussion of the application is presented below.
3. CY 2024 TPNIES Application for Buzzy[supreg] Pro
Pain Care LabsTM submitted an application for the TPNIES
for Buzzy[supreg] Pro for CY 2024. Buzzy[supreg] Pro is one of several
models of the Buzzy[supreg] device. The Buzzy[supreg] device is
intended to control pain associated with needle procedures and for
temporary relief of minor injuries. Buzzy[supreg] Pro is a palm-sized
external use vibration device used with unique ice packs and is
intended to temporarily desensitize and physiologically block pain
associated with dialysis cannulation. The applicant stated that
dialysis cannulation pain affects 12 to 80 percent of dialysis patients
and is a substantial contributor to reduced quality of
life.67 68 The applicant further stated that cannulation
pain is associated with fear of the cannulation process, the decision
to undergo hemodialysis and sometimes the hemodialysis itself.
---------------------------------------------------------------------------
\67\ Kosmadakis G, Amara I, Costel G. Pain on arteriovenous
fistula cannulation: A narrative review. Semin Dial 2021;34(4):275-
84 doi: 10.1111/sdi.12979 [published Online First: 20210507].
\68\ Kosmadakis G, Amara B, Costel G, Lescure C. Pain associated
with arteriovenous fistula cannulation: Still a problem. Nephrol
Ther 2022;18(1):59-62 doi: 10.1016/j.nephro.2021.05.002 [published
Online First: 20210618].
---------------------------------------------------------------------------
The applicant described the steps for using Buzzy[supreg] Pro
during dialysis: (1) thread the hands free strap or regular tourniquet
through the ice pack and the device so that the ice pack is on the
concave side of the device; (2) attach the device and the ice directly
over the site; (3) activate the vibration toggle switch and leave in
place 30 to 120 seconds; (4) during cannulation, move the device
proximally so the dot on the side opposite the switch is 2 to 3 cm
proximal to the cannulation site; (5) clean the site per cannulation
protocol; and (6) remove the device after the painful part of procedure
is completed.
a. Renal Dialysis Service Criterion (Sec. 413.236(b)(1))
Regarding the first TPNIES eligibility criterion in Sec.
413.236(b)(1), that the item has been designated by CMS as a renal
dialysis service under Sec. 413.171, pain management associated with
dialysis cannulation is a service that is furnished to individuals for
the treatment of ESRD and is essential for the delivery of maintenance
dialysis. We consider Buzzy[supreg] Pro a renal dialysis service under
Sec. 413.171.
b. Newness Criterion (Sec. 413.236(b)(2))
With respect to the second TPNIES eligibility criterion in Sec.
413.236(b)(2), that the item is new, meaning within 3 years beginning
on the date of the FDA marketing authorization, the applicant stated
that it is seeking 510(k) marketing authorization from the FDA for a
new utility and design of Buzzy[supreg] created for dialysis fistulae
sites, patented in 2022 under the name Buzzy[supreg] Pro. To be
eligible for the TPNIES, the applicant must apply within 3 years of the
FDA marketing authorization date and receive FDA marketing
authorization by the HCPCS Level II deadline of July 3, 2023.
The applicant submitted the indications for use portion of its FDA
510(k) application that identifies Buzzy[supreg] as all Buzzy[supreg]
models: Mini Healthcare, XL Healthcare, Mini Personal, XL Personal and
Pro to control pain associated with needle procedures including
dialysis and the temporary relief of minor injuries. The applicant
provided supplemental information in a document titled ``510(k)
Summary'' that included a comparison table of the Predicate Device
(K130631) to the Subject Device (K202993). The document indicated that
only the Buzzy[supreg] Pro model is recommended for dialysis. The
document also indicated that Buzzy[supreg] Pro is identical to the
predicate device in terms of materials, vibration motor, circuitry,
functionality, and intended use; differs only in shape but is
comparable in size to the predicate device; and Buzzy[supreg] Pro is
distinguished by its rectangular shape to offer users a more
professional looking alternative to the bee-shape of the other device.
In the CY 2024 ESRD PPS proposed rule, we stated that we would be
interested in better understanding the way in which the Buzzy[supreg]
Pro, that is the subject of this TPNIES application, differs from the
other Buzzy[supreg] models and whether Buzzy[supreg] Pro is indicated
for adult versus pediatric patients, or both. We noted that to satisfy
the newness criterion, the FDA 510(k) marketing authorization must have
been issued within 3 years covering the specific device and model that
is the subject of the TPNIES application. We invited public comment on
this issue in the proposed rule.
Comment: The applicant submitted a comment to demonstrate that the
device meets the newness criterion. With respect to our question
regarding the way in which the Buzzy[supreg] Pro, which is the subject
of this TPNIES application, differs from the other Buzzy[supreg]
models, the applicant provided a table comparing Buzzy[supreg] Pro and
predicate Buzzy[supreg] devices and stated that Buzzy[supreg] Pro is
identical to the predicate devices in terms of materials, vibration
motor, circuitry, functionality, curvature to fit the angle of the arm,
and the mnemonic design with a ``dot'' to put near the
[[Page 76416]]
``shot.'' The applicant stated that Buzzy[supreg] Pro is thinner,
lighter, and has dual arms to attach to the cannulation site compared
to the predicate device; and Buzzy[supreg] Pro offers users a more
professional looking alternative to the bee-shape of the other device.
With respect to FDA marketing authorization, the applicant
indicated that Buzzy[supreg] Pro received FDA 510(k) approval on May
15, 2023, to control pain associated with needle procedures (for
example, injections, vascular access, cannulation, lab draws, blood
donation, dialysis, cosmetic and dental injections).
Response: We appreciate the applicant's clarification regarding
Buzzy[supreg] Pro's similarity to its predicate devices and
confirmation of FDA marketing authorization. Based on the information
provided by the applicant, we agree that Buzzy[supreg] Pro meets the
newness criterion.
c. Commercial Availability Criterion (Sec. 413.236(b)(3))
Regarding the third TPNIES eligibility criterion in Sec.
413.236(b)(3), that the item is commercially available by January 1 of
the particular CY, meaning the year in which the payment adjustment
would take effect, the applicant stated that it expects Buzzy[supreg]
Pro would be commercially available immediately after receiving FDA
marketing authorization.
Comment: The applicant submitted a comment indicating that as of
May 15, 2023, Buzzy[supreg] Pro is commercially available.
Response: Based on the information provided by the applicant,
Buzzy[supreg] Pro meets the commercial availability criterion.
d. HCPCS Level II Application Criterion (Sec. 413.236(b)(4))
Regarding the fourth TPNIES eligibility criterion in Sec.
413.236(b)(4) requiring that the applicant submit a complete HCPCS
Level II code application by the HCPCS Level II application deadline of
July 3, 2023, the applicant stated that it intends to apply by the
deadline.
Comment: The applicant submitted a comment indicating that the
HCPCS Level II code application was submitted to CMS on July 1, 2023.
Response: We appreciate the applicant's confirmation of having
submitted the HCPCS Level II code application and confirm that CMS
received the application by the deadline. Therefore, we agree the
applicant has met the HCPCS Level II application criterion.
e. Innovation Criteria (Sec. Sec. 413.236(b)(5) and 412.87(b)(1))
(1) Substantial Clinical Improvement Claims and Sources
With regard to the fifth TPNIES eligibility criterion under Sec.
413.236(b)(5), that the item is innovative, meaning it meets the
substantial clinical improvement criteria specified in Sec.
412.87(b)(1), the applicant presented two substantial clinical
improvement claims. First, the applicant stated that Buzzy[supreg] Pro
controls needle pain for dialysis. Specifically, per the applicant,
Buzzy[supreg] Pro makes cannulation pain relief available to dialysis
patients, which significantly improves clinical outcomes related to
depression and discontinuation of dialysis due to needle pain. Second,
the applicant stated that Buzzy[supreg] Pro reduces needle fear.
With respect to the claim that Buzzy[supreg] Pro controls needle
pain for dialysis, the applicant stated that currently, the most
effective options for dialysis cannulation pain are the topical
anesthetic, EMLA[supreg] and vapocoolant spray.\69\ Per the applicant,
systematic reviews recommend against vapocoolant use due to lack of
efficacy \70\ and EMLA[supreg] incurs $15 cost per use and takes 1 hour
to become effective. The applicant asserted that the Buzzy[supreg]
device has been shown to be superior to vapocoolant spray \71\ and
equivalent to topical anesthetics EMLA[supreg] and LMX[supreg] at a
fraction of the cost and time.72 73 The applicant stated
that while ice is effective for reducing dialysis pain for both adults
and children, it is messy and inferior. The applicant further stated
that a Buzzy[supreg] device cannulation study in adults found that ice
is only 10 percent of the effect, with the mechanical gate control
neuromodulation (vibration) providing 90 percent of the pain
relief.\74\
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\69\ [Ccedil]elik G, [Ouml]zbek O, Y[inodot]lmaz M, Duman I,
[Ouml]zbek S, Apiliogullari S. Vapocoolant spray vs lidocaine/
prilocaine cream for reducing the pain of venipuncture in
hemodialysis patients: a randomized, placebo-controlled, crossover
study. Int J Med Sci 2011;8(7):623-7 doi: 10.7150/ijms.8.623
[published Online First: 20111012].
\70\ Hogan ME, Smart S, Shah V, Taddio A. A systematic review of
vapocoolants for reducing pain from venipuncture and venous
cannulation in children and adults. J Emerg Med 2014;47(6):736-49
doi: 10.1016/j.jemermed.2014.06.028 [published Online First:
20140829].
\71\ Baxter AL, Leong T, Mathew B. External thermomechanical
stimulation versus vapocoolant for adult venipuncture pain: pilot
data on a novel device. Clin J Pain 2009;25(8):705-10 doi: 10.1097/
AJP.0b013e3181af1236 [published Online First: 2009/11/19].
\72\ Lescop K, Joret I, Delbos P, et al. The effectiveness of
the Buzzy[supreg] device to reduce or prevent pain in children
undergoing needle-related procedures: The results from a
prospective, open-label, randomised, non-inferiority study. Int J
Nurs Stud 2021;113:103803 doi: 10.1016/j.ijnurstu.2020.103803
[published Online First: 20201019].
\73\ Potts DA, Davis KF, Elci OU, Fein JA. A Vibrating Cold
Device to Reduce Pain in the Pediatric Emergency Department: A
Randomized Clinical Trial. Pediatr Emerg Care 2017 doi: 10.1097/
pec.0000000000001041 [published Online First: 2017/01/26].
\74\ Abidin NH. Assessing The Effectiveness Of A
Thermomechanical Device (Buzzy[supreg]) In Reducing Venous
Cannulation Pain In Adult Patients. Middle East Journal of
Anesthesiology 2018;25(1):61-67.
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With respect to the claim that Buzzy[supreg] Pro reduces needle
fear, the applicant stated that 25 to 47 percent of chronic kidney
patients have needle fear.\75\ The applicant further stated that CDC
recommends vibrating cold devices for needle fear in children, and cold
devices with a buzzer for adults.\76\ The applicant also stated that
meta-analyses demonstrate significant fear reduction with Buzzy[supreg]
device,\77\ and a New Zealand study demonstrated improved adherence to
Bicillin injections with fear reduced 50 percent after three uses of
Buzzy[supreg] device.\78\ The applicant also stated that Buzzy[supreg]
device is indicated by Health Canada to ``control pain and fear from
needles'' and is used for fearful dialysis patients in the Netherlands.
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\75\ Duncanson E, Le Leu RK, Shanahan L, et al. The prevalence
and evidence-based management of needle fear in adults with chronic
disease: A scoping review. PLoS One 2021;16(6):e0253048 doi:
10.1371/journal.pone.0253048 [published Online First: 20210610].
\76\ Easy to Read: Needle Phobia. Available at: https://www.cdc.gov/ncbddd/humandevelopment/covid-19/needle-phobia/index.html. Accessed March 9, 2023.
\77\ Ballard A, Khadra C, Adler S, Trottier ED, Le May S.
Efficacy of the Buzzy[supreg] Device for Pain Management during
Needle-Related Procedures: A Systematic Review and Meta-analysis.
Clin J Pain 2019 doi: 10.1097/ajp.0000000000000690 [published Online
First: 2019/03/05].
\78\ Russell K, Nicholson R, Naidu R. Reducing the pain of
intramuscular benzathine penicillin injections in the rheumatic
fever population of Counties Manukau District Health Board. J
Paediatr Child Health 2014;50(2):112-7 doi: 10.1111/jpc.12400
[published Online First: 2013/10/19].
\79\ Attia, A., Hassan, A. Effect of cryotherapy on pain
management at the puncture site of arteriovenous fistula among
children undergoing hemodialysis. International Journal of Nursing
Sciences 2017; (4) 46-51.
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The applicant submitted 33 unique sources of evidence with its
application in support of its claims of substantial clinical
improvement. Thirty of the sources that were submitted examined the
effect of external cold and vibration devices, including the
Buzzy[supreg] device, though not Buzzy[supreg] Pro, during needle
procedures other than dialysis cannulation. One article examined the
effect of cryotherapy on pediatric pain management at the arteriovenous
fistula site during hemodialysis.\79\ Because the
[[Page 76417]]
study did not examine the effect of external cold and vibration devices
such as the Buzzy[supreg] device or more specifically the device that
is the subject of this TPNIES application, Buzzy[supreg] Pro, in
managing dialysis related pain or fear, it was not directly applicable
to the applicant's substantial clinical improvement claims. One article
evaluated the effectiveness of distraction cards, in pediatrics in
reducing pain and anxiety during intramuscular injection.\80\ Because
the study did not examine the effect of external cold and vibration
devices such as the Buzzy[supreg] device or the Buzzy[supreg] Pro
device in managing dialysis-related pain or fear, it was not directly
applicable to the applicant's substantial clinical improvement claims.
One document labeled as Dutch guidelines was submitted in non-English
text and thus, was not readily accessible to our review team.
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\80\ Sahiner, N., Turkmen, A. The Effect of Distraction Cards on
Reducing Pain and Anxiety During Intramuscular Injection in
Children. Worldviews on Evidence-Based Nursing 2019; 1-6.
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The applicant also submitted a list of references, referred to as a
literature review, that pertained to the applicant's products, among
which, the Buzzy[supreg] device was listed as relieving or reducing
needle pain and fear and for needle procedures and for musculoskeletal
pain.
In a document titled ``Summary of Clinical Evidence--relief of
needle pain and fear,'' the applicant presented the study objectives
and key features of 29 \81\ of the 30 submitted sources that examined
the effect of external cold and vibration devices, including the
Buzzy[supreg] device, though not Buzzy[supreg] Pro, during needle
procedures other than dialysis cannulation. The document identified
several additional sources that were not submitted by the applicant.
Finally, the applicant submitted a document titled ``Buzzy Fear
reduction rationale and table'' that duplicated information already
captured in the ``Summary of Clinical Evidence--relief of needle pain
and fear'' document. Table 10 lists the 29 sources that were both
identified by the applicant in the ``Summary of Clinical Evidence--
relief of needle pain and fear'' document and that were submitted. We
have not included sources that were mentioned by the applicant, but not
submitted to us.
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\81\ The following source was not included in the summary table:
Redfern RE, Chen JT, Sibrel S, Effects of Thermomechanical
Stimulation during Vaccination on Anxiety, Pain, and Satisfaction in
Pediatric Patients: A Randomized Controlled Trial. J Pediatr
Nurs.2018.38: 1-7.
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(2) CMS Assessment of Substantial Clinical Improvement Claims and
Sources
As discussed in the CY 2024 ESRD PPS proposed rule (88 FR 42484
through 42485), we summarized our specific concerns regarding
application of the substantial clinical improvement criteria under
Sec. Sec. 413.236(b)(5) and 412.87(b)(1) in connection with the
submission.
As stated previously, the applicant must demonstrate that the
equipment or supply meets at least one of the following three
substantial clinical improvement criteria in order to be eligible for
the TPNIES: (1) the item offers a treatment option for a patient
population unresponsive to, or ineligible for, currently available
treatment; (2) the item offers the ability to diagnose a medical
condition in the patient population where that medical condition is
currently undetectable or offers the ability to diagnose a medical
condition earlier in a patient population than allowed by currently
available methods; or (3) the item significantly improves clinical
outcomes relative to services or technologies previously available. The
applicant stated that Buzzy[supreg] Pro makes dialysis cannulation pain
relief available to dialysis patients, which significantly improves
clinical outcomes related to depression and discontinuation of dialysis
due to needle pain. Therefore, in the proposed rule, we noted our
belief that the applicant was targeting the clinical outcomes criterion
(previously noted number (3)). The applicant also stated that
Buzzy[supreg] Pro reduces needle fear. In the proposed rule, we also
noted that we did not identify evidence within the application or the
submitted materials documenting improved clinical outcomes related to
depression or dialysis adherence but would be interested in reviewing
such evidence.
With respect to the submitted evidence, we noted that it did not
appear that the studies reflected the use of (1) Buzzy[supreg] Pro, the
device that is the subject of the TPNIES application, nor (2)
Buzzy[supreg] Pro in the context of dialysis cannulation. Specifically,
the applicant submitted an application for Buzzy[supreg] Pro,
indicating that Buzzy[supreg] Pro is a new design created for dialysis
fistulae sites, patented in 2022. However, the sources submitted were
dated prior to the 2022 new design patent date for dialysis fistulae
sites. As such, we stated that it appeared that the sources submitted
reflected the use of a predecessor Buzzy[supreg] device. In addition,
while the applicant's ``Summary of Clinical Evidence'' document
presented sources as evaluating Buzzy[supreg] Pro's efficacy in
managing vascular access pain or fear, we noted that none of these
sources appear to evaluate vascular access in the context of dialysis
cannulation. The studies evaluated pain and fear in the context of
other types of needle procedures, including vaccine or medication
injections, blood specimen collection, and intravenous catheter
insertion.
We noted that it was unclear whether findings of pain or fear
reduction from the use of the Buzzy[supreg] device in non-dialysis
needle procedures could be extrapolated to dialysis cannulation pain or
fear. There are several unique features to dialysis cannulation that
may limit generalizability. These include the need for regular
punctures several times per week, the maintenance of cannulation for
several hours during dialysis treatments, the use of substantially
larger needle sizes in dialysis, and complications that are associated
with frequent vascular access cannulation, such as infections and
thrombosis. As such, we questioned whether outcomes could reasonably be
extrapolated as applicable to patients undergoing dialysis cannulation.
As identified in the table, most of the studies provided in support
of the applicant's claims reflect pediatric patient experiences. We
noted that pediatric patients comprise a small proportion, just 0.14
percent, of the total Medicare ESRD patient population (87 FR 67222).
As such, we noted that the data that was heavily weighted towards the
pediatric population may have limited generalizability to the non-
pediatric majority of the ESRD patient population.
While the applicant stated that the Buzzy[supreg] devices are less
expensive than topical anesthetic, we noted that cost is not an
eligibility criterion for the TPNIES.
We also noted that it was unclear whether a single Buzzy[supreg]
Pro device and its components (for example, tourniquet and ice pack)
are intended for single versus multiple patient use in the ESRD
facility setting. To the extent that the device or its components are
intended for use among multiple patients, we noted that we would be
interested in data that examines the risk of infection associated with
the use of Buzzy[supreg] Pro in the dialysis patient population.
Additionally, we noted that we were not aware of any data that examines
the risk of harm to the dialysis access site or any other adverse
events associated with use of the Buzzy[supreg] Pro in the dialysis
patient population, including access and bloodstream infections and
thromboses but would be interested in the results of such data.
In addition, the applicant stated that currently, the most
effective options for dialysis cannulation pain are topical anesthetics
and vapocoolant spray. We noted that we would be interested in studies
comparing the use of Buzzy[supreg] Pro to topical anesthetics or
vapocoolant and that demonstrate that Buzzy[supreg] Pro significantly
improves clinical outcomes of dialysis patients relative to existing
available treatments.
We invited public comments on whether the Buzzy[supreg] Pro meets
the substantial clinical improvement criteria for the TPNIES.
Comment: We received a comment from the applicant in support of a
TPNIES approval for Buzzy[supreg] Pro. The applicant stated that there
are seven literature-supported parameters by which Buzzy[supreg] Pro
meets the substantial clinical improvement criteria, any one of which
independently would satisfy the standard. The applicant presented the
following table highlighting the ways in which Buzzy[supreg]
significantly improves clinical outcomes relative to renal dialysis
services previously available.
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\82\ Russell K, Nicholson R, Naidu R. Reducing the pain of
intramuscular Benzathine penicillin injections in the rheumatic
fever populations of Counties Manukau District Health Board. J
Paediatr Child Health 2014;50(2):112-7 doi: 10.1111/jpc.12400
[published Online First: 2013/10/19].
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[[Page 76426]]
[GRAPHIC] [TIFF OMITTED] TR06NO23.020
With respect to the more rapid beneficial resolution of the disease
process treatment, the applicant stated that chronic patients consider
a reduction in their procedural time a clinically significant
improvement.
With respect to improved quality of life, the applicant stated that
Buzzy[supreg] devices have been shown to be clinically superior to
vapocoolant spray for pain relief in adults and
children,83 84 and that vapocoolant spray lacks efficacy and
is associated with potential risks of frostbite or triggering a sickle
cell crisis. The applicant stated that EMLA is effective for
cannulation pain but requires 60 minutes to become effective and is
associated with potential risks, including petechiae and skin breakdown
from the occlusive dressing used after applying the cream. The
applicant stated that Buzzy[supreg] is equivalent to the topical
anesthetics EMLA and LMX by patient and parent report and at a fraction
of the time.85 86 87 88
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\83\ Baxter AL, Cohen LL, McElvery HL, Lawson ML, von Baeyer CL.
An integration of vibration and cold relieves venipuncture pain in a
pediatric emergency department. Pediatr Emerg Care 2011;27(12):1151-
6 doi: 10.1097/PEC.0b013e318237ace4.
\84\ Baxter AL, Leong T, Mathew B. External thermomechanical
stimulation versus vapocoolant for adult venipuncture pain: pilot
data on a novel device. Clin J Pain 2009;25(8):705-10 doi: 10.1097/
AJP.0b013e3181af1236 [published Online First: 2009/11/19].
\85\ Bahorski JS, Hauber RP, Hanks C, et al. Mitigating
procedural pain during venipuncture in a pediatric population: A
randomized factorial study. Int J Nurs Stud 2015;52(10):1553-64 doi:
10.1016/j.ijnurstu.2015.05.014 [published Online First: 20150610].
\86\ Lescop K, Joret I, Delbos P, et al. The effectiveness of
the Buzzy([supreg]) device to reduce or prevent pain in children
undergoing needle-related procedures: The results from a
prospective, open-label, randomised, non-inferiority study. Int J
Nurs Stud 2021;113:103803 doi: 10.1016/j.ijnurstu.2020.103803
[published Online First: 20201019].
\87\ Potts DA, Davis KF, Elci OU, Fein JA. A Vibrating Cold
Device to Reduce Pain in the Pediatric Emergency Department: A
Randomized Clinical Trial. Pediatr Emerg Care 2019;35(6):419-25 doi:
10.1097/pec.0000000000001041 [published Online First: 2017/01/26].
\88\ Baxter AL, Cohen LL, Tsze D. Buzzy versus EMLA: Abstract
omits clinical noninferiority and time and cost savings: A
commentary on Lescop et al. (2021). Int J Nurs Stud 2021;121:104011
doi: 10.1016/j.ijnurstu.2021.104011 [published Online First:
20210626].
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The applicant stated that Buzzy[supreg] decreases fear as compared
to other interventions, citing multiple meta-analyses indicating that
Buzzy[supreg] reduces fear and anxiety in pediatric venipuncture
89 90 and that Buzzy[supreg] was also effective in adult
venipuncture patients with needle fear or anxiety.91 92 The
applicant referred to a generic recommendation for ``buzzing devices''
for adult needle fear on the CDC website.\93\
---------------------------------------------------------------------------
\89\ Ballard A, Khadra C, Adler S, Trottier ED, Le May S.
Efficacy of the Buzzy Device for Pain Management during Needle-
Related Procedures: A Systematic Review and Meta-analysis. Clin J
Pain 2019 doi: 10.1097/ajp.0000000000000690 [published Online First:
2019/03/05].
\90\ Su HC, Hsieh CW, Lai NM, Chou PY, Lin PH, Chen KH. Using
Vibrating and Cold Device for Pain Relieves in Children: A
Systematic Review and Meta-analysis of Randomized Controlled Trials.
J Pediatr Nurs 2021;61:23-33 doi: 10.1016/j.pedn.2021.02.027
[published Online First: 20210316].
\91\ Baxter AL, Leong T, Mathew B. External thermomechanical
stimulation versus vapocoolant for adult venipuncture pain: pilot
data on a novel device. Clin J Pain 2009;25(8):705-10 doi: 10.1097/
AJP.0b013e3181af1236 [published Online First: 2009/11/19].
\92\ Redfern RE, Micham J, Sievert D, Chen JT. Effects of
Thermomechanical Stimulation During Intravenous Catheter Insertion
in Adults: A Prospective Randomized Study. J Infus Nurs
2018;41(5):294-300 doi: 10.1097/nan.0000000000000294.
\93\ https://www.cdc.gov/ncbddd/humandevelopment/covid-19/needle-phobia/healthcare-providers.html Accessed September 8, 2023.
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The applicant stated that 43 percent of dialysis patients
experienced pain despite EMLA use \94\ and that Buzzy[supreg] patients
like the sense of control of being able to hold the device in the right
spot for the best pain relief.
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\94\ https://www.youtube.com/watch?v=1moJgluvS7c&t=350s Accessed
September 8, 2023.
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In support of the claim that Buzzy[supreg] reduces at least one
clinically significant adverse event, the applicant stated that
vibration over 150Hz results in vasodilation, which can reduce the
likelihood of a needle side-walling a vein, causing pain or vasovagal
stimulation.\95\ The applicant referred to a recent study presented in
2023, which found that in 360 teenagers who received vaccination,\96\
Buzzy[supreg] reduced severe vasovagal symptoms 25 percent and improved
vasodilation, potentially reducing vessel wall trauma.
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\95\ Skoglund CR. Vasodilatation in human skin induced by low-
amplitude high-frequency vibration. Clin Physiol 1989;9(4):361-72.
\96\ Smith MJ, Broder KR, Chung RJ, et al. Preventing Post-
Vaccination Presyncope and Syncope in Adolescents Using Simple
Clinic-Based Interventions: a Randomized-Controlled Trial. Pediatric
Academic Societies Meeting. Washington, DC, 2023.
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The applicant also provided responses to CMS's concerns identified
in the CY 2024 proposed rule. In response to the CMS concern regarding
a lack of evidence documenting improved clinical outcomes related to
depression or dialysis adherence, the applicant stated that increased
feelings of control are correlated with reduced depression. The
applicant specified that
[[Page 76427]]
because studies of patients with chronic pain with or without
depression have identified self-efficacy as a primary component of
effective interventions \97\ and because chronic pain and depression
are common in dialysis patients,98 99 a fast intervention
that allows self-adjustment and relief optimization should be more
appropriate and effective among patients receiving dialysis than among
patients undergoing single, small gauge, and less risky cannulations.
The applicant stated that adherence to regular cannulation reduces
hospitalization.\100\ The applicant also stated that needle fatigue can
lead to nonadherence to a treatment plan and that nonadherence
increases healthcare costs, emergency department visits, disease
complications, and in extreme cases, the likelihood of death.\101\
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\97\ Borsbo B, Gerdle B, Peolsson M. Impact of the interaction
between self-efficacy, symptoms and catastrophising on disability,
quality of life and health in with chronic pain patients. Disability
and rehabilitation 2010;32(17):1387-96 doi: 10.3109/
09638280903419269 [published Online First: 2010/06/02].
\98\ Davison SN, Jhangri GS. The impact of chronic pain on
depression, sleep, and the desire to withdraw from dialysis in
hemodialysis patients. J Pain Symptom Manage 2005;30(5):465-73 doi:
10.1016/j.jpainsymman.2005.05.013.
\99\ Masi[agrave]-Plana A, Juviny[agrave]-Canal D, Su[ntilde]er-
Soler R, Sitjar-Su[ntilde]er M, Casals-Alonso C, Mantas-
Jim[eacute]nez S. Pain, Anxiety, and Depression in Patients
Undergoing Chronic Hemodialysis Treatment: A Multicentre Cohort
Study. Pain Manag Nurs 2022;23(5):632-39 doi: 10.1016/
j.pmn.2022.03.005 [published Online First: 20220422].
\100\ Russell K, Nicholson R, Naidu R. Reducing the pain of
intramuscular benzathine penicillin injections in the rheumatic
fever population of Counties Manukau District Health Board. J
Paediatr Child Health 2014;50(2):112-7 doi: 10.1111/jpc.12400
[published Online First: 2013/10/19].
\101\ Lee K, Kim D, Lee H, Lee E. The effect of using
vapocoolant spray for pain reduction in arteriovenous fistula
cannulation among patients undergoing hemodialysis: A randomized
control trial. Appl Nurs Res 2023;71:151674 doi: 10.1016/
j.apnr.2023.151674 [published Online First: 20230317].
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In response to the CMS concern that the sources submitted reflected
the use of a predecessor Buzzy[supreg] device, the applicant stated
that because Buzzy[supreg] Pro received FDA 510(k) approval on May 15,
2023, there are no studies specific to Buzzy[supreg] Pro.
In response to the CMS concern that it is unclear whether findings
of pain or fear reduction from the use of the Buzzy[supreg] device in
non-dialysis needle procedures could be extrapolated to dialysis
cannulation pain or fear, the applicant asserted that because emergency
department venipuncture studies typically involve anxiety, they are
appropriate comparators for dialysis, where anxiety is common. The
applicant further noted that many dialysis studies do not find a
benefit the first time an intervention is attempted. The applicant also
stated that adult dialysis cannulation studies that use vapocoolant and
topical anesthetic do not evaluate anxiety, and the only studies
evaluating anxiety and dialysis cannulation used lavender oil as a
comparator.
In response to the CMS interest in studies comparing the use of
Buzzy[supreg] Pro to topical anesthetics or vapocoolant and that
demonstrate that Buzzy[supreg] Pro significantly improves clinical
outcomes of dialysis patients relative to existing available
treatments, the applicant provided the following two summary tables and
stated that the numbers given in the tables allow relative comparison
between interventions and the pain reported with dialysis cannulation
and adult emergency department trials of Buzzy[supreg]. The first table
summarizes studies of pain or anxiety relief specific to dialysis
cannulation and identifies the significant differences in bold text.
The second table summarizes Buzzy[supreg] outcomes including pain,
anxiety, and vasovagal symptom relief in various types of cannulations
and identifies the significant differences in bold text.
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In response to the CMS concern that the data heavily weighted
towards the pediatric population may have limited generalizability to
the non-pediatric majority of the ESRD patient population, the
applicant referred to materials submitted with its application and
asserted that these demonstrate significant pain and fear reduction
with the Buzzy[supreg] device, superiority to vapocoolant, and
equivalency to topical anesthetics but in a shorter period of time. The
applicant stated that five independent peer reviewed studies on adult
venipuncture using Buzzy[supreg]
[[Page 76429]]
demonstrate the following: vibration is the primary active ingredient;
improved efficacy in patients with needle fear; superiority to
vapocoolant spray; and pain reduction and improved satisfaction.
In response to our clarification that cost is not a TPNIES
eligibility criterion, the applicant acknowledged our clarification but
stated that cost is a barrier to the use of EMLA. The applicant
compared the cost of EMLA at $6.48 per cannulation to the cost of
Buzzy[supreg] at $0.375 per cannulation. The applicant concluded that
increased access to pain relief is a substantial clinical benefit that
is not currently available due to cost.
In response to the CMS question as to whether a single
Buzzy[supreg] Pro device and its components (for example, tourniquet
and ice pack) are intended for single versus multiple patient use in
the ESRD facility setting, the applicant stated that Buzzy[supreg] and
Buzzy[supreg] Pro are made of medical grade plastic in accordance with
ISO-13485 and MDSAP standards and can be disinfected with
chlorhexidine, alcohol swabs, or any hospital grade cleanser in
accordance with the requirements applied to a stethoscope or blood
pressure cuff. The applicant further noted that the ice packs are
medical grade, intended for a single patient, but can be reused
hundreds of times. Per the applicant, the straps are also intended for
single-patient use but can be used multiple times in a home setting.
The applicant stated that infection control varies widely based on
regional idiosyncrasies and may involve the use of an infection control
bag around the ice pack; not using the ice pack; using an infection
control bag around both the device and the ice pack; having patients
bring their own ice pack; giving the ice pack to the patient following
the procedure; or discarding the ice pack.
In response to the CMS interest in data that examines the risk of
infection associated with the use of Buzzy[supreg] Pro in the dialysis
patient population and the CMS interest in data that examines the risk
of harm to the dialysis access site or any other adverse events
associated with use of the Buzzy[supreg] Pro in the dialysis patient
population, including access and bloodstream infections and thromboses,
the applicant stated that to date, with conservatively over 114,000,000
needle procedures, there are no reported instances of Buzzy[supreg]
being associated with a vascular access mishap. Per the applicant, the
standard risks of vascular damage may be reduced because of the
vasodilation. The applicant also stated that because the device goes
proximal to the cannulation site when it is being cleaned and accessed,
there is never a time when Buzzy[supreg] is placed on the area of
recent cannulation. The applicant also stated that Buzzy[supreg] has
been used for dialysis in the Netherlands for four years with only
positive reports of efficacy, efficiency, and safety.
The applicant also provided additional information explaining the
pain transmission process and its belief that that Buzzy[supreg] Pro's
mechanical stimulation is an innovative approach in pain management.
Specifically, the applicant stated that pain is transmitted to the
spine on fast pain nerves and that local mechanisms to reduce pain
transmission from skin to spine include lidocaine, cold spray or ice.
Per the applicant, as cold travels to the brain on slow C-fibers it
activates pain inhibition, which is most effective when applied at
temperatures ranging from 0-4C, for a duration of 30 seconds or more,
and when applied proximal or distant to the area of pain. The applicant
also identified the mechanical stimulation of the fibers which transmit
touch sensations as a mechanism for reducing pain, noting that optimal
stimulation occurs between 180 and 250Hz. Per the applicant,
Buzzy[supreg] units provide mechanical stimulation using a 200 Hz
vibration motor.
The applicant also presented a new substantial clinical improvement
claim, asserting that Buzzy[supreg] Pro offers a treatment option for a
patient population unresponsive to, or ineligible for currently
available treatment options. Specifically, the applicant stated that
cost and time are barriers to patients accessing the currently
available treatment options for dialysis cannulation pain control and
asserted that Buzzy[supreg] Pro addresses these barriers. As stated
previously, the applicant compared the cost of EMLA at $6.48 per
cannulation to the cost of Buzzy[supreg] at $0.375 per cannulation and
concluded that Buzzy[supreg] addresses the cost barrier to patients
accessing dialysis cannulation pain relief. The applicant also asserted
that the time requirement for using EMLA reduces the likelihood of its
use in busy dialysis clinics or if the patient comes in late. The
applicant stated that because patients prescribed EMLA for home
application prior to treatment at the dialysis clinic often misuse the
product, they are unresponsive to EMLA. Per the applicant,
Buzzy[supreg] works on contact and can easily be applied by the
patient. The applicant stated that given the short, 30 to 60 second
duration of pain relief obtained from vapocoolant spray, needle pain is
a barrier to receiving treatment in the home setting. The applicant
also stated that the pain from the mechanical pressure of the dialysis
needle inside the vessel cannot be treated with EMLA or vapocoolant
spray. The applicant stated that because Buzzy[supreg] Pro works
proximally to the pain, it is effective for patients who otherwise are
unable to access pain control.
We also received several comments from patient advocates supporting
the applicant's two substantial clinical improvement claims that
Buzzy[supreg] Pro reduces pain and anxiety associated with dialysis. A
few commenters offered anecdotal experience regarding the use of
Buzzy[supreg] Pro in the context of dialysis cannulation and stated
that Buzzy[supreg] Pro's benefits are supported by peer-reviewed
scientific literature. Commenters stated that Buzzy[supreg] Pro would
promote patient choice by providing fast onset dialysis cannulation
pain relief without the hassles and expense of topical anesthetics. One
commenter suggested that the In-Center Hemodialysis Consumer Assessment
of Healthcare Providers and Systems (CAHPS) Survey should be updated to
capture patient experience with dialysis cannulation pain.
Response: We appreciate the applicant and other commenters' input
regarding whether Buzzy[supreg] Pro meets the TPNIES innovation
criterion at Sec. 413.236(b)(5) and substantial clinical improvement
criteria at Sec. 412.87(b)(1). While the applicant stated that there
are seven literature-supported parameters by which Buzzy[supreg] Pro
meets the substantial clinical improvement criteria, it was not clear
to us to which parameters or sources of literature the applicant was
referring.
In response to our request for evidence of improved clinical
outcomes related to depression or dialysis adherence, the applicant
stated that because increased feelings of control are correlated with
reduced depression, an intervention that allows for self-adjustment and
relief should be more effective among patients receiving dialysis than
patients undergoing other types of needle cannulations. However, the
applicant did not provide direct evidence that interventions to reduce
pain in dialysis populations would subsequently reduce depression or
that Buzzy[supreg] Pro specifically reduces depression. In addition,
while the applicant stated that adherence to regular cannulation
reduces hospitalization, the evidence cited by the applicant does not
pertain to improved dialysis adherence or reductions in
hospitalizations. We are not aware of evidence demonstrating
[[Page 76430]]
that the use of Buzzy[supreg] Pro is associated with the clinical
outcome of improved dialysis adherence. Therefore, our request for
evidence of improved clinical outcomes related to depression or
dialysis adherence associated with the use of Buzzy[supreg] Pro in the
dialysis patient population has not been sufficiently addressed.
We appreciate the applicant's confirmation that the evidence
submitted pertained to studies of the predicate device, Buzzy[supreg]
and that there are no studies specific to Buzzy[supreg] Pro. We also
appreciate the applicant's responses to our concern about the absence
of evidence that evaluates Buzzy[supreg] Pro's efficacy in managing
pain or fear in the context of dialysis cannulation rather than in the
context of non-dialysis needle procedures. The applicant asserted that
emergency department venipuncture studies typically involve anxiety and
are therefore appropriate comparators for dialysis, where anxiety is
common. We do not believe that the presence of anxiety renders
emergency department venipuncture a suitable proxy for dialysis
cannulation. In addition, the applicant did not address the unique
features of dialysis or the differences between venipuncture and
dialysis cannulation that may limit generalizability, including the use
of substantially larger needle sizes in dialysis, repeated cannulations
thrice weekly, continued cannulation throughout a dialysis session, and
complications associated with frequent vascular access cannulation such
as infections and thrombosis. As such, we do not believe it is possible
to extrapolate outcomes achieved with Buzzy[supreg] Pro in the context
of non-dialysis needle procedures to dialysis cannulation.
We also appreciate the comments from patient advocates offering
anecdotal experience with Buzzy[supreg] Pro in the context of dialysis
cannulation but would be especially interested in additional detail,
including the numbers of patients involved and the specific outcomes
that they experienced from Buzzy[supreg] Pro. While some commenters
asserted that Buzzy[supreg] Pro's benefits for the renal dialysis
patient population are supported by peer-reviewed scientific
literature, because such sources were not provided by the commenters,
we were unable to verify these assertions.
While Buzzy[supreg] Pro may demonstrate similar results to that of
its predicate devices, our primary concern regarding the lack of direct
evidence that Buzzy[supreg] results in pain or fear reduction in the
context of dialysis cannulation pain or fear has not been sufficiently
addressed.
In response to our request for studies comparing Buzzy[supreg] Pro
to topical anesthetics or vapocoolant spray and that demonstrate that
Buzzy[supreg] Pro significantly improves clinical outcomes of dialysis
patients relative to existing available treatments, the applicant's
first summary table reflects outcomes specific to dialysis but does not
reflect experiences with Buzzy[supreg] Pro. While the second table
reflects outcomes specific to Buzzy[supreg], it does not capture
experience in the dialysis setting. Not all studies included in the
summary tables shown previously in this rule were provided with the
application or public comment. However, none of the studies appear to
specifically examine Buzzy[supreg] Pro's efficacy in improving clinical
outcomes of dialysis patients as compared to topical anesthetics or
vapocoolant spray.
Regarding our concern that data in support of the applicant's
claims may have limited generalizability to the non-pediatric majority
of the ESRD patient population, the applicant reiterated references
from its application to independent peer reviewed studies on adult
venipuncture using Buzzy[supreg]. These studies compared Buzzy[supreg]
to no intervention and Buzzy[supreg] to vapocoolant or cold
interventions. We also note that the applicant referred to a source
labeled ``Abedin et. al.,'' but we did not receive the study or the
complete citation for this source. Because the studies did not compare
Buzzy[supreg] to lidocaine and did not take place in the dialysis
setting, the applicant has not sufficiently addressed our concern about
the generalizability of these studies.
Regarding the applicant's additional evidence since the application
submission, we acknowledge the reference to the 1989 study pertaining
to vasodilation in human skin and the 2023 study pertaining to the
prevention of post-vaccine syncope. While these studies were not
submitted to us, similarly to the evidence previously submitted, it
does not appear that they assessed the efficacy of Buzzy[supreg] Pro in
the context of dialysis cannulation.
We appreciate the applicant's clarification regarding use among
single vs. multiple patients in the ESRD facility setting and
confirmation that to date, there are no reported instances of
Buzzy[supreg] being associated with a vascular access mishap. However,
because the applicant did not specify the percentage of the 114,000,000
needle procedures performed with Buzzy[supreg] that pertained to
dialysis cannulation, our concern about the lack of data examining the
risk of harm to the access site or any other adverse events associated
with the use of Buzzy[supreg] Pro in the renal dialysis patient
population has not been sufficiently addressed.
For the reasons noted previously, we do not believe that there is
sufficient evidence to demonstrate that Buzzy[supreg] Pro significantly
improves clinical outcomes relative to renal dialysis services
previously available.
With respect to the applicant's new substantial clinical
improvement claim that Buzzy[supreg] Pro offers a treatment option for
a patient population unresponsive to, or ineligible for, currently
available treatments, we acknowledge that patients may appreciate the
option of a rapid acting form of dialysis cannulation pain relief.
While the applicant stated that Buzzy[supreg] offers a more rapid
beneficial resolution of the disease process treatment than currently
available options, the applicant did not provide additional evidence
demonstrating the clinical superiority of Buzzy[supreg] Pro over
topical lidocaine in the context of dialysis cannulation. Although the
applicant stated that lidocaine requires an hour to take full effect,
it did not provide evidence that Buzzy[supreg] Pro is superior to
lidocaine after shorter time frames in the dialysis setting, that
shorter timeframes do not provide adequate pain control with topical
lidocaine, or that patients are unable to apply lidocaine an hour
before their scheduled dialysis treatment. With respect to the
applicant's assertion that the higher cost of EMLA as compared to
Buzzy[supreg] is a barrier to pain relief, we note that because topical
lidocaine is included in the pain management category of drugs/
biological products included in the ESRD PPS, dialysis facilities would
be expected to provide it when determined necessary for the treatment
of graft site pain. While cost may be a practical barrier to access for
some patients, we do not equate this barrier with either
unresponsiveness or ineligibility. In summary, based on the information
provided, we are not able to conclude that there is sufficient evidence
to demonstrate that Buzzy[supreg] Pro offers a treatment option for a
patient population unresponsive to, or ineligible for, currently
available treatments.
Finally, we note that the comment suggesting that the CAHPS Survey
should be updated to capture patient experience with dialysis
cannulation pain is beyond the scope of this proposed rule.
In accordance with TPNIES policy and Sec. 412.87(b)(1)(i), we
consider the totality of the circumstances when making a determination
that a new renal dialysis equipment or supply represents
[[Page 76431]]
an advance that substantially improves, relative to renal dialysis
services previously available, the diagnosis or treatment of Medicare
beneficiaries. In addition, per Sec. 412.87(b)(1)(iii), CMS considers
a range of evidence from published or unpublished information sources,
including other appropriate information sources not otherwise listed
under Sec. 412.87(b)(1)(iii).
After carefully reviewing the application, the information
submitted by the applicant addressing our concerns raised in the CY
2024 ESRD PPS proposed rule, and comments submitted by the public, we
have determined that Buzzy[supreg] Pro has not shown that it represents
an advance that substantially improves, relative to renal dialysis
services previously available, the treatment of Medicare beneficiaries.
For the reasons discussed previously, we conclude that Buzzy[supreg]
Pro does not meet the TPNIES innovation criteria under Sec.
413.236(b)(5) and Sec. 412.87(b)(1).
f. Capital-Related Assets Criterion (Sec. 413.236(b)(6))
With respect to the sixth TPNIES eligibility criterion under Sec.
413.236(b)(6), limiting capital-related assets from being eligible for
the TPNIES, except those that are home dialysis machines, we note that
Buzzy[supreg] Pro does not meet the definition of a capital-related
asset under Sec. 413.236(a)(2), because it is not an asset that the
ESRD facility has an economic interest in through ownership that is
subject to depreciation.\102\
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\102\ See also CMS Provider Reimbursement Manual, Chapter 1,
section 104.1. Available at: https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Paper-Based-Manuals-Items/CMS021929.
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Comment: The applicant submitted a comment indicating that
Buzzy[supreg] Pro is not an asset that the ESRD facility has an
economic interest in through ownership that is subject to depreciation.
Response: We agree that Buzzy[supreg] Pro does not meet the
definition of a capital-related asset under Sec. 413.236(a)(2).
Final Rule Action: After a consideration of all the public comments
received, we have determined that the evidence and public comments
submitted are not sufficient to demonstrate that Buzzy[supreg] Pro
meets all eligibility criteria to qualify for the TPNIES for CY 2024.
As a result, Buzzy[supreg] Pro will not be paid for using the TPNIES
per Sec. 413.236(d). We note that in the CY 2021 ESRD PPS final rule
(85 FR 71412), CMS indicated that entities would have 3 years beginning
on the date of FDA marketing authorization in which to submit their
applications for the TPNIES. Based on the Buzzy[supreg] Pro FDA
marketing authorization date of May 15, 2023, the applicant may be
eligible to apply for the TPNIES for CYs 2025, 2026, or 2027, and CMS
would review any new information provided for the applicable rulemaking
cycle.
4. Other Public Comments on the TPNIES
We received several comments regarding the TPNIES policies,
including the length of the TPNIES payment period and suggestions for
new payment adjustments. Commenters urged CMS to extend the TPNIES
payment period to at least three years to allow for two full years of
data collection, and then increase the ESRD PPS base rate to account
for the new technology. Commenters suggested that CMS issue an RFI
seeking public feedback on a post-TPNIES add-on payment adjustment and
adopt a post-TPNIES payment adjustment in future rulemaking.
Commenters suggested revisions to existing TPNIES policies, such as
extending the TPNIES to all capital-related assets, expanding the
TPNIES for home dialysis devices that are acquired through operating
leases, removing the TPNIES offset amount, and developing further
guidance explaining the way in which CMS evaluates TPNIES applicants'
substantial clinical improvement data.
Commenters suggested that we clarify the way in which MACs
determine and provide payment rates for items approved for the TPNIES.
Commenters suggested that these rates should be provided no later than
March 31 of the first year of TPNIES eligibility and that MACs should
provide clear and timely TPNIES claims processing guidance to the
dialysis facilities.
Finally, we received comments suggesting that CMS develop a
Transitional Laboratory Add-on Payment Adjustment (TLAPA) to
incentivize innovation in laboratory services for beneficiaries with
ESRD.
While we are not providing detailed responses to these comments in
this final rule because they are out of scope of the proposed rule, we
thank the commenters for their input and will potentially consider the
recommendations for future rulemaking.
D. Continuation of Approved Transitional Add-On Payment Adjustments for
New and Innovative Equipment and Supplies for CY 2024
In this section of the final rule, we identify any items previously
approved for the TPNIES and for which payment is continuing for CY
2024. As described in the CY 2023 ESRD PPS final rule, payment for the
one item approved for the TPNIES, the Tablo[supreg] Hemodialysis
System, as described by HCPCS code E1629, expires on December 31, 2023
(87 FR 67216). As such there are no items previously approved for the
TPNIES for which payment is continuing in CY 2024.
Comment: Several commenters requested that CMS extend the TPNIES
payment period for the Tablo[supreg] Hemodialysis System beyond the
December 31, 2023, end date to December 31, 2024. Commenters stated
that implementation difficulties with the first CMS-approved TPNIES
application resulted in lower than anticipated uptake of the
Tablo[supreg] System. Commenters stated that MACs demonstrated variable
levels of understanding about the Capital Related Assets (CRA) for the
TPNIES and that providers lacked clear guidance on what information
ESRD facilities were to include on their claims. The commenters stated
that these challenges contributed to claim denials and an
administrative burden on ESRD facilities.
Response: CMS did not propose to extend the 2-CY TPNIES payment
period as established in Sec. 413.236(d)(1) in the CY 2024 ESRD PPS
proposed rule, and we are not finalizing any such change in this final
rule. However, we acknowledge the commenters' concerns pertaining to
TPNIES claims processing related matters and have issued Change Request
12347 to the MACs outlining the way in which the CRA for the TPNIES is
calculated for claims processing purposes.\103\ In addition, in August
2022, CMS instructed MACs to adjust ESRD claims following CMS
deployment of a corrected ESRD Pricer and to ensure that their systems
were properly set up to suspend the claim for manual pricing. CMS
provided a Medicare Learning Network (MLN) article instructing
providers on how to submit Tablo[supreg] Systems claims.\104\ This
article was supplemented with an MLN Connects newsletter reminding
[[Page 76432]]
providers to submit the invoice for the CRA for the TPNIES to their MAC
and report the appropriate revenue code and HCPCS code with modifier on
the claim for treatments in which the CRA for the TPNIES was used.
Providers were also reminded to address any issues returned to them by
their MAC and resubmit the effected claims.\105\
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\103\ Change Request 12347. Implementation of the Capital
Related Assets Adjustment (CRA) for the Transitional Add-on Payment
Adjustment for New and Innovative Equipment and Supplies (TPNIES)
Under the End Stage Renal Disease Prospective Payment System (ESRD
PPS). https://www.cms.gov/files/document/r11533otn.pdf.
\104\ MLN Matters Article. Implementation of the Capital Related
Assets (CRA) Adjustment for the Transitional Add-on Payment
Adjustment for New and Innovative Equipment and Supplies (TPNIES)
Under the End Stage Renal Disease Prospective Payment System (ESRD
PPS). https://www.cms.gov/files/document/mm12347-implementation-capital-related-assets-cra-adjustment-transitional-add-payment-adjustment-new.pdf.
\105\ MLN Connects Newsletter. ESRD: Submitting Dialysis Claims
the Include Capital Related Assets Eligible for the TPNIES https://www.cms.gov/training-education/medicare-learning-network/newsletter/2023-09-14-mlnc#_Toc145581414.
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E. Continuation of Approved Transitional Drug Add-On Payment
Adjustments for CY 2024
Under Sec. 413.234(c)(1), a new renal dialysis drug or biological
product that is considered included in the ESRD PPS base rate is paid
the TDAPA for 2 years. In December 2021, CMS approved Korsuva[supreg]
(difelikefalin) for the TDAPA under the ESRD PPS, effective April 1,
2022. Implementation instructions are specified in CMS Transmittal
11295,\106\ dated March 15, 2022, and available at: https://www.cms.gov/files/document/r11295CP.pdf.
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\106\ CMS Transmittal 11295 rescinded and replaced CMS
Transmittal 11278, dated February 24, 2022.
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In July 2023, after the CY 2024 ESRD PPS proposed rule appeared in
the Federal Register on June 30, 2023, CMS approved Jesduvroq
(daprodustat) for the TDAPA under the ESRD PPS, effective October 1,
2023. Implementation instructions are specified in CMS Transmittal
12157, dated July 27, 2023, and available at: https://www.cms.gov/files/document/r12157cp.pdf.
Table 11 identifies the two new renal dialysis drugs for which the
TDAPA payment period as specified in Sec. 413.234(c)(1) will continue
in CY 2024: Korsuva[supreg] (difelikefalin) that was approved for the
TDAPA effective in CY 2022, and Jesduvroq (daprodustat) that was
approved for the TDAPA effective in CY 2023. Table 11 also identifies
the products' HCPCS coding information as well as the payment
adjustment effective dates and end dates.
[GRAPHIC] [TIFF OMITTED] TR06NO23.023
III. Calendar Year (CY) 2024 Payment for Renal Dialysis Services
Furnished to Individuals With Acute Kidney Injury (AKI)
A. Background
The Trade Preferences Extension Act of 2015 (TPEA) (Pub. L. 114-27)
was enacted on June 29, 2015, and amended the Act to provide coverage
and payment for dialysis furnished by an ESRD facility to an individual
with AKI. Specifically, section 808(a) of the TPEA amended section
1861(s)(2)(F) of the Act to provide coverage for renal dialysis
services furnished on or after January 1, 2017, by a renal dialysis
facility or a provider of services paid under section 1881(b)(14) of
the Act to an individual with AKI. Section 808(b) of the TPEA amended
section 1834 of the Act by adding a subsection (r) to provide payment,
beginning January 1, 2017, for renal dialysis services furnished by
renal dialysis facilities or providers of services paid under section
1881(b)(14) of the Act to individuals with AKI at the ESRD PPS base
rate, as adjusted by any applicable geographic adjustment applied under
section 1881(b)(14)(D)(iv)(II) of the Act and adjusted (on a budget
neutral basis for payments under section 1834(r) of the Act) by any
other adjustment factor under section 1881(b)(14)(D) of the Act that
the Secretary elects.
In the CY 2017 ESRD PPS final rule, we finalized several coverage
and payment policies to implement subsection (r) of section 1834 of the
Act and the amendments to section 1861(s)(2)(F) of the Act, including
the payment rate for AKI dialysis (81 FR 77866 through 77872 and
77965). We interpret section 1834(r)(1) of the Act as requiring the
amount of payment for AKI dialysis services to be the base rate for
renal dialysis services determined for a year under the ESRD PPS base
rate as set forth in Sec. 413.220, updated by the ESRD bundled market
basket percentage increase factor minus a productivity adjustment as
set forth in Sec. 413.196(d)(1), adjusted for wages as set forth in
Sec. 413.231, and adjusted by any other amounts deemed appropriate by
the Secretary under Sec. 413.373. We codified this policy in Sec.
413.372 (81 FR 77965).
B. Summary of the Proposed Provisions, Public Comments, and Responses
to Comments on the CY 2024 Payment for Renal Dialysis Services
Furnished to Individuals With AKI
The CY 2024 ESRD PPS proposed rule, titled ``Medicare Program; End-
Stage Renal Disease Prospective Payment System, Payment for Renal
Dialysis Services Furnished to Individuals with Acute Kidney Injury,
End-Stage Renal Disease Quality Incentive Program, and End-Stage Renal
Disease Treatment Choices Model'' (88 FR 42430-42544), referred to as
the ``CY 2024 ESRD PPS proposed rule,'' appeared in the June 30, 2023
version of the Federal Register, with a comment period that ended on
August 25, 2023. In that proposed rule, we proposed to update the AKI
dialysis payment rate for CY 2024. We received 10 public comments on
our proposal. In this final rule, we provide a summary of each proposed
provision, a summary of public comments received and our responses to
them, and the policies we are finalizing for CY 2024 payment for renal
dialysis services furnished to individuals with AKI.
[[Page 76433]]
C. Annual Payment Rate Update for CY 2024
1. CY 2024 AKI Dialysis Payment Rate
The payment rate for AKI dialysis is the ESRD PPS base rate
determined for a year under section 1881(b)(14) of the Act, which is
the finalized ESRD PPS base rate, including the applicable annual
market basket update, geographic wage adjustments, and any other
discretionary adjustments, for such year. We note that ESRD facilities
can bill Medicare for non-renal dialysis items and services and receive
separate payment in addition to the payment rate for AKI dialysis.
As discussed in section II.B.1.d of this final rule, the ESRD PPS
base rate is $271.02, which reflects the application of the CY 2024
wage index budget-neutrality adjustment factor of 0.999534 and the CY
2024 ESRDB market basket percentage increase of 2.4 percent reduced by
the productivity adjustment of 0.3 percentage point, that is, 2.1
percent. Accordingly, we are finalizing a CY 2024 per treatment payment
rate of $271.02 (($265.57 x 0.999534) x 1.021 = $271.02) for renal
dialysis services furnished by ESRD facilities to individuals with AKI.
This final payment rate is further adjusted by the wage index, as
discussed in the next section of this final rule.
2. Geographic Adjustment Factor
Under section 1834(r)(1) of the Act and regulations at Sec.
413.372, the amount of payment for AKI renal dialysis services is the
base rate for renal dialysis services determined for a year under
section 1881(b)(14) of the Act (updated by the ESRDB market basket
percentage increase and reduced by the productivity adjustment), as
adjusted by any applicable geographic adjustment factor applied under
section 1881(b)(14)(D)(iv)(II) of the Act. Accordingly, we apply the
same wage index under Sec. 413.231 that is used under the ESRD PPS and
discussed in section II.B.1.b of this final rule. The AKI dialysis
payment rate is adjusted by the wage index for a particular ESRD
facility in the same way that the ESRD PPS base rate is adjusted by the
wage index for that ESRD facility (81 FR 77868). Specifically, we apply
the wage index to the labor-related share of the ESRD PPS base rate
that we utilize for AKI dialysis to compute the wage-adjusted, per-
treatment-AKI dialysis payment rate. We also apply the wage index
policies regarding the 0.600 wage index floor (87 FR 67161 through
67166) and the 5 percent cap on wage index decreases (87 FR 67159
through 67161) to AKI dialysis payments to ESRD facilities.
We received 10 public comments on our proposal to update the
payment rate for renal dialysis services furnished to individuals with
AKI. Commenters included a coalition of dialysis organizations, a non-
profit dialysis organization, a trade association, a renal product
development company, and multiple large dialysis organizations. The
comments on our proposal and our responses are set forth below.
Comment: Some commenters expressed support for the CY 2024 proposed
payment rate for individuals with AKI, which is to say the commenters
supported increasing payments for AKI by the proposed productivity-
adjusted ESRDB market basket update of 1.7 percent. Many commenters
requested that CMS allow for AKI patients to select home dialysis
modalities by eliminating the current prohibition. Some commenters also
expressed concerns that the proposed market basket increase is
insufficient to account for inflation. One commenter suggested that any
forecast error adjustment applied to the ESRD PPS should also be
applied to payments for AKI patients.
Response: We appreciate the commenters' support for the proposed CY
2024 productivity-adjusted ESRDB market basket update of 1.7 percent.
We acknowledge the request for AKI patients to select home dialysis
modalities, and we thank commenters for their input. We note that
currently, CMS will only pay for renal dialysis services at an ESRD
facility for patients with AKI, and we did not propose to change this
policy in the CY 2024 ESRD PPS proposed rule. Current AKI dialysis
payment policy was implemented under the CY 2017 ESRD PPS final rule
(81 FR 77866 through 77872, and 77965). Over the years, we have
received several comments regarding the site of renal dialysis services
for Medicare beneficiaries with AKI. We have solicited comments in the
recent past, including in the CY 2022 ESRD PPS proposed rule (86 FR
36322, 36408), when we requested information regarding potentially
modifying the site of renal dialysis services for patients with AKI and
payment for AKI in the home setting. CMS continues to believe that this
population requires close medical supervision by qualified staff during
their dialysis treatment. We recognize commenters' concerns that the
proposed ESRDB market basket update is insufficient given inflation. As
discussed in section II.B.1.a.(2)(c) of this final rule, we believe the
final CY 2024 ESRDB market basket update using the 2020-based ESRDB
adequately reflects the average change in the price of goods and
services ESRD facilities purchase to provide renal dialysis services
and is technically appropriate to use as the ESRD PPS payment update
factor, which determines the payment rate for renal dialysis services
furnished to patients with AKI at ESRD facilities. We appreciate the
commenter's suggestion that any forecast error adjustment applied to
payments under the ESRD PPS should also be applied to payments for AKI
patients. As discussed in section II.B.1.a.(2)(e) of this final rule,
we are not finalizing a forecast error adjustment for the ESRD PPS for
several reasons, but we will consider this suggestion for potential
future rulemaking.
Final Rule Action: We are finalizing our proposal to base the AKI
payment rate on the finalized ESRD PPS base rate, adjusted by the ESRD
facility's wage index. Specifically, the final CY 2024 ESRD PPS base
rate is $271.02 as finalized in section II.B.1.d of this final rule.
Accordingly, we are finalizing a CY 2024 per treatment payment rate of
$271.02 for renal dialysis services furnished by ESRD facilities to
individuals with AKI. Additionally, we are finalizing our proposal to
apply the updated the ESRD PPS wage index for CY 2024 payments for
renal dialysis services furnished by ESRD facilities to individuals
with AKI as finalized in section II.B.1.b of this final rule.
IV. End-Stage Renal Disease Quality Incentive Program (ESRD QIP)
A. Background
For a detailed discussion of the ESRD QIP's background and history,
including a description of the Program's authorizing statute and the
policies that we have adopted in previous final rules, we refer readers
to previous ESRD QIP rules at: 75 FR 49030; 76 FR 628; 76 FR 70228; 77
FR 67450; 78 FR 72156; 79 FR 66120; 80 FR 68968; 81 FR 77834; 82 FR
50738; 83 FR 56922; 84 FR 60648; 85 FR 71398; 86 FR 61874; and 87 FR
67136.
We have also codified many of our policies for the ESRD QIP at
Sec. Sec. 413.177 and 413.178.
B. Updates to the Regulation Text for the ESRD QIP
1. Revision to the Definition of ``Minimum Total Performance Score
(mTPS)'' at Sec. 413.178(a)(8)
In the CY 2019 ESRD PPS final rule, we codified a number of key
terms used in the ESRD QIP at Sec. 413.178(a) of our regulations (83
FR 56980 through 56982). One of these terms is ``minimum total
performance score'' (mTPS), which we defined at Sec. 413.178(a)(8)
``with
[[Page 76434]]
respect to a payment year'' \107\ as ``the total performance score that
an ESRD facility would receive if, during the baseline period, it
performed at the 50th percentile of national ESRD facility performance
on all clinical measures and the median of national ESRD facility
performance on all reporting measures.''
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\107\ In the CY 2023 ESRD PPS final rule, we revised Sec.
413.178(a)(8) to exempt PY 2023 (87 FR 67229).
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In the CY 2024 ESRD PPS proposed rule, we stated that we have
recently reevaluated this definition and determined that it should be
revised to more accurately capture how we calculate the median of
national ESRD facility performance on reporting measures (88 FR 42487).
We noted that, although we use data prior to the performance period to
calculate these medians, the data may not be from the same time period,
or ``baseline period'' (see Sec. 413.178(a)(2)) used to calculate the
50th percentile of national ESRD facility performance on the clinical
measures. Instead, our policy has been to calculate the median of
national ESRD facility performance on the ESRD QIP reporting measures
using the most recently available data prior to the applicable
performance period for the payment year. If there were no data
available prior to the first performance period of a new reporting
measure, as was the case for the Clinical Depression Screening and
Follow-Up reporting measure, we would use a proxy median for purposes
of including the reporting measure in our calculation of the mTPS. We
stated that we selected the values for these proxy medians based on the
availability of previous measure data, a facility's familiarity with
similar measures or requirements, and considerations regarding a
facility's ability to comply with new reporting measure requirements
during the initial performance periods for a new reporting measure.
In the CY 2024 ESRD PPS proposed rule, we proposed to update the
definition of ``minimum total performance score'' at Sec.
413.178(a)(8) so that it accurately captures these policies (88 FR
42487). We also proposed that, with respect to the adoption of future
reporting measures, including the reporting measures proposed in the CY
2024 ESRD PPS proposed rule, if there is an insufficient quantity of
data available prior to the first performance period of a new reporting
measure, we will set a proxy median of zero for the reporting measure
until we have sufficient data to calculate the median. We stated our
belief that this proposal will provide facilities with additional
predictability and transparency regarding our calculation of the mTPS
for a payment year. We noted that, although many facilities score much
higher than zero during the initial performance periods of a new
reporting measure, we believe that setting the proxy median at zero
where we do not have sufficient data available will account for the
possibility that new reporting measures may have different reporting
requirements. For example, a new reporting measure may require a
facility to report new or additional data in CMS's ESRD Quality
Reporting System (EQRS) to be eligible for scoring on the reporting
measure. Additionally, a new reporting measure may require that a
facility reconsider its internal processes to comply with the reporting
requirements and be eligible for scoring. In the proposed rule, we
stated that we believe that using a median of zero for new reporting
measures would ensure that the mTPS is calculated based on the worst-
case scenario, rather than assuming a median higher than what may be
observed once data are available. We noted that setting the proxy
median at zero until we have sufficient data available to calculate the
median would allow the timely inclusion of a new reporting measure in
the ESRD QIP measure set, as well as our calculation of the mTPS, while
also encouraging facilities to report the new or additional data that
may be specified by that reporting measure so that they are able to
receive credit for reporting.
We welcomed public comment on this proposal. The comments we
received and our responses are set forth below.
Comment: A few commenters expressed support for the proposed update
to the definition of mTPS, as it will allow for timely inclusion of new
reporting measures and encourage facilities to report data.
Response: We thank commenters for their support.
Final Rule Action: After considering public comments, we are
finalizing our proposal as proposed.
2. Codification of the ESRD QIP Measure Adoption, Retention, and
Removal Policies
In the CY 2013 ESRD PPS final rule (77 FR 67475), we finalized a
policy to retain measures from prior program years for each successive
program year, unless otherwise proposed and finalized. In the CY 2019
ESRD PPS final rule (83 FR 56983 through 56985), we finalized eight
measure removal factors for the ESRD QIP, and we refer readers to that
final rule for details. We also finalized a policy to retain a measure
for certain specified reasons, such as when a particular measure
addresses a gap in quality so significant that removing the measure
could result in poor quality or when a measure addresses a statutorily-
required topic, even if one or more of the measure removal factors
applies. In the CY 2013 ESRD PPS final rule (77 FR 67475), we also
finalized that we would generally remove an ESRD QIP measure using
notice and comment rulemaking unless we determined that the continued
collection of data on the measure raised patient safety concerns. In
that case, we stated that we would promptly remove the measure,
immediately notify ESRD facilities and the public through the usual
communication channels (including listening sessions, memos, email
notification, and website postings), and publish the justification for
the removal in the Federal Register during the next rulemaking cycle.
In the CY 2024 ESRD PPS proposed rule, we proposed to revise Sec.
413.178(c) such that it incorporates these measure adoption, retention,
and removal policies (88 FR 42487). We proposed that existing Sec.
413.178(c)(1) through (5) would be consolidated and renumbered as Sec.
413.178(c)(1)(i) through (v), and we would add a new Sec.
413.178(c)(1)(vi), which would codify our policy to adopt measures for
the ESRD QIP beyond those that address the topics described at Sec.
413.178(c)(1)(i) through (v). We also proposed to codify at Sec.
413.178(c)(2) our policies regarding the use of endorsed measures. We
proposed to codify at Sec. 413.178(c)(3) our policy regarding the
updating of measure specifications. Additionally, we proposed to codify
at Sec. 413.178(c)(4) our policy regarding measure retention. Finally,
we proposed to codify at Sec. 413.178(c)(5) our policies regarding
measure removal. We stated our belief that these proposals will make it
easier for interested parties to find these policies and will further
align the ESRD QIP regulations with the regulations we have codified
for other quality reporting programs.
We welcomed public comment on these proposals. The comments we
received and our responses are set forth below.
Comment: A few commenters expressed support for the proposals to
codify existing measure adoption, retention, and removal policies,
noting that these updates will provide transparency for evaluating
measures.
Response: We thank the commenters for their support.
Final Rule Action: After considering public comments, we are
finalizing our proposals as proposed.
[[Page 76435]]
C. Updates to Requirements Beginning With the PY 2026 ESRD QIP
1. PY 2026 ESRD QIP Measure Set
In the CY 2024 ESRD PPS proposed rule, we proposed to remove the
Ultrafiltration Rate reporting measure and the Standardized Fistula
Rate clinical measure beginning with PY 2026 (88 FR 42499 through
42500). We also proposed to add the Facility Commitment to Health
Equity reporting measure to the ESRD QIP measure set beginning with PY
2026 (88 FR 42489 through 42494). The previously finalized and proposed
new measures are summarized in Table 12 of the proposed rule (88 FR
42488). We describe the previously finalized measures and the measures
we are finalizing in this final rule in Table 12. The technical
specifications for each of these measures can be found in the CMS ESRD
Measures Manual for the 2023 Performance Period.\108\
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\108\ https://www.cms.gov/files/document/esrd-measures-manual-v80.pdf.
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BILLING CODE 4120-01-P
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\109\ In previous years, we referred to the consensus-based
entity by corporate name. We have updated this language to refer to
the consensus-based entity more generally.
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[[Page 76436]]
[GRAPHIC] [TIFF OMITTED] TR06NO23.024
[[Page 76437]]
2. Adoption of the Facility Commitment to Health Equity Reporting
Measure Beginning With the PY 2026 ESRD QIP
a. Background
In the CY 2024 ESRD PPS proposed rule, we stated that significant
and persistent disparities in healthcare outcomes exist in the U.S. (88
FR 42489). For example, belonging to a racial or ethnic minority group,
being a member of the lesbian, gay, bisexual, transgender, and queer
(LGBTQ+) community, being a member of a religious minority, living in a
rural area, being a person with a disability or disabilities, or being
near or below the poverty level, is often associated with worse health
outcomes.110 111 112 113 114 115 116 117 118 119 Numerous
studies have shown that among Medicare beneficiaries, individuals who
are racial and ethnic minorities often receive lower quality hospital
care, report lower experiences of care, and experience more frequent
hospital readmissions and procedural
complications.120 121 122 123 124 125 Readmission rates in
the Hospital Readmissions Reduction Program have shown to be higher
among Black and Hispanic Medicare beneficiaries with common conditions,
including congestive heart failure and acute myocardial
infarction.126 127 128 129 130 Data indicate that, even
after accounting for factors such as socioeconomic conditions, members
of racial and ethnic minority groups reported experiencing lower
quality healthcare.\131\ Evidence of differences in quality of care
received by people from racial and ethnic minority groups show worse
health outcomes, including a higher incidence of diabetes complications
such as retinopathy.\132\ Additionally, inequities in the drivers of
health affecting these groups, such as poverty and healthcare access,
are interrelated and influence a wide range of health and quality-of-
life outcomes and risks.\133\
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\110\ Joynt KE, Orav E, Jha AK. (2011). Thirty-Day Readmission
Rates for Medicare Beneficiaries by Race and Site of Care. JAMA,
305(7), 675-681. Available at: doi:10.1001/jama.2011.123.
\111\ Lindenauer PK, Lagu T, Rothberg MB, et al. (2013). Income
Inequality and thirty-Day Outcomes After Acute Myocardial
Infarction, Heart Failure, and Pneumonia: Retrospective Cohort
Study. BMJ, 346. Available at: https://doi.org/10.1136/bmj.f521.
\112\ Trivedi AN, Nsa W, Hausmann LRM, et al. (2014). Quality
and Equity of Care in U.S. Hospitals. N Engl J Med, 371(24), 2298-
2308. Available at: doi: 10.1056/NEJMsa1405003.
\113\ Polyakova, M, Udalova V, Kocks, G, Genadek K, Finlay K,
Finkelstein AN. (2021). Racial Disparities In Excess All-Cause
Mortality During The Early COVID-19 Pandemic Varied Substantially
Across States. Health Affairs, 40(2), 307-316. Available at: https://doi.org/10.1377/hlthaff.2020.02142.
\114\ Rural Health Research Gateway. (2018). Rural Communities:
Age, Income, and Health Status. Rural Health Research Recap.
Available at: https://www.ruralhealthresearch.org/assets/2200-8536/rural-communities-age-income-health-status-recap.pdf.
\115\ HHS Office of Minority Health. (2020). Progress Report to
Congress, 2020 Update on the Action Plan to Reduce Racial and Ethnic
Health Disparities. Department of Health and Human Services.
Available at: https://minorityhealth.hhs.gov/report-congress-minority-health.
\116\ Heslin KC, Hall JE. (2021). Sexual Orientation Disparities
in Risk Factors for Adverse COVID-19-Related Outcomes, by Race/
Ethnicity--Behavioral Risk Factor Surveillance System, United
States, 2017-2019. MMWR Morb Mortal Wkly Rep, 70(5), 149. doi:
10.15585/mmwr.mm7005a1.
\117\ Poteat TC, Reisner SL, Miller M, Wirtz AL. (2020). COVID-
19 Vulnerability of Transgender Women With and Without HIV Infection
in the Eastern and Southern U.S. medRxiv. doi: 10.1101/
2020.07.21.20159327.
\118\ Vu M, Azmat A, Radejko T, Padela AI. (2016). Predictors of
Delayed Healthcare Seeking Among American Muslim Women. Journal of
Women's Health, 25(6), 586-593. doi: 10.1089/jwh.2015.5517.
\119\ Nadimpalli SB, Cleland CM, Hutchinson MK, Islam N, Barnes
LL, Van Devanter N. (2016). The Association Between Discrimination
and the Health of Sikh Asian Indians. Health Psychology, 35(4), 351-
355. https://doi.org/10.1037/hea0000268.
\120\ CMS Office of Minority Health. (2020). Racial, Ethnic, and
Gender Disparities in Healthcare in Medicare Advantage. Baltimore,
MD: Centers for Medicare & Medicaid Services. Available at: .
\121\ CMS Office of Minority Health. (Updated August 2018).
Guide to Reducing Disparities in Readmissions. Baltimore, MD:
Centers for Medicare & Medicaid Services. Available at: https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/OMH_Readmissions_Guide.pdf.
\122\ Singh JA, Lu X, Rosenthal GE, Ibrahim S, Cram P. (2014).
Racial Disparities in Knee and Hip Total Joint Arthroplasty: An 18-
year analysis of national Medicare data. Ann Rheum Dis., 73(12),
2107-15. Available at: doi:10.1136/annrheumdis-2013-203494.
\123\ Rivera-Hernandez M, Rahman M, Mor V, Trivedi AN. (2019).
Racial Disparities in Readmission Rates among Patients Discharged to
Skilled Nursing Facilities. J Am Geriatr Soc., 67(8), 1672-1679.
Available at: https://doi.org/10.1111/jgs.15960.
\124\ Joynt KE, Orav E, Jha AK. (2011). Thirty-Day Readmission
Rates for Medicare Beneficiaries by Race and Site of Care. JAMA,
305(7), 675-681. Available at: doi:10.1001/jama.2011.123.
\125\ Tsai TC, Orav EJ, Joynt KE. (2014). Disparities in
Surgical 30-day Readmission Rates for Medicare Beneficiaries by Race
and Site of Care. Ann Surg., 259(6), 1086-1090. Available at: doi:
10.1097/SLA.0000000000000326.
\126\ Rodriguez F, Joynt KE, Lopez L, Saldana F, Jha AK. (2011).
Readmission Rates for Hispanic Medicare Beneficiaries with Heart
Failure and Acute Myocardial Infarction. Am Heart J., 162(2), 254-
261 e253. Available at: https://doi.org/10.1016/j.ahj.2011.05.009.
\127\ Centers for Medicare & Medicaid Services. (2014). Medicare
Hospital Quality Chartbook: Performance Report on Outcome Measures.
Available at: https://www.hhs.gov/guidance/document/medicare-hospital-quality-chartbook-performance-report-outcome-measures.
\128\ CMS Office of Minority Health. (Updated August 2018).
Guide to Reducing Disparities in Readmissions. Baltimore, MD:
Centers for Medicare & Medicaid Services. Available at: https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/OMH_Readmissions_Guide.pdf.
\129\ Prieto-Centurion V, Gussin HA, Rolle AJ, Krishnan JA.
(2013). Chronic Obstructive Pulmonary Disease Readmissions at
MinorityServing Institutions. Ann Am Thorac Soc., 10(6), 680-684.
Available at: https://doi.org/10.1513/AnnalsATS.201307-223OT.
\130\ Joynt KE, Orav E, Jha AK. (2011). Thirty-Day Readmission
Rates for Medicare Beneficiaries by Race and Site of Care. JAMA,
305(7), 675-681. Available at: doi:10.1001/jama.2011.123.
\131\ Nelson AR. (2003). Unequal Treatment: Report of the
Institute of Medicine on Racial and Ethnic Disparities in
Healthcare. The Annals of thoracic surgery, 76(4), S1377-S1381. doi:
10.1016/s0003-4975(03)01205-0.
\132\ Peek, ME, Odoms-Young, A, Quinn, MT, Gorawara-Bhat, R,
Wilson, SC, & Chin, MH. (2010). Race and Shared Decision-Making:
Perspectives of African-Americans with diabetes. Social Science &
Medicine, 71(1), 1-9. Available at: doi:10.1016/
j.socscimed.2010.03.014.
\133\ Department of Health and Human Services. (2021). Healthy
People 2020: Disparities. Available at: www.healthypeople.gov/2020/about/foundation-health-measures/Disparities.
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In the CY 2022 ESRD PPS proposed rule (86 FR 36362 through 36369),
we requested information on our Equity Plan for Improving Quality in
Medicare (also referred to as the CMS Framework for Health
Equity),\134\ which outlines our commitment to close health equity gaps
through improved data collection, measurement, and analysis of
disparities across programs and policies. The request for information
requested public comment regarding the potential stratification of
quality measure results by race and ethnicity and the potential
creation of a hospital or facility equity score in CMS quality
reporting and value-based purchasing programs, including the ESRD QIP.
In the CY 2024 ESRD PPS proposed rule, we stated that we received many
responses to that request for public comment (88 FR 42489), and we
referred readers to the CY 2022 ESRD PPS final rule for summaries of
those comments (86 FR 61934 through 61937). We noted in the CY 2022
ESRD PPS final rule the value of these comments in the continuing
development of our health equity quality measurement efforts, and we
stated that we would take the comments
[[Page 76438]]
into account for future development and expansion of our health equity
quality measurement efforts.
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\134\ Centers for Medicare and Medicaid Services. (2022). CMS
Framework for Health Equity 2022-2032. Available at: https://www.cms.gov/files/document/cms-framework-health-equity-2022.pdf.
Centers for Medicare & Medicaid Services. (2021). Paving the Way to
Equity: A Progress Report. Available at: https://www.cms.gov/files/document/paving-way-equity-cms-omh-progress-report.pdf. Accessed on
February 20, 2023. See also, Centers for Medicare & Medicaid
Services Office of Minority Health. (2021). The CMS Equity Plan for
Improving Quality in Medicare. 2015-2021. Available at: https://
www.cms.gov/About-CMS/Agency-Information/OMH/OMH_Dwnld-
CMS_EquityPlanforMedicare_090615.pdf#:~:text=The%20Centers%20for%20Me
dicare%20%26%20Medicaid%20Services%20%28CMS%29,evidence%20base%2C%20i
dentifying%20opportunities%2C%20and%20gathering%20stakeholder%20input
. Accessed on February 20, 2023.
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The Agency for Healthcare Research and Quality (AHRQ) and The Joint
Commission have independently concluded that facility leadership plays
an important role in promoting a culture of quality and
safety.135 136 137 AHRQ research shows that facility boards
can influence quality and safety in a variety of ways; not only through
strategic initiatives, but also through more direct interactions with
frontline workers.\138\ The Joint Commission found that a leader who is
committed to prioritizing and making patient safety visible through
every day actions is a critical part of creating a true culture of
safety, which in turn fosters an organizational culture in which
patients are treated with dignity and respect.\139\ Because CMS is also
working toward the goal of all patients receiving high-quality
healthcare, regardless of individual characteristics, we are also
committed to supporting healthcare organizations in building a culture
of safety and equity that focuses on educating and empowering their
workforce to recognize and eliminate health disparities. This includes
patients receiving the right care, at the right time, in the right
setting for their condition(s), regardless of those characteristics.
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\135\ Agency for Healthcare Research and Quality. Leadership
Role in Improving Patient Safety. Patient Safety Primer, September
2019. Available at: https://psnet.ahrq.gov/primer/leadership-role-improving-safety.
\136\ Joint Commission on Accreditation of Healthcare
Organizations, USA. The essential role of leadership in developing a
safety culture. Sentinel Event Alert. 2017 (Revised June 2021).
Available at: https://www.jointcommission.org/-/media/tjc/documents/resources/patient-safety-topics/sentinel-event/sea-57-safety-culture-and-leadership-final2.pdf.
\137\ See information on launch of new ``Health Care Equity
Certification'' in July 2023 from Joint Commission on Accreditation
of Healthcare Organizations, USA, available at: https://www.jointcommission.org/our-priorities/health-care-equity/health-care-equity-prepublication/.
\138\ Agency for Healthcare Research and Quality. Leadership
Role in Improving Patient Safety. Patient Safety Primer, September
2019: Available at: https://psnet.ahrq.gov/primer/leadership-role-improving-safety.
\139\ Joint Commission on Accreditation of Healthcare
Organizations, USA. The essential role of leadership in developing a
safety culture. Sentinel Event Alert. 2017 (Revised June 2021).
Available at: https://www.jointcommission.org/-/media/tjc/documents/resources/patient-safety-topics/sentinel-event/sea-57-safety-culture-and-leadership-final2.pdf.
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We believe that strong and committed leadership from dialysis
facility executives and board members is essential and can play a role
in shifting organizational culture and advancing equity goals for
dialysis facilities. Studies demonstrate that hospital leadership can
positively influence culture for better quality, patient outcomes, and
experience of care.140 141 142 A systematic review of 122
published studies showed that strong leadership that prioritized
safety, quality, and the setting of clear guidance with measurable
goals for improvement resulted in a high-performing hospital with
better patient outcomes.\143\ We believe this conclusion also applies
to dialysis facilities, and that the commitment of dialysis facility
leadership to health equity would result in a reduction of health
disparities in the ESRD population.
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\140\ Bradley EH, Brewster AL, McNatt Z, et al. (2018) How
Guiding Coalitions Promote Positive Culture Change in Hospitals: A
Longitudinal Mixed Methods Interventional Study. BMJ Qual Saf.,
27(3), 218-225. doi:10.1136/bmjqs-2017-006574.
\141\ Smith SA, Yount N, Sorra J. (2017). Exploring
Relationships Between Hospital Patient Safety Culture and Consumer
Reports Safety Scores. BMC Health Services Research, 17(1), 143.
doi:10.1186/s12913-017-2078-6.
\142\ Keroack MA, Youngberg BJ, Cerese JL, Krsek C, Prellwitz
LW, Trevelyan EW. (2007). Organizational Factors Associated with
High Performance in Quality and Safety in Academic Medical Centers.
Acad Med., 82(12), 1178-86. doi: 10.1097/ACM.0b013e318159e1ff.
\143\ Millar R, Mannion R, Freeman T, et al. (2013). Hospital
Board Oversight of Quality and Patient Safety: A Narrative Review
and Synthesis of Recent Empirical Research. The Milbank quarterly,
91(4), 738-70. doi:10.1111/1468-0009.12032.
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Our belief that a leadership commitment to health equity can lead
to a reduction of health disparities is also supported by research
conducted by the Institute for Healthcare Improvement (IHI), which
studied 23 health systems throughout the U.S. and Canada. The IHI's
research showed that health equity must be a priority championed by
leadership teams to improve both patient access to needed healthcare
services and outcomes among populations that have been disadvantaged by
the healthcare system.\144\ This IHI study specifically identified
concrete actions to make advancing health equity a core strategy,
including establishing this goal as a leader-driven priority alongside
organizational development structures and processes.\145\ Based upon
these findings, we believe that dialysis facility leadership can be
instrumental in setting specific, measurable, attainable, realistic,
and time-based (SMART) goals to assess progress towards achieving
equity goals and ensuring high-quality care at dialysis facilities is
accessible to all. Based on this well-developed body of evidence, in
the proposed rule we proposed to adopt an attestation-based structural
reporting measure, Facility Commitment to Health Equity, for the ESRD
QIP beginning with PY 2026 (88 FR 42490).
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\144\ Mate KS and Wyatt R. (2017). Health Equity Must Be a
Strategic Priority. NEJM Catalyst. Available at: https://catalyst.nejm.org/doi/full/10.1056/CAT.17.0556.
\145\ Mate KS and Wyatt R. (2017). Health Equity Must Be a
Strategic Priority. NEJM Catalyst. Available at: https://catalyst.nejm.org/doi/full/10.1056/CAT.17.0556.
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The first pillar of our strategic priorities \146\ reflects our
deep commitment to improvements in health equity by addressing the
health disparities that underly our health system. In line with this
strategic pillar, we developed this structural measure to assess
facility commitment to health equity across five domains (see Table 13)
using a suite of organizational competencies aimed at achieving health
equity for all patients, including but not limited to patients who
belong to racial and ethnic minority groups, people with disabilities,
members of the LGBTQ+ community, individuals with limited English
proficiency, rural populations, religious minorities, and people facing
socioeconomic challenges. We believe these elements are actionable
focus areas, and assessment of dialysis facility leadership commitment
to them is foundational.
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\146\ Brooks-LaSure, C. (2021). My First 100 Days and Where We
Go From Here: A Strategic Vision for CMS. Centers for Medicare &
Medicaid. Available at: https://www.cms.gov/blog/my-first-100-days-and-where-we-go-here-strategic-vision-cms.
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We proposed to adopt the measure under section 1881(h)(2)(A)(iv) of
the Act, which gives the Secretary broad authority to specify measures
for the ESRD QIP (88 FR 42490). We noted that disparities in health
equity are tied to worse patient outcomes in the ESRD community. For
example, individuals from racial and ethnic minority groups and with
lower incomes are less likely to receive recommended care for CKD risk
factors and are also less likely to reduce CKD risk through recommended
treatment goals.147 148 149 150
[[Page 76439]]
Consequently, some groups are more likely to progress from CKD to ESRD
and less likely to be under the care of a nephrologist before starting
dialysis.\151\ Individuals from racial and ethnic minority groups with
ESRD are more likely to have 30-day hospital readmissions when compared
to non-Hispanic White patients.\152\ We stated that we believe that
this measure is an appropriate measure of ESRD quality of care because
it would improve facilities' awareness of the tie between their
structural practices and their patient outcomes by reporting these
data, thus informing facility practices such that their patients attain
better outcomes. We also stated our belief that the proposed measure
would incentivize facilities to collect and utilize their data to
identify their own critical equity gaps, implement plans to address
said gaps, and ensure that they dedicate resources to addressing those
gaps. Facilities could analyze data to understand, for example, whether
there are any demographic factors (such as race, national origin,
primary language, and ethnicity), or social drivers of health (such as
housing status and food security) that may be affecting access to care
or contributing to poor outcomes in their patient populations and, in
turn, develop appropriate solutions to improve access and outcomes.
Thus, the measure aims to support facilities in leveraging available
data, pursuing focused quality improvement activities, and promoting
efficient and effective use of their resources. While the measure does
not require facilities to take specific actions, we expect that any
solution a facility might develop to address a gap it identifies would
comply with all applicable Federal non-discrimination laws. We also
note that the measure is intended to promote health equity for all
patients and is not intended to create a conflict between a CMS
requirement and a State's civil rights laws.
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\147\ United States Renal Data System. 2021 USRDS Annual Data
Report: Epidemiology of kidney disease in the United States.
National Institutes of Health, National Institute of Diabetes and
Digestive and Kidney Diseases, Bethesda, MD, 2021. We note that,
following publication of the CY 2024 ESRD PPS proposed rule, the
USRDS has published its 2022 annual report, which is available at:
https://usrds-adr.niddk.nih.gov/2022.
\148\ Benjamin O, Lappin SL. End-Stage Renal Disease. [Updated
2021 Sep 16]. In: Stat Pearls [internet]. Treasure Island (FL):
StatPearls Publishing; 2022. Available from: https://www.ncbi.nlm.nih.gov/books/NBK499861/.
\149\ Norris, K.C., Williams, S.F., Rhee, C.M., Nicholas, S.B.,
Kovesdy, C.P., et al. (2017). Hemodialysis Disparities in African
Americans: The Deeply Integrated Concept of Race in the Social
Fabric of Our Society. Seminars in Dialysis 30(3):213-223.
doi:10.1111/sdi.12589.
\150\ CMS (2021). Chronic Kidney Disease Disparities:
Educational Guide for Primary Care. Available at: https://www.cms.gov/files/document/chronic-kidney-disease-disparities-educational-guide-primary-care.pdf.
\151\ Norton, J. M., Moxey-Mims, M. M., Eggers, P. W., Narva, A.
S., Star, R. A., Kimmel, P. L., & Rodgers, G. P. (2016). Social
Determinants of Racial Disparities in CKD. Journal of the American
Society of Nephrology: JASN, 27(9), 2576-2595. https://doi.org/10.1681/ASN.2016010027.
\152\ CMS (2014). Health Disparities Among Aged ESRD
Beneficiaries, 2014. Available at: https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/ESRD-Infographic.pdf.
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The five questions of the structural measure are adapted from the
CMS Office of Minority Health's Building an Organizational Response to
Health Disparities framework, which focuses on data collection, data
analysis, culture of equity, and quality improvement.\153\ We have
already adopted this measure for the Hospital Inpatient Quality
Reporting (IQR) Program, and we refer readers to the FY 2023 IPPS/LTCH
PPS final rule (87 FR 49191 through 49201) for a discussion of the
measure in that program. In the proposed rule, we stated that, other
than replacing the term ``hospital'' with the term ``facility,'' the
measure is identical to the Hospital IQR Program measure. The Facility
Commitment to Health Equity measure is aligned with the Meaningful
Measures Area of ``Equity of Care'' and the Meaningful Measures 2.0
goal to ``Leverage Quality Measures to Promote Equity and Close Gaps in
Care'' because it seeks to assess structural health equity issues that
could inform facility practices such that their patients attain better
outcomes. This measure also supports the Meaningful Measures 2.0
objective to ``[c]ommit to a patient-centered approach in quality
measure and value-based incentives programs to ensure that quality and
safety measures address healthcare equity'' because the measure would
incentivize facilities to identify their own healthcare equity gaps
from a structural perspective.
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\153\ Centers for Medicare & Medicaid Services. (2021). Building
an Organizational Response to Health Disparities [Fact Sheet]. U.S.
Department of Health and Human Services. Available at: https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/Health-Disparities-Guide.pdf.
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b. Overview of Measure
The Facility Commitment to Health Equity reporting measure assesses
dialysis facility commitment to health equity using a suite of equity-
focused organizational competencies aimed at achieving health equity
for all populations, including those that have been disadvantaged,
marginalized, and underserved by the healthcare system. As previously
noted, this includes, but is not limited to: racial and ethnic minority
groups, people with disabilities, members of the LGBTQ+ community,
individuals with limited English proficiency, rural populations,
religious minorities, and people facing socioeconomic challenges. Table
13 includes the five attestation domains and the elements within each
of those domains for which we had proposed a facility would report an
affirmative attestation in order for the facility to receive points for
that domain.
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c. Measure Calculation
The Facility Commitment to Health Equity measure consists of five
attestation-based questions, each representing a separate domain of
commitment. For a facility to affirmatively attest ``yes'' to a domain,
and receive points for that domain, the facility would need to
determine that it engages in all of the activities that are included as
elements under the domain. A facility that engages in all of the
activities for a domain would report an affirmative attestation by
answering ``yes'' to the attestation-based question for that domain.
There is no option for a facility to answer ``yes'' in response to an
attestation-based question for a domain if the facility engages in
some, but not all, of the activities included as domain elements, and
there is also no option for a facility to answer ``no'' in response to
any attestation-based question for a domain. The measure would be
expressed as a fraction, and a facility can score either 0, 2, 4, 6, 8,
or 10 for the performance period, depending on the number of domains to
which a facility positively attests. In the proposed rule, we proposed
that the measure denominator would be ``ten,'' with each domain being
represented as two points out of that total ten points, and that the
numerator would be calculated as two points for each ``yes'' answer the
facility reports which are then summed together (88 FR 42493). We
stated that we chose to award facilities two points for each
affirmative response to an attestation-based question so that the
maximum number of points a facility could receive for the measure is
ten, which is the same maximum number of points that a facility can
receive on other ESRD QIP measures.
For example, for Domain 1 (``Facility commitment to reducing
healthcare disparities is strengthened when equity is a key
organizational priority''), a facility would evaluate and determine
whether its strategic plan satisfies all of the elements described in
(A) through (D) (see Table 13). If the facility's plan satisfies all
four of these elements, the facility would respond ``yes'' to the
attestation-based question for Domain 1 and receive two (2) points for
that response. If the facility determined that its strategic plan
satisfies elements (A) and (B) but not (C) and (D), the facility would
not be able to respond ``yes'' to Domain 1 and would not receive any
points for that domain.
The numerator is calculated as the sum of the points the facility
earns for responding ``yes'' to the attestation-based questions. For
example, a facility that responds ``yes'' to all five attestation-based
questions would receive the maximum 10 points (two points for each of
the five ``yes'' responses). A facility that responds ``yes'' to three
of the attestation-based questions would receive six points.
We proposed that the Facility Commitment to Health Equity reporting
measure would be added to the Reporting Measure Domain (88 FR 42493).
We noted that technical specifications for the measure can be found in
the ESRD QIP CY 2024 Technical Measure Specifications, which are
available at: https://www.cms.gov/medicare/quality-initiatives-patient-assessment-instruments/esrdqip/061_technicalspecifications. Consistent
with case minimums we have adopted for our other ESRD QIP reporting
measures, we proposed that facilities must have 11 qualifying patients
and a CCN open date before September 1 of the performance period that
applies to the program year in order to be eligible for scoring on the
Facility Commitment to Health Equity reporting measure.
d. Data Submission and Reporting
In the proposed rule, we proposed to require facilities to submit
data needed to calculate the Facility Commitment to Health Equity
measure once on an annual basis using CMS's ESRD Quality Reporting
System (EQRS) beginning with PY 2026 (88 FR 42494). We proposed that
the deadline for submission would be the end of the EQRS December data
reporting month for the applicable performance period, which is
consistent with current reporting deadlines for other ESRD QIP
measures. For example, for the PY 2026 ESRD QIP, facilities would need
to report data on the measure by the end of the December data reporting
month in CY 2024. As described in Table 17 of the proposed rule (88 FR
42504) and reproduced in Table 18 of this final rule, we proposed
performance standards for the Facility Commitment to Health Equity
reporting measure. We also proposed a 12-month performance period for
the measure, and note that we did not receive any comments on this
aspect of the measure proposal. We further proposed that facilities
would be required to follow the submission and reporting requirements
for web-based measures for the ESRD QIP posted on the QualityNet
website: https://qualitynet.cms.gov/esrd/esrdqip.
e. Review by the Measure Applications Partnership
The Facility Commitment to Health Equity measure was included as a
measure under consideration for the ESRD QIP on the publicly available
``List of Measures Under Consideration for December 1, 2022'' (MUC
List), a list of measures under consideration for use in various
Medicare quality programs.\154\ The CBE-convened Measure Applications
Partnership (MAP) Health Equity Advisory Group reviewed the MUC List
and the Facility Commitment to Health Equity measure (MUC2022-027) in
detail on December 6-7, 2022.\155\ The Health Equity Advisory Group
expressed concern that this is more of a ``checklist'' measure that may
not directly address health inequities at a systemic level, but the
advisory group generally agreed that a structural measure such as this
one represents progress toward improving equitable care.\156\ In
addition, on December 8 through 9, 2022, the MAP Rural Health Advisory
Group reviewed the 2022 MUC List, and the MAP Hospital Workgroup
reviewed the 2022 MUC List on December 13 through 14, 2022.\157\ The
MAP Hospital Workgroup recognized that reducing health care disparities
would represent a substantial benefit to overall quality of care, but
expressed reservations about the measure's link to clinical outcomes;
the MAP Hospital Workgroup members voted to conditionally support the
measure for rulemaking pending: (1) endorsement by a consensus-based
entity (CBE); (2) committing to look at outcomes in the future; (3)
providing more clarity on the measure and supplementing interpretations
with
[[Page 76442]]
results; and (4) verifying attestation provided by the accountable
entities.\158\ Thereafter, the MAP Coordinating Committee deliberated
on January 24 through 25, 2023 and ultimately voted to conditionally
support the Facility Commitment to Health Equity measure for rulemaking
with the same conditions.\159\
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\154\ Centers for Medicare & Medicaid Services. 2022. List of
Measures Under Consideration for December 1, 2022. We note that the
link provided in the CY 2024 ESRD PPS proposed rule has been
updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\155\ Centers for Medicare & Medicaid Services. 2023. 2022-2023
MAP Final Recommendations. We note that the link provided in the CY
2024 ESRD PPS proposed rule has been updated, and is now available
at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\156\ Centers for Medicare & Medicaid Services. 2023. 2022-2023
MAP Final Recommendations. We note that the link provided in the CY
2024 ESRD PPS proposed rule has been updated, and is now available
at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\157\ [thinsp]Centers for Medicare & Medicaid Services. 2023.
2022-2023 MAP Final Recommendations. Rural Health Advisory Group. We
note that the link provided in the CY 2024 ESRD PPS proposed rule
has been updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\158\ Centers for Medicare & Medicaid Services. 2023. 2022-2023
MAP Final Recommendations. We note that the link provided in the CY
2024 ESRD PPS proposed rule has been updated, and is now available
at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\159\ Centers for Medicare & Medicaid Services. 2023. 2022-2023
MAP Final Recommendations. We note that the link provided in the CY
2024 ESRD PPS proposed rule has been updated, and is now available
at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
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f. Consensus-Based Entity Endorsement
Although section 1881(h)(2)(B)(i) of the Act generally requires
that measures specified by the Secretary for the ESRD QIP be endorsed
by the entity with a contract under section 1890(a) of the Act, section
1881(h)(2)(B)(ii) of the Act states that in the case of a specified
area or medical topic determined appropriate by the Secretary for which
a feasible and practical measure has not been endorsed by the entity
with a contract under section 1890(a) of the Act, the Secretary may
specify a measure that is not so endorsed as long as due consideration
is given to measures that have been endorsed or adopted by a consensus
organization identified by the Secretary. We reviewed CBE-endorsed
measures and were unable to identify any other CBE-endorsed measures on
this topic, and therefore we believe the exception in section
1881(h)(2)(B)(ii) of the Act applies.
g. Public Display
In the proposed rule, we proposed to publicly display the facility-
specific results for the Facility Commitment to Health Equity reporting
measure on an annual basis through our Care Compare website at: https://www.medicare.gov/care-compare/. We stated that we anticipate making
the first public report available in January 2026.
We invited public comment on this proposal. The comments we
received and our responses are set forth below.
Comment: Several commenters expressed support for the Facility
Commitment to Health Equity measure. A few of these commenters
appreciated the Facility Commitment to Health Equity measure as a step
towards requiring demonstration of equitable policies and practices.
One commenter noted that the measure will help facilities assess
commitment to health equity by focusing on relevant organizational
competencies. One commenter, emphasizing the importance of strong,
diverse, and committed leadership in advancing health equity goals at
the facility level, stated that the measure would incentivize
facilities to identify and address equity gaps. One commenter noted
that the measure is a low burden first step to address inequity,
supports Meaningful Measures 2.0, and focuses on SMART goals which are
the basis for measuring improvement in health outcomes.
Response: We thank commenters for their support of our proposal to
adopt the Facility Commitment to Health Equity reporting measure. We
agree that the measure assesses a facility's commitment to health
equity and is intended to encourage facilities to understand their own
health equity gaps so they can improve patient outcomes.
Comment: A few commenters expressed support for public reporting of
the measure.
Response: We thank the commenters for their support.
Comment: A few commenters who supported the adoption of the
Facility Commitment to Health Equity measure also offered suggestions
for possible expansion of the measure. A few commenters recommended
expanding the scope of the measure to specifically ensure that
facilities identify and address equity in access to home dialysis. One
commenter recommended that the measure eventually be expanded to
capture a greater depth of information that would provide more
meaningful data to CMS and patients. The commenter also recommended
that CMS include health equity requirements as part of the Conditions
for Coverage for the Medicare program, which could potentially be used
to require that facilities collect and stratify data on certain
demographic elements. One commenter encouraged CMS take actions to
further enable nurses to support health equity efforts, noting their
critical role in patient engagement while balancing administrative
burden.
Response: We thank commenters for their suggestions, which we will
consider as we continue to develop potential future policies on this
topic.
Comment: One commenter expressed support for the Facility
Commitment to Health Equity measure but recommended that CMS ensure
that there are no unintended consequences, such as disincentivizing
facilities from operating in areas that may have greater health
disparities.
Response: We appreciate the commenter's support and will monitor
this measure, as we do all ESRD QIP measures, for any unintended or
adverse outcomes associated with implementation.
Comment: Several commenters stated that it was unclear how the
Facility Commitment to Health Equity measure would result in a
reduction of social inequities. A few commenters expressed concern that
the measure lacks follow-up and does not require facilities to take
specific action upon identifying health equity gaps. A few commenters
expressed concern that, without additional requirements for facilities
to make changes based on identified health equity gaps, the Facility
Commitment to Health Equity measure may only serve as a checklist
measure rather than incentivizing change at the systemic level. One
commenter expressed concern that the Facility Commitment to Health
Equity measure is not relevant to the ESRD QIP because the measure was
developed for the hospital setting. One commenter expressed concern
that the measure would not promote meaningful action in patient care
because it is not clinical.
Response: We believe this measure is an important foundational
measure for improving health equity for the facility's entire patient
population, which may include patients that have been underserved by
the healthcare system. As we discussed in section IV.C.2.a. of the
proposed rule, there is substantial research showing differences in
care and experiences among underserved populations (88 FR 42489 through
42491). The measure is intended to encourage facilities to analyze
their own data to understand whether there are demographic factors or
other social drivers of health that may be contributing to the health
outcomes experienced by their patients so they can develop solutions to
improve those outcomes for all of their patients. We believe that
adopting the measure for dialysis facilities will help improve access
to care and outcomes for the ESRD population by making facilities more
aware of certain potential opportunities for improvement. We also
believe that a commitment to health equity by dialysis facility
leadership can foster organizational competencies aimed at achieving
health equity for the facility's patients. Although the Facility
Commitment to Health Equity reporting measure is not a clinical
measure, the measure could improve facility awareness of the tie
between its structural practices and its patient outcomes, which we
believe will lead to improved clinical outcomes for patients.
[[Page 76443]]
Comment: Although commenters appreciated the importance of a
commitment to health equity and expressed support for CMS's efforts to
address health equity, a few commenters expressed concern that the
Facility Commitment to Health Equity measure needs to be developed
further prior to inclusion in the ESRD QIP so that it is more
meaningful to the ESRD population and care setting. One commenter
requested that CMS engage with stakeholders in the ESRD community to
improve the measure so that it is more applicable to the dialysis
facility setting.
Response: The Facility Commitment to Health Equity measure is a
structural measure that is designed to apply across multiple healthcare
settings. The five measure domains (that is, equity is a strategic
priority, data collection, data analysis, quality improvement, and
leadership engagement) apply to dialysis facilities. Specifically,
dialysis facilities collect data and analyze data for quality
improvement purposes. Facilities also establish organizational plans
that define practices and policies that impact health equity. We
believe strong and committed leadership from dialysis facility
leadership is essential and can play a role in advancing equity goals
for facilities. Although we appreciate commenters' desire that the
measure be tailored further to the ESRD population and setting, we
believe that the measure sufficiently addresses a facility's leadership
and its commitment to health equity in a way that encompasses the needs
of that population and setting. The measure is intended to provide
information to facilities on the level of unmet need among their
patients by encouraging facilities to identify and address potential
health equity gaps. We believe this measure is an important step toward
assessing facility leadership commitment and a fundamental step toward
closing the gap in equitable care for the facility's patients. We will
continue to monitor the measure as it is implemented to ensure that it
is meaningful to the ESRD community.
Comment: A few commenters recommended that CMS submit the measure
to the CBE for review and endorsement to ensure that it is useful and
meaningful for the ESRD population and care setting.
Response: While we recognize the value of CBE endorsement review,
and plan to submit this measure for CBE endorsement in the future,
measures of health equity are a priority for CMS, and we believe it is
important to implement this measure as soon as possible. We note that
under section 1881(h)(2)(B)(ii) of the Act the Secretary may specify a
measure that is not endorsed by a CBE as long as due consideration is
given to measures that have been endorsed or adopted by a consensus
organization identified by the Secretary. We reviewed CBE-endorsed
measures and were unable to identify any other CBE-endorsed measures on
this topic, and therefore, we believe the exception in section
1881(h)(2)(B)(ii) of the Act applies. We believe the Facility
Commitment to Health Equity measure establishes an important foundation
to prioritize the achievement of health equity among facilities.
Comment: A few commenters expressed concern regarding the reporting
burden associated with the proposed measure requirements and
recommended that CMS weigh the potential impact on patient health
outcomes against this new administrative burden. A few commenters
stated that certain types of facilities, such as rural and small
facilities, may lack the resources to implement this measure and, as a
result, could be unfairly penalized. One commenter stated that
compliance with the new measure will require substantial training and
additional staff support. One commenter expressed concern that the
reporting requirements associated with the proposed measure would take
resources away from patient care.
Response: We recognize the commenters' concerns about burden of new
measure requirements in the ESRD QIP and believe that our data
submission requirements pose minimal burden on facilities given that
facilities will have 14 months to report the measure with respect to
each performance period. We believe this measure reporting timeline
will provide facilities with ample time to submit data in a timely
manner. We also believe the benefits of this measure outweigh the
burden of reporting it.
Comment: One commenter requested that facilities receive full
credit for attestation, regardless of whether the facility negatively
or positively attests to each given domain. The commenter noted that
this would be consistent with other reporting measures in the ESRD QIP
measure set, which award points for reporting the data, rather than the
results of the reported data.
Response: We believe this measure is an important step towards
assessing leadership commitment to health equity and a fundamental step
towards identifying and closing gaps in quality outcomes. We also
believe that a facility should not receive the maximum 10 points on the
measure for a performance year if it cannot affirmatively attest to all
five domains. We believe that the proposed scoring methodology is
consistent with the scoring methodology we have adopted for the MedRec
reporting measure, which requires that facilities report that
medication reconciliation was performed and documented by an eligible
professional during the reporting period in order to be awarded the
maximum number of points for the measure (83 FR 57009 and 57011).
Comment: One commenter recommended removing the term ``priority''
from Domain 1 to avoid implying that there are populations who are not
priorities.
Response: We agree with the commenter that a facility's entire
patient population should have access to high quality ESRD care.
However, we disagree with commenter that the term ``priority'' should
be removed, as we believe the element focuses on populations that the
facility may identify as having experienced health disparities at that
particular facility. A facility has discretion to identify its own
priority populations and develop its own solutions to support its
equity goals. Therefore, we are finalizing the reference to ``priority
populations'' in Domain 1 as proposed.
Comment: Several commenters recommended that CMS update the measure
specifications in Domain 2 so that facilities without certified EHR
technology are able to positively attest to all domains, noting that
dialysis facilities are not required to use certified EHR technology
and may not have it available. These commenters expressed concern that
public reporting of measure results for facilities that do not
positively attest to all domains because they are without access to
certified EHR technology could lead the public to misinterpret the
results as a lack of commitment to health equity. A few commenters
recommended that CMS revise the language to remove the reference to
certified EHR technology to provide flexibility regarding the type of
data technology used while retaining the requirement to input the data
into structured fields. One commenter requested clarification regarding
whether it will accept Electronic Data Interchange (EDI) in the EQRS
for this measure.
Response: We thank commenters for their feedback. Although the
majority of dialysis facilities use some type of EHR technology, we
acknowledge that dialysis facilities are not currently required to use
EHR technology certified by the Office of the National Coordinator for
Health Information
[[Page 76444]]
Technology (ONC) to comply with the requirements of the ESRD QIP. We
agree with commenters that the proposed language in Domain 2 may
prevent facilities from affirmatively attesting to Domain 2 if they can
only affirmatively attest to the elements in (A) and (B). Therefore, we
are finalizing a revision to the elements of Domain 2 so that
facilities can affirmatively attest to that domain if they use EHR
technology that is not certified by ONC. This updated language is
provided in Table 14 below and states, ``(C) Our facility inputs
demographic and/or social determinant of health information collected
from patients into structured, interoperable data elements using EHR
technology.'' Although we encourage facilities to use certified health
IT to promote interoperability and health information exchange across
the healthcare system, we are not requiring dialysis facilities to use
certified EHR technology for purposes of reporting this measure. We
note that EHR technology may include EDI, and therefore EDI may be
accepted as part of the EHR technology requirements included under
Domain 2.
Comment: One commenter noted the relatively short timeframe for
implementation and potential for error in data collection and reporting
due to the complexity of the new data collection and reporting
requirements. One commenter expressed concern regarding the element
under Domain 3 that the facility have facility performance dashboards
to affirmatively attest to that domain beginning with PY 2024, noting
that such dashboards require thoughtful development to ensure that they
are appropriately designed for lower patient volumes and account for
potential clinically-related factors.
Response: We believe that facilities should have sufficient time to
implement any structural processes they need to report the measure.
However, to the extent a facility may need to implement new data
collections or update its systems to enable it to affirmatively attest
to Domain 3 or any other domain, a facility will have until two months
after the end of each 12-month performance period to submit its
attestations for that performance period in EQRS. In addition, a
facility can report an affirmative attestation for a domain as long as
it satisfies the elements of the domain at any time during the
applicable performance period.
Comment: One commenter stated that all facilities participating in
the ESRD Network Program should meet the Domain 4 requirement that
facilities engage in quality activities and recommended that all
dialysis facilities receive automatic credit for this domain.
Response: We believe it is necessary for each dialysis facility to
review its health equity practices under each domain and attest to each
domain separately, including Domain 4. If a facility participates in
quality improvement activities focused on reducing health disparities
as part of a facility's participation in an ESRD Network, then a
facility may affirmatively attest under Domain 4.
Comment: A few commenters observed that the language in Domain 5
does not apply to many individual dialysis facilities, as they are part
of national groups and therefore do not have facility-level CEOs or
boards of trustees. A few commenters also requested clarification as to
whether the Facility Commitment to Health Equity measure requirements
would apply to each individual dialysis facility separately, or whether
they would apply to the larger organization which includes the
individual dialysis facility. One commenter expressed concern regarding
the potential burden imposed on small facilities if compliance with the
Facility Commitment to Health Equity measure would be required at the
facility level and recommended that small facilities be exempt from
Facility Commitment to Health Equity reporting requirements, or that
CMS allow such facilities that are part of a larger organization to use
the organization's strategic plan to satisfy measure requirements. One
commenter expressed concern that facility-level analysis of disparities
may be insufficient to identify and address gaps in the dialysis
setting as these facilities serve more geographically homogenous
populations than other types of healthcare facilities, such as
hospitals.
Response: We thank commenters for their feedback and are finalizing
a modified version of the Domain 5 elements. Whereas the originally
proposed language for Domain 5 required that facilities attest to
leadership engagement at the facility level only, we agree that
facilities should be able to attest to leadership engagement under
Domain 5 if their senior leadership engages in the Domain 5 elements
and that engagement applies to the facility, regardless of whether
those senior leaders operate at only the facility or at a larger
organization that includes the facility. Accordingly, we are finalizing
that the referenced facility senior leadership could be, but are not
required to be, the facility's own chief executives or its board of
trustees.
Regarding commenters' requests for clarification as to whether the
measure requirements would apply to each individual dialysis facility
separately, or whether they would apply to the larger organization
which includes the individual dialysis facility, we note that we
proposed for the Facility Commitment to Health Equity reporting measure
to apply to individual facilities. For all five measure domains, an
individual facility may attest to both facility-level efforts as well
as activities that are implemented by the individual facility as part
of a larger organization's policies. For individual facilities that are
part of larger organizations, we note that this may include leadership
engagement at the larger organizational level as well as leadership
engagement at the individual facility level. Specifically, the
reporting measure would require facilities to review their own
activities in relation to the five measure domains to identify ways to
address disparities within the patient population they serve. We
believe this revision will apply more broadly to accommodate the unique
organization structures across facilities.
The elements of the Facility Commitment to Health Equity Measure,
including the revised language for Domains 2 and 5, are provided in
Table 14.
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Comment: One commenter expressed concern regarding the Facility
Commitment to Health Equity measure, stating that the measure
essentially
[[Page 76446]]
served as a back-door mandate to require that facilities perform a
specific activity and did not provide facilities with flexibility to
achieve the ultimate goal of the measure.
Response: We disagree with the commenter. We believe this measure
is an important foundation for improving health equity in the provision
of ESRD care. We believe that each of the domains provides flexibility
for facilities to affirmatively attest without imposing overly narrow
or prescriptive requirements. Although facilities will be required to
affirmatively attest to each of the elements for a domain to receive
points for that domain, a facility has the discretion to determine what
activities will satisfy each element. We encourage facilities to
analyze their own data to improve their awareness of whether there is a
tie between their structural practices and the outcomes experienced by
their patients, with the goal of attaining better outcomes for all of
their patients.
Final Rule Action: After considering public comments, we are
finalizing the adoption of the Facility Commitment to Health Equity
reporting measure with language refinements to the elements in Domains
2 and 5 as described in Table 14 of this final rule, beginning with PY
2026.
3. Modification of the COVID-19 Vaccination Coverage Among Healthcare
Personnel (HCP) Measure Beginning With PY 2026
a. Background
On January 31, 2020, the Secretary of the Department of Health and
Human Services declared a public health emergency (PHE) for the United
States in response to the global outbreak of SARS-COV-2, a novel (new)
coronavirus that causes a disease named ``coronavirus disease 2019''
(COVID-19).\160\ Subsequently, the COVID-19 Vaccination Coverage Among
Healthcare Personnel (HCP) measure was adopted across multiple quality
reporting programs including the ESRD QIP (87 FR 67244 through 67248),
the Hospital IQR Program (86 FR 45374), the Inpatient Psychiatric
Facility Quality Reporting Program (86 FR 42633 through 42640), the
Hospital Outpatient Quality Reporting Program (86 FR 63824 through
63833), the PPS-Exempt Cancer Hospital Quality Reporting Program (86 FR
45428 through 45434), the Ambulatory Surgical Center Quality Reporting
Program (86 FR 63875 through 63883), the Long-Term Care Hospital
Quality Reporting Program (86 FR 45438 through 45446), the Skilled
Nursing Facility Quality Reporting Program (86 FR 42480 through 42489),
and the Inpatient Rehabilitation Facility Quality Reporting Program (86
FR 42385 through 42396). COVID-19 has continued to spread domestically
and around the world with more than 103.9 million cases and 1.13
million deaths in the United States as of June 19, 2023.\161\ In
recognition of the ongoing significance and complexity of COVID-19, the
Secretary renewed the PHE on April 21, 2020, July 23, 2020, October 2,
2020, January 7, 2021, April 15, 2021, July 19, 2021, October 15, 2021,
January 14, 2022, April 12, 2022, July 15, 2022, October 13, 2022,
January 11, 2023, and February 9, 2023.\162\ While the PHE expired on
May 11, 2023, HHS has stated that the public health response to COVID-
19 remains a public health priority with a whole of government approach
to combatting the virus, including through vaccination efforts.\163\
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\160\ U.S. Dept of Health and Human Services, Office of the
Assistant Secretary for Preparedness and Response. (2020).
Determination that a Public Health Emergency Exists. Available at:
https://aspr.hhs.gov/legal/PHE/Pages/2019-nCoV.aspx.
\161\ CDC. COVID Data Tracker. Accessed June 19, 2023. Available
at: https://covid.cdc.gov/covid-data-tracker/#datatracker-home. We
note that we have updated in this final rule the number of cases and
deaths provided in the proposed rule, which stated that ``COVID-19
has continued to spread domestically and around the world with more
than 103.9 million cases and 1.1 million deaths in the United States
as of March 27, 2023.'' (88 FR 42494).
\162\ U.S. Dept. of Health and Human Services. Office of the
Assistant Secretary for Preparedness and Response. (2023). Renewal
of Determination that a Public Health Emergency Exists. Available
at: https://aspr.hhs.gov/legal/PHE/Pages/COVID19-9Feb2023.aspx.
\163\ U.S. Dept. of Health and Human Services. Fact Sheet:
COVID-19 Public Health Emergency Transition Roadmap. February 9,
2023. Available at: https://www.hhs.gov/about/news/2023/02/09/fact-sheet-covid-19-public-health-emergency-transition-roadmap.html.
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As we stated in the CY 2023 ESRD PPS final rule (87 FR 67244) and
in our Revised Guidance for Staff Vaccination Requirements,\164\
vaccination is a critical part of the nation's strategy to effectively
counter the spread of COVID-19. We continue to believe it is important
to incentivize and track HCP vaccination through quality measurement
across care settings, including dialysis facilities, to protect health
care workers, patients, and caregivers, and to help sustain the ability
of HCP in each of these care settings to continue serving their
communities. Prior to the publication of the CY 2023 ESRD PPS final
rule on November 7, 2022, the FDA had approved or issued emergency use
authorizations (EUAs) for COVID-19 vaccines for adults manufactured by
Pfizer-BioNTech,\165\ Moderna,\166\ and Janssen.\167\ The populations
for which all three vaccines were authorized at that time included
individuals 18 years of age and older, and the Pfizer-BioNTech vaccine
was authorized for ages 12 and older. The FDA issued an approval for
the Pfizer-BioNTech vaccine, now marketed as Comirnaty, on August 23,
2021.\168\ Additionally, the FDA issued approval for the Moderna
vaccine, marketed as Spikevax, on January 31, 2022 \169\ and an EUA for
the Novavax adjuvanted vaccine on July 13, 2022.\170\ The FDA also
issued EUAs for single booster doses of the then-authorized COVID-19
vaccines. As of November 19, 2021,171 172 173 a single
[[Page 76447]]
booster dose of each COVID-19 vaccine was authorized for all eligible
individuals 18 years of age and older. EUAs were subsequently issued
for a second booster dose of the Pfizer-BioNTech and Moderna vaccines
in certain populations in in March 2022.\174\ FDA first authorized the
use of a booster dose of bivalent or ``updated'' COVID-19 vaccines from
Pfizer-BioNTech and Moderna in August 2022.\175\ Since the publication
of the CY 2024 ESRD PPS proposed rule, the 2023-2024 updated Pfizer-
BioNTech, Moderna, and Novavax COVID-19 vaccines were recommended by
CDC for use in the United States.\176\ The 2023-2024 updated COVID-19
vaccine more closely targets the XBB lineage of the Omicron variant and
could restore protection against severe COVID-19 that may have
decreased over time.
---------------------------------------------------------------------------
\164\ Centers for Medicare & Medicaid Services. Revised Guidance
for Staff Vaccination Requirements QSO-23-02-ALL. October 26, 2022.
Available at: https://www.cms.gov/files/document/qs0-23-02-all.pdf.
\165\ Food and Drug Administration. (December 2020). FDA Takes
Key Action in Fight Against COVID-19 By Issuing Emergency Use
Authorization for First COVID-19 Vaccine. Available at: https://www.fda.gov/news-events/press-announcements/fda-takes-key-action-fight-against-covid-19-issuing-emergency-use-authorization-first-covid-19.
\166\ Food and Drug Administration. (December 2020). FDA Takes
Additional Action in Fight Against COVID-19 By Issuing Emergency Use
Authorization for Second COVID-19 Vaccine. Available at: https://www.fda.gov/news-events/press-announcements/fda-takes-additional-action-fight-against-covid-19-issuing-emergency-use-authorization-second-covid.
\167\ Food and Drug Administration. (February 2021). FDA Issues
Emergency Use Authorization for Third COVID-19 Vaccine. Available
at: https://www.fda.gov/news-events/press-announcements/fda-issues-emergency-use-authorization-third-covid-19-vaccine.
\168\ Food and Drug Administration. (August 2021). FDA Approves
First COVID-19 Vaccine. Available at: https://www.fda.gov/news-events/press-announcements/fda-approves-first-covid-19-vaccine.
\169\ Food and Drug Administration. (January 2022). Coronavirus
(COVID-19) Update: FDA Takes Key Action by Approving Second COVID-19
Vaccine. Available at: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-takes-key-action-approving-second-covid-19-vaccine.
\170\ Food and Drug Administration. (July 2022). Coronavirus
(COVID-19) Update: FDA Authorizes Emergency Use of Novavax COVID-19
Vaccine, Adjuvanted. Available at: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-authorizes-emergency-use-novavax-covid-19-vaccine-adjuvanted.
\171\ Food and Drug Administration. (September 2021). FDA
Authorizes Booster Dose of Pfizer-BioNTech COVID-19 Vaccine for
Certain Populations. Available at: https://www.fda.gov/news-events/press-announcements/fda-authorizes-booster-dose-pfizer-biontech-covid-19-vaccine-certain-populations.
\172\ Food and Drug Administration. (October 2021). Coronavirus
(COVID-19) Update: FDA Takes Additional Actions on the Use of a
Booster Dose for COVID-19 Vaccines. Available at: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-takes-additional-actions-use-booster-dose-covid-19-vaccines.
\173\ Food and Drug Administration. (November 2021). Coronavirus
(COVID-19) Update: FDA Expands Eligibility for COVID-19 Vaccine
Boosters. Available at: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-expands-eligibility-covid-19-vaccine-boosters.
\174\ Food and Drug Administration. (March 2022). Coronavirus
(COVID-19) Update: FDA Authorizes Second Booster Dose of Two COVID-
19 Vaccines for Older and Immunocompromised Individuals. Available
at: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-authorizes-second-booster-dose-two-covid-19-vaccines-older-and.
\175\ Food and Drug Administration. (August 2022). Coronavirus
(COVID-19) Update: FDA Authorizes Moderna, Pfizer-BioNTech Bivalent
COVID-19 Vaccines for Use as a Booster Dose. Available at: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-authorizes-moderna-pfizer-biontech-bivalent-covid-19-vaccines-use. We note that, as of September 12, 2023, the bivalent
COVID-19 vaccines are no longer FDA authorized. FDA. (September 11,
2023). FDA Takes Action on Updated mRNA COVID-19 Vaccines to Better
Protect Against Currently Circulating Variants. Available at:
https://www.fda.gov/news-events/press-announcements/fda-takes-action-updated-mrna-covid-19-vaccines-better-protect-against-currently-circulating. The bivalent COVID-19 vaccines have been
replaced with the updated 2023-2024 (XBB-variant) COVID-19 vaccines.
\176\ CDC. (October 4, 2023). Stay Up to Date with COVID-19
Vaccines. Available at: https://www.cdc.gov/coronavirus/2019-ncov/vaccines/stay-up-to-date.html.
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We stated in the CY 2023 ESRD PPS final rule that HCP are at risk
of carrying COVID-19 infection to patients, experiencing illness or
death themselves as a result of contracting COVID-19, and transmitting
COVID-19 to their families, friends, and the general public (87 FR
67244). While the impact of COVID-19 vaccines on asymptomatic infection
and transmission is not yet fully known, there is now robust data
available on COVID-19 vaccine effectiveness across multiple populations
against symptomatic infection, hospitalization, and death. Two-dose
COVID-19 vaccines from Pfizer-BioNTech and Moderna were found to be 88
percent and 93 percent effective against hospitalization for COVID-19,
respectively, over 6 months for adults over age 18 without
immunocompromising conditions.\177\ During a SARS-COV-2 surge in the
spring and summer of 2021, 92 percent of COVID-19 hospitalizations and
91 percent of COVID-19-associated deaths were reported among persons
not fully vaccinated.\178\ Real-world studies of population-level
vaccine effectiveness indicated similarly high rates of effectiveness
in preventing SARS-COV-2 infection among frontline workers in multiple
industries, with a 90 percent effectiveness in preventing symptomatic
and asymptomatic infection from December 2020 through August 2021.\179\
Vaccines have also been highly effective in real-world conditions
preventing COVID-19 in HCP with up to 96 percent effectiveness for
fully vaccinated HCP, including those at risk for severe infection and
those in racial and ethnic groups disproportionately affected by COVID-
19.\180\ In the presence of high community prevalence of COVID-19,
residents of nursing homes with low staff vaccination coverage had
higher rates of COVID-19 cases and COVID-19 related deaths than those
among residents of nursing homes with high staff vaccination
coverage.\181\ Overall, data demonstrate that COVID-19 vaccines are
effective and prevent severe disease, including hospitalization and
death.
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\177\ CDC. (September 24, 2021). Morbidity and Mortality Weekly
Report (MMWR). Comparative Effectiveness of Moderna, Pfizer-
BioNTech, and Janssen (Johnson & Johnson) Vaccines in Preventing
COVID-19 Hospitalizations Among Adults Without Immunocompromising
Conditions--United States, March-August 2021. Available at: https://cdc.gov/mmwr/volumes/70/wr/mm7038e1.htm?s_cid=mm7038e1_w.
\178\ CDC. (September 10, 2021). Morbidity and Mortality Weekly
Report (MMWR). Monitoring Incidence of COVID-19 Cases,
Hospitalizations, and Deaths, by Vaccination Status--13 U.S.
Jurisdictions, April 4-July 17, 2021. Available at: https://www.cdc.gov/mmwr/volumes/70/wr/mm7037e1.htm.
\179\ CDC. (August 27, 2021). Morbidity and Mortality Weekly
Report (MMWR). Effectiveness of COVID-19 Vaccines in Preventing
SARS-COV-2 Infection Among Frontline Workers Before and During
B.1.617.2 (Delta) Variant Predominance--Eight U.S. Locations,
December 2020-August 2021. Available at: https://www.cdc.gov/mmwr/volumes/70/wr/mm7034e4.htm.
\180\ Pilishivi, T. et al. (December 2022). Effectiveness of
mRNA Covid-19 Vaccine among U.S. Health Care Personnel. New England
Journal of Medicine. 2021 Dec 16;385(25):e90. Available online at:
https://pubmed.ncbi.nlm.nih.gov/34551224/.
\181\ McGarry BE et al. (January 2022). Nursing Home Staff
Vaccination and Covid-19 Outcomes. New England Journal of Medicine.
2022 Jan 27;386(4):397-398. Available online at: https://pubmed.ncbi.nlm.nih.gov/34879189/.
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As SARS-COV-2 persists and evolves, our COVID-19 vaccination
strategy must remain responsive. When we finalized adoption of the
COVID-19 Vaccination Coverage Among HCP measure in the CY 2023 ESRD PPS
final rule, we stated that HCP should be counted as vaccinated if they
received COVID-19 vaccination any time from when it first became
available in December 2020 (87 FR 67247). We noted that a completed
vaccination course, defined for purposes of the measure as the primary
vaccination series, may require one or more doses depending on the
specific vaccine used, and that the NHSN application automatically
calculates the total value for ``Any completed COVID-19 vaccine
series.'' We also stated that, as vaccination protocols continue to
evolve, we would continue to work with the CDC to update relevant
measure specifications as necessary. Since we finalized the COVID-19
Vaccination Coverage Among HCP measure in the CY 2023 ESRD PPS final
rule, new variants of SARS-COV-2 have emerged around the world and
within the United States. Specifically, the Omicron variant (and its
related subvariants) is listed as a variant of concern by the CDC
because it spreads more easily than earlier variants.\182\ Vaccine
manufacturers initially responded to the Omicron variant by developing
bivalent COVID-19 vaccines, which included a component of the original
virus strain to provide broad protection against COVID-19 and a
component of the Omicron variant to provide better protection against
COVID-19 caused by the Omicron variant.\183\ These booster doses of the
bivalent COVID-19 vaccines were shown to increase immune response to
SARS-COV-2 variants, including Omicron, particularly in individuals who
are more than 6 months removed from receipt of their primary
series.\184\ We noted in the proposed rule that the FDA issued EUAs for
booster doses of two bivalent COVID-19 vaccines, one from Pfizer-
BioNTech \185\ and one from
[[Page 76448]]
Moderna,\186\ and strongly encouraged anyone who is eligible to
consider receiving a booster dose with a bivalent COVID-19 vaccine to
provide better protection against currently circulating variants.\187\
Since the publication of the CY 2024 ESRD PPS proposed rule, an updated
2023-2024 formulation of COVID-19 vaccine has been approved that more
closely targets the XBB lineage of the Omicron variant and could
restore protection against severe COVID-19 that may have decreased over
time.\188\ Updated COVID-19 vaccine doses are associated with a greater
reduction in infections among HCP and their patients relative to those
who only received primary series vaccination,189 190 with a
rate of breakthrough infections among HCP who received only a two-dose
regimen of 21.4 percent compared to a rate of 0.7 percent among boosted
HCP.\191\ Data from the existing COVID-19 Vaccination Coverage Among
HCP measure demonstrate clinically significant variation in booster
dose vaccination rates across facilities.
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\182\ Food and Drug Administration. (August 2021). Variants of
the Virus. Available at: https://www.cdc.gov/coronavirus/2019-ncov/variants/index.html.
\183\ Food and Drug Administration. (November 2022). COVID-19
Bivalent Vaccine Boosters.
\184\ Oster Y et al. (May 2022). The effect of a third BNT162b2
vaccine on breakthrough infections in health care workers: a cohort
analysis. Clin Microbiol Infect. 2022 May;28(5):735.e1-735.e3.
Available online at: https://pubmed.ncbi.nlm.nih.gov/35143997/.
\185\ Food and Drug Administration. (November 2022). Pfizer-
BioNTech COVID-19 Vaccines. Available at: https://www.fda.gov/emergency-preparedness-and-response/coronavirus-disease-2019-covid-19/pfizer-biontech-covid-19-vaccines.
\186\ Food and Drug Administration. (November 2022). Moderna
COVID-19 Vaccines. Available at: https://www.fda.gov/emergency-preparedness-and-response/coronavirus-disease-2019-covid-19/moderna-covid-19-vaccines.
\187\ Food and Drug Administration. (August 2022). Coronavirus
(COVID-19) Update: FDA Authorizes Moderna, Pfizer-BioNTech Bivalent
COVID-19 Vaccines for Use as a Booster Dose. Available at: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-authorizes-moderna-pfizer-biontech-bivalent-covid-19-vaccines-use.
\188\ CDC. (October 4, 2023). Stay Up to Date with COVID-19
Vaccines. Available at: https://www.cdc.gov/coronavirus/2019-ncov/vaccines/stay-up-to-date.html.
\189\ Prasad N et al. (May 2022). Effectiveness of a COVID-19
Additional Primary or Booster Vaccine Dose in Preventing SARS-CoV-2
Infection Among Nursing Home Residents During Widespread Circulation
of the Omicron Variant--United States, February 14-March 27, 2022.
Morbidity and Mortality Weekly Report (MMWR). 2022 May 6;71(18):633-
637. Available online at: https://pubmed.ncbi.nlm.nih.gov/35511708/.
\190\ Oster Y et al. (May 2022). The effect of a third BNT162b2
vaccine on breakthrough infections in health care workers: a cohort
analysis. Clin Microbiol Infect. 2022 May;28(5):735.e1-735.e3.
Available online at: https://pubmed.ncbi.nlm.nih.gov/35143997/.
\191\ Ibid.
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We believe that vaccination remains the most effective means to
prevent the worst consequences of COVID-19, including severe illness,
hospitalization, and death. Given the availability of vaccine efficacy
data, EUAs and Biologics License Application approvals issued by the
FDA for updated 2023-2024 formulations of the vaccine, the continued
presence of SARS-COV-2 in the United States, and variance among rates
of updated vaccinations, it is important to modify the COVID-19
Vaccination Coverage Among HCP measure to reflect recent updates that
explicitly specify for HCP to receive primary series and updated
vaccine doses in a timely manner. As the COVID-19 pandemic persists, we
continue to believe that monitoring and surveillance is important and
provides patients, beneficiaries, and their caregivers with information
to support informed decision making. In the CY 2024 ESRD PPS proposed
rule, we proposed to modify the COVID-19 Vaccination Coverage Among HCP
measure to replace the term ``complete vaccination course'' with the
term ``up to date'' in the HCP vaccination definition (88 FR 42496). We
also proposed to update the numerator to specify the time frames within
which an HCP is considered up to date with recommended COVID-19
vaccines, including updated vaccine doses, beginning with PY 2026. As
we stated in the CY 2023 ESRD PPS final rule (87 FR 67245), the COVID-
19 Vaccination Coverage Among HCP measure is a process measure that
assesses HCP vaccination coverage rates. Unlike outcome measures,
process measures do not assess a particular outcome.
b. Overview of Updated Measure
The COVID-19 Vaccination Coverage Among HCP measure is a process
measure developed by the CDC to track COVID-19 vaccination coverage
among HCP in settings such as dialysis facilities, and the measure is
reported via the CDC's NHSN.
We refer readers to the CY 2023 ESRD PPS final rule (87 FR 67245
through 67246) for more information on the initial review of the
measure by the Measure Applications Partnership (MAP). We included an
updated version of the measure on the Measures Under Consideration
(MUC) list for the 2022-2023 pre-rulemaking cycle for consideration by
the MAP. In December 2022, the MAP's Hospital Workgroup discussed the
modified measure. The Hospital Workgroup stated that the revision of
the current measure captures up-to-date vaccination information in
accordance with CDC recommendations updated since its initial
development. Additionally, the Hospital Workgroup appreciated that the
respecified proposed measure of the target population is broader and
simplified from seven categories of HCP to four.\192\ During review,
the Health Equity Advisory Group highlighted the importance of COVID-19
measures and questioned whether the measure excludes individuals with
contraindications to FDA authorized or approved COVID-19 vaccines, and
whether the measure will be stratified by demographic factors. The
measure developer confirmed that HCP with contraindications to the
vaccines are excluded from the measure denominator, but the measure
would not be stratified since the data are submitted at an aggregate
rather than an individual level. The Rural Health Advisory Group
expressed concerns about data collection burden, citing that collection
is performed manually and that small rural facilities may not have
employee health software.\193\ The measure developer acknowledged the
challenge of getting adequate documentation and emphasized the goal to
ensure the measure does not present a burden on the provider. The
developer also noted that the model used for this measure is based on
the Influenza Vaccination Coverage Among HCP measure (CBE #0431), and
it intends to utilize a similar approach to the modified COVID-19
Vaccination Coverage Among HCP measure if the COVID-19 vaccination
strategy becomes seasonal. The revised measure received conditional
support for rulemaking from both the MAP workgroups pending testing
indicating the measure is reliable and valid, and endorsement by the
consensus-based entity (CBE).\194\ The MAP noted that the previous
version of the measure received endorsement from the CBE (CBE #3636)
\195\ and that the CDC intends to submit the updated measure for
endorsement.
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\192\ Centers for Medicare & Medicaid Services. MAP 2022-2023
Preliminary Analysis Worksheet. 2022. We note that the link provided
in the CY 2024 ESRD PPS proposed rule has been updated, and is now
available at: https://mmshub.cms.gov/sites/default/files/map-preliminary-recommendations-2022-2023.xlsx.
\193\ Centers for Medicare & Medicaid Services. MAP 2022-2023
Final Recommendations. We note that the link provided in the CY 2024
ESRD PPS proposed rule has been updated, and is now available at:
https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\194\ In previous years, we referred to the consensus-based
entity by corporate name. We have updated this language to refer to
the consensus-based entity more generally.
\195\ We note that the reference provided in the CY 2024 ESRD
PPS proposed rule has been updated, and is now as follows: Centers
for Medicare & Medicaid Services. Measure Specifications for
Hospital Workgroup for the 2022 MUC List. Available at: https://mmshub.cms.gov/sites/default/files/map-hospital-measure-specifications-manual-2022.pdf.
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(1) Measure Specifications
This reporting measure includes at least one week of data
collection a month for each of the three months in
[[Page 76449]]
a quarter. The denominator is the number of HCP eligible to work in the
facility for at least one day during the reporting period, excluding
persons with contraindications to COVID-19 vaccination that are
described by the CDC. Facilities report the following four categories
of HCP to NHSN:
1. Employees: includes all persons who receive a direct paycheck
from the reporting facility (that is, on the facility's payroll),
regardless of clinical responsibility or patient contact.
2. Licensed independent practitioners (LIPs): This includes
physicians (MD, DO), advanced practice nurses, and physician assistants
only who are affiliated with the reporting facility but are not
directly employed by it (that is, they do not receive a direct paycheck
from the reporting facility), regardless of clinical responsibility or
patient contact. Post-residency fellows are also included in this
category if they are not on the facility's payroll.
3. Adult students/trainees and volunteers: This includes all
medical, nursing, or other health professional students, interns,
medical residents, and volunteers aged 18 or over who are affiliated
with the healthcare facility, but are not directly employed by it (that
is, they do not receive a direct paycheck from the facility),
regardless of clinical responsibility or patient contact.
4. Other contract personnel: Contract personnel are defined as
persons providing care, treatment, or services at the facility through
a contract who do not fall into any of the previously discussed
denominator categories. This also includes vendors providing care,
treatment, or services at the facility who may or may not be paid
through a contract. Facilities are required to enter data on other
contract personnel for submission in the NHSN application, but data for
this category are not included in the COVID-19 Vaccination Coverage
Among HCP measure.\196\ The denominator excludes denominator-eligible
individuals with contraindications as defined by the CDC.\197\ There
are no changes to the denominator exclusions.
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\196\ For more details on the reporting of other contract
personnel, we refer readers to the NHSN COVID-19 Vaccination
Protocol, Weekly COVID-19 Vaccination Module for Healthcare
Personnel available at: https://www.cdc.gov/nhsn/pdfs/hps/covidvax/protocol-hcp-508.pdf.
\197\ CDC. (2022). Contraindications and precautions. Available
at: https://www.cdc.gov/vaccines/covid-19/clinical-considerations/interim-considerations-us.html#contraindications.
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The numerator of the modified measure is the cumulative number of
HCP in the denominator population who are considered up to date with
recommended COVID-19 vaccines. Facilities would refer to the definition
of up to date as of the first day of the applicable reporting quarter,
which can be found at https://www.cdc.gov/nhsn/pdfs/hps/covidvax/UpToDateGuidance-508.pdf. In the proposed rule, we provided the example
that HCP would be considered up to date during the applicable
performance period for the ESRD QIP if they met one of the following
criteria:
1. Individuals who received an updated bivalent \198\ booster dose,
or
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\198\ In the CY 2024 ESRD PPS proposed rule, we noted that the
updated (bivalent) Moderna and Pfizer-BioNTech boosters targeted the
most recent Omicron subvariants. The updated (bivalent) boosters
were recommended by the CDC on September 2, 2022. As of the CY 2024
ESRD PPS proposed rule, we also noted that the original, monovalent
mRNA vaccines are no longer authorized as a booster dose for people
ages 12 years and older. Since the proposed rule was published, the
bivalent COVID-19 vaccines are no longer FDA authorized. FDA.
(September 11, 2023). FDA Takes Action on Updated mRNA COVID-19
Vaccines to Better Protect Against Currently Circulating Variants.
Available at: https://www.fda.gov/news-events/press-announcements/fda-takes-action-updated-mrna-covid-19-vaccines-better-protect-against-currently-circulating. The bivalent COVID-19 vaccines have
been replaced with the updated 2023-2024 (XBB-variant) COVID-19
vaccines.
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2a. Individuals who received their last booster dose less than 2
months ago, or
2b. Individuals who completed their primary series \199\ less than
2 months ago.
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\199\ Although in the CY 2024 ESRD PPS proposed rule we
indicated that completing a primary series means receiving a two-
dose series of a COVID-19 vaccine or a single dose of Janssen/J&J
COVID-19 vaccine (88 FR 42496), we note that the Janssen/J&J COVID-
19 vaccine is no longer being used in the United States. For further
information, please see CDC. (2023). Janssen (Johnson & Johnson)
COVID-19 Vaccine. Available at: https://www.cdc.gov/vaccines/covid-19/info-by-product/janssen/index.html.
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We note that since publication of the proposed rule, the CDC's
definition for up to date vaccination has evolved. HCP would be
considered up to date during the applicable performance period for the
ESRD QIP if they met the following criteria:
1. Individuals who received an updated \200\ vaccine dose.
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\200\ The 2023-2024 updated Pfizer-BioNTech, Moderna, and
Novavax COVID-19 vaccines were recommended by CDC for use in the
United States. The 2023-2024 updated COVID-19 vaccine more closely
targets the XBB lineage of the Omicron variant and could restore
protection against severe COVID-19 that may have decreased over
time. Individuals are also considered up to date if they received a
bivalent vaccine or a Novavax vaccine within the last 2 months, or
if they received a Novavax vaccine after completing a primary
series. For further details, please see: https://www.cdc.gov/coronavirus/2019-ncov/vaccines/stay-up-to-date.html.
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We refer readers to https://www.cdc.gov/nhsn/pdfs/hps/covidvax/UpToDateGuidance-508.pdf for more details on the measure
specifications.
We noted in the proposed rule that the updated COVID-19 Vaccination
Coverage Among HCP measure would remain a reporting measure. The
updates to measure weighting for PY 2026 and PY 2027 are discussed
further in sections IV.C.6 and IV.D.7 of this final rule.
(2) Consensus-Based Entity Endorsement
The current version of the measure in the ESRD QIP received CBE
endorsement (CBE #3636, ``Quarterly Reporting of COVID-19 Vaccination
Coverage among Healthcare Personnel'') on July 26, 2022. Although
section 1881(h)(2)(B)(i) of the Act generally requires that measures
specified by the Secretary for the ESRD QIP be endorsed by the entity
with a contract under section 1890(a) of the Act, section
1881(h)(2)(B)(ii) of the Act states that in the case of a specified
area or medical topic determined appropriate by the Secretary for which
a feasible and practical measure has not been endorsed by the entity
with a contract under section 1890(a) of the Act, the Secretary may
specify a measure that is not so endorsed as long as due consideration
is given to measures that have been endorsed or adopted by a consensus
organization identified by the Secretary. In developing the CY 2024
ESRD PPS proposed rule, we reviewed CBE-endorsed measures and were
unable to identify any other CBE-endorsed measures on this topic;
therefore, we believe the exception for non-CBE-endorsed measures
applies. The CDC, as the measure developer, is pursuing endorsement for
the modified version of the measure.
c. Data Submission and Reporting
We refer readers to the CY 2023 ESRD PPS final rule (87 FR 67246)
for information on data submission and reporting for the measure. We
did not propose any changes to the existing data submission
requirements.
We invited public comment on this proposal. The comments we
received and our responses are set forth below.
Comment: Several commenters expressed support for the proposal to
modify the COVID-19 Vaccination Coverage Among HCP reporting measure.
Several of these commenters noted that vaccination is a critical tool
to protect the health of HCP and patients. One commenter expressed
support for the proposed modification, noting that continued tracking
of up-to-date vaccination status is important to help facilities
prepare for infectious
[[Page 76450]]
threats. One commenter expressed support for the proposed update
because it will align the requirements between agencies.
Response: We thank the commenters for their support. We agree that
vaccination plays a critical part of HHS's strategy to effectively
counter the spread of COVID-19. We continue to believe it is important
to incentivize and track rates of vaccination among HCP through quality
measurement across care settings, including the dialysis facility
setting, to protect healthcare workers, patients, and caregivers, and
to help sustain the ability of HCP in each of these care settings to
continue serving their communities.
Comment: Several commenters expressed concern regarding the
reporting burden associated with the proposed changes, recommending
that CMS weigh the potential impact on patient health outcomes against
potential administrative burden for facilities. A few commenters
recommended that the measure exclude staff who are not directly
employed by the facility to reduce tracking burden. One commenter noted
that the reporting burden associated with the measure was
disproportionate to its weight as part of the ESRD QIP measure set.
Response: We acknowledge commenters' concerns regarding reporting
burden associated with the specifications of this measure specifically
around the definition of HCP. We note that given the highly infectious
nature of the virus that causes COVID-19, we believe it is important to
encourage all eligible personnel within the facility, regardless of
patient contact, role, or employment type, to receive the COVID-19
vaccination to prevent outbreaks within the facility which may affect
resource availability and have a negative impact on patient access to
care. We note that the proposed updates to the COVID-19 Vaccination
Coverage Among HCP reporting measure do not include a change to the
definition of HCP, and that facilities have been reporting the COVID-19
Vaccination Coverage among HCP measure since January 1, 2022. With
regard to the commenter's concern about the proportionality of the
measure's reporting burden to its measure weight within the ESRD QIP,
we note that the burden associated with a given measure is only one of
several factors taken into consideration when determining the weight of
the measure within the ESRD QIP. We take numerous factors into account
when determining appropriate domain and measure weights, including
clinical evidence, opportunity for improvement, clinical significance,
and patient and provider burden (83 FR 56995 through 56996).
Comment: One commenter also supported aligning reporting with that
for Influenza Vaccination Coverage Among HCP if the COVID-19
vaccination strategy becomes seasonal. One commenter recommended
requiring annual reporting at the end of the respiratory season.
Response: We thank the commenter for this suggestion. As we stated
in the CY 2024 ESRD PPS proposed rule (88 FR 42497), the model used for
this measure is based on the Influenza Vaccination Coverage Among HCP
measure (CBE #0431), and the measure developer intends to utilize a
similar approach with respect to the modified version of the measure if
the COVID-19 vaccination strategy becomes seasonal. For that reason, we
may consider aligning reporting for the COVID-19 Vaccination Coverage
Among HCP reporting measure with the Influenza Vaccination Coverage
Among HCP measure in the future. We continue to monitor COVID-19 as
part of our public health response and will consider information we
collect to inform any potential action that may address seasonality in
future rulemaking.
Comment: One commenter recommended that the measure get CBE review
and endorsement prior to inclusion in the ESRD QIP.
Response: The current version of the measure received CBE
endorsement (CBE #3636, ``Quarterly Reporting of COVID-19 Vaccination
Coverage among Healthcare Personnel'') on July 26, 2022. As we stated
in the CY 2024 ESRD PPS proposed rule (88 FR 42497 through 42498), in
the case of a specified area or medical topic determined appropriate by
the Secretary for which a feasible and practical measure has not been
endorsed by the entity with a contract under section 1890(a) of the
Act, the Secretary may specify a measure that is not so endorsed as
long as due consideration is given to measures that have been endorsed
or adopted by a consensus organization identified by the Secretary. For
this CY 2024 ESRD PPS rule cycle, we reviewed CBE-endorsed measures.
While the current, CBE-endorsed version of the measure is available,
the modified version of the measure more completely accounts for the
availability of booster and bivalent doses which were not yet developed
when the current version of the measure was adopted. Having given due
consideration to CBE-endorsed measures, we believe the exception for
non-CBE-endorsed measures under section 1881(h)(2)(B)(ii) of the Act
applies. The measure steward, CDC, has submitted the modified measure
to the CBE for endorsement and it is currently under review.
Comment: A few commenters expressed concern regarding the COVID-19
Vaccination Coverage Among HCP reporting measure, stating that
facilities should not be held responsible for a HCP's decision to get
vaccinated because those decisions are beyond the facility's control.
Response: We understand the commenters' concern that there are many
factors outside of a facility's control that could affect vaccination
coverage among a facility's HCP; however, we believe that all
facilities face such concerns and that public reporting of these data
can help patients and their caregivers identify which facilities have
better vaccination coverage among their HCP. We wish to emphasize that
the measure does not require that HCP actually receive the COVID-19
vaccine. The COVID-19 Vaccination Coverage Among HCP measure only
requires reporting of vaccination rates.
Comment: A few commenters recommended removing the COVID-19
Vaccination Coverage Among HCP reporting measure from the ESRD QIP
measure set. One commenter believed that the measure should be removed
because the PHE has ended and CMS has also ended staff vaccination
requirements related to COVID-19 vaccination. One commenter stated that
the measure should be removed because it is outside the scope of the
ESRD QIP.
Response: As commenters noted, the PHE for COVID-19 expired on May
11, 2023.\201\ However, the expiration of the PHE for COVID-19 has no
bearing on this measure because vaccination continues to be an
essential tool in preventing COVID-19 transmission, and we believe that
monitoring and surveillance of vaccination rates through measure
performance is important and provides patients, beneficiaries, and
their caregivers with information to support informed decision making.
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\201\ U.S. Dept. of Health and Human Services. Fact Sheet:
COVID-19 Public Health Emergency Transition Roadmap. February 9,
2023. Available at: https://www.hhs.gov/about/news/2023/02/09/fact-sheet-covid-19-public-health-emergency-transition-roadmap.html.
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Final Rule Action: After considering public comments, we are
finalizing our proposal to modify the COVID-19 Vaccination Coverage
Among Healthcare Personnel (HCP) Measure.
[[Page 76451]]
4. Conversion of the Clinical Depression Screening and Follow-Up
Reporting Measure to a Clinical Measure Beginning With the PY 2026 ESRD
QIP
In the CY 2015 ESRD PPS final rule, we finalized the adoption of
the Clinical Depression Screening and Follow-Up reporting measure,
beginning in PY 2018 (79 FR 66200 through 66203). As we noted in the CY
2015 ESRD PPS final rule, depression is a highly prevalent condition in
patients with ESRD, which impacts many aspects of a patient's life and
is associated with higher rates of mortality in the ESRD population.
Adoption of a measure that assesses whether facilities screen patients
for depression, and develop follow-up plans when appropriate, was and
still is an opportunity to improve the health of patients with ESRD.
In the CY 2024 ESRD PPS proposed rule, we proposed to convert the
Clinical Depression Screening and Follow-Up reporting measure to a
clinical measure and to adopt a new methodology for scoring that
measure as a clinical measure (88 FR 42498). We stated our belief that
this proposed update would help to ensure that the measure is scored in
a manner that more closely aligns with current clinical guidelines for
depression screening and follow-up because it narrows the number of
conditions on which a facility can earn points.
Clinical guidelines indicate that providers should both screen for
depression and develop a follow-up plan for patients who test positive
for depression.\202\ Screening for depression is an important aspect of
ESRD patient care, especially because ESRD and depression may present
with similar symptoms, including but not limited to fatigue, poor
appetite, headaches, and lack of focus.\203\ Developing a follow-up
plan for patients who screen positive for depression is equally
important because ESRD patients may not be aware that they can seek
treatment or that such treatment could be beneficial.\204\ Under the
specifications of the current Clinical Depression Screening and Follow-
Up reporting measure, facilities are required to report one of six
conditions with respect to each eligible patient, and we calculate the
measure rate for the facility as the percentage of eligible patients
for which the facility reports one of those six conditions. The six
conditions are as follows:
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\202\ KDOQI clinical practice guidelines for cardiovascular
disease in dialysis patients Volume 45, SUPPLEMENT 3, 16-
153, April 2005. https://doi.org/10.1053/j.ajkd.2005.01.019.
\203\ PCORI Evidence Update. Treating Depression When You're on
Dialysis (for Patients). July 2021. Available at: https://www.pcori.org/sites/default/files/PCORI-Evidence-Update-for-Patients-Treating-Depression-When-Youre-on-Dialysis.pdf.
\204\ Michael J Fischer, Elani Streja, Jui-Ting Hsiung, Susan T
Crowley, Csaba P Kovesdy, Kamyar Kalantar-Zadeh, Wissam M Kourany,
Depression screening and clinical outcomes among adults initiating
maintenance hemodialysis, Clinical Kidney Journal, Volume 14, Issue
12, December 2021, Pages 2548-2555, https://doi.org/10.1093/ckj/sfab097.
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Screening for clinical depression is documented as being
positive, and a follow-up plan is documented.
Screening for clinical depression is documented as
positive, and a follow-up plan is not documented, and the facility
possesses documentation stating the patient is not eligible.
Screening for clinical depression is documented as
positive, the facility possesses no documentation of a follow-up plan,
and no reason is given.
Screening for clinical depression is documented as
negative, and a follow-up plan is not required.
Screening for clinical depression is not documented, but
the facility possesses documentation stating the patient is not
eligible.
Screening for clinical depression is not documented, and
no reason is given.
In the proposed rule, we did not propose to revise any of these
conditions. However, we proposed that we would convert the measure to a
clinical measure and award credit to facilities only if they report one
of the following four of those six conditions:
Screening for clinical depression is documented as being
positive, and a follow-up plan is documented.
Screening for clinical depression is documented as
positive, and a follow-up plan is not documented, and the facility
possesses documentation stating the patient is not eligible.
Screening for clinical depression is documented as
negative, and a follow-up plan is not required.
Screening for clinical depression is not documented, but
the facility possesses documentation stating the patient is not
eligible.
In the proposed rule, we noted that if a facility selects one of
the other two conditions (that is, ``Screening for clinical depression
is documented as positive, the facility possesses no documentation of a
follow-up plan, and no reason is given'' and ``Screening for clinical
depression is not documented, and no reason is given''), the facility
would not receive credit in the numerator (88 FR 42498). We stated that
we believe this proposed update is important because it would assess
facility performance on both the clinical depression screening and the
follow-up plan, to the extent that one is needed, and would also
incentivize facilities to report the reason for either not documenting
that they screened for clinical depression, or why they do not possess
documentation of a follow-up plan. We believe that the performance
score calculation methodology changes we proposed to the Clinical
Depression Screening and Follow-Up reporting measure would have a
greater impact on fostering care coordination among providers and
improving patient outcomes by incentivizing the documentation of
depression screenings and follow-up plans, or alternatively requiring
facilities to provide a reason why no screening or follow-up plan was
documented. This measure update would also align with our efforts under
the Meaningful Measures Framework, which identifies high-priority areas
for quality measurement and improvement to assess core issues most
critical to high-quality healthcare and improving patient
outcomes.\205\ In 2021, we launched Meaningful Measures 2.0 to promote
innovation and modernization of all aspects of quality, and to address
a wide variety of settings, stakeholders, and measure
requirements.\206\ We are addressing healthcare priorities and gaps
with Meaningful Measures 2.0 by leveraging quality measures to increase
efficiency, reduce burden, and close gaps in care. In the CY 2024 ESRD
PPS proposed rule, we noted that the proposed updates to the Clinical
Depression Screening and Follow-Up measure would support these efforts
and would align with several Meaningful Measures Areas, including
``Seamless Care Coordination'' and ``Behavioral Health,'' as we believe
that incentivizing the documentation of follow-up plans would encourage
care coordination efforts to support the behavioral health outcomes of
ESRD patients (88 FR 42499). We stated that the proposed modifications
would also align with the Meaningful Measures 2.0 goal to ``Leverage
measures to drive outcome improvement through public reporting and
payment programs'' because we believe that converting the Clinical
Depression Screening and Follow-Up reporting measure to a clinical
measure would help to drive outcome improvement through the ESRD QIP.
Additionally, in the
[[Page 76452]]
proposed rule we stated that this proposed measure update would align
with efforts to develop a Universal Foundation \207\ that would help
implement the vision outlined in our National Quality Strategy \208\
and is fundamental to achieving several of the agency's quality and
value-based care goals.\209\ We noted that our proposal to update the
Clinical Depression Screening and Follow-Up measure would help to align
the measure that is used in the ESRD QIP with the measure identified
for use across multiple programs as part of the Behavioral Health
domain of the Universal Foundation measure set.\210\
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\205\ Centers for Medicare & Medicaid Services. Meaningful
Measures Framework. Available at: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/CMS-Quality-Strategy.
\206\ Centers for Medicare & Medicaid Services. (2021).
Meaningful Measures 2.0: Moving from Measure Reduction to
Modernization. Available at: https://www.cms.gov/meaningful-measures-20-moving-measure-reduction-modernization. We note that
Meaningful Measures 2.0 is still under development.
\207\ Jacobs D, Schreiber M, Seshamani M, Tsai D, Fowler E,
Fleisher, L. Aligning Quality Measures across CMS--The Universal
Foundation. The New England Journal of Medicine, February 1, 2023.
Available at: https://www.nejm.org/doi/full/10.1056/NEJMp2215539.
\208\ Schreiber M, Richards AC, Moody-Williams J, Fleisher LA.
The CMS National Quality Strategy: a person-centered approach to
improving quality. Centers for Medicare and Medicaid Services, June
6, 2022 (https://www.cms.gov/blog/cms-national-quality-strategy-person-centered-approach-improving-quality).
\209\ Jacobs D, Fowler E, Fleisher L, Seshamani M. The Medicare
value-based care strategy: alignment, growth, and equity. Health
Affairs, July 21, 2022 (https://www.healthaffairs.org/content/forefront/medicare-value-based-care-strategy-alignment-growth-and-equity).
\210\ Jacobs D, Schreiber M, Seshamani M, Tsai D, Fowler E,
Fleisher, L. Aligning Quality Measures across CMS--The Universal
Foundation. The New England Journal of Medicine, February 1, 2023.
Available at: https://www.nejm.org/doi/full/10.1056/NEJMp2215539.
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We also proposed to convert the Clinical Depression Screening and
Follow-Up measure from a reporting measure to a clinical measure
beginning with PY 2026, and to move that measure to the Care
Coordination Measure Domain beginning with that payment year (88 FR
42499). We proposed to convert the Clinical Depression Screening and
Follow-Up measure from a reporting measure to a clinical measure
because we believe that our proposed update to the performance score
calculation aligned with that of a clinical measure. We proposed to
move the Clinical Depression Screening and Follow-Up measure from the
Reporting Measure Domain to the Care Coordination Measure Domain
because the updated clinical measure would no longer be appropriate for
inclusion under the Reporting Measure Domain. We note that we did not
propose to change eligibility requirements for the measure. We discuss
our updates to measure domains and weights for PY 2026 in section
IV.C.6 of this final rule.
We welcomed public comment on our proposal. The comments we
received and our responses are set forth below.
Comment: Several commenters expressed support for the proposal to
convert the Clinical Screening and Follow-Up reporting measure to a
clinical measure. A few of these commenters expressed support for the
proposed update because it will help to better identify and treat
clinical depression in ESRD patients. One commenter noted that the
proposed change will better align the measure with current clinical
guidelines for depression screening and follow-up.
Response: We thank commenters for their support.
Comment: Several commenters expressed concern regarding the
reporting burden associated with the proposed changes, recommending
that CMS weigh the potential impact on patient health outcomes against
potential administrative burden.
Response: Although we would be converting the Clinical Depression
Screening and Follow-Up measure from a reporting measure to a clinical
measure and changing the methodology to score it as a clinical measure,
we did not propose any changes that would change the reporting process
or burden associated with the Clinical Depression Screening and Follow-
Up measure. Although facilities would be scored differently and would
be required to provide follow-up documentation or a reason no screening
or follow-up has been documented to receive credit on the measure, they
would continue to report data for this measure to EQRS in the same
manner. We believe converting this measure to a clinical measure is
important because it will assess facility performance on the measure in
a way that is more meaningful to patient health outcomes, and that the
potential beneficial impact on patient health outcomes outweighs the
potential burden to facilities that may need to update their clinical
depression screening and follow-up practices to receive credit for the
measure. However, we will continue to monitor for potential unintended
consequences.
Comment: Several commenters expressed concern regarding the ability
of current facility staff to effectively support patients with clinical
depression, noting that many facilities are under-resourced. A few
commenters recommended establishing supports (such as allowing co-
located mental health providers to bill Medicare) prior to converting
the measure. A few commenters expressed concern regarding the
meaningfulness of the Clinical Depression Screening and Follow-Up
clinical measure, noting that many ESRD patients live in areas where
there is a shortage of mental health care professionals and therefore
would likely have difficulty accessing appropriate follow-up care
following a positive depression screen.
Response: We thank the commenters for their feedback. We believe
the updated scoring methodology has the potential to foster better care
coordination and improve patient outcomes because it awards points
facilities if they report that they documented follow-up plans for
eligible patients who screened positive for clinical depression. As a
documented outline of care for a positive depression screening, a
follow-up plan may take into account a patient's ability to access
follow-up care. However, we acknowledge that there might be
circumstances, such as a lack of community resources, that may be
beyond the facility's control, and the measure does not require the
facility to ensure that the patient completed a follow-up plan.
Comment: A few commenters expressed concern about potential lack of
patient privacy at facilities impacting the ability to engage
effectively with the patient's care team to support mental health care
needs. One commenter expressed concern that patients may feel pressured
to participate in clinical depression screening surveys due to the
proposed measure updates, and that a positive result on the screening
may lead to patient stigma and impact future care.
Response: We appreciate commenters' concern and agree that
protecting patient privacy is imperative. We note that the updated
Clinical Depression Screening and Follow-Up clinical measure does not
impose additional or new requirements on facilities that would
interfere with a patient's right to privacy, and such information would
be part of the patient's medical record and subject to same privacy
protections as the patient's other medical information. The measure
does not require patients to participate in a screening, and we have no
reason to believe that facilities would pressure their patients into
participating. Consistent with existing measure guidance, a patient
would be considered ``not eligible'' for purposes of the measure if the
patient's medical records document that the patient declined to
participate in a clinical depression screening and would, therefore, be
excluded from the measure cohort.\211\ However, we will continue to
monitor for potential unintended consequences.
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\211\ https://www.cms.gov/files/document/esrd-measures-manual-v81.pdf.
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[[Page 76453]]
Comment: One commenter expressed concerns regarding the timing of
screening, stating that this would require screening all patients
during the first quarter and stated that this is not clinically
appropriate for some patients and not feasible for others due to
fluctuating first dates of dialysis, hospitalizations, and other
reasons. The commenter recommended including a denominator exclusion
for ``patient stopped treatment at the facility prior to scheduled
screening'' prior to adoption of this measure as a clinical measure.
Response: Facilities are required to report measure data before the
close of the clinical month of December in EQRS each year, so patient
screening may take place at any time during the 12-month period of
performance. We note that, to be eligible for the measure, a patient
must be treated at a facility for at least 90 days. However, a facility
is not precluded from screening its patients during that initial 90-day
period, and we would encourage facilities to do so as part of their
overall patient health assessments. Therefore, we do not think the
suggested denominator exclusion is necessary.
Comment: A few commenters recommended removing the Clinical
Depression Screening and Follow-Up measure from the ESRD QIP
altogether. A few commenters recommended moving the measure to Dialysis
Facility Compare because it would more effectively provide
beneficiaries with useful information about facility performance on the
measure. A few commenters expressed the belief that the measure should
be removed from the ESRD QIP because it is topped out.
Response: We believe that the Clinical Depression Screening and
Follow-Up measure remains an important part of the ESRD QIP measure set
and that the public reporting of facility performance scores on the
measure provides patients and caregivers with helpful information.
Including the Clinical Depression Screening and Follow-Up measure in
the ESRD QIP also incentivizes facilities to improve their performance
on the measure, which we believe will ultimately result in better
patient outcomes. Although we acknowledge that the measure, in its
current iteration as a reporting measure with six conditions, may be
topped out, we proposed to update the conditions needed to receive
credit and to convert the measure to a clinical measure. Under our
previously adopted methodology (79 FR 66174), a clinical measure is
considered to be topped out if national measure data show (1)
statistically indistinguishable performance levels at the 75th and 90th
percentiles; and (2) a truncated coefficient of variation (TCV) of less
than or equal to 0.1. To determine whether a clinical measure is topped
out, we initially focus on the top distribution of facility performance
on each measure and note if their 75th and 90th percentiles are
statistically indistinguishable. Then, to ensure that we properly
account for the entire distribution of scores, we analyze the truncated
coefficient of variation (TCV) for the measure. As PY 2026 would be the
first year that the Clinical Depression Screening and Follow-Up
clinical measure would be included in the ESRD QIP, we do not have the
clinical national measure performance data necessary to perform a
topped-out analysis at this time.
Final Rule Action: After considering public comments, we are
finalizing our proposals to update the Clinical Depression Screening
and Follow-Up measure and to convert it to a clinical measure beginning
with PY 2026 as proposed.
5. Removal of Two Measures From the ESRD QIP Measure Set, Beginning
With PY 2026
In the CY 2024 ESRD PPS proposed rule, we stated that we have
undertaken efforts to review the existing ESRD QIP measure set to
ensure continued clinical impact and effectiveness of the measures on
facility performance (88 FR 42499). Based on that analysis and our
evaluation of the Program's measures, we proposed to remove the
Ultrafiltration Rate reporting measure and the Standardized Fistula
Rate clinical measure beginning with PY 2026.
a. Removal of the Ultrafiltration Rate Reporting Measure From the ESRD
QIP Measure Set Beginning With PY 2026
In the CY 2017 ESRD PPS final rule, we adopted the Ultrafiltration
Rate reporting measure (81 FR 77912 through 77915). The measure
assesses the number of months for which a facility reports all data
elements required to calculate ultrafiltration rates (UFR) for each
qualifying patient. The Ultrafiltration Rate reporting measure is
intended to guard against risks associated with high ultrafiltration
(that is, rapid fluid removal) rates for adult dialysis patients
undergoing hemodialysis (HD), because of indications that high
ultrafiltration is an independent predictor of mortality. Faster
ultrafiltration may lead to a number of health risks resulting from
large volumes of fluid removed rapidly during each dialysis session,
with deleterious consequences for the patient both in the short and
longer term. When we added this measure to the ESRD QIP, we believed
the documentation of the ultrafiltration measurements would ultimately
contribute to the quality of the patient's ESRD treatment (81 FR 77912
through 77915).
In the CY 2024 ESRD PPS proposed rule, we noted that more recent
studies have indicated that the Ultrafiltration Rate reporting measure
may not result in the intended patient outcomes (88 FR 42499). For
example, a patient's body size may be a confounding, possibly
explanatory factor for the relationship between higher UFR and
increased mortality.\212\ Additionally, although the Ultrafiltration
Rate reporting measure captures a patient's UFR measurements reported
monthly, the mortality risks associated with high UFR may be due to the
frequency or number of HD sessions with high UFR.\213\ We stated our
belief that these findings show that the documentation of a patient's
ultrafiltration measurements through the current Ultrafiltration Rate
reporting measure may not necessarily indicate the quality of a
patient's ESRD treatment and tracking the ultrafiltration rate as a
quality indicator may influence decision-making regarding dialysis
treatment. Therefore, a facility's performance on the measure may not
accurately reflect the quality of care provided. Accordingly, in the
proposed rule we proposed to remove this measure from the ESRD QIP
measure set under measure removal factor 2 (performance or improvement
on a measure does not result in better or the intended patient
outcomes) beginning with the PY 2026 ESRD QIP (88 FR 42499).
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\212\ John T. Daugirdas and Daniel Schneditz. Seminars in
Dialysis: Hemodialysis Ultrafiltration Rate Targets Should Be Scaled
to Body Surface Area Rather than to Body Weight. 2017.
\213\ Jose E. Navarrete, Ajai Rajabalan, Jason Cobb, and Janice
P. Lea. Proportion of Hemodialysis Treatments with High
Ultrafiltration Rate and the Association with Mortality. Kidney360
3: 1359-1366, 2022. doi: https://doi.org/10.34067/KID.0001322022.
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We welcomed public comment on our proposal. The comments we
received and our responses are set forth below.
Comment: Several commenters expressed support for our proposal to
remove the Ultrafiltration Rate reporting measure from the ESRD QIP
measure set. A few commenters agreed that the measure should be removed
because UFR measurement may not necessarily reflect the quality of a
patient's HD session. A few commenters expressed support for removing
the measure because it would enable a more individualized approach to
clinical
[[Page 76454]]
decision-making regarding fluid management and allow flexibility to
provide care that is specific to a patient's individual case. A few
commenters expressed support for removing the measure because they
believe that the measure is topped out.
Response: We thank commenters for their support. Although we do not
believe that the measure is topped out, we do agree with commenters
that the Ultrafiltration Rate reporting measure is appropriate for
removal because the measure may not reflect quality of care provided
and removing the measure from the ESRD QIP measure set would support a
more individualized approach to fluid management.
Comment: Several commenters noted the importance of fluid
management and recommended ways to continue encouraging facilities to
monitor patient-level UFR data. A few commenters recommended that CMS
expand the Ultrafiltration Rate reporting measure to collect data on
patient symptoms experienced during and between treatments as well to
better understand the relationship between UFR and patient outcomes.
One commenter recommended that CMS convert the Ultrafiltration Rate
reporting measure to a clinical measure. One commenter recommended that
the measure be modified to address the confounding factors associated
with high UFR.
Response: We thank commenters for their recommendations. Given the
importance of fluid management to ESRD treatment, we encourage
facilities to continue monitoring patient UFR data to ensure patient
safety and improve HD care for ESRD patients. Although we are removing
the Ultrafiltration Rate reporting measure because we do not believe
that performance or improvement on the measure itself results in better
patient outcomes, we may consider alternative measures which address
confounding factors associated with high UFR in future rulemaking.
Comment: Several commenters expressed concern regarding the
proposed removal of the Ultrafiltration Rate reporting measure, stating
that high UFR is associated with health complications and the measure
incentivizes patient safety. One commenter posited that the decline in
hospitalization events and ED visits for ESRD patients on hemodialysis
between 2019 and 2020 could be attributed to the implementation of the
Ultrafiltration Rate reporting measure in 2019. The commenter noted
that most HD machines are designed to facilitate the tracking of
patient UFR data, and that it is important for staff to review and
analyze this patient data to address symptoms and/or medical
complications. One commenter noted there was no clinical support for
high UFR.
Response: We encourage facilities to continue monitoring patient
UFR data to ensure patient safety and improve hemodialysis (HD) care
for ESRD patients. Although we are removing the Ultrafiltration Rate
reporting measure because we believe that performance or improvement on
the measure itself does not result in better patient outcomes, we
believe that facilities will continue to monitor patient UFR data as
part of a patient's ESRD treatment.
Comment: A few commenters expressed concern regarding the reporting
burden associated with the proposed changes, recommending that CMS
weigh the potential impact on patient health outcomes against potential
administrative burden. One commenter specifically expressed concern
regarding the burden impact on rural facilities due to the lack of
resources.
Response: We do not believe that removing a measure from the ESRD
QIP will impose additional burden on facilities.
Final Rule Action: After considering public comments, we are
finalizing our proposal to remove the Ultrafiltration Rate reporting
measure from the ESRD QIP measure set beginning with PY 2026 as
proposed.
b. Removal of the Standardized Fistula Rate Clinical Measure From the
ESRD QIP Measure Set
In the CY 2018 ESRD PPS final rule, we adopted the Standardized
Fistula Rate clinical measure (82 FR 50774 through 50777). Along with
the Long-Term Catheter Rate clinical measure, we stated that the two
vascular access measures, when used together, consider arteriovenous
(AV) fistula use as a positive outcome and prolonged use of a tunneled
catheter as a negative outcome. With the growing recognition that some
patients may exhaust their options for an AV fistula, or have
comorbidities that may limit the success of AV fistula creation,
pairing the measures accounts for all vascular access options. The
Standardized Fistula Rate measure adjusts for patient factors where
fistula placement may be either more difficult or not appropriate and
acknowledges that in certain circumstances an AV graft may be the best
access option by accounting for that possibility in the current measure
specifications. In the CY 2018 ESRD PPS final rule, we stated that this
paired incentive structure that relies on both measures reflects
consensus best practice and supports maintenance of the gains in
vascular access success achieved via the Fistula First/Catheter Last
Project over the last decade (82 FR 50777).
In the CY 2024 ESRD PPS proposed rule, we noted that since the CY
2018 ESRD PPS final rule, there have been several changes to what many
experts consider to be best practices with respect to vascular access
in ESRD patients due to improvements in the care of ESRD patients
overall, changes in patient demographics, and increasing patient
longevity (88 FR 42500). Guidance published in 2019 by the National
Kidney Foundation's Kidney Disease Outcome Quality Initiative (KDOQI)
reflects updated best practices.\214\ The KDOQI's 2019 guidance notes
that prior guidelines and initiatives have emphasized a ``fistula
first'' approach to vascular access choice due to the AV fistula's
associations with better short-term results compared with other
vascular access types.\215\ However, the 2019 guidance also notes that
more recent data have challenged these associations because of the high
complication rates of AV fistula maturation failure requiring
intervention. The guidance also encourages a more holistic, long-term
approach to dialysis access that strives to preserve patient
vasculature and avoid unnecessary procedures and complications.
Therefore, following re-evaluation of this Fistula First approach, the
KDOQI's 2019 guidance concludes that the Fistula First approach should
no longer be considered a clinical best practice. Instead, the KDOQI's
2019 guidance concludes that a patient-centered approach to
hemodialysis vascular access that is based on a consideration of the
patient's needs and dialysis access eligibility is preferred. Providers
should consider what would be most appropriate for the individual
patient, including that AV fistula may not always be most appropriate
based on the individual patient's needs.
---------------------------------------------------------------------------
\214\ Lok CE, Huber TS, Lee T, et al; KDOQI Vascular Access
Guideline Work Group. KDOQI clinical practice guideline for vascular
access: 2019 update. Am J Kidney Dis. 2020;75(4)(suppl 2):S1-S164.
\215\ KDOQI clinical practice guidelines for vascular access. Am
J Kidney Dis. 2006;48:S176-S247.
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After considering these evolving best practices and the KDOQI's
2019 guidance, in the proposed rule we stated that we have determined
that the Standardized Fistula Rate Clinical Measure does not provide
patients and their healthcare providers the necessary
[[Page 76455]]
level of flexibility to choose the most suitable AV access (88 FR
42500). We noted our belief that patients, in consultation with their
healthcare providers, should have the flexibility to choose AV access
(either AV fistula or AV graft) where appropriate to their specific
patient characteristics and treatment plans. This determination should
be based on the healthcare provider's best clinical judgment that
considers the vessel characteristics, patient comorbidities, health
circumstances, and patient preference. Accordingly, we proposed to
remove the Standardized Fistula Rate clinical measure from the ESRD QIP
measure set beginning with PY 2026 under measure removal factor 3 (a
measure no longer aligns with current clinical guidelines or practice).
We stated in the proposed rule that we continue to consider both AV
fistula and AV graft as preferable forms of vascular access to a long-
term catheter, and that evidence shows that long-term catheters should
only be used when all other AV access options have been exhausted (88
FR 42500).\216\ We also expressed our continued belief that it is
important to track the use of long-term catheters, minimize their use
where possible, and incentivize best practices for vascular access. For
those reasons, we did not propose to remove the Long-Term Catheter Rate
clinical measure.
---------------------------------------------------------------------------
\216\ Lok CE, Huber TS, Lee T, et al; KDOQI Vascular Access
Guideline Work Group. KDOQI clinical practice guideline for vascular
access: 2019 update. Am J Kidney Dis. 2020;75(4)(suppl 2):S1-S164.
---------------------------------------------------------------------------
In the proposed rule, we also proposed to remove the reference to
the Vascular Access Type Measure Topic and to assign the total weight
of that topic (12 percent) solely to the Long-Term Catheter Rate
clinical measure (88 FR 42500), as described in Table 15 of the
proposed rule. We proposed to assign the total weight to the Long-Term
Catheter Rate clinical measure because we believe this continues to be
an important measure of facility performance tied to improved patient
outcomes. We noted our belief that our proposal to assign the total 12
percent weight to the Long-Term Catheter Rate clinical measure
reflected our view that long-term catheter use is the least-favored
vascular access treatment option and should be avoided where more
clinically preferable vascular access treatment options would be
appropriate.
We welcomed public comment on our proposal. The comments we
received and our responses are set forth below.
Comment: Many commenters expressed support for the proposed removal
of the Standardized Fistula Rate clinical measure from the ESRD QIP.
Several of these commenters noted that removing the Standardized
Fistula Rate clinical measure would enable clinicians to support the
vascular access care treatment options that are most appropriate for
their individual patients. Several commenters stated that the continued
focus on long-term catheter rates through the Long-Term Catheter Rate
clinical measure will sufficiently address reduction of catheters. One
commenter stated that removing the measure will reduce costs by not
incentivizing clinicians to perform procedures that may be unnecessary,
painful, or have a low likelihood of success. One commenter expressed
the belief that the measure should be removed because it is topped out.
Response: We thank commenters for their support. Although we do not
believe that the measure is topped out, we do agree with commenters
that the Standardized Fistula Rate clinical measure is appropriate for
removal because the measure no longer aligns with current clinical
guidelines or best practices and that removing the measure will support
a more individualized approach to vascular access care.
Comment: Although a few commenters expressed support for the
proposed removal, the commenters recommended that CMS continue to
monitor AV fistula and AV graft rates.
Response: We thank the commenters for their support, and we will
continue to monitor trends in ESRD patient data and quality of care.
Comment: One commenter did not support removal of the measure. The
commenter stated that they believe there is strong evidence that AV
fistula utilization is associated with better outcomes and is superior
to AV grafts and tunneled catheters. This commenter recommended
lowering the performance standard for the Standardized Fistula Rate
clinical measure and stated that this would indirectly make the use of
AV grafts less punitive without removing the measure while still
allowing individualized care for each patient. This commenter expressed
concern that removal of the measure will further incentivize the use of
AV grafts instead of AV fistula due to higher costs associated with
grafts because of more frequent procedures. This commenter expressed
concern that these new incentives will cause significant reductions in
fistula utilization with adverse consequences.
Response: We agree with the commenter that AV fistulas are the
preferred vascular access treatment option in cases where it is
appropriate based on the individual patient's needs, and we continue to
consider both AV fistula and AV graft as preferable forms of vascular
access to a long-term catheter. Although we will continue to monitor
trends in AV fistula and AV graft utilization, we believe that removing
the Standardized Fistula Rate clinical measure will provide flexibility
to determine which vascular access treatment option is most appropriate
based on the patient's specific characteristics and treatment plans.
Comment: A few commenters expressed concern regarding the increased
weight of the Long-Term Catheter Rate clinical measure in the ESRD QIP.
One commenter noted that, particularly among small or rural facilities,
long-term catheter rates may be impacted by factors beyond a facility's
control, such as physician availability, surgeon appointment openings,
and operating room availability. One commenter recommended that CMS
update the Long-Term Catheter Rate clinical measure to account for the
increased prevalence of two-step fistula placements, which may impact
long-term catheter rates. One commenter recommended several patient
exclusions be added to the denominator of the Long-Term Catheter Rate
clinical measure to account for different situations in which AV
fistula or AV graft placement is not appropriate based on the patient's
clinical case or individual preferences. The commenter stated that such
exclusions would help to make the measure more patient-centered and
meaningful, reflecting that the ``right'' vascular access is different
for every patient.
Response: We appreciate commenters' concern. However, we believe
the Long-Term Catheter Rate clinical measure continues to be an
important measure of facility performance tied to improved patient
outcomes. The increased weight of the Long-Term Catheter Rate clinical
measure reflects our view that long-term catheter use is the least-
favored vascular access treatment option and should be avoided where
more clinically preferable vascular access treatment options would be
appropriate. Although we acknowledge that long-term catheter usage may
be appropriate in certain circumstances depending on a particular
patient's clinical case, we believe the Long-Term Catheter Rate
clinical measure continues to align with current clinical guidelines
and incentivizes best practices in vascular access treatment for ESRD
patients. However, we will also continue to monitor the impact of our
updated policy, as well as trends in the use of two-step fistula
placements.
[[Page 76456]]
Comment: A few commenters expressed concern regarding the reporting
burden associated with the proposed changes, recommending that CMS
weigh the potential impact on patient health outcomes against potential
administrative burden. One commenter specifically expressed concern
with the burden impact on rural facilities due to the lack of
resources.
Response: We do not believe that removing a measure from the ESRD
QIP will impose additional burden on facilities.
Final Rule Action: After considering public comments, we are
finalizing our proposal to remove the Standardized Fistula Rate
clinical measure from the ESRD QIP measure set beginning with PY 2026
as proposed.
6. Revisions To Measure Domains and To Measure Weights Used To
Calculate the Total Performance Score (TPS) Beginning With the PY 2026
ESRD QIP
In the CY 2023 ESRD PPS final rule (87 FR 67251 through 67254), we
finalized revisions to the ESRD QIP measure domains beginning with PY
2025. Specifically, we added the Reporting Measure Domain and updated
measure domains and measure weights across five measure domains:
Patient & Family Engagement, Care Coordination, Clinical Care, Safety,
and Reporting. The measure domains and weights we finalized in the CY
2023 ESRD PPS final rule were depicted in Table 14 of the CY 2024 ESRD
PPS proposed rule (88 FR 42501) and are depicted in this final rule in
Table 15.
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As discussed previously, we are finalizing our proposals that
beginning with PY 2026, the Clinical Depression Screening and Follow-Up
reporting measure will be converted to a clinical measure and included
in the Care Coordination Measure Domain, the Standardized Fistula Rate
clinical measure will be removed from the Clinical Care Measure Domain,
the Ultrafiltration Rate reporting measure will be removed from the
Reporting Measure Domain, and the Facility Commitment to Health Equity
reporting measure will be added to the Reporting Measure Domain. To
accommodate the new numbers of measures in the Care Coordination
Measure Domain, Clinical Care Measure Domain, and Reporting Measure
Domain, in the CY 2024 ESRD PPS proposed rule, we proposed to update
the individual measure weights in each of these domains (88 FR 42501).
We stated our belief that these proposed updates to the individual
measure weights would help to ensure that a facility's individual
measure performance has an appropriately proportionate impact on a
facility's TPS, while also further incentivizing improvement on
clinical measures. For example, for the Care Coordination Measure
Domain, we proposed to update the measure weights for the SHR clinical
measure and the SRR clinical measure to accommodate the inclusion of
the proposed Clinical Depression Screening and Follow-Up clinical
measure. We stated that we believe these newly proposed measure weights
would strike an appropriate balance between the importance of facility
performance on the SHR clinical measure and the SRR clinical measure on
measuring patient outcomes, while also reflecting the impact of the
proposed Clinical Depression Screening and Follow-Up clinical measure
on patient quality of care. Additionally, we noted in the proposed rule
that the Vascular Access Type Measure Topic is currently weighted at 12
percent and includes both the Standardized Fistula Rate clinical
measure and the Long-Term Catheter Rate clinical measure. We proposed
to remove the Standardized Fistula Rate clinical measure and the
Vascular Access Type Measure Topic, and we also proposed to weight the
Long-Term Catheter Rate clinical measure at 12 percent. We noted our
belief this proposal would incentivize improvement and reflect the
impact of facility performance on the Long-Term Catheter Rate clinical
measure (as the sole vascular access type measure) on patient outcomes.
We also stated that we continue to believe that patient outcomes
improve when
[[Page 76457]]
they receive the most clinically appropriate vascular access treatment
option, and that long-term catheters should only be used when other
vascular access treatment options are not feasible. Consistent with our
approach in the CY 2023 ESRD PPS final rule (87 FR 67251 through
67253), we proposed to assign individual measure weights to reflect the
proposed updated number of measures in the Reporting Measure Domain so
that each measure is weighted equally (88 FR 42501 through 42502). In
light of these proposed updates to measures within the Reporting
Measure Domain, we stated that we would weight each measure equally at
2 percent, which is consistent with our previously finalized approach
to weight each measure in the Reporting Measure Domain equally. We note
that although we proposed to change the number of measures in three of
the domains and the weights of certain individual measures in those
domains, we did not propose to change the weights of the five domains
themselves because we believe the updates to individual measures and
measure weights do not significantly impact the measure domains
themselves such that updating the weights of the measure domains would
be required to accommodate the updated individual measure weights. In
the CY 2024 ESRD PPS proposed rule, the previously finalized and newly
proposed measures weights that would be included in each domain, along
with the proposed new measure weights, for PY 2026 were depicted in
Table 15 (88 FR 42502).
We welcomed public comment on these proposals. The comments we
received and our responses are set forth below.
Comment: A few commenters expressed concern regarding the proposed
updates to the individual measure weights within the Clinical Care
Measure Domain. One commenter expressed concern regarding the proposed
updates to the weight of the Long-Term Catheter Rate clinical measure,
recommending that CMS re-weight the Long-Term Catheter Rate clinical
measure at 9 percent and the STrR clinical measure at 10 percent within
the Clinical Care Measure Domain. One commenter stated that because
catheters are clinically appropriate for some patients, the measure
weight for the Long-Term Catheter Rate clinical measure should not be
updated and the remaining weight should be distributed among the other
measure domains.
Response: We appreciate commenters' concerns. However, we believe
that the Long-Term Catheter Rate clinical measure continues to be an
important measure of facility performance tied to improved patient
outcomes and that the increased weight would incentivize improvement
and reflect the impact of facility performance on the Long-Term
Catheter Rate clinical measure (as the sole vascular access type
measure) on patient outcomes. The increased weight of the Long-Term
Catheter Rate clinical measure reflects our view that long-term
catheter use is the least-favored vascular access treatment option and
should be avoided where more clinically preferable vascular access
treatment options would be appropriate. We will also take commenters'
recommendations regarding specific measure weights into consideration
for future rulemaking, but believe that the proposed weights are
appropriate at this time to incentivize quality improvement in clinical
measures.
Comment: One commenter recommended that CMS increase the weight of
the Reporting Measure Domain, noting the burden of complying with
reporting measure requirements.
Response: We take numerous factors into account when determining
appropriate domain and measure weights, including clinical evidence,
opportunity for improvement, clinical significance, and patient and
provider burden (83 FR 56995 through 56996). We also consider (1) the
number of measures and measure topics in a domain; (2) how much
experience facilities have had with the measures and measure topics in
a domain; and (3) how well the measures align with CMS's highest
priorities for quality improvement for patients with ESRD (79 FR
66214). We assign weights to the measure domains based on the clinical
value and meaningfulness of the measures to patients, and the burden of
complying with individual measure requirements. We believe that the
Reporting Measure Domain weights are appropriate to incentivize the
provision of high quality health care for all ESRD QIP measures.
Final Rule Action: After considering public comments, we are
finalizing our proposals to update the measure domains and measure
weights for the PY 2026 ESRD QIP as proposed, and therefore, provide
the newly finalized ESRD QIP measure domains and measure weights in
Table 16.
[[Page 76458]]
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7. Performance Standards for the PY 2026 ESRD QIP
Section 1881(h)(4)(A) of the Act requires the Secretary to
establish performance standards with respect to the measures selected
for the ESRD QIP for a performance period with respect to a year. The
performance standards must include levels of achievement and
improvement, as determined appropriate by the Secretary, and must be
established prior to the beginning of the performance period for the
year involved, as required by section 1881(h)(4)(C) of the Act. We
refer readers to the CY 2013 ESRD PPS final rule (76 FR 70277) for a
discussion of the achievement and improvement standards that we have
established for clinical measures used in the ESRD QIP. We define the
terms ``achievement threshold,'' ``benchmark,'' ``improvement
threshold,'' and ``performance standard'' in our regulations at Sec.
413.178(a)(1), (3), (7), and (12), respectively. For reporting
measures, performance standards are the levels of data submission and
completion of other actions specified by CMS that are used to award
points to an ESRD facility on the measure (Sec. 413.178(a)(12)).
In the CY 2023 ESRD PPS final rule (87 FR 67259 through 67260), we
set the performance period for the PY 2026 ESRD QIP as CY 2024 and the
baseline period as CY 2022. In the proposed rule, we estimated the
performance standards for the PY 2026 clinical measures in Table 16
using data from CY 2021, which was the most recent data available (88
FR 42502). For certain measures previously suppressed for the PY 2023
performance period due to significant impacts on the measure related to
the COVID-19 public health emergency (87 FR 67225 through 67237), we
used CY 2019 data. We are updating these performance standards for all
measures, using CY 2022 data, in this final rule, in Table 17.
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[[Page 76459]]
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In addition, we summarize in Table 18 our requirements for
successful reporting on our previously finalized reporting measures for
the PY 2026 ESRD QIP and our proposed requirements for successful
reporting of the Facility Commitment to Health Equity reporting
measure. We address comments regarding our proposed reporting
requirements for the Facility Commitment to Health Equity reporting
measure in section IV.C.2 of this final rule.
[[Page 76460]]
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8. Eligibility Requirements for the PY 2026 ESRD QIP
Our previously finalized minimum eligibility requirements for
scoring the ESRD QIP measures are described in Table 18a of the CY 2024
ESRD PPS proposed rule (88 FR 42505), and provided in Table 19a.
[[Page 76461]]
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In the CY 2024 ESRD PPS proposed rule, we proposed to add
eligibility requirements for the new Facility Commitment to Health
Equity reporting
[[Page 76462]]
measure, as well as other proposed updates to the ESRD QIP measure set
beginning with the PY 2026 ESRD QIP, as reflected in Table 18b in the
proposed rule (88 FR 42504 through 42506).
We welcomed public comment on these proposals. The comments we
received and our responses are set forth below.
Comment: One commenter expressed continued concern regarding the
potential to unfairly penalize small facilities due to eligibility
requirements and encouraged CMS to engage with the community to better
support small facilities.
Response: We acknowledge the commenter's concern and will continue
to monitor the impact of all ESRD QIP measures on small facilities to
ensure they are not unfairly penalized due to eligibility requirements
associated with a given measure.
Final Rule Action: After considering public comments, we are
finalizing our proposals as proposed. Since we are finalizing our
proposal for the new measure as proposed, as well as finalizing other
proposed updates to the ESRD QIP measure set beginning with the PY 2026
ESRD QIP, our newly finalized minimum eligibility requirements for
scoring the ESRD QIP measures are described in Table 19b.
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[[Page 76463]]
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9. Payment Reduction Scale for the PY 2026 ESRD QIP
Under our current policy, a facility does not receive a payment
reduction for a payment year in connection with its performance under
the ESRD QIP if it achieves a TPS that is at or above the minimum TPS
(mTPS) that we establish for the payment year. We have defined the mTPS
in our regulations at Sec. 413.178(a)(8) as, with respect to a payment
year, the TPS that an ESRD facility would receive if, during the
baseline period, it performed at the 50th percentile of national
performance on all clinical measures and the median of
[[Page 76464]]
national ESRD facility performance on all reporting measures.
Under our current policy, which is codified at Sec. 413.177 of our
regulations, we implement the payment reductions on a sliding scale
using ranges that reflect payment reduction differentials of 0.5
percent for each 10 points that the facility's TPS falls below the mTPS
(76 FR 634 through 635).
In the proposed rule, we stated that for PY 2026, we estimated
using available data that a facility must meet or exceed a mTPS of 52
to avoid a payment reduction (88 FR 42507). We noted that the mTPS
estimated in the proposed rule is based on data from CY 2021 and CY
2019 instead of the PY 2026 baseline period (CY 2022) because CY 2022
data were not yet available. We presented the estimated payment
reduction scale in Table 19 of the CY 2024 ESRD PPS proposed rule (88
FR 42507). We stated our intention to update the mTPS for PY 2026, as
well as the payment reduction ranges for that payment year, in this CY
2024 ESRD PPS final rule. We have now finalized the payment reductions
that will apply to the PY 2026 ESRD QIP using updated CY 2022 data. The
mTPS for PY 2026 will be 53, and the finalized payment reduction scale
is shown in Table 20.
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D. Updates to Requirements Beginning With the PY 2027 ESRD QIP
1. PY 2027 ESRD QIP Measure Set
Under our current policy, we generally retain all measures once
adopted for a payment year for subsequent payment years. In the
proposed rule, we proposed to add the Screening for Social Drivers of
Health reporting measure and the Screen Positive Rate for Social
Drivers of Health reporting measure to the ESRD QIP measure set
beginning with PY 2027. As discussed in sections IV.D.2 and IV.D.3 of
this final rule, we are finalizing these measure proposals and provide
the finalized PY 2027 ESRD QIP measure set in Table 21.
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[[Page 76465]]
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[[Page 76466]]
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2. Adoption of the Screening for Social Drivers of Health Reporting
Measure Beginning With PY 2027
Our commitment to supporting facilities in building equity into
their health care delivery practices is, in part, focused on empowering
their workforce to recognize and eliminate health disparities that
disproportionately impact their patients who have health-related social
needs (HRSNs). HRSNs are significant risk factors associated with worse
health outcomes as well as increased health care utilization.\217\ We
believe that the identification of HRSNs among facility patients has
two significant benefits. First, research has shown that certain HRSNs
disproportionately impact populations that have historically been
underserved by the healthcare system and screening helps identify
individuals who may have HRSNs.\218\ Due to the association between
chronic condition risk and HRSNs, screening for these needs could serve
as evidence-based building blocks for supporting ESRD facilities in
addressing persistent disparities and tracking progress towards closing
the health equity gap in the ESRD population. Second, we believe HRSN
screening by facilities could enable them to engage in meaningful
collaboration with other healthcare providers and community-based
organizations as part of a more holistic approach to addressing health
equity gaps that negatively impact their ESRD patients, which may also
eventually result in implementing and evaluating related innovations in
health and social care delivery among these facilities, healthcare
providers and community-based organizations.
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\217\ Centers for Medicare & Medicaid Services. (2021). A Guide
to Using the Accountable Health Communities Health-Related Social
Needs Screening Tool: Promising Practices and Key Insights. June
2021. Available at: https://innovation.cms.gov/media/document/ahcm-screeningtool-companion. Accessed: November 23, 2021.
\218\ American Hospital Association. (2020). Health Equity,
Diversity & Inclusion Measures for Hospitals and Health System
Dashboards. December 2020. Accessed: January 18, 2022. Available at:
https://ifdhe.aha.org/system/files/media/file/2020/12/ifdhe_inclusion_dashboard.pdf.
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In the FY 2023 IPPS/LTCH PPS final rule (87 FR 49191 through
49220), we finalized the adoption of two evidence-based measures in the
Hospital Inpatient Quality Reporting (IQR) Program, the Screening for
Social Drivers of Health and the Screen Positive Rate for Social
Drivers of Health measures. These two Social Drivers of Health measures
support identification of specific risk factors for inadequate
healthcare access and adverse health outcomes among patients. These
measures also encourage hospitals to systematically collect HRSN data.
We have also finalized a policy requiring that all Special Needs Plans
(SNPs) include one or more questions on housing stability, food
security, and access to transportation in their Health Risk Assessment
(HRA) using questions from a list of screening instruments specified in
sub-regulatory guidance (87 FR 27726 through 27740), as well as adopted
the Screening for Social Drivers of Health measure in the Merit-based
Incentive Payment System (87 FR 70054 and 70055).
In the CY 2024 ESRD PPS proposed rule, we stated that advancing
health equity by addressing the health disparities that underlie the
country's health system is one of our strategic pillars and a Biden-
Harris Administration priority (88 FR 42509).\219\ We noted our belief
that the Screening for Social Drivers of Health reporting measure
aligns with The CMS Quality Strategy Goals for effective care
coordination and prevention and treatment of chronic conditions.\220\
We stated that the Screening for Social Drivers of Health reporting
measure would enable facilities to identify patients with HRSNs, who
are known to experience the greatest risk of poor health outcomes.
Improvement in risk identification has the potential to reduce
healthcare access barriers, address the disproportionate expenditures
attributed to populations with greatest risk, and improve the
facility's quality of care through the facility taking steps to
mitigate poor health outcomes by improving their care coordination
efforts.221 222 223 224 These data could help facilities
improve their care coordination efforts, including by understanding
what HRSNs might be contributing to poor patient outcomes so that
facilities can direct resources, as appropriate, toward referring their
patients to resources that might be able to help them resolve their
HRSNs.
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\219\ Brooks-LaSure, C. (2021). My First 100 Days and Where We
Go From Here: A Strategic Vision for CMS. Centers for Medicare &
Medicaid. Available at: https://www.cms.gov/blog/my-first-100-days-and-where-we-go-here-strategic-vision-cms.
\220\ Centers for Medicare & Medicaid Services. (2021) CMS
National Quality Strategy. Available at: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/CMS-Quality-Strategy.
\221\ Baker, M.C., Alberti, P.M., Tsao, T.Y., Fluegge, K.,
Howland, R.E., & Haberman, M. (2021). Social Determinants Matter for
Hospital Readmission Policy: Insights From New York City. Health
Affairs, 40(4), 645-654. Available at: https://doi.org/10.1377/hlthaff.2020.01742.
\222\ Hammond, G., Johnston, K., Huang, K., Joynt Maddox, K.
(2020). Social Determinants of Health Improve Predictive Accuracy of
Clinical Risk Models for Cardiovascular Hospitalization, Annual
Cost, and Death. Circulation: Cardiovascular Quality and Outcomes,
13 (6) 290-299. Available at: https://doi.org/10.1161/CIRCOUTCOMES.120.006752.
\223\ Hill-Briggs, F. (2021, January 1). Social Determinants of
Health and Diabetes: A Scientific Review. Diabetes Care. Available
at: https://pubmed.ncbi.nlm.nih.gov/33139407/.
\224\ Jaffrey, J.B., Safran, G.B., Addressing Social Risk
Factors in Value-Based Payment: Adjusting Payment Not Performance to
Optimize Outcomes and Fairness. Health Affairs Blog, April 19, 2021.
Available at: https://www.healthaffairs.org/do/10.1377/forefront.20210414.379479/full/.
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a. Background
Health disparities manifest primarily as worse health outcomes in
population groups where access to care is
inequitable.225 226 227 228 229 Such differences persist
across geography and healthcare settings irrespective of improvements
in quality of care over time.230 231 232 Assessment of HRSNs
is an essential mechanism for capturing the interaction between social,
community, and environmental factors associated with health status and
health
[[Page 76467]]
outcomes.233 234 235 Growing evidence demonstrates that
specific social risk factors are directly associated with patient
health outcomes as well as healthcare utilization, costs, and
performance in quality reporting and payment
programs.236 237
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\225\ Seligman, H.K., & Berkowitz, S.A. (2019). Aligning
Programs and Policies to Support Food Security and Public Health
Goals in the United States. Annual Review of Public Health, 40(1),
319-337. Available at: https://pubmed.ncbi.nlm.nih.gov/30444684/.
\226\ The Physicians Foundation. (2020). Survey of America's
Patients, Part Three. Available at: https://physiciansfoundation.org/wp-content/uploads/2020/10/2020-Physicians-Foundation-Survey-Part3.pdf.
\227\ Office of the Assistant Secretary for Planning and
Evaluation (ASPE) (2020). Report to Congress: Social Risk Factors
and Performance Under Medicare's Value-Based Purchasing Program
(Second of Two Reports). Available at: https://aspe.hhs.gov/pdf-report/second-impact-report-to-congress.
\228\ Trivedi AN, Nsa W, Hausmann LRM, et al. Quality and Equity
of Care in U.S. Hospitals. New England Journal of Medicine. 2014;
371(24):2298-2308.
\229\ Billioux, A., Verlander, K., Anthony, S., & Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
\230\ Office of the Assistant Secretary for Planning and
Evaluation (ASPE) (2020). Report to Congress: Social Risk Factors
and Performance Under Medicare's Value-Based Purchasing Program
(Second of Two Reports). Available at: https://aspe.hhs.gov/pdf-report/second-impact-report-to-congress.
\231\ Hill-Briggs, F. (2021, January 1). Social Determinants of
Health and Diabetes: A Scientific Review. Diabetes Care. Available
at: https://pubmed.ncbi.nlm.nih.gov/33139407/.
\232\ Khullar, D., MD. (2020, September 8). Association Between
Patient Social Risk and Physician Performance American academy of
Family Physicians. Addressing Social Determinants of Health in
Primary Care team-based approach for advancing health equity.
Available at: https://www.aafp.org/dam/AAFP/documents/patient_care/everyone_project/team-based-approach.pdf.
\233\ Institute of Medicine. (2014). Capturing Social and
Behavioral Domains and Measures in Electronic Health Records: Phase
2. Washington, DC: The National Academies Press. Available at:
https://doi.org/10.17226/18951.
\234\ Alley, D. E., C. N. Asomugha, P. H. Conway, and D. M.
Sanghavi. (2016). Accountable Health Communities--Addressing Social
Needs through Medicare and Medicaid. The New England Journal of
Medicine 374(1):8-11. Available at: https://doi.org/10.1056/NEJMp1512532.
\235\ CDC. CDC COVID-19 Response Health Equity Strategy:
Accelerating Progress Towards Reducing COVID-19 Disparities and
Achieving Health Equity. July 2020. Available at: https://www.cdc.gov/coronavirus/2019-ncov/community/health-equity/cdc-strategy.html. Accessed November 17, 2021.
\236\ Zhang Y, Li J, Yu J, Braun RT, Casalino LP. (2021). Social
Determinants of Health and Geographic Variation in Medicare per
Beneficiary Spending. JAMA Network Open. 2021;4(6):e2113212.
doi:10.1001/jamanetworkopen.2021.13212.
\237\ Khullar, D., Schpero, W.L., Bond, A.M., Qian, Y., &
Casalino, L.P. (2020). Association Between Patient Social Risk and
Physician Performance Scores in the First Year of the Merit-based
Incentive Payment System. JAMA, 324(10), 975-983. https://doi.org/10.1001/jama.2020.13129.
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Significant and persistent health disparities in the United States
result in adverse health outcomes for people with
ESRD.238 239 The COVID-19 pandemic has illuminated the
detrimental interaction between HRSNs, adverse health outcomes, and
health care utilization in the United States.240 241
Emerging evidence has shown that specific social risk factors are
directly associated with health outcomes and health care utilization
and costs.242 243 244 245 Of particular concern among people
with ESRD are HRSNs that have an effect on treatment outcomes,
including inadequate access to healthy foods, unstable housing, limited
transportation, and community safety concerns.246 247
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\238\ United States Renal Data System. 2021 USRDS Annual Data
Report: Epidemiology of kidney disease in the United States.
National Institutes of Health, National Institute of Diabetes and
Digestive and Kidney Diseases, Bethesda, MD, 2021. We note that,
following publication of the CY 2024 ESRD PPS proposed rule, the
USRDS has published its 2022 annual report, which is available at:
https://usrds-adr.niddk.nih.gov/2022.
\239\ Weinhandl, E.D., Wetmore, J.B., Peng, Y., Liu, J.,
Gilbertson, D.T., et al., (2021). Initial Effects of COVID-19 on
Patient with ESKD. Journal of the American Society of Nephrology 32:
1444-1453. doi: https://doi.org/10.1681/ASN.2021010009.
\240\ CDC. CDC COVID-19 Response Health Equity Strategy:
Accelerating Progress Towards Reducing COVID-19 Disparities and
Achieving Health Equity. July 2020. Available at: https://www.cdc.gov/coronavirus/2019-ncov/community/health-equity/cdc-strategy.html. Accessed November 17, 2021.
\241\ Weinhandl, E.D., Wetmore, J.B., Peng, Y., Liu, J.,
Gilbertson, D.T., et al., (2021). Initial Effects of COVID-19 on
Patient with ESKD. Journal of the American Society of Nephrology 32:
1444-1453. doi: https://doi.org/10.1681/ASN.2021010009.
\242\ Hill-Briggs, F. (2021, January 1). Social Determinants of
Health and Diabetes: A Scientific Review. Diabetes Care. Available
at: https://care.diabetesjournals.org/lookup/doi/10.2337/dci20-0053.
\243\ Dean, E.B., French, M.T., Mortensen, K. (2020). Health
Services Research 55 (Supplement 2): 883-893. doi: 10.1111/1475-
6773.13283.
\244\ Berkowitz, S.A., Kalkhoran, S., Edwards, S.T., Essien,
U.R., Baggett, T.P. (2018). Unstable Housing and Diabetes-Related
Emergency Department Visits and Hospitalization: A Nationally
Representative Study of Safety-Net Clinic Patients. Diabetes Care
41: 933-939. https://doi.org/10.2337/dc17-1812.
\245\ National Academies of Sciences, Engineering, and Medicine
2019. Dialysis Transportation: The Intersection of Transportation
and Healthcare. Washington, DC: The National Academies Press.
https://doi.org/10.17226/25385.
\246\ Ibid.
\247\ CMS (2021). Chronic Kidney Disease Disparities:
Educational Guide for Primary Care. Available at: https://www.cms.gov/files/document/chronic-kidney-disease-disparities-educational-guide-primary-care.pdf.
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We believe that improvement in care coordination between ESRD
facilities, hospitals, and community-based organizations would yield
better health outcomes for people with ESRD, and subsequently lead to
improvements in quality performance for dialysis and other health care
providers. We believe that the Screening for Social Drivers of Health
reporting measure would help inform facilities of the impact of HRSNs
in people with ESRD by assessing the proportion of adult patients who
are screened for social drivers of health in five core domains: food
insecurity, housing instability, transportation needs, utility
difficulties, and interpersonal safety.
In the CY 2023 ESRD PPS proposed rule, we sought public comment on
the potential future inclusion of the Screening for Social Drivers of
Health measure in the ESRD QIP (87 FR 38554 through 38556). For a
summary of the comments we received, as well as our responses, we refer
readers to the CY 2023 ESRD PPS final rule (87 FR 67265 through 67268).
In the CY 2023 ESRD PPS final rule, we stated that we were considering
whether to incorporate measures that assess screening for health-
related social needs into the ESRD QIP measure set (87 FR 67264).
In the CY 2024 ESRD PPS proposed rule, we proposed to adopt the
Screening for Social Drivers of Health reporting measure under section
1881(h)(2)(A)(iv) of the Act, which gives the Secretary broad authority
to specify measures for the ESRD QIP (88 FR 42510). As discussed
previously, disparities in health equity are tied to worse patient
outcomes in the ESRD community. While widespread interest in addressing
HRSNs exists, action is inconsistent, specifically in ESRD facilities.
Therefore, we believe it is appropriate to require facilities to report
data on this measure because the intent of the proposed measure is to
incentivize facilities to collect and utilize their data to identify
the impact of HRSNs in their ESRD patient population, including whether
there is a relationship between those HRSNs and the outcomes
experienced by their patients with those HRSNs. Screening data
collected by the facility could inform their provision of care such
that they improve the outcomes experienced by patients with HRSNs.
Facilities could analyze their screening data to understand whether
there are any HRSNs that may be affecting their patients' access to
care or contributing to poor outcomes in their patient populations and,
in turn, develop appropriate solutions to improve access and outcomes.
While the measure does not require facilities to take specific actions
following an HRSN screening, we expect that any solution a facility
might develop to address a gap it identifies would comply with all
applicable Federal non-discrimination laws. We also noted that the
measure is intended to promote health equity for all patients and is
not intended to create a conflict between a CMS requirement and a
State's civil rights laws.
Under our Meaningful Measures Framework,\248\ the Screening for
Social Drivers of Health reporting measure, along with the Screen
Positive Rate for Social Drivers of Health reporting measure discussed
in section IV.D.3 of this final rule, addresses the quality priority of
``Work with Communities to Promote Best Practices of Healthy Living''
through the Meaningful Measures Area of ``Equity of Care.''
Additionally, consistent with Meaningful Measures 2.0, these measures
address the ``healthcare equity'' priority area and align with our
commitment to introduce plans to close health equity gaps and promote
equity through quality measures, including to ``develop and implement
measures that reflect social and economic determinants.'' \249\
Development and proposal of these measures also aligns with our
strategic pillar to advance
[[Page 76468]]
health equity by addressing the health disparities that underlie our
health system.\250\ We also believe these measures address the quality
priority ``Promoting Effective Prevention and Treatment of Chronic
Disease'' through the Meaningful Measures Area ``Management of Chronic
Conditions,'' by improving a facility's ability to assess and implement
effective care coordination for its patients. For example, data
demonstrate that an overwhelming majority of people with ESRD travel
outside their homes for dialysis three times per week, round trip, and
that transportation challenges contribute to shortened treatment
episodes and adverse health outcomes.251 252 Identification
of patients with transportation difficulties could encourage facilities
to provide information to these patients about available community-
based transportation services that could help these patients with their
transportation needs. We also believe that the measures would encourage
facilities to incorporate HRSN screening into their routine care, which
would in turn improve their ability to understand the full needs of
their patients, including those who may need additional care
coordination but might be reluctant to otherwise seek assistance due to
concerns about personal stigmatization.
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\248\ Centers for Medicare & Medicaid Services. Meaningful
Measures Framework. Available at: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/CMS-Quality-Strategy.
\249\ Centers for Medicare & Medicaid Services. Meaningful
Measures 2.0: Moving from Measure Reduction to Modernization.
Available at: https://www.cms.gov/meaningful-measures-20-moving-measure-reduction-modernization. We note that Meaningful Measures
2.0 is still under development.
\250\ Brooks-LaSure, C. (2021). My First 100 Days and Where We
Go From Here: A Strategic Vision for CMS. Available at: https://www.cms.gov/blog/my-first-100-days-and-where-we-go-here-strategic-vision-cms.
\251\ Ibid.
\252\ United States Renal Data System. 2021 USRDS Annual Data
Report: Epidemiology of kidney disease in the United States.
National Institutes of Health, National Institute of Diabetes and
Digestive and Kidney Diseases, Bethesda, MD, 2021. We note that,
following publication of the CY 2024 ESRD PPS proposed rule, the
USRDS has published its 2022 annual report, which is available at:
https://usrds-adr.niddk.nih.gov/2022.
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Growing evidence demonstrates that specific social risk factors are
directly associated with patient health outcomes as well as healthcare
utilization, costs, and performance in quality reporting and payment
programs.253 254 In 2017, CMS's Center for Medicare and
Medicaid Innovation (CMMI) launched the Accountable Health Communities
(AHC) Model to test the impact of systematically identifying and
addressing the HRSNs of community-dwelling Medicare and Medicaid
beneficiaries (through screening, referral, and community navigation on
their health outcomes and related healthcare utilization and
costs).255 256 257 258 The CMS Innovation Center developed
the AHC Model based on evidence that addressing HRSNs through enhanced
linkages between health systems and community-based organizations can
improve health outcomes and reduce costs.\259\ HRSNs are significant
risk factors associated with adverse health outcomes and increased
health care utilization, including excessive emergency department (ED)
visits and avoidable hospitalizations.260 261 Unmet HRSNs,
such as food insecurity, inadequate or unstable housing, and inadequate
transportation may increase risk for onset of chronic conditions, such
as ESRD, and accelerate exacerbation of related adverse health
outcomes.262 263 264 The AHC Model had a 5-year period of
performance that began in May 2017 and concluded in April 2022, with
beneficiary screening beginning in the summer of 2018 following an
implementation period.265 266 Evaluation of the AHC Model
data is still underway, and the most recent evaluation was published in
the second AHC Model evaluation report on May 18, 2023.\267\
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\253\ Zhang Y, Li J, Yu J, Braun RT, Casalino LP. (2021). Social
Determinants of Health and Geographic Variation in Medicare per
Beneficiary Spending. JAMA Network Open. 2021;4(6):e2113212.
doi:10.1001/jamanetworkopen.2021.13212.
\254\ Khullar, D., Schpero, W. L., Bond, A. M., Qian, Y., &
Casalino, L. P. (2020). Association Between Patient Social Risk and
Physician Performance Scores in the First Year of the Merit-based
Incentive Payment System. JAMA, 324(10), 975-983. https://doi.org/10.1001/jama.2020.13129.
\255\ Centers for Medicare & Medicaid Services. (2021). A Guide
to Using the Accountable Health Communities Health-Related Social
Needs Screening Tool: Promising Practices and Key Insights. June
2021. Accessed: November 23, 2021. Available at: https://innovation.cms.gov/media/document/ahcm-screeningtool-companion.
\256\ Alley, D. E., C. N. Asomugha, P. H. Conway, and D. M.
Sanghavi. 2016. Accountable Health Communities--Addressing Social
Needs through Medicare and Medicaid. The New England Journal of
Medicine 374(1):8-11. Available at: https://doi.org/10.1056/NEJMp1512532.
\257\ Billioux, A., Verlander, K., Anthony, S., & Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
\258\ Centers for Medicare & Medicaid Services. (2021).
Accountable Health Communities Model. Accountable Health Communities
Model [verbar] CMS Innovation Center. Accessed November 23, 2021.
Available at: https://innovation.cms.gov/innovation-models/ahcm.
\259\ RTI International. (2020). Accountable Health Communities
(AHC) Model Evaluation. Available at: https://innovation.cms.gov/data-and-reports/2020/ahc-first-eval-rpt.
\260\ Billioux, A., Verlander, K., Anthony, S., & Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
\261\ Alley, D. E., C. N. Asomugha, P. H. Conway, and D. M.
Sanghavi. 2016. Accountable Health Communities--Addressing Social
Needs through Medicare and Medicaid. The New England Journal of
Medicine 374(1):8-11. Available at: https://doi.org/10.1056/NEJMp1512532.
\262\ Office of the Assistant Secretary for Planning and
Evaluation (ASPE) (2020). Report to Congress: Social Risk Factors
and Performance Under Medicare's Value-Based Purchasing Program
(Second of Two Reports). Available at: https://aspe.hhs.gov/pdf-report/second-impact-report-to-congress.
\263\ Hill-Briggs, F. (2021, January 1). Social Determinants of
Health and Diabetes: A Scientific Review. Diabetes Care. Available
at: https://care.diabetesjournals.org/lookup/doi/10.2337/dci20-0053.
\264\ Laraia, B.A. (2013). Food Insecurity and Chronic Disease.
Advances in Nutrition, 4: 203-212, doi: 10.3945/an.112.003277.
\265\ RTI International. (2020). Accountable Health Communities
(AHC) Model Evaluation. Available at: https://innovation.cms.gov/data-and-reports/2020/ahc-first-eval-rpt.
\266\ We note that the model officially concluded in April 2022
but many awardees are continuing with no-cost extensions to continue
utilizing unspent cooperative agreement funding and all awardees
will conclude by April 2023.
\267\ RTI International. (2023). Accountable Health Communities
(AHC) Model Evaluation. Available at: https://innovation.cms.gov/data-and-reports/2023/ahc-second-eval-rpt.
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While social risk factors may have a significant impact on health
outcomes, the mechanisms by which this connection emerges are complex
and multifaceted.268 269 270 271 The persistent interactions
between individuals' HRSNs, medical providers' practices/behaviors, and
community resources significantly impact healthcare access, quality,
and ultimately costs, as described in the CMS Equity Plan for Improving
Quality in Medicare.272 273 In
[[Page 76469]]
their 2018 survey of 8,500 physicians, The Physicians Foundation found
almost 90 percent of physician respondents reported their patients had
a serious health problem linked to poverty or other social
conditions.\274\ Additionally, associations between disproportionate
health risk, hospitalization, and adverse health outcomes have been
highlighted and magnified by the COVID-19 pandemic.275 276
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\268\ Kaiser Family Foundation. (2021). Racial and Ethnic Health
Inequities and Medicare. Available at: https://www.kff.org/medicare/report/racial-and-ethnic-health-inequities-and-medicare/. Accessed
November 23, 2021.
\269\ Khullar, D., MD. (2020, September 8). Association Between
Patient Social Risk and Physician Performance American academy of
Family Physicians. (2020). Addressing Social Determinants of Health
in Primary Care team-based approach for advancing health equity.
\270\ Hammond, G., Johnston, K., Huang, K., Joynt Maddox, K.
(2020). Social Determinants of Health Improve Predictive Accuracy of
Clinical Risk Models for Cardiovascular Hospitalization, Annual
Cost, and Death. Circulation: Cardiovascular Quality and Outcomes,
13 (6) 290-299. Available at: https://doi.org/10.1161/CIRCOUTCOMES.120.006752.
\271\ The Physicians Foundation. (2021). Viewpoints: Social
Determinants of Health. Available at: https://physiciansfoundation.org/wp-content/uploads/2019/08/The-Physicians-Foundation-SDOH-Viewpoints.pdf. Accessed December 8, 2021.
\272\ Centers for Medicare & Medicaid Services. (2021). Paving
the Way to Equity: A Progress Report. Accessed January 18, 2022.
Available at: https://www.cms.gov/files/document/paving-way-equity-cms-omh-progress-report.pdf.
\273\ Centers for Medicare & Medicaid Services Office of
Minority Health. (2021). The CMS Equity Plan for Improving Quality
in Medicare. 2015-2021. Available at: https://www.cms.gov/About-CMS/
Agency-Information/OMH/OMH_Dwnld-
CMS_EquityPlanforMedicare_090615.pdf#:~:text=The%20Centers%20for%20Me
dicare%20%26%20Medicaid%20Services%20%28CMS%29,evidence%20base%2C%20i
dentifying%20opportunities%2C%20and%20gathering%20stakeholder%20input
.
\274\ The Physicians Foundation. (2019). Viewpoints: Social
Determinants of Health. Available at: https://physiciansfoundation.org/wp-content/uploads/2019/08/The-Physicians-Foundation-SDOH-Viewpoints.pdf. Accessed December 8, 2021.
\275\ CDC. (2020). CDC COVID-19 Response Health Equity Strategy:
Accelerating Progress Towards Reducing COVID-19 Disparities and
Achieving Health Equity. July 2020. Available at: https://www.cdc.gov/coronavirus/2019-ncov/community/health-equity/cdc-strategy.html. Accessed November 17, 2021.
\276\ Kaiser Family Foundation. (2021). Racial and Ethnic Health
Inequities and Medicare. Available at: https://www.kff.org/medicare/report/racial-and-ethnic-health-inequities-and-medicare/. Accessed
November 23, 2021.
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The following five core domains were selected to screen for HRSNs
among Medicare and Medicaid beneficiaries under the AHC Model: (1) food
insecurity; (2) housing instability; (3) transportation needs; (4)
utility difficulties; and (5) interpersonal safety. These domains were
chosen based upon literature review and expert consensus utilizing the
following criteria: (1) availability of high-quality scientific
evidence linking a given HRSN to adverse health outcomes and increased
healthcare utilization, including hospitalizations and associated
costs; (2) ability for a given HRSN to be screened and identified in
the inpatient setting prior to hospital discharge, addressed by
community-based services, and potentially improve healthcare outcomes,
including reduced hospital re-admissions; and (3) evidence that a given
HRSN is not systematically addressed by healthcare providers.\277\ In
addition to established evidence of their association with health
status, risk, and outcomes, these five domains were also selected
because they can be assessed across the broadest spectrum of
individuals in a variety of settings.278 279 280
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\277\ Billioux, A., Verlander, K., Anthony, S., & Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
\278\ Billioux, A., Verlander, K., Anthony, S., & Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
\279\ Centers for Medicare & Medicaid Services. (2021).
Accountable Health Communities Model. Accountable Health Communities
Model [bond] CMS Innovation Center. Accessed November 23, 2021.
Available at: https://innovation.cms.gov/innovation-models/ahcm.
\280\ Kamyck, D., Senior Director of Marketing. (2019). CMS
releases standardized screening tool for health-related social
needs. Activate Care. Available at: https://blog.activatecare.com/news.
\281\ Berkowitz SA, Seligman HK, Meigs JB, Basu S. Food
insecurity, healthcare utilization, and high cost: a longitudinal
cohort study. Am J Managed Care. 2018 Sep;24(9):399-404. PMID:
30222918; PMCID: PMC6426124.
\282\ Hill-Briggs, F. (2021, January 1). Social Determinants of
Health and Diabetes: A Scientific Review. Diabetes Care. Available
at: https://pubmed.ncbi.nlm.nih.gov/33139407/.
\283\ Seligman, H.K., Berkowitz, S.A. (2019). Aligning Programs
and Policies to Support Food Security and Public Health Goals in the
United States. Annual Review of Public Health, 40(1), 319-337.
Available at: https://pubmed.ncbi.nlm.nih.gov/30444684/.
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These five evidence-based HRSN domains informed our development of
the Screening for Social Drivers of Health reporting measure, as well
as a second measure, Screen Positive Rate for Social Drivers of Health
reporting measure. These domains are described in Table 22.
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\284\ National Academies of Sciences, Engineering, and Medicine
2006. Executive Summary: Cost-Benefit Analysis of Providing Non-
Emergency Medical Transportation. Washington, DC: The National
Academies Press. Available at: https://doi.org/10.17226/23285.
\285\ Hill-Briggs, F. (2021, January 1). Social Determinants of
Health and Diabetes: A Scientific Review. Diabetes Care. Available
at: https://pubmed.ncbi.nlm.nih.gov/33139407/.
\286\ Berkowitz SA, Seligman HK, Meigs JB, Basu S. Food
insecurity, healthcare utilization, and high cost: a longitudinal
cohort study. Am J Managed Care. 2018 Sep;24(9):399-404. PMID:
30222918; PMCID: PMC6426124.
\287\ Dean, E. B., French, M. T., Mortensen, K. (2020a). Food
insecurity, health care utilization, and health care expenditures.
Health Services Research, 55(S2), 883-893. Available at: https://doi.org/10.1111/1475-6773.13283.
\288\ Larimer, M. E. (2009). Health Care and Public Service Use
and Costs Before and After Provision of Housing for Chronically
Homeless Persons with Severe Alcohol Problems. JAMA, 301(13), 1349.
Available at: https://doi.org/10.1001/jama.2009.414.
\289\ Hill-Briggs, F. (2021). Social Determinants of Health and
Diabetes: A Scientific Review. Diabetes Care. Available at: https://pubmed.ncbi.nlm.nih.gov/33139407/.
\290\ Henry M., de Sousa, T., Roddey, C., Gayen, S., Bednar, T.;
Abt Associates. The 2020 Annual Homeless Assessment Report (AHAR) to
Congress; Part 1: Point-in-Time Estimates of Homelessness, January
2021. U.S. Department of Housing and Urban Development. Accessed
November 24, 2021. Available at: https://www.huduser.gov/portal/sites/default/files/pdf/2020-AHAR-Part-1.pdf.
[GRAPHIC] [TIFF OMITTED] TR06NO23.037
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\291\ Larimer, M. E. (2009). Health Care and Public Service Use
and Costs Before and After Provision of Housing for Chronically
Homeless Persons with Severe Alcohol Problems. JAMA, 301(13), 1349.
Available at: https://doi.org/10.1001/jama.2009.414.
\292\ Baxter, A., Tweed, E., Katikireddi, S., Thomson, H.
(2019). Effects of Housing First approaches on health and well-being
of adults who are homeless or at risk of homelessness: systematic
review and meta-analysis of randomized controlled trials. Journal of
Epidemiology and Community Health, 73; 379-387. Available at:
https://jech.bmj.com/content/jech/73/5/379.full.pdf.
\293\ National Academies of Sciences, Engineering, and Medicine
2006. Executive Summary: Cost-Benefit Analysis of Providing Non-
Emergency Medical Transportation. Washington, DC: The National
Academies Press. Available at: https://doi.org/10.17226/23285.
\294\ National Academies of Sciences, Engineering, and Medicine
2006. Executive Summary: Cost-Benefit Analysis of Providing Non-
Emergency Medical Transportation. Washington, DC: The National
Academies Press. Available at: https://doi.org/10.17226/23285.
\295\ Hill-Briggs, F. (2021, January 1). Social Determinants of
Health and Diabetes: A Scientific Review. Diabetes Care. Available
at: https://pubmed.ncbi.nlm.nih.gov/33139407/.
\296\ Billioux, A., Verlander, K., Anthony, S., Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
\297\ Shier, G., Ginsburg, M., Howell, J., Volland, P., Golden,
R. (2013). Strong Social Support Services, Such as Transportation
And Help For Caregivers, Can Lead To Lower Health Care Use And
Costs. Health Affairs, 32(3), 544-551. Available at: https://doi.org/10.1377/hlthaff.2012.0170.
\298\ Baxter, A., Tweed, E., Katikireddi, S., Thomson, H.
(2019). Effects of Housing First approaches on health and well-being
of adults who are homeless or at risk of homelessness: systematic
review and meta-analysis of randomized controlled trials. Journal of
Epidemiology and Community Health, 73; 379-387. Available at:
https://jech.bmj.com/content/jech/73/5/379.full.pdf.
\299\ Wright, B. J., Vartanian, K. B., Li, H. F., Royal, N.,
Matson, J. K. (2016). Formerly Homeless People Had Lower Overall
Health Care Expenditures After Moving into Supportive Housing.
Health Affairs, 35(1), 20-27. Available at: https://doi.org/10.1377/hlthaff.2015.0393.
\300\ Billioux, A., Verlander, K., Anthony, S., Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
\301\ Henry M., de Sousa, T., Roddey, C., Gayen, S., Bednar, T.;
Abt Associates. The 2020 Annual Homeless Assessment Report (AHAR) to
Congress; Part 1: Point-in-Time Estimates of Homelessness, January
2021. U.S. Department of Housing and Urban Development. Accessed
November 24, 2021. Available at: https://www.huduser.gov/portal/sites/default/files/pdf/2020-AHAR-Part-1.pdf.
\302\ Larimer, M. E. (2009). Health Care and Public Service Use
and Costs Before and After Provision of Housing for Chronically
Homeless Persons with Severe Alcohol Problems. JAMA, 301(13), 1349.
Available at: https://doi.org/10.1001/jama.2009.414.
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[[Page 76471]]
The Screening for Social Drivers of Health reporting measure
assesses screening of the same HRSNs.
In the proposed rule, we proposed that facilities would be able to
choose a screening tool for purposes of this measure or otherwise
screen their patients using a method of their choosing in order to give
facilities the flexibility to accommodate the population they serve and
their individual needs (88 FR 42513).303 304 We noted that
the 10-item AHC Health-Related Social Needs Screening Tool that AHC
Model participants used to identify HRSNs in the five core domains
(described in Table 22) among community-dwelling Medicare, Medicaid,
and dually eligible beneficiaries was tested across varied care-
delivery sites in diverse geographic locations across the
U.S.305 306 Facilities may wish to consider using that tool
because it has been found to be both reliable and valid, including high
inter-rater reliability and concurrent and predictive validity.\307\
Moreover, the screening tool can be implemented in a variety of places
where patients seek healthcare, including dialysis facilities.\308\
However, as stated previously, we did not propose to require facilities
to use this tool, or any other specific tool, for purposes of the
Screening for Social Drivers of Health reporting measure.
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\303\ Social Interventions Research & Evaluation Network.
(2019). Social Needs Screening Tool Comparison Table. Available at:
https://sirenetwork.ucsf.edu/tools-resources/resources/screening-tools-comparison. Accessed January 18, 2021.
\304\ Centers for Medicare & Medicaid Services. (2021). A Guide
to Using the Accountable Health Communities Health-Related Social
Needs Screening Tool: Promising Practices and Key Insights (June
2021). Available at: https://innovation.cms.gov/media/document/ahcm-screeningtool-companion. Accessed January 18, 2021.
\305\ More information on the HRSN Screening Tool is available
at: https://innovation.cms.gov/files/worksheets/ahcm-screeningtool.pdf.
\306\ RTI International. (2020). Accountable Health Communities
(AHC) Model Evaluation. Available at: https://innovation.cms.gov/data-and-reports/2020/ahc-first-eval-rpt.
\307\ Lewis C., Wellman R., Jones S., Walsh-Bailey C., Thompson
E., Derus A., Paolino A., Steiner J., De Marchis E., Gottlieb L.,
and Sharp A. (2020). Comparing the Performance of Two Social Risk
Screening Tools in a Vulnerable Subpopulation. J Family Med Prim
Care. 2020 Sep; 9(9): 5026-5034. Available at: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7652127/.
\308\ CMS. A Guide to Using the Accountable Health Communities
Health-Related Social Needs Screening Tool: Promising Practices and
Key Insights. June 2021. Accessed: November 23, 2021. Available at:
https://innovation.cms.gov/media/document/ahcm-screeningtool-companion.
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b. Overview of Measure
The Screening for Social Drivers of Health measure assesses the
percentage of patients age 18 and older that a dialysis facility
screens for food insecurity, housing instability, transportation needs,
utility difficulties, and interpersonal safety. To report on this
measure, facilities would provide: (1) the number of patients admitted
to the facility who are 18 years or older during the applicable
performance period who are screened for all of the following five
HRSNs: Food insecurity, housing instability, transportation needs,
utility difficulties, and interpersonal safety; and (2) the total
number of patients at the facility who are 18 years or older during the
applicable performance period and who are not excluded from the
measure. In the proposed rule, we proposed to add this measure to the
Reporting Measure Domain beginning with PY 2027 (88 FR 42514). We
discuss measure domains and weights for PY 2027 in section IV.D.7 of
this final rule.
Measure specifications for this measure are currently available on
the QualityNet website at: https://qualitynet.cms.gov/esrd/esrdqip.
(1) Cohort
The cohort for the Screening for Social Drivers of Health reporting
measure is all patients, aged 18 years and older, who are treated at
the facility during the applicable performance period and not eligible
to be excluded from the measure.
(2) Numerator
The numerator is calculated as the number of patients who are 18
years or older who are treated at the facility during the applicable
performance period and are not eligible to be excluded from the
measure, and are screened during the performance period for all of the
following five HRSNs: Food insecurity, housing instability,
transportation needs, utility difficulties, and interpersonal safety.
(3) Denominator
The denominator is calculated as the number of patients at the
dialysis facility and who are 18 years or older on the first day of the
performance period. The following patients are excluded from the
denominator: (1) Patients who opt-out of screening; and (2) patients
who are unable to complete the screening and have no legal guardian or
caregiver who is able to complete the screening on their behalf.
c. Measure Calculation
The Screening for Social Drivers of Health measure is calculated as
the number of patients at a dialysis facility who are 18 years or older
who are treated at the facility during the applicable performance
period and are not eligible to be excluded from the measure, and are
screened by the facility for all five HRSNs (food insecurity, housing
instability, transportation needs, utility difficulties, and
interpersonal safety) divided by the total number of patients 18 years
or older on the 1st day of the performance period (January 1st) at that
dialysis facility. In the proposed rule, we proposed a 12-month period
of performance for the measure, and facilities would be required to
report annually (88 FR 42514). We proposed that a facility would be
scored according to the following equation:
[GRAPHIC] [TIFF OMITTED] TR06NO23.038
We believe that this scoring policy would encourage facilities to
report the measure data appropriately without penalizing facilities for
the results of such data, which may be based on circumstances beyond a
facility's control.
d. Data Submission and Reporting
In the proposed rule, we proposed to require facilities to report
this measure on an annual basis beginning with PY 2027 (88 FR 42514).
In alignment with the policy we finalized for the Hospital IQR Program,
we would allow facilities flexibility to select their own screening
tool or method to screen patients for
[[Page 76472]]
food insecurity, housing instability, transportation needs, utility
difficulties, and interpersonal safety. Potential sources of these data
for incorporation in a tool could include, for example, administrative
claims data, electronic clinical data, standardized patient
assessments, or patient-reported data and surveys. Additionally,
multiple screening tools exist and are publicly available. Facilities
could refer to the Social Interventions Research and Evaluation Network
(SIREN) website, for example, for comprehensive information about the
most widely used HRSN screening tools.309 310 SIREN contains
descriptions of the content and characteristics of various tools,
including information about intended populations, completion time, and
number of questions. We encourage facilities to consider digital
standardized screening tools and refer readers to the FY 2023 IPPS/LTCH
PPS final rule (87 FR 49207), where we noted that the use of certified
health IT can support capture of HRSN information in an interoperable
fashion so that these data can be shared across the care continuum to
support coordinated care.
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\309\ Social Interventions Research & Evaluation Network.
(2019). Social Needs Screening Tool Comparison Table. Available at:
https://sirenetwork.ucsf.edu/tools-resources/resources/screening-tools-comparison. Accessed January 18, 2021.
\310\ The Social Interventions Research and Evaluation Network
(SIREN) at University of California San Francisco was launched in
the spring of 2016 to synthesize, disseminate, and catalyze research
on the social determinants of health and healthcare delivery.
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We proposed that the deadline for submission would be the end of
the EQRS December data reporting month for the applicable performance
period, which is consistent with current reporting deadlines for other
ESRD QIP measures (88 FR 42514). For example, the deadline for
submission in PY 2027 would be the end of the December data reporting
month in CY 2025.
e. Review by the Measure Applications Partnership
We included the Screening for Social Drivers of Health reporting
measure as a measure under consideration for the ESRD QIP on the
publicly available 2022 MUC List, a list of measures under
consideration for use in various Medicare programs.\311\ The CBE-
convened MAP Health Equity Advisory Group reviewed the MUC List and the
Screening for Social Drivers of Health measure (MUC 2022-053) in detail
and at the same time as the Screen Positive Rate for Social Drivers of
Health measure on December 6-7, 2022 (discussed below).\312\ The Health
Equity Advisory Group expressed support for the data collection related
to social drivers of health, but raised concerns about public reporting
of the data and redundancy in asking for the same information of
patients. In addition, on December 8-9, 2022, the MAP Rural Health
Advisory Group reviewed the 2022 MUC List and the MAP Hospital
Workgroup did so on December 13-14, 2022.\313\ The Rural Health
Advisory Group noted some potential reporting challenges including the
potential masking of health disparities that are underrepresented in
some areas and that sample size and populations served may be an issue,
but expressed that the measure serves as a starting point to determine
where screening is occurring. The MAP Hospital Workgroup expressed
strong support for the measure but noted that interoperability will be
important and cautioned about survey fatigue. The MAP Hospital
Workgroup members conditionally supported the measure pending: (1)
testing of the measure's reliability and validity; (2) endorsement by a
consensus-based entity (CBE); (3) additional details on how potential
tools map to the individual drivers, as well as best practices; (4)
what resources may be available to assist patients; and (5) alignment
with data standards, particularly the GRAVITY project.\314\ Thereafter,
the MAP Coordinating Committee deliberated on January 24 and 25, 2023,
and ultimately voted to conditionally support the Screening for Social
Drivers of Health reporting measure for rulemaking with the same
conditions.\315\
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\311\ Centers for Medicare & Medicaid Services. 2022. List of
Measures Under Consideration for December 1, 2022. We note that the
link provided in the CY 2024 ESRD PPS proposed rule has been
updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\312\ Centers for Medicare & Medicaid Services. 2022. 2022-2023
MAP Preliminary Recommendations. Health Equity Advisory Group. We
note that the link provided in the CY 2024 ESRD PPS proposed rule
has been updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\313\ Centers for Medicare & Medicaid Services. 2022. 2022-2023
MAP Preliminary Recommendations, Rural Health Advisory Group. We
note that the link provided in the CY 2024 ESRD PPS proposed rule
has been updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\314\ Centers for Medicare & Medicaid Services. (2022). 2022-
2023 MAP Final Recommendations. We note that the link provided in
the CY 2024 ESRD PPS proposed rule has been updated, and is now
available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports. For Information on
the GRAVITY project, please see https://thegravityproject.net/.
\315\ Centers for Medicare & Medicaid Services. 2023. 2022-2023
MAP Final Recommendations. We note that the link provided in the CY
2024 ESRD PPS proposed rule has been updated, and is now available
at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
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f. Consensus-Based Entity Endorsement
Although section 1881(h)(2)(B)(i) of the Act generally requires
that measures specified by the Secretary for the ESRD QIP be endorsed
by the entity with a contract under section 1890(a) of the Act, section
1881(h)(2)(B)(ii) of the Act states that in the case of a specified
area or medical topic determined appropriate by the Secretary for which
a feasible and practical measure has not been endorsed by the entity
with a contract under section 1890(a) of the Act, the Secretary may
specify a measure that is not so endorsed as long as due consideration
is given to measures that have been endorsed or adopted by a consensus
organization identified by the Secretary. We reviewed CBE-endorsed
measures and were unable to identify any other CBE-endorsed measures on
this topic, and, therefore, we believe the exception in section
1881(h)(2)(B)(ii) of the Act applies.
g. Public Display
In the proposed rule, we proposed to publicly display the facility-
specific results for the Screening for Social Drivers of Health measure
on an annual basis through our Care Compare website at: https://www.medicare.gov/care-compare/. We stated that we anticipate making the
first public report available in January 2027.
We invited public comment on this proposal. The comments we
received and our responses are set forth below. We address comments
that broadly referred both the Screening for Social Drivers of Health
measure and the Screen Positive Rate for Social Drivers of Health
measure in this section as well.
Comment: Several commenters expressed support for the Screening for
Social Drivers of Health reporting measure, noting that it would help
to provide facilities with additional information to help identify and
address health disparities in ESRD patients. A few commenters noted
that identifying patient social risk factors will allow care providers
and community organizations to work together to improve care delivery.
Response: We thank commenters for their support.
[[Page 76473]]
Comment: Several commenters expressed support for the proposed
Screening for Social Drivers of Health reporting measure and
recommended additional changes to the measure specifications. A few of
these commenters suggested that the measure screen for additional
HRSNs, such as financial needs and caregiver burdens. One commenter,
noting the critical role of nurses in cultivating trust and
communication with patients as being necessary to help identify and
address health disparities among patients while also balancing
administrative burden, recommended that CMS take additional actions
that would further enable nurses to comprehensively address HRSNs
across care settings. One commenter stated that patients who are unable
to complete screenings and do not have a legal guardian or caregiver
able to complete the screening on their behalf are extremely vulnerable
and recommended dialysis facilities be encouraged to support these
patients in resource identification.
Response: We thank commenters for their support and will take their
recommendations under consideration for future rulemaking. We selected
the proposed five HRSN domains based on the successful use of these
domains in the screening that was done under the AHC Model. We note
that while the Screening for Social Drivers of Health measure requires
screening for the five identified HRSNs, facilities may screen for
additional HRSNs that they believe may be impacting their patient
population. One resource that facilities could consider is the
Accountable Health Communities screening tool, which includes questions
for eight supplemental domains, including financial strain. Although
the Screening for Social Drivers of Health reporting measure excludes
patients who are unable to complete the screening and have no legal
guardian or caregiver who is able to complete the screening on their
behalf, we would nonetheless encourage facilities to support these
patients with resource identification.
Comment: Several commenters expressed concern that the proposed
Screening for Social Drivers of Health reporting measure and the Screen
Positive Rate for Social Drivers of Health reporting measure would not
effectively address poor health outcomes associated with HRSNs. A few
of these commenters believed that the measures did not provide
sufficient patient or provider support to help empower patients to
improve their health outcomes. One commenter noted that the
availability of community resources is highly variable depending on
location and expressed concern that screening for HRSNs through
administering questionnaires may be futile in deprived areas that lack
access to such community organizations. One commenter expressed concern
that the proposed measures may lead to unintended consequences and
further perpetuate health disparities by disincentivizing facilities
from providing care to patients with HRSNs or communities with higher
rates of HRSNs. One commenter expressed concern that the proposed
measures do not distinguish between a patient's social risks and a
patient's social needs, noting that the former is determined by
screening instrument and the latter is based on a patient's own
priorities and preferences. The commenter recommended that CMS develop
a measure that focuses on assessing a patient's self-identified needs
and priorities while ensuring that resources are available to provide
responsive follow-up care.
Response: We thank commenters for their feedback. During the
development of both Social Drivers of Health measures, we gave this
topic significant consideration. The intent of the two measures is to
incentivize facilities to screen their patients for HRSNs in five core
domains, as well as to analyze those data to determine whether there is
a relationship between the HRSNs and the outcomes experienced by their
patients. Facilities could use those data to develop solutions to
improve access to care and clinical outcomes among their patient
population. Evaluation of the AHC Model concluded that universal
screening may identify needs that would otherwise remain
undetected.\316\ While broad availability of community-based resources
that address patients' health-related social needs would be ideal, we
believe that one of the benefits of these measures will be
identification of opportunities to enable meaningful action, including
prioritizing and investing in such resources where feasible. For
example, a facility may decide to offer shuttle services for some of
its patients if transportation is identified as a barrier to treatment.
A facility may also be able to connect patients with local resources to
assist with food insecurity, housing instability, or utility
difficulties. Beginning to collect the data on patients' HRSNs remains
imperative and a crucial step in developing resources for advancing
health equity.
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\316\ RTI International. (2020). Accountable Health Communities
(AHC) Model Evaluation. Available at: https://innovation.cms.gov/data-and-reports/2020/ahc-first-eval-rpt.
---------------------------------------------------------------------------
We note that identifying and addressing HRSNs is a critical topic
for ESRD patients and that there are high levels of health disparities
experienced by this patient population. Although we believe that the
two measures will not lead to unintended consequences because screening
would be required for all eligible patients and facilities would not be
penalized based on reported screen positive rates, CMS will monitor
measure implementation as part of standard program and measure review
and will consider updates to the measures if improvements are
identified through this process.
Comment: Several commenters expressed concern that the proposed
Screening for Social Drivers of Health reporting measure and the Screen
Positive Rate for Social Drivers of Health reporting measure were not
ready for inclusion in the ESRD QIP measure set. A few commenters
recommended an endorsement review by the CBE to ensure that such
measures will drive improved health outcomes and advance health equity,
given the significance of addressing social risk factors and the
potential administrative burden associated with the inclusion of new
measures. One commenter expressed concern with the proposed measures,
recommending that more work be done to address potential reporting
challenges and potential masking of health disparities before the
measures are incorporated into the ESRD QIP. One commenter noted that
these are the first measures aimed at HRSNs that would be used in the
ESRD QIP, and the impact of their adoption into a payment program is
unknown.
Response: Although we recognize the value of measures undergoing
review for potential CBE endorsement, given the urgency of improving
health equity, we believe it is important to implement this measure as
soon as possible while balancing facilities' need for sufficient time
to implement screening and data collection processes, which is why we
proposed to adopt this measure beginning with the PY 2027 ESRD QIP. We
note that the most recent evaluation of the AHC model, which informed
the development of these proposed measures, showed that it was
effective in screening beneficiaries for HRSNs, identifying eligible
beneficiaries, and referring those beneficiaries to HRSN-related
navigation services.\317\ We
[[Page 76474]]
believe that the success of the AHC model shows that these measures
will have a similar impact. Additionally, we note that, under section
1881(h)(2)(B)(ii) of the Act, the Secretary may specify a measure that
is not so endorsed as long as due consideration is given to measures
that have been endorsed or adopted by a consensus organization
identified by the Secretary. We reviewed measures endorsed by consensus
organizations and were unable to identify any other measures on this
topic endorsed by a consensus organization, and therefore, we believe
the exception in section 1881(h)(2)(B)(ii) of the Act applies.
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\317\ RTI International. (2023). Accountable Health Communities
(AHC) Model Evaluation. Available at: https://innovation.cms.gov/data-and-reports/2023/ahc-second-eval-rpt.
---------------------------------------------------------------------------
Comment: Several commenters expressed concern with the potential
burden associated with the proposed Screening for Social Drivers of
Health reporting measure and the Screen Positive Rate for Social
Drivers of Health reporting measure. A few commenters noted that
facilities would need additional resources in order to implement and
comply with proposed measure requirements. A few of these commenters
expressed particular concern regarding staffing constraints. A few
commenters expressed concern regarding the administrative burden
associated with the data collection and reporting requirements and
requested that facilities receive additional resources such as training
and funding to support the data collection and reporting efforts
associated with the proposed measures. One commenter expressed concern
that the administrative burden associated with the proposed measures
could divert facility resources from direct patient care and requested
an assessment of the administrative burden.
Response: While we understand that implementation of the Screening
for Social Drivers of Health reporting measure and the Screen Positive
Rate for Social Drivers of Health reporting measure are associated with
some burden, as discussed in section VI.C.3 of this final rule, we
believe the benefits outweigh the burden because screening for and
identifying patients' HRSNs is a critical step towards a facility
identifying and understanding how the presence of the screened HRSNs
might be impacting patient access to ESRD care and outcomes. We intend
to monitor the measures for any unintended or adverse outcomes
associated with implementation.
We note that screening can occur any time during the patient's
treatment at the facility during the performance period prior to
discharge and that, for example, the AHC Screening Tool addresses these
5 HRSNs using a total of 10 questions. Therefore, we believe that
facilities will be able to find sufficient time to screen their
patients.
Comment: A few commenters expressed concern with the proposed
Screening for Social Drivers of Health reporting measure and the Screen
Positive Rate for Social Drivers of Health reporting measure, believing
that the goals of the two measures were already effectively covered
through other means. One of these commenters noted that facilities are
already required to screen their patients for HRSNs as part of ESRD
Conditions for Coverage assessments required at 42 CFR 494.90. One of
these commenters stated that dialysis facilities are already required
to screen patients for multiple non-clinical conditions, noting that
CMS previously proposed revisions to the ESRD Medical Evidence Report
form (CMS-2728), which includes seven screening questions related to
HRSNs that address the same five core domains as these measures. One of
these commenters stated that the clinical measures currently included
in the ESRD QIP are more effectively aimed at incentivizing beneficial
patient outcomes such as preventing avoidable hospitalizations and
reducing mortality.
Response: We recognize that there may be overlap between the HRSN
data screened for under the proposed measures and data that facilities
are reporting for other purposes. However, we note that some of the
data cited by commenters is collected on a one-time basis, whereas the
Screening for Social Drivers of Health reporting measure and the Screen
Positive Rate for Social Drivers of Health reporting measures require
that the screens be conducted annually. This difference in the
frequency of the screens will facilitate the ability of facilities to
identify HRSNs that develop or change over time. We agree with the
commenter that noted the beneficial impact of clinical measures in the
ESRD QIP measure set. Given the link between social risk factors and
adverse health outcomes, we believe that incentivizing facilities to
screen for and identify a patient's HRSNs will similarly lead to better
patient health outcomes.
Comment: A few commenters recommended that the measures use a
standardized survey to identify and collect HRSN data. One of these
commenters noted that because the measure does not require facilities
to use a standard screening instrument, facility performance on the
measure is not comparable and the reported data will not be meaningful
to the public. The commenter recommended that CMS only publicly report
whether a facility screens for HRSNs and that CMS not publicly report
the percentage of patients at a facility that screens positive for each
HRSN. One commenter recommended that CMS provide guidance on the role
of Protocol for Responding to & Assessing Patients' Assets, Risks &
Experiences (PRAPARE) for screening in dialysis facilities. One
commenter suggested that the measure use a standardized survey to
identify and collect HRSN data.
Response: We proposed that facilities would be able to choose their
own screening tool for purposes of complying with both the Screening
for Social Drivers of Health reporting measure and the Screen Positive
Rate for Social Drivers of Health reporting measure because we think it
is important to provide facilities with the flexibility to choose the
screening tool that works best for them. We understand that the absence
of a standardized screening tool could introduce some inconsistency in
the information collected across facilities because different screening
tools may vary in terms of the number of screening questions included
or the language used in those screening questions. While we acknowledge
the potential benefits of requiring all facilities to use the same
screening instrument or a prescribed set of standards around the number
or types of screening questions used, we also recognize the benefits of
providing facilities with flexibility to customize screening and data
collection to their patient populations. We encourage facilities to
select screening tools that have undergone thorough testing to ensure
they are accurate and reliable. We believe that this measure should
promote screening practices which, among other things, help to identify
unmet HRSNs.
We disagree with commenter's recommendation that CMS publicly
report only whether a facility screens for HRSNs and not the percentage
of patients at a facility that screens positive for each HRSN. Public
reporting provides a means of delivering important healthcare
information to facilities, consumers, and patient advocates on the
level of unmet HRSNs among a facility's patient population that might
be contributing to the clinical outcomes at the facility. We believe
that a facility's ability to identify HRSNs among its patient
population should be considered part of the quality of care it provides
to its patients. In addition to helping facilities identify these HRSNs
among their patient population that could play a factor in clinical
outcomes, it also may provide the public with
[[Page 76475]]
useful information that could be used to improve resources available to
patients.
Although the commenter is correct that PRAPARE may be a useful
screening tool for engaging patients in assessing and addressing social
drivers of health, we are not requiring that facilities use a specific
standardized screening tool for purposes of complying with the proposed
measures at this time. For selecting a screening tool, we suggest that
facilities refer to evidence-based resources for comprehensive
information about the most widely used HRSN screening tools. For
example, the Social Interventions Research and Evaluation Network
(SIREN) website, housed at the Center for Health and Community at the
University of California, San Francisco, contains descriptions of the
content and characteristics of various tools, including information
about intended populations, completion time, and number of questions.
Comment: One commenter expressed concern with the proposed use of a
standardized tool to screen patients for HRSNs, noting that HRSN
screening may be accomplished through alternative means such as
informal but thorough patient interviewing by a practitioner or
predictive modeling using available patient data. The commenter
cautioned against penalizing providers for not using a standardized
tool to screen for HRSNs, absent evidence showing the superiority of
the proposed method.
Response: We did not propose to require facilities to use a
standardized screening tool. In the proposed rule, we proposed that
facilities would be able to select a screening tool of their choosing
for purposes of this measure to give facilities the flexibility to
tailor their screen to the needs of their patient population.
Comment: A few commenters requested clarification regarding whether
Electronic Data Interchange may be used between systems and the
screening tools already in place, including clarification that CMS
intends to collect the data through the EQRS. One commenter recommended
delaying adoption of the Screening for Social Drivers of Health
reporting measure and the Screen Positive Rate for Social Drivers of
Health reporting because dialysis facilities may need more time to
update different EMRs.
Response: Facilities will collect and report the measure data
through EQRS. Because we are not requiring facilities to adopt a
standardized screening tool, we believe that the proposed measures
provide facilities with the flexibility to customize screening and data
collection to their local community contexts and patient populations,
especially in the initial stages of implementing screening protocols.
We note that these measures are proposed for inclusion beginning with
PY 2027, so we believe that facilities will have ample time to build
out their interfaces and test their systems before measure data
reporting requirements officially begin.
Comment: A few commenters recommended that CMS align the Screening
for Social Drivers of Health reporting measure and the Screen Positive
Rate for Social Drivers of Health reporting measure with the
requirements of the Comprehensive Kidney Care Contracting (CKCC) option
of the KCC Model.
Response: We thank commenters for the recommendations.
Comment: One commenter recommended that facilities should receive
full credit for reporting on these measures, cautioning against
potentially penalizing facilities by holding them accountable for
social disparities beyond their control.
Response: We proposed that the Screening for Social Drivers of
Health measure is calculated as the number of eligible patients at a
dialysis facility who are 18 years or older who are treated at the
facility during the applicable performance period and are screened by
the facility for all five HRSNs divided by the total number of patients
18 years or older on the 1st day of the performance period at that
dialysis facility. For the Screen Positive Rate for Social Drivers of
Health reporting measure, we proposed that the facility's measure rate
would be calculated as the number of eligible patients for whom the
facility reports the screening results for all five HRSNs during the
performance period over the total number of eligible patients who the
facility screened for all five HRSNs during that performance period. To
calculate the facility's score on the measure, we would multiply the
results of that fraction by ten. We note that patients who opt-out or
are unable to complete the screening are excluded from the measure
denominators, so that facilities are not penalized if a patient refuses
to answer certain screening questions. Facilities will be scored on
whether they reported the measure data, not the results of the measure
data itself. Although we believe that it is important to encourage
facilities to screen their patients for HSRNs and to report data for
screen positive rates, we want to avoid potential unintended
consequences that may result from scoring facilities on the outcomes of
the screen positive rates themselves. That is, we will not score a
facility based on its screen positive rates, which may reflect
circumstances beyond a facility's control. We believe that these
scoring policies will encourage facilities to report the measure data
accurately without penalizing facilities for the results of such data.
Comment: One commenter expressed strong concern that the two
proposed measures were inappropriate for use in the ESRD QIP, noting
the risk of exacerbating long-standing mistrust in the healthcare
system among certain patient populations. One commenter recommended
that resources be offered to all patients to avoid potential stigma
associated with a patient's identified HRSNs. One commenter recommended
that ``screening'' be clearly defined to ensure that patients are being
actively and directly engaged in these screenings. The commenter
expressed strong concern that incentivizing facility performance
through data collection and financial penalties would potentially
interfere with the autonomy of the facility's patients.
Response: We agree that it is important for the screening for HRSNs
to be accomplished in a way that is respectful, person-centered, and
engenders trust. We recommend that facilities consider these factors in
their selection of a screening tool or other methodology to use for
purposes of implementing these measures. We note that the results of a
patient's HRSN screening would become part of the patient's medical
record and therefore subject to the same privacy protections as the
rest of the patient's medical record. We note that identifying and
addressing HRSNs is a critical topic for ESRD patients and that there
are high levels of health disparities experienced by this patient
population. We believe that identifying the HRSNs of ESRD patients will
be valuable in helping facilities to identify and understand patients'
unmet needs, which may encourage improvements in care coordination with
outpatient and community resources, and further support development of
patient-centered treatment plans.
Comment: One commenter believed that HRSN screenings should remain
voluntary, and clinics should not be penalized if a patient refuses to
respond to a question or screening.
Response: Patients who opt-out of a screening or are unable to
complete a screening are excluded from the measure denominator, so a
facility will not be penalized if a patient declines to respond to a
question or opts out of the screening entirely. We encourage facilities
to explain to their patients
[[Page 76476]]
what the purpose of the screening is and that they may opt out.
Final Rule Action: After considering public comments, we are
finalizing our proposal to adopt the Screening for Social Drivers of
Health reporting measure as proposed.
3. Adoption of the Screen Positive Rate for Social Drivers of Health
Reporting Measure Beginning With PY 2027
a. Background
The impact of social risk factors on health outcomes has been well-
established in the literature.318 319 320 321 322 The
Physicians Foundation reported that 73 percent of the physician
respondents to their annual survey agreed that social risk factors such
as housing instability and food insecurity would drive health services
demand in 2021.\323\ Recognizing the need for a more comprehensive
approach to closing equity gaps, we have prioritized quality measures
that identify social drivers of health among patients served in various
care settings and, in turn, support providers in addressing the impact
of these drivers on disparities in patient outcomes, healthcare
utilization, and costs.324 325 326 Specifically, in the
dialysis facility setting, we aim to encourage systematic
identification of patients' HRSNs as part of treatment planning, with
the intention of promoting linkages with relevant community-based
services that address those needs. We also believe that the
identification of HRSNs can help facilities devise strategies that
improve the quality of care provided to all of their patients and lead
to improved health outcomes following establishment of care at the
facility.
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\318\ Institute of Medicine 2014. Capturing Social and
Behavioral Domains and Measures in Electronic Health Records: Phase
2. Washington, DC: The National Academies Press. Available at:
https://doi.org/10.17226/18951.
\319\ Centers for Medicare & Medicaid Services. (2021).
Accountable Health Communities Model. Accountable Health Communities
Model [bond] CMS Innovation Center. Available at: https://innovation.cms.gov/innovation-models/ahcm. Accessed November 23,
2021.
\320\ Kaiser Family Foundation. (2021). Racial and Ethnic Health
Inequities and Medicare. Available at: https://www.kff.org/medicare/report/racial-and-ethnic-health-inequities-and-medicare/. Accessed
November 23, 2021.
\321\ Milkie Vu et al. Predictors of Delayed Healthcare Seeking
Among American Muslim Women, Journal of Women's Health 26(6) (2016)
at 58; Nadimpalli SB, Cleland CM, Hutchinson MK, Islam N, Barnes LL,
Van Devanter N. (2016) The Association between Discrimination and
the Health of Sikh Asian Indians. Health Psychology, 35(4), 351-355.
https://doi.org/10.1037/hea0000268.
\322\ Office of the Assistant Secretary for Planning and
Evaluation (ASPE). (2020). Report to Congress: Social Risk Factors
and Performance Under Medicare's Value-Based Purchasing Program
(Second of Two Reports). Available at: https://aspe.hhs.gov/pdf-report/second-impact-report-to-congress.
\323\ The Physicians Foundation. (2020) 2020 Survey of America's
Patients, Part Three. Available at: https://physiciansfoundation.org/wp-content/uploads/2020/10/2020-Physicians-Foundation-Survey-Part3.pdf.
\324\ Alley, D.E., C.N. Asomugha, P.H. Conway, and D.M.
Sanghavi. 2016. Accountable Health Communities-Addressing Social
Needs through Medicare and Medicaid. The New England Journal of
Medicine 374(1):8-11. Available at: https://doi.org/10.1056/NEJMp1512532.
\325\ Centers for Medicare & Medicaid Services. (2021).
Accountable Health Communities Model. Accountable Health Communities
Model [bond] CMS Innovation Center. Available at: https://innovation.cms.gov/innovation-models/ahcm. Accessed November 23,
2021.
\326\ Billioux, A., Verlander, K., Anthony, S., & Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
---------------------------------------------------------------------------
While the Screening for Social Drivers of Health reporting measure
(discussed in section IV.D.2 of this final rule) enables facilities to
identify patients with HRSNs, we stated in the CY 2024 ESRD PPS
proposed rule (88 FR 42516) that the Screen Positive Rate for Social
Drivers of Health measure would allow facilities to capture the
magnitude of these needs by reporting the rate of those patients who
screen positive for HRSNs and even potentially estimate the impact of
individual-level HRSNs on healthcare utilization when evaluating
quality of care.327 328 329 These measures complement each
other because they would require facilities to report both the
percentage of patients they screened (under the Screening for Social
Drivers of Health measure) and the results of that screening (under the
Screen Positive Rate for Social Drivers of Health measure) in order to
potentially identify gaps and develop sustainable solutions at a
facility level and a community level. In the proposed rule, we noted
that our proposals to adopt these two separate, complementary measures
align with other quality reporting programs (88 FR 42516). These two
measures have been finalized for the Hospital IQR Program in the FY
2023 IPPS/LTCH PPS final rule (87 FR 49191 through 49220), and since
publication of the CY 2024 ESRD PPS proposed rule, have been finalized
for the PPS-Exempt Cancer Hospital Quality Reporting Program in the FY
2024 IPPS/LTCH PPS final rule (88 FR 59210 through 59222) and the
Inpatient Psychiatric Facility Quality Reporting Program in the FY 2024
IPF PPS final rule (88 FR 51107 through 51121).
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\327\ Baker, M.C., Alberti, P.M., Tsao, T.Y., Fluegge, K.,
Howland, R.E., & Haberman, M. (2021). Social Determinants Matter for
Hospital Readmission Policy: Insights From New York City. Health
Affairs, 40(4), 645-654. Available at: https://doi.org/10.1377/hlthaff.2020.01742.
\328\ CMS. Accountable Health Communities Model. Accountable
Health Communities Model [bond] CMS Innovation Center. Available at:
https://innovation.cms.gov/innovation-models/ahcm. Accessed November
23, 2021.
\329\ Hammond, G., Johnston, K., Huang, K., Joynt Maddox, K.
(2020). Social Determinants of Health Improve Predictive Accuracy of
Clinical Risk Models for Cardiovascular Hospitalization, Annual
Cost, and Death. Circulation: Cardiovascular Quality and Outcomes,
13 (6) 290-299. Available at: https://doi.org/10.1161/CIRCOUTCOMES.120.006752.
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In the CY 2024 ESRD PPS proposed rule, we proposed to adopt this
measure under section 1881(h)(2)(A)(iv) of the Act, which gives the
Secretary broad authority to specify measures for the ESRD QIP (88 FR
42516). The Screen Positive Rate for Social Drivers of Health reporting
measure would require facilities to screen all patients who are 18
years or older for food insecurity, housing instability, transportation
needs, utility difficulties, and interpersonal safety and then report
the resulting screen positive rates for each of those domains to CMS.
These are the same five core HRSN domains under the Screening for
Social Drivers of Health reporting measure, and facilities could use
the same screening tool for purposes of both measures. We stated that
reporting the screen positive rate for social drivers of health for
each domain could inform actionable planning by facilities by helping
to enable the development of individual patient action plans for those
patients who screen positive (including navigation and referral).
Following a positive HRSN screening, facilities could analyze data to
understand, for example, whether there are any HRSNs that may be
affecting their patients' access to care or contributing to poor
outcomes in their patient populations and, in turn, develop appropriate
solutions to improve access and outcomes. Thus, this measure has the
potential to improve patient outcomes by acknowledging patients' non-
clinical needs that nevertheless greatly contribute to adverse clinical
outcomes and providing the opportunity for additional support by
linking providers with community-based organizations to enhance
patient-centered treatment and discharge planning, although such reach
out is not required.330 331 332 This
[[Page 76477]]
measure may also prove useful to patients by providing data
transparency and signifying facilities' familiarity, expertise, and
commitment regarding these issues. Finally, we believe this measure has
the potential to facilitate data-informed collaboration with community-
based services and focused community investments, including the
development of pathways and infrastructure to more seamlessly connect
patients to local community resources. Thus, the measure aims to
support facilities in leveraging available data, pursuing focused
quality improvement activities, and promoting efficient and effective
use of their resources. While the measure does not require facilities
to take specific actions, we expect that any solution a facility might
develop to address a gap it identifies would comply with all applicable
Federal non-discrimination laws. We also note that the measure is
intended to promote health equity for all patients and is not intended
to create a conflict between a CMS requirement and a State's civil
rights laws.
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\330\ The Physicians Foundation. (2020). Survey of America's
Patients, Part Three. Available at: https://physiciansfoundation.org/wp-content/uploads/2020/10/2020-Physicians-Foundation-Survey-Part3.pdf.
\331\ De Marchis, E., Knox, M., Hessler, D., Willard-Grace, R.,
Oliyawola, JN, et al. (2019). Physician Burnout and Higher Clinic
Capacity to Address Patients' Social Needs. The Journal of the
American Board of Family Medicine, 32 (1), 69 through 78.
\332\ Kung, A., Cheung, T., Knox, M., Willard-Grace, R.,
Halpern, J., et.al, (2019). Capacity to Address Social Needs Affect
Primary Care Clinician Burnout. Annals of Family Medicine. 17 (6),
487 through 494. Available at: https://doi.org/10.1370/afm.2470.
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b. Overview of Measure
The Screen Positive Rate for Social Drivers of Health measure
identifies the proportion of patients at the facility who screened
positive for each of the following five HRSNs: Food insecurity, housing
instability, transportation needs, utility difficulties, and
interpersonal safety. We proposed that we would require facilities to
report these data as five separate rates.\333\ Measure specifications
for this measure are currently available on the QualityNet website at:
https://qualitynet.cms.gov/esrd/esrdqip.
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\333\ Billioux, A., Verlander, K., Anthony, S., & Alley, D.
(2017). Standardized Screening for Health-Related Social Needs in
Clinical Settings: The Accountable Health Communities Screening
Tool. NAM Perspectives, 7(5). Available at: https://doi.org/10.31478/201705b.
---------------------------------------------------------------------------
(1) Cohort
The cohort for the Screen Positive Rate for Social Drivers of
Health is patients, aged 18 years or older who are treated at the
facility during the applicable performance period and are not eligible
to be excluded from the measure, who were screened by the facility for
all five HRSNs, and for whom the facility reports the results of a
screen asking whether they have a need in one or more of the following
five HRSNs (calculated separately): Food insecurity, housing
instability, transportation needs, utility difficulties or
interpersonal safety.\334\
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\334\ In the CY 2024 ESRD PPS proposed rule, we stated that the
cohort consisted of eligible patients ``who were screened by the
facility for an HRSN, and who screened positive for one or more of
the following five HRSNs: Food insecurity, housing instability,
transportation needs, utility difficulties or interpersonal
safety.'' (88 FR 42517). This statement describes the numerator,
rather than the measure cohort, and we have revised our descriptions
of the measure cohort and the measure numerator in this final rule
accordingly.
---------------------------------------------------------------------------
(2) Numerator
The numerator consists of the number of patients at a dialysis
facility who are 18 years or older who are treated at the facility
during the applicable performance period and are not eligible to be
excluded from the measure, who were screened for all five HRSNs, and
who screened positive for one or more of the following five HRSNs: Food
insecurity, housing instability, transportation needs, utility
difficulties, or interpersonal safety.\335\
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\335\ In the CY 2024 ESRD PPS proposed rule, we stated that the
numerator consisted of eligible patients ``who were screened for an
HRSN, and for whom the facility reports the results of a screen
asking whether they have a need in one or more of the following five
HRSNs (calculated separately): Food insecurity, housing instability,
transportation needs, utility difficulties or interpersonal
safety.'' (88 FR 42517). This statement describes the measure
cohort, rather than the measure numerator, and we have revised our
descriptions of the measure cohort and the measure numerator in this
final rule accordingly.
---------------------------------------------------------------------------
(3) Denominator
The denominator consists of the number of patients at a dialysis
facility who are 18 years or older who are treated at the facility
during the applicable performance period and are not eligible to be
excluded from the measure, and are screened for an HRSN (food
insecurity, housing instability, transportation needs, utility
difficulties and interpersonal safety). The following patients are
excluded from the denominator: (1) Patients who opt-out of screening;
and (2) patients who are themselves unable to complete the screening
and have no caregiver able to do so on the patient's behalf.
c. Measure Calculation
We proposed that the facility's measure rate for this measure would
be calculated for a payment year as the number of eligible patients for
whom the facility reports the screening results for all five HRSNs
during the performance period over the total number of eligible
patients who the facility screened for all five HRSNs during that
performance period. To calculate the facility's score on the measure,
we would multiply the results of that fraction by ten. The full
equation is set forth here:
[GRAPHIC] [TIFF OMITTED] TR06NO23.039
However, for purposes of public reporting only, we proposed to
display the facility's screen positive rate for each HRSN separately,
for a total of five separate rates. Although we would not score
facilities on the results of those five separate rates, we believe that
making such data public may help to better inform patients and their
caregivers about a facility. We proposed a 12-month period of
performance for the measure, and facilities would be required to report
annually.
We believe that these policies would encourage facilities to report
the measure data appropriately without scoring facilities based on the
results of such data, which may be based on circumstances beyond a
facility's control. Although we believe that it is important to
encourage facilities to screen their patients for HSRNs and to report
data for screen positive rates, we want to avoid potential unintended
consequences that may result from scoring facilities on the outcomes of
the screen positive rates themselves. That is, we do not want to score
a facility based on its patients' given socioeconomic factors, which
may be based on circumstances beyond a facility's control.
[[Page 76478]]
d. Data Collection, Submission and Reporting
In the CY 2024 ESRD PPS proposed rule, we proposed to require
facilities to submit data necessary to calculate the numerator and the
denominator for this measure once annually within the ESRD Quality
Reporting System (EQRS), beginning with PY 2027 (88 FR 42517). We
proposed that facilities would be required to submit data on this
measure using the same process we have finalized for the submission of
data on other measures in the ESRD QIP within EQRS.
e. Review by the Measure Applications Partnership
We included the Screen Positive Rate for Social Drivers of Health
reporting measure for consideration in the ESRD QIP on the publicly
available 2022 MUC List, a list of measures under consideration for use
in various Medicare programs.\336\ The CBE-convened MAP Health Equity
Advisory Group reviewed the Screen Positive Rate for Social Drivers of
Health measure (MUC 2022-050) in detail and at the same time as the
Screening for Social Drivers of Health measure on December 6-7,
2022.\337\ The Health Equity Advisory Group expressed support for the
collection of data related to social health drivers, but raised
concerns regarding public reporting and the repetition of asking
patients the same questions. In addition, on December 8-9, 2022, the
MAP Rural Health Advisory Group reviewed the 2022 MUC List and was also
reviewed by the MAP Hospital Workgroup on December 13-14, 2022.\338\
The Rural Health Advisory Group noted potential reporting challenges
including the potential masking of health disparities that are
underrepresented in some areas and that sample size and populations
served may be an issue, but also expressed support that the measure
seeks to advance the drivers of health and serves as a starting point
to determine where screening is occurring. The MAP Hospital Workgroup
recommended conditional support for the measure for rulemaking pending
endorsement by a CBE to address reliability and validity concerns,
attentiveness to how results are shared and contextualized for public
reporting, and encouragement for CMS to examine any differences in
reported rates by reporting process (to assess whether they are the
same or different across dialysis facilities).\339\ Thereafter, the MAP
Coordinating Committee deliberated on January 24-25, 2023, and
ultimately voted to conditionally support the Screen Positive Rate for
Social Drivers of Health measure for rulemaking with the same
conditions.\340\
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\336\ [thinsp]Centers for Medicare Medicaid Services. 2022. List
of Measures Under Consideration for December 1, 2022. We note that
the link provided in the CY 2024 ESRD PPS proposed rule has been
updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\337\ Centers for Medicare Medicaid Services. 2022. 2022-2023
MAP Preliminary Recommendations, Health Equity Advisory Group. We
note that the link provided in the CY 2024 ESRD PPS proposed rule
has been updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\338\ Centers for Medicare Medicaid Services. 2022. MAP
Preliminary Recommendations, Rural Health Advisory Group. We note
that the link provided in the CY 2024 ESRD PPS proposed rule has
been updated, and is now available at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\339\ Centers for Medicare Medicaid Services. 2023. 2022-2023
MAP Final Recommendations. We note that the link provided in the CY
2024 ESRD PPS proposed rule has been updated, and is now available
at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\340\ Centers for Medicare Medicaid Services. 2023. 2022-2023
MAP Final Recommendations. We note that the link provided in the CY
2024 ESRD PPS proposed rule has been updated, and is now available
at: https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
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f. Consensus-Based Entity Endorsement
Although section 1881(h)(2)(B)(i) of the Act generally requires
that measures specified by the Secretary for the ESRD QIP be endorsed
by the entity with a contract under section 1890(a) of the Act, section
1881(h)(2)(B)(ii) of the Act states that in the case of a specified
area or medical topic determined appropriate by the Secretary for which
a feasible and practical measure has not been endorsed by the entity
with a contract under section 1890(a) of the Act, the Secretary may
specify a measure that is not so endorsed as long as due consideration
is given to measures that have been endorsed or adopted by a consensus
organization identified by the Secretary. We reviewed CBE-endorsed
measures and were unable to identify any other CBE-endorsed measures on
this topic, and, therefore, we believe the exception in section
1881(h)(2)(B)(ii) of the Act applies.
g. Public Display
In the proposed rule, we proposed to publicly display the ESRD QIP
score and facility-specific rates for the Screen Positive Rate for
Social Drivers of Health measure on an annual basis beginning in PY
2027 through our Care Compare website at: https://www.medicare.gov/care-compare/.
We invited public comment on this proposal. The comments we
received and our responses are set forth below. We note that we have
addressed comments that broadly referred both the Screening for Social
Drivers of Health measure and the Screen Positive Rate for Social
Drivers of Health measure in section IV.D.2 of this final rule.
Comment: Several commenters expressed support for the proposed
Screen Positive Rate for Social Drivers of Health reporting measure. A
few of these commenters noted that the proposed measure would provide
facilities with important information regarding a patient's potential
HRSNs that often impact patient outcomes. A few commenters expressed
support because the measure will help identify patient social risk
factors, allowing care providers and community organizations to work
together to improve care delivery. One commenter expressed support and
noted that the transportation challenges and utility insecurity may be
particularly important for dialysis patients.
Response: We thank the commenters for their support. We agree that
HRSNs are critical factors that impact patient outcomes, and increased
knowledge about patients' HRSNs will help facilities ensure that all of
their patients receive the highest quality ESRD care. Further, we agree
that collecting these data will incentivize facilities to better
recognize whether any of the HRSNs in the screening tool are impacting
their patients and take steps to improve access and outcomes.
Comment: One commenter expressed support for the proposal to
include the Screen Positive Rate for Social Drivers of Health measure
as a reporting measure so that facilities are not scored based on the
results of the data which reflect factors beyond the facility's
control.
Response: We thank the commenter for its support.
Comment: Several commenters recommended additional changes to the
measure specifications to encourage follow up after a positive
screening. A few commenters recommended that CMS require the
development of action plans to address HRSNs or otherwise add
requirements for facilities to follow up with patients on identified
HRSNs where appropriate. A few commenters recommended that CMS update
the measure to require referral and delivery of identified needed
services. If services are not available, one commenter suggested that
facilities should be responsible for reporting this to relevant
Federal, State, or local agencies authorities. One commenter
[[Page 76479]]
recommended that CMS consider potential uses for the data captured by
this measure and propose these uses in future rulemaking.
Response: We thank the commenters for their recommendations, and
may consider them in future rulemaking. We believe this measure has the
potential to improve patient outcomes by acknowledging patients' HSRN
needs that can contribute to adverse clinical outcomes.
Comment: A few commenters expressed concern that the Screen
Positive Rate for Social Drivers of Health reporting measure would
disincentivize caring for socially vulnerable patients because
facilities serving patient populations with high rates of HRSNs would
be unfairly penalized for poor performance on the proposed measure. One
commenter expressed concern that the proposed Screen Positive Rate for
Social Drivers of Health reporting measure will disadvantage facilities
by penalizing them based on the existence of patients with HRSNs,
rather than the quality of care provided, and recommended that CMS
instead offer supplemental payments to facilities that commit to use
these supplemental payments to address HRSNs relevant to their patient
population.
Response: We believe that identifying the HRSNs of ESRD patients
will be valuable in helping facilities to identify and understand
patients' unmet needs, which may encourage improvements in care
coordination with outpatient and community resources, and further
support development of patient-centered treatment plans. We note that
identifying and addressing HRSNs is a critical topic for ESRD patients
and that there are high levels of health disparities experienced by
this patient population. Although we believe that the proposed measure
will not lead to unintended consequences because facilities would not
be penalized based on reported screen positive rates, CMS will monitor
measure implementation and data reporting as part of standard program
and measure review and will consider updates to the measure if
improvements are identified through this process. Although we
appreciate the commenter's suggestion that CMS offer supplemental
payments to facilities to address HRSNs relevant to their patient
population, we do not have authority under the ESRD QIP statute to
offer the supplemental payments suggested by the commenter.
Comment: A few commenters expressed concern with the proposed
Screen Positive Rate for Social Drivers of Health reporting measure,
stating that data collected for this measure ultimately would not
provide consumers with meaningful information relevant to a facility's
quality of care. One commenter noted that publicly reported information
would be subject to misinterpretation due to existing biases and
preconceptions. A few commenters did not support public reporting
because the measure reflects characteristics of the facility's patient
population, not the facility's performance or quality of care.
Response: We appreciate the commenters' concerns. The measure
provides a means of delivering important healthcare information to
facilities, consumers, and patient advocates on the level of unmet
HRSNs among a facility's patient population that might be contributing
to the clinical outcomes experienced at the facility. We believe that a
facility's ability to identify these HRSNs among its patient population
should be considered part of the quality of care it provides to its
patients. In addition to helping facilities identify these HRSNs among
their patient population that could play a factor in clinical outcomes,
it also may provide the public with useful information that could be
used to improve resources available to patients. We intend to conduct
outreach and education with providers and patients to share information
about the two Social Drivers of Health measures in conjunction with
public reporting.
Comment: A few commenters expressed concern regarding the potential
burden associated with the proposed measure. Noting the potential
burden to facilities, one commenter recommended that facilities receive
adequate support and training to facilitate the data collection efforts
associated with such measure prior to the measure's implementation. One
commenter expressed concern that the measure adds reporting burden to
report data that CMS is already collecting. One commenter expressed
concern that the proposed Screen Positive Rate for Social Drivers of
Health reporting measure would not benefit small facilities that
already have individualized care plans for each of their patients, and
that the additional burden from the proposed measure outweighs any
potential benefit to patients.
Response: While we understand implementation of HRSN screening
processes and reporting of the Screen Positive Rate for Social Drivers
of Health reporting measure is associated with some burden, as
discussed in section VI.C.3 of this final rule, we believe the benefits
outweigh the burden because identifying patients' HRSNs is a critical
step towards a facility identifying and understanding how the presence
of the screened HRSNs might be impacting patient access to ESRD care
and outcomes. We appreciate that facilities may already be collecting
relevant data and potentially incorporating it into individualized
patient care plans. However, we believe that the proposed Screen
Positive Rate for Social Drivers of Health reporting measure is an
important step towards health equity by supporting facilities in
leveraging available data, pursuing focused quality improvement
activities, and promoting efficient and effective use of their
resources.
Comment: One commenter expressed concern with the proposed Screen
Positive Rate for Social Drivers of Health reporting measure,
recommending that CMS further explore potential reliability and
validity concerns associated with the measure before it is included in
the ESRD QIP.
Response: We appreciate the commenter's concern. We note that the
most recent evaluation of the AHC model, which informed the development
of these proposed measures, showed that it was effective in screening
beneficiaries for HRSNs, identifying eligible beneficiaries, and
referring those beneficiaries to HRSN-related navigation services.
Although facilities in the ESRD QIP can use a screening tool of their
choice, we note that multiple screening tools exist and are publicly
available. Facilities could refer to the SIREN website, for example,
for comprehensive information about the most widely used HRSN screening
tools, including validity assessments where available.\341\ We note
that CMS also performs validity assessments as part of its annual EQRS
data validation. Additionally, CMS will monitor measure implementation
and data reporting as part of standard program and measure review and
will consider updates to the measure if improvements are identified
through this process.
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\341\ Social Interventions Research & Evaluation Network.
(2019). Social Needs Screening Tool Comparison Table. Available at:
https://sirenetwork.ucsf.edu/tools-resources/resources/screening-tools-comparison. Accessed October 24, 2023.
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Comment: One commenter requested that CMS provide additional
information regarding how the data will be used. Commenter also
questioned the intervals for collecting the data.
Response: We believe that the data may be used by facilities to
inform actionable planning by helping to enable the development of
individual patient action plans for those patients who screen positive
(including
[[Page 76480]]
navigation and referral). By helping to identify patients' non-clinical
needs that nevertheless greatly contribute to adverse clinical
outcomes, the data may be used to link providers with community-based
organizations to enhance patient-centered treatment and discharge
planning, although such reach out is not required. We also note that
there are multiple interested parties who will be able to use data
regarding facilities' patient populations, including patients and their
caregivers, patient advocacy organizations, local community services
organizations, and Federal, State, and local policy makers. We also
believe that the measure will facilitate systematic gathering of such
data in a manner that provides information to facilities on the level
of unmet need among their patients that many facilities do not compile
currently. Although facilities are reporting the data to CMS for
purposes of the measures at this time, CMS at this time does not plan
to use the data for any purposes beyond the public reporting being
finalized in this final rule.
Comment: One commenter stated that the equation provided does not
match the description of the numerator. The commenter also recommended
establishing a baseline period for implementation and data validation
prior to public reporting.
Response: In the CY 2024 ESRD PPS proposed rule, we stated that the
numerator consisted of eligible patients ``who were screened for an
HRSN, and for whom the facility reports the results of a screen asking
whether they have a need in one or more of the following five HRSNs
(calculated separately): Food insecurity, housing instability,
transportation needs, utility difficulties or interpersonal safety.''
(88 FR 42517). However, this statement actually describes the measure
cohort, rather than the measure numerator. The measure numerator was
correctly described in the equation that we proposed to use for scoring
facilities on the measure. Therefore, in this final rule we have
updated the description of the numerator to match the equation. The
numerator now reads, ``The numerator consists of the number of patients
at a dialysis facility who are 18 years or older who are treated at the
facility during the applicable performance period and are not eligible
to be excluded from the measure, who were screened for all five HRSNs,
and who screened positive for one or more of the following five HRSNs:
Food insecurity, housing instability, transportation needs, utility
difficulties, or interpersonal safety.'' Regarding the commenter's
suggestion to establish a baseline period for implementation and data
validation, we note that we are finalizing an updated definition of
mTPS in IV.B.1 of this final rule which applies to new reporting
measures for which there is an insufficient quantity of data available
prior to the first performance period. Under our finalized policy, if
there is an insufficient quantity of data available prior to the first
performance period of a new reporting measure, we will set a proxy
median of zero for the reporting measure until we have sufficient data,
which will account for the possibility that new reporting measures may
have different reporting requirements. We believe this policy will
allow the timely inclusion of new reporting measures in the ESRD QIP
measure set while also encouraging facilities to report the new or
additional data that may be specified by that reporting measure so that
they are able to receive credit for reporting. We also believe that by
delaying the implementation of these measures until PY 2027 will give
facilities ample time to ensure the validity of their data. CMS also
performs validity assessments as part of its annual EQRS data
validation.
Final Rule Action: After considering public comments, we are
finalizing our proposal to adopt the Screen Positive Rate for Social
Drivers of Health reporting measure.
4. Performance Period for the PY 2027 ESRD QIP
We continue to believe that our current policy of 12-month
performance and baseline periods provide us sufficiently reliable
quality measure data for the ESRD QIP. Under this policy, we will adopt
CY 2025 as the performance period and CY 2023 as the baseline period
for the PY 2027 ESRD QIP.
We did not propose any changes to this policy. We addressed
comments and finalized our proposals to apply this performance period
to the Screening for Social Drivers of Health reporting measure and the
Screen Positive Rate for Social Drivers of Health reporting measure in
sections IV.D.2 and IV.D.3 of this final rule.
5. Performance Standards for the PY 2027 ESRD QIP
Section 1881(h)(4)(A) of the Act requires the Secretary to
establish performance standards with respect to the measures selected
for the ESRD QIP for a performance period with respect to a year. The
performance standards must include levels of achievement and
improvement, as determined appropriate by the Secretary, and must be
established prior to the beginning of the performance period for the
year involved, as required by section 1881(h)(4)(C) of the Act. We
refer readers to the CY 2012 ESRD PPS final rule (76 FR 70277) for a
discussion of the achievement and improvement standards that we have
established for clinical measures used in the ESRD QIP. We define the
terms ``achievement threshold,'' ``benchmark,'' ``improvement
threshold,'' and ``performance standard'' in our regulations at Sec.
413.178(a)(1), (3), (7), and (12), respectively. For reporting
measures, performance standards are the levels of data submission and
completion of other actions specified by CMS that are used to award
points to an ESRD facility on the measure (Sec. 413.178(a)(12)).
a. Performance Standards for Clinical Measures in the PY 2027 ESRD QIP
In the CY 2024 ESRD PPS proposed rule, we erroneously stated that
at that time, we did not have the necessary data to assign numerical
values to the achievement thresholds, benchmarks, and 50th percentiles
of national performance for the clinical measures because we did not
have CY 2022 data, and stated our intention to publish these numerical
values, using CY 2022 data, in the CY 2024 ESRD PPS final rule (88 FR
42518). We intended to refer to CY 2023 data in the proposed rule,
rather than CY 2022 data. Because we do not have CY 2023 data at this
time, we are clarifying in this final rule that we will publish these
numerical values, using CY 2023 data, in the CY 2025 ESRD PPS final
rule.
b. Performance Standards for the Newly Finalized Reporting Measures
Beginning With the PY 2027 ESRD QIP
In this final rule, we are finalizing our proposals to add the
Screening for Social Drivers of Health reporting measure and the Screen
Positive Rate for Social Drivers of Health reporting measure beginning
with the PY 2027 ESRD QIP, which we discuss in IV.D.2 and IV.D.3 of
this final rule. We are finalizing a 12-month period of performance for
both the Screening for Social Drivers of Health reporting measure and
the Screen Positive Rate for Social Drivers of Health reporting
measure, and facilities will be required to report annually for both
measures beginning with the PY 2027 ESRD QIP.
6. Scoring the PY 2027 ESRD QIP
a. Scoring Facility Performance on Clinical Measures
In the CY 2014 ESRD PPS final rule, we finalized policies for
scoring
[[Page 76481]]
performance on clinical measures based on achievement and improvement
(78 FR 72215 through 72216). In the CY 2019 ESRD PPS final rule, we
finalized a policy to continue use of this methodology for future
payment years (83 FR 57011) and we codified these scoring policies at
Sec. 413.178(e). In the CY 2023 ESRD PPS final rule, we updated our
scoring methodology beginning with PY 2025 (87 FR 67251 through 67254).
b. Scoring Facility Performance on Reporting Measures
Our policy for scoring performance on reporting measures is
codified at Sec. 413.178(e). In section IV.D.2 of this final rule, we
are finalizing our proposal to adopt the Screening for Social Drivers
of Health reporting measure beginning with PY 2027. We are also
finalizing our proposal to adopt the Screen Positive Rate for Social
Drivers of Health reporting measure, as discussed in section IV.D.3 of
this final rule. As discussed above, we are finalizing in this final
rule that a facility will be scored based on the equations described in
sections IV.D.2.c and IV.D.3.c of this final rule. We are adopting a
12-month period of performance for the measures, and facilities will be
required to report annually. We believe that these scoring policies
will encourage facilities to report the measure data appropriately
without penalizing facilities for the results of such data, which may
be impacted by circumstances beyond a facility's control.
7. Revisions To Measure Domains and To Measure Weights Used To
Calculate the Total Performance Score (TPS) Beginning With the PY 2027
ESRD QIP
In the CY 2024 ESRD PPS proposed rule, beginning with PY 2027, we
proposed to add the Screening for Social Drivers of Health reporting
measure and the Screen Positive for Social Drivers of Health reporting
measure to the Reporting Measure Domain (88 FR 42519). To accommodate
the new number of measures in the Reporting Measure Domain, we proposed
to update the individual measure weights in this domain. We stated our
belief that these proposed updates would help to ensure that a
facility's individual measure performance has an appropriately
proportionate impact on a facility's TPS, while also continuing to
further incentivize improvement on clinical measures through those
individual measure weights. Consistent with our approach in the CY 2023
ESRD PPS final rule, we proposed to assign individual measure weights
to reflect the proposed updated number of measures in the Reporting
Measure Domain so that each measure is weighted equally (87 FR 67251
through 67253). Since we proposed to add two new measures to the
Reporting Measure Domain beginning with PY 2027, we stated that we
would weight each measure within that domain equally at approximately
1.43 percent, which is consistent with our previously finalized
approach to weight each measure in the Reporting Measure Domain
equally. We noted that although we proposed to change the number of
measures in the Reporting Measure Domain and weights of certain
individual measures in that domain, we did not propose to change the
weights of the five domains themselves, because we believe the proposed
updates to individual measures and measure weights did not
significantly impact the measure domains themselves such that updating
the weights of the measure domains would be required to accommodate the
updated individual measure weights. The previously finalized and newly
proposed measures that would be included in each domain, along with the
proposed new measure weights, beginning with PY 2027, were depicted in
Table 22 of the proposed rule (88 FR 42520).
We welcomed public comment on these proposals. The comments we
received and our responses are set forth below.
Comment: One commenter recommended that the ESRD QIP measure set be
streamlined to focus more weight on clinically meaningful measures.
Response: We agree with the commenter that the weights should
reflect clinical value and meaningfulness to patients, which we took
into account in developing our measure domains and individual measure
weights. We believe that the measure domains and weights will provide
facilities with meaningful incentives to improve their performance on
measures that are impactful in terms of both clinical value and
importance to patients. We note that we have developed the ESRD QIP
measure set specifically to ensure that facilities focus on the most
relevant clinical topics that will lead to improved quality of care and
better outcomes for patients.
Comment: One commenter expressed concern that with the large number
of program measures, the reporting measures' weight is
disproportionately small compared to the effort to operationalize
associated processes, and recommended collaboration with the kidney
care community to identify appropriate measures and weights.
Response: We note that the weight of a given measure domain takes
into account a number of factors, including clinical evidence,
opportunity for improvement, clinical significance, and patient and
provider burden (83 FR 56995 through 56996). We also consider (1) the
number of measures and measure topics in a domain; (2) how much
experience facilities have had with the measures and measure topics in
a domain; and (3) how well the measures align with CMS's highest
priorities for quality improvement for patients with ESRD (79 FR
66214). We assign weights to the measure domains based on the clinical
value and meaningfulness of the measures to patients, and the burden of
complying with individual measure requirements. Having taken all of
these factors into consideration, we believe that the Reporting Measure
Domain weights are appropriate to support high quality health care on
all ESRD QIP measures.
Final Rule Action: After considering public comments, we are
finalizing our proposals as proposed. As we discussed previously, we
are finalizing our proposals to update the measure domains and measure
weights beginning with the PY 2027 ESRD QIP as proposed, and therefore
provide the updated ESRD QIP measure domains and measure weights in
Table 23.
BILLING CODE 4120-01-P
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[GRAPHIC] [TIFF OMITTED] TR06NO23.040
BILLING CODE 4120-01-C
V. End-Stage Renal Disease Treatment Choices (ETC) Model
A. Background
Section 1115A of the Act authorizes the Innovation Center to test
innovative payment and service delivery models expected to reduce
Medicare, Medicaid, and Children's Health Insurance Program (CHIP)
expenditures while preserving or enhancing the quality of care
furnished to the beneficiaries of these programs. The purpose of the
ETC Model is to test the effectiveness of adjusting certain Medicare
payments to ESRD facilities and Managing Clinicians to encourage
greater utilization of home dialysis and kidney transplantation,
support Beneficiary modality choice, reduce Medicare expenditures, and
preserve or enhance the quality of care. As described in the Specialty
Care Models final rule (85 FR 61114), beneficiaries with ESRD are among
the most medically fragile and high-cost populations served by the
Medicare program. ESRD Beneficiaries require dialysis or kidney
transplantation to survive, and the majority of ESRD Beneficiaries
receiving dialysis receive hemodialysis in an ESRD facility. However,
as described in the Specialty Care Models final rule, alternative renal
replacement modalities to in-center hemodialysis, including home
dialysis and kidney transplantation, are associated with improved
clinical outcomes, better quality of life, and lower costs than in-
center hemodialysis (85 FR 61264).
The ETC Model is a mandatory payment model. ESRD facilities and
Managing Clinicians are selected as ETC Participants based on their
location in Selected Geographic Areas--a set of 30 percent of Hospital
Referral Regions (HRRs) that have been randomly selected to be included
in the ETC Model, as well as HRRs with at least 20 percent of ZIP
codes\TM\ located in Maryland.\342\ CMS excludes all U.S.
[[Page 76483]]
Territories from the Selected Geographic Areas.
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\342\ ZIP code\TM\ is a trademark of the United States Postal
Service.
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Under the ETC Model, ETC Participants are subject to two payment
adjustments. The first is the Home Dialysis Payment Adjustment (HDPA),
which is an upward adjustment on certain payments made to participating
ESRD facilities under the ESRD Prospective Payment System (PPS) on home
dialysis claims, and an upward adjustment to the Monthly Capitation
Payment (MCP) paid to participating Managing Clinicians on home
dialysis-related claims. The HDPA applies to claims with claim service
dates beginning January 1, 2021 and ending December 31, 2023.
The second payment adjustment under the ETC Model is the
Performance Payment Adjustment (PPA). For the PPA, we assess ETC
Participants' home dialysis rates and transplant rates during a
Measurement Year (MY), which includes 12 months of performance data.
Each MY has a corresponding PPA Period--a 6-month period that begins 6
months after the conclusion of the MY. We adjust certain payments for
ETC Participants during the PPA Period based on the ETC Participant's
home dialysis rate and transplant rate, calculated as the sum of the
transplant waitlist rate and the living donor transplant rate, during
the corresponding MY.
Based on an ETC Participant's achievement in relation to benchmarks
based on the home dialysis rate and transplant rate observed in
Comparison Geographic Areas during the Benchmark Year, and the ETC
Participant's improvement in relation to their own home dialysis rate
and transplant rate during the Benchmark Year, we would make an upward
or downward adjustment to certain payments to the ETC Participant. The
magnitude of the positive and negative PPAs for ETC Participants
increases over the course of the Model. These PPAs apply to claims with
claim service dates beginning July 1, 2022 and ending June 30, 2027.
In the CY 2022 ESRD PPS final rule, we finalized a number of
changes to the ETC Model. We made adjustments to the calculation of the
home dialysis rate (86 FR 61951 through 61955) and the transplant rate
(86 FR 61955 through 61959) and updated the methodology for attributing
Pre-emptive Living Donor Transplant (LDT) Beneficiaries (86 FR 61950
through 61951). We modified the achievement benchmarking and scoring
methodology (86 FR 61959 through 61968), as well as the improvement
benchmarking and scoring methodology (86 FR 61968 through 61971). We
specified the method and requirements for sharing performance data with
ETC Participants (86 FR 61971 through 61984). We also made a number of
updates and clarifications to the kidney disease patient education
services waivers and made certain related flexibilities available to
ETC Participants (86 FR 61984 through 61994). In the CY 2023 ESRD PPS
final rule (87 FR 67136) we finalized further changes to the ETC Model.
We updated the PPA achievement scoring methodology beginning in the
fifth Measurement Year (MY) of the ETC Model, which began on January 1,
2023 (87 FR 67277 through 67278). We also clarified requirements for
qualified staff to furnish and bill kidney disease patient education
services under the ETC Model's Medicare program waivers (87 FR 67278
through 67280), and finalized our intent to publish participant-level
model performance information to the public (87 FR 67280).
B. Summary of the Proposed Provisions, Public Comments, and Responses
to Comments on the ETC Model
The CY 2024 ESRD PPS proposed rule appeared in the June 30, 2023,
version of the Federal Register, with a comment period that ended on
August 25, 2023. In that proposed rule, we proposed to modify the ETC
Model, effective January 1, 2024, to acknowledge the availability of
administrative review of targeted review requests. We received five
timely public comments on our proposal, including comments from
dialysis organizations and national provider and quality improvement
organizations. We also received comments related to issues that we did
not discuss in the CY 2024 ESRD PPS proposed rule. These include, for
example, general expressions of support for the ETC Model, concerns
regarding CMS's methodology for ETC Participant selection and
aggregation group construction, a recommendation that CMS develop a
tool to measure the experience of Beneficiaries using home modalities,
and recommendations regarding the format in which CMS posts ETC Model
results. While we generally are not addressing those comments in this
final rule, we thank commenters for their input and may consider their
recommendations in future rulemaking. In this final rule, we provide a
summary the proposed provision, a summary of the public comments
received and our responses to them, and the policies we are finalizing
for the ETC Model. These policies take effect January 1, 2024.
In the Specialty Care Models final rule (85 FR 61114), we
established our policies for targeted reviews of the calculation of an
ETC Participant's Modality Performance Score (MPS). As described in
Sec. 512.390(c), targeted reviews are limited to the calculation of
the MPS and may not pertain to the methodologies used to calculate the
MPS, home dialysis rate, transplant rates, achievement and improvement
benchmarks, or the PPA amounts. ETC Participants have 90 days following
the availability of the MPS to submit a targeted review request. CMS
responds to each targeted review request that is received within the
90-day time period. CMS may solicit additional information from the ETC
Participant in support of the request after which a determination is
made as to whether there was an error in the calculation of the ETC
Participant's MPS that results in an incorrect PPA being applied during
the PPA period. In such a scenario, CMS notifies the ETC Participant
and resolves any resulting discrepancy in payment that arises from the
application of an incorrect PPA.
In the CY 2024 ESRD PPS proposed rule, we proposed revisions to our
regulations at Sec. 512.390 to clarify the ability of the CMS
Administrator to review targeted review determinations. In particular,
we proposed to add Sec. 512.390(d) to specify that the CMS
Administrator may review targeted review requests when administrative
review is requested by ETC Participants within 15-calendar days of a
targeted review request determination made by CMS.
We proposed that within 45 days of the date of the ETC
Participant's request for administrative review, the CMS Administrator
may act as follows: (i) decline to review the targeted review request
determination made by CMS, (ii) render a final decision based on the
CMS Administrator's review of the targeted review request
determination, or (iii) choose to take no action on the request for
administrative review. We proposed that targeted review request
determinations made by the CMS Administrator are considered final if
the CMS Administrator declines an ETC Participant's request for
administrative review or if the CMS Administrator does not take any
action on the ETC Participant's request for administrative review by
the end of the 45-day period described.
We also proposed a conforming change to delete the existing
provision in Sec. 512.390(c)(5), which states that decisions based on
targeted review are final, and there is no further review or appeal.
These changes were proposed to ensure that accountability for the
decisions of CMS is vested in a
[[Page 76484]]
principal officer and to bring the targeted review process to a more
similar posture as other CMS appeals entities that provide for CMS
Administrator review. These revisions were also proposed to ensure that
ETC Participants are aware that administrative review is available to
ETC Participants who wish to seek additional review of the results of a
targeted review request.
We solicited comment on this proposal.
Comment: We received five in scope comments timely submitted. All
five comments were supportive of our proposed administrative review
policy. One provider organization wrote that the proposed policy would
increase awareness of the availability of administrative review among
ETC Participants. A dialysis organization wrote that the proposed
policy would increase transparency and accountability for targeted
review determinations made by CMS. A kidney care coalition also noted
the proposed policy would support awareness, transparency, and
accountability.
Response: We thank the commenters for their support of our proposed
administrative review policy.
Final Rule Action: We are finalizing our proposed modifications to
the ETC Model regulations at Sec. 512.390 to clarify the ability of
the CMS Administrator to review targeted review determinations. We are
adding Sec. 512.390(d) to specify that the CMS Administrator may
review targeted review requests when administrative review is requested
by ETC Participants within 15-calendar days of a targeted review
request determination made by CMS.
VI. Collection of Information Requirements
Under the Paperwork Reduction Act of 1995, we are required to
provide 60-day notice in the Federal Register and solicit public
comment before a collection of information requirement is submitted to
OMB for review and approval. To fairly evaluate whether an information
collection should be approved by OMB, section 3506(c)(2)(A) of the
Paperwork Reduction Act of 1995 requires that we solicit comment on the
following issues.
The need for the information collection and its usefulness
in carrying out the proper functions of our agency.
The accuracy of our estimate of the information collection
burden.
The quality, utility, and clarity of the information to be
collected.
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
We are soliciting public comment on each of these issues for the
following sections of this document that contain information collection
requirements (ICRs).
A. ICRs Regarding the JW and JZ Reporting Requirements; Reporting
Policy for Discarded Amounts of Renal Dialysis Drugs and Biological
Products Paid for Under the ESRD PPS, Section II.B.1.h (OMB Control
Number 0938-0997)
As discussed in section II.B.1.h of this final rule, we are
finalizing a requirement that beginning January 1, 2025, ESRD
facilities must report information on claims about the total number of
billing units of any discarded amount of a renal dialysis drug or
biological product from a single-dose container or single-use package
that is paid for under the ESRD PPS, using the JW modifier (or any
successor modifier that includes the same data). Additionally, we are
finalizing a requirement that ESRD facilities report the JZ modifier
for all such drugs and biological products with no discarded amounts
beginning no later than January 1, 2025. Based on our analysis of ESRD
PPS claims as well as the billing guidance in sections 8 and 17 of the
Medicare Claims Processing Manual, we have determined that the JW
modifier requirement reflects current practices for ESRD facilities and
would not significantly increase burden for ESRD facilities.
Additionally, the JZ modifier requirement is not expected to increase
burden on ESRD facilities because under the guidance provided regarding
use of the JW modifier, the ESRD facility should already have processes
in place in order to determine, in the case of certain drugs and
biological products, whether or not there are any discarded units from
a single use container or package, record discarded amounts in the
patient medical record, and specify administered and discarded amounts
on the claim form. Additionally, as discussed in section II.B.1.h of
this final rule, any separately payable drugs or biological products
that ESRD facilities bill for using the AY modifier would already be
subject to the JW and JZ modifier policies under Medicare Part B.
Although we recognize that ESRD facilities may need additional time to
train staff and update their systems in order to apply existing
processes to a broader scope of renal dialysis drugs and biological
products, we continue to anticipate that most ESRD facilities should
already be set up to report the JW and JZ modifiers without incurring
additional burden.
B. ICRs Regarding the Proposal to Require Time on Machine Data as a
Recordkeeping and Cost Reporting Requirement for Outpatient Maintenance
Dialysis; Section II.B.1.j (OMB Control Numbers 0938-0997)
We are finalizing a requirement that ESRD facilities submit data
and information on ESRD PPS claims regarding the number of minutes
between the start and end of hemodialysis treatment, without accounting
for any interruptions, received by a beneficiary in center in an ESRD
facility effective January 1, 2025. We have developed monetary
estimates of the amount of ESRD facility staff time required to
calculate and report on claims the minutes of time on machine for each
in-center hemodialysis treatment to estimate the cost associated with
the finalized requirement to report time on machine data. We have
included those estimates in the Regulatory Impact Analysis in section
VII.D.2.a of this final rule. We acknowledge the burden associated with
this requirement, but we note that the burden associated with the CMS-
1450 institutional claim form already accounts for the variability in
the number and type of codes submitted for each claim.
C. Additional Information Collection Requirements
1. ESRD QIP--Wage Estimates (OMB Control Numbers 0938-1289 and 0938-
1340)
To derive wages estimates, we used data from the U.S. Bureau of
Labor Statistics' May 2021 National Occupational Employment and Wage
Estimates. In the CY 2016 ESRD PPS final rule (80 FR 69069), we stated
that it was reasonable to assume that Medical Records and Health
Information Technicians, who are responsible for organizing and
managing health information data, are the individuals tasked with
submitting measure data to the ESRD Quality Reporting System (EQRS)
(formerly, CROWNWeb) and the CDC's NHSN, as well as compiling and
submitting patient records for the purpose of data validation studies.
In the proposed rule, we stated that the most recently available median
hourly wage of a Medical Records Specialist is $22.43 per hour (88 FR
42522).\343\ In this final rule, we are updating the median hourly wage
to $22.69 per hour, which reflects
[[Page 76485]]
the most recently available data.\344\ We also calculate fringe benefit
and overhead at 100 percent. We adjusted these employee hourly wage
estimates by a factor of 100 percent to reflect current HHS department-
wide guidance on estimating the cost of fringe benefits and overhead.
These are necessarily rough adjustments, both because fringe benefits
and overhead costs vary significantly from employer to employer and
because methods of estimating these costs vary widely from study to
study. Nonetheless, there is no practical alternative, and we believe
that these are reasonable estimation methods. Therefore, using these
assumptions, in the proposed rule we estimated an hourly labor cost of
$44.86 as the basis of the wage estimates for all collections of
information calculations in the ESRD QIP (88 FR 42522). In this final
rule, we are updating our previously estimated hourly labor cost to
$45.38 as the basis of the wage estimates for all collections of
information calculations in the ESRD QIP.
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\343\ https://www.bls.gov/oes/2021/may/oes292072.htm. Accessed
on January 3, 2023.
\344\ https://www.bls.gov/oes/current/oes292072.htm. Accessed on
July 18, 2023.
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We used this updated wage estimate, along with updated facility and
patient counts, to update our estimate for the total information
collection burden in the ESRD QIP for PY 2026 that we discussed in the
CY 2024 ESRD PPS proposed rule (88 FR 42522 through 42523) and to
estimate the total information collection burden in the ESRD QIP for PY
2027. We provide the re-estimated information collection burden
associated with the PY 2026 ESRD QIP and the newly estimated
information collection burden associated with the PY 2027 ESRD QIP in
section VII.C.3 of this final rule.
2. Estimated Burden Associated With The Data Validation Requirements
for PY 2026 and PY 2027 (OMB Control Numbers 0938-1289 and 0938-1340)
In the CY 2020 ESRD PPS final rule, we finalized a policy to adopt
the EQRS (formerly, CROWNWeb) data validation methodology that we
previously adopted for the PY 2016 ESRD QIP as the methodology we would
use to validate EQRS data for all payment years, beginning with PY 2021
(83 FR 57001 through 57002). Under this methodology, 300 facilities are
selected each year to submit 10 records to CMS, and we reimburse these
facilities for the costs associated with copying and mailing the
requested records. The burden associated with these validation
requirements is the time and effort necessary to submit the requested
records to a CMS contractor. In this final rule, we are updating these
burden estimates using a newly available wage estimate of a Medical
Records Specialist. In the CY 2020 ESRD PPS final rule, we estimated
that it would take each facility approximately 2.5 hours to comply with
this requirement (84 FR 60787). If 300 facilities are requested to
submit records, we estimated that the total combined annual burden for
these facilities would be 750 hours (300 facilities x 2.5 hours). Since
we anticipate that Medical Records Specialists or similar
administrative staff would submit these data, we estimate that the
aggregate cost of the EQRS data validation each year would be
approximately $34,035 (750 hours x $45.38), or an annual total of
approximately $113.45 ($34,035/300 facilities) per facility in the
sample. The burden cost increase associated with these requirements
will be submitted to OMB in the revised information collection request
(OMB control number 0938-1289; Expiration date: November 30, 2025).
In the CY 2021 ESRD PPS final rule, we finalized our policy to
reduce the number of records that a facility selected to participate in
the NHSN data validation must submit to a CMS contractor, beginning
with PY 2023 (85 FR 71471 through 71472). Under this finalized policy,
a facility is required to submit records for 20 patients across any two
quarters of the year, instead of 20 records for each of the first two
quarters of the year. The burden associated with this policy is the
time and effort necessary to submit the requested records to a CMS
contractor. Applying this policy for NHSN validation, we estimated that
it would take each facility approximately 5 hours to comply with this
requirement. If 300 facilities are requested to submit records each
year, we estimated that the total combined annual burden hours for
these facilities per year would be 1,500 hours (300 facilities x 5
hours). Since we anticipate that Medical Records Specialists or similar
staff would submit these data, using the newly available wage estimate
of a Medical Records Specialist, we estimate that the aggregate cost of
the NHSN data validation each year would be approximately $68,070
(1,500 hours x $45.38), or a total of approximately $226.90 ($68,070/
300 facilities) per facility in the sample. While the burden hours
estimate would not change, the burden cost updates associated with
these requirements will be submitted to OMB in the revised information
collection request (OMB control number 0938-1340; Expiration date:
November 30, 2025).
3. Estimated EQRS Reporting Requirements for PY 2026 and PY 2027 (OMB
Control Number 0938-1289)
To estimate the burden associated with the EQRS reporting
requirements (previously known as the CROWNWeb reporting requirements),
we look at the total number of patients nationally, the number of data
elements per patient-year that the facility would be required to submit
to EQRS for each measure, the amount of time required for data entry,
the estimated wage plus benefits applicable to the individuals within
facilities who are most likely to be entering data into EQRS, and the
number of facilities submitting data to EQRS. In the CY 2023 ESRD PPS
final rule, we estimated that the burden associated with EQRS reporting
requirements for the PY 2026 ESRD QIP was approximately $220 million
for approximately 4,908,291 total burden hours (87 FR 67282).
We are finalizing several changes to the ESRD QIP measure set in
this final rule that will affect the burden associated with EQRS
reporting requirements for PY 2026 or PY 2027. Beginning with PY 2026,
we are removing two measures from the ESRD QIP measure set and adding
one measure to the ESRD QIP measure set. We note that, although the
finalized measure we are adding to the ESRD QIP measure set beginning
with PY 2026 is modified from the version of the measure that was
proposed, the estimated burden associated with the measure will not
change because the modification will not impose additional EQRS
reporting requirements on facilities. For PY 2027 and for subsequent
years, we are adding two measures to the ESRD QIP measure set. We have
re-calculated the burden estimate for PY 2026 to reflect the impact of
these finalized policies, using updated estimates of the total number
of ESRD facilities, the total number of patients nationally, and wages
for Medical Records Specialists or similar staff, as well as a refined
estimate of the number of hours needed to complete data entry for EQRS
reporting. In the CY 2024 ESRD PPS proposed rule, we estimated that the
amount of time required to submit measure data to EQRS would be 2.5
minutes per element and did not use a rounded estimate of the time
needed to complete data entry for EQRS reporting (88 FR 42523). We are
further updating these estimates in this final rule. There are 126 data
elements for 507,837 patients across 7,833 facilities, for a total of
63,987,462
[[Page 76486]]
elements (126 data elements x 507,837 patients). At 2.5 minutes per
element, this would yield approximately 340.3 hours per facility.
Therefore, the PY 2026 burden would be 2,666,144 hours (340.3 hours x
7,833 facilities). Using the wage estimate of a Medical Records
Specialist, we estimate that the PY 2026 total burden cost is
approximately $120.9 million (2,666,144 hours x $45.38).
There would also be an incremental burden change from PY 2026 to PY
2027 because we are adding two new measures beginning with PY 2027. For
PY 2027, there are 136 data elements proposed for 507,837 patients
across 7,833 facilities. At 2.5 minutes per element, this would yield
approximately 367.3 hours per facility. Therefore, the PY 2027 burden
would be 2,877,743 hours (367.3 hours x 7,833 facilities). Using the
wage estimate of a Medical Records Specialist, we estimate that the PY
2027 total burden cost would be approximately $130.5 million (2,877,743
hours x $45.38).
We received two comments on the ESRD QIP collection of information
discussions. The comments we received and our response is set forth
below.
Comment: One commenter stated that because CMS is estimating an
increase in facility burden for both PY 2026 and PY 2027, CMS should
limit data collection and reporting under the ESRD QIP to those
measures that are absolutely necessary to ensure that facilities can
spend the maximum time, effort and resources on caring for patients. A
second commenter expressed concern that $131 million dollars of
increased burden is not sustainable.
Response: We note that we have developed the ESRD QIP measure set
specifically to ensure that facilities focus on the most relevant
clinical topics that will lead to improved quality of care and better
outcomes for patients. We appreciate the commenter's concern regarding
the estimated burden for PY 2027, but note that the net increase in
burden from PY 2026 (approximately $120.9 million) to PY 2027
(approximately $130.5 million) is estimated to be less than $10
million. By contrast, the estimated burden for PY 2026 is approximately
$100 million less than the estimated burden for PY 2025, which is
approximately $220 million (87 FR 67282).
If you comment on these information collection, that is, reporting,
recordkeeping or third-party disclosure requirements, submit your
comments to the Office of Information and Regulatory Affairs, Office of
Management and Budget, Attention: CMS Desk Officer, CMS-1782-F
Fax: (202) 395-6974; or
Email: [email protected].
VII. Regulatory Impact Analysis
A. Statement of Need
1. ESRD PPS
On January 1, 2011, we implemented the ESRD PPS, a case-mix
adjusted, bundled PPS for renal dialysis services furnished by ESRD
facilities as required by section 1881(b)(14) of the Act, as added by
section 153(b) of MIPPA (Pub. L. 110-275). Section 1881(b)(14)(F) of
the Act, as added by section 153(b) of MIPPA, and amended by section
3401(h) of the Affordable Care Act (Pub. L. 111-148), established that
beginning CY 2012, and each subsequent year, the Secretary shall
annually increase payment amounts by an ESRD market basket percentage
increase, reduced by the productivity adjustment described in section
1886(b)(3)(B)(xi)(II) of the Act. This final rule implements updates
and policy changes to the CY 2024 ESRD wage index values, the final
combined wage index and TPEAPA budget-neutrality adjustment factor, the
outlier payment threshold amounts, and the TPNIES offset amount.
Failure to publish this final rule would result in ESRD facilities not
receiving appropriate payments in CY 2024 for renal dialysis services
furnished to ESRD beneficiaries.
This rule also has several policy changes to improve payment
stability and adequacy under the ESRD PPS. These include a new
transitional add-on payment adjustment for pediatric patients and a new
add-on payment adjustment for certain new renal dialysis drugs and
biological products in existing ESRD PPS functional categories after
the end of the TDAPA period. We are also finalizing updates to the
administrative process for the LVPA, requiring ESRD facilities to
report on claims billing units of any discarded amounts of certain
drugs and biological products, and requiring ESRD facilities to report
``time on machine'' data on ESRD PPS claims for all in-center
hemodialysis treatments. We believe that each of these changes will
improve payment stability and adequacy under the ESRD PPS.
2. AKI
This final rule finalizes updates to the payment rate for renal
dialysis services furnished by ESRD facilities to individuals with AKI.
As discussed in section III.B of this final rule, we are also applying
to all AKI dialysis payments the updates to the ESRD PPS base rate and
wage index. Failure to publish this final rule would result in ESRD
facilities not receiving appropriate payments in CY 2024 for renal
dialysis services furnished to patients with AKI in accordance with
section 1834(r) of the Act.
3. ESRD QIP
Section 1881(h)(1) of the Act requires CMS to reduce the payments
otherwise made to a facility under the ESRD PPS by up to two percent if
the facility does not satisfy the requirements of the ESRD QIP for that
year. This final rule finalizes updates for the ESRD QIP, including
removing the Ultrafiltration Rate reporting measure from the ESRD QIP
measure set beginning with PY 2026, removing the Standardized Fistula
Rate clinical measure from the ESRD QIP measure set beginning with PY
2026, updating the COVID-19 Vaccination Coverage Among HCP beginning
with PY 2026, converting the Clinical Depression Screening and Follow-
Up reporting measure to a clinical measure beginning with PY 2026, and
adding the Facility Commitment to Health Equity reporting measure to
the ESRD QIP measure set beginning with PY 2026. This final rule also
finalizes the adoption of the Screening for Social Drivers of Health
reporting measure and the Screen Positive Rate for Social Drivers of
Health reporting measure to the ESRD QIP measure set beginning with PY
2027.
4. ETC Model
We believe it is necessary to make certain changes to the ETC Model
to acknowledge the availability of administrative review of targeted
review requests. The policy we are finalizing in this rule is necessary
to provide transparency to ETC Participants regarding the avenue
available to them should they wish to seek additional review of the
results of a targeted review request determination.
B. Overall Impact
We have examined the impacts of this final rule as required by
Executive Order 12866 on Regulatory Planning and Review (September 30,
1993), Executive Order 13563 on Improving Regulation and Regulatory
Review (January 18, 2011), Executive Order 14094 entitled ``Modernizing
Regulatory Review'' (April 6, 2023), the Regulatory Flexibility Act
(RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Act,
section 202 of the Unfunded Mandates Reform Act of 1995 (March 22,
1995; Pub. L. 104-4), Executive
[[Page 76487]]
Order 13132 on Federalism (August 4, 1999), and the Congressional
Review Act (5 U.S.C. 804(2))
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 14094 entitled ``Modernizing Regulatory Review'' (hereinafter,
the Modernizing E.O.) amends section 3(f)(1) of Executive Order 12866
(Regulatory Planning and Review). The amended section 3(f) of Executive
Order 12866 defines a ``significant regulatory action'' as an action
that is likely to result in a rule: (1) having an annual effect on the
economy of $200 million or more in any 1 year (adjusted every 3 years
for changes in gross domestic product), or adversely affect in a
material way the economy, a sector of the economy, productivity,
competition, jobs, the environment, public health or safety, or State,
local, territorial, or Tribal governments or communities; (2) creating
a serious inconsistency or otherwise interfering with an action taken
or planned by another agency; (3) materially altering the budgetary
impacts of entitlement grants, user fees, or loan programs or the
rights and obligations of recipients thereof; or (4) raising legal or
policy issues for which centralized review would meaningfully further
the President's priorities or the principles set forth in this
Executive order.
A regulatory impact analysis (RIA) must be prepared for major rules
with significant regulatory action/s and/or with significant effects as
per section 3(f)(1) of Executive Order 12866 ($200 million or more in
any 1 year). Based on our estimates of the combined impact of the ESRD
PPS, ESRD QIP, and ETC provisions in this final rule, OMB has
determined this rulemaking is significant per section 3(f)(1) economic
effect as measured by the $200 million or more in any 1 year threshold,
and hence is also a major rule under Subtitle E of the Small Business
Regulatory Enforcement Fairness Act of 1996 (also known as the
Congressional Review Act). Accordingly, we have prepared a Regulatory
Impact Analysis that to the best of our ability presents the costs and
benefits of the rulemaking. Therefore, OMB has reviewed this final
rule, and the Department has provided the following assessment of its
impact.
C. Impact Analysis
1. ESRD PPS
We estimate that the revisions to the ESRD PPS will result in an
increase of approximately $190 million in Medicare payments to ESRD
facilities in CY 2024, which includes the amount associated with
updates to the outlier thresholds, payment rate update, updates to the
wage index, the budget-neutral transitional pediatric ESRD add-on
payment adjustment, the beginning of the post-TDAPA add-on payment
adjustment, and continuation of the approved TDAPA as identified in
Table 11. We note that approximately $10 million in projected CY 2024
expenditures for Jesduvroq (daprodustat) are not included in the
detailed economic analysis in Table 24 due to the fact that we do not
yet have the required claims data for Jesduvroq, and therefore we
cannot estimate impacts at the facility level.
2. AKI
We estimate that the updates to the AKI payment rate will result in
an increase of approximately $1 million in Medicare payments to ESRD
facilities in CY 2024.
3. ESRD QIP
We estimate that the updates to the ESRD QIP will result in $16
million in estimated payment reductions across all facilities for PY
2026.
4. ETC Model
We estimate that the changes to the ETC Model will not impact the
Model's projected direct savings from payment adjustments alone. As
described in the CY 2023 ESRD PPS final rule, we estimate that the
Model would generate $28 million in direct savings related to payment
adjustments over 6.5 years (87 FR 67297 through 67299).
5. Summary of Impacts
We estimate that the combined impact of the policies finalized in
this rule on payments for CY 2024 is $190 million based on the
estimates of the updates to the ESRD PPS and the AKI payment rates, as
well as $10 million in projected new TDAPA spending in CY 2024. We
estimate an additional $12 million in costs associated with the final
policy to require ESRD facilities to report time on machine data. We
estimate the impacts of the ESRD QIP for PY 2026 to be $120.9 million
in information collection burden and $16 million in estimated payment
reductions across all facilities. Additionally, we estimate the impacts
of the ESRD QIP for PY 2027 to be $130.5 million in information
collection burden and $13.8 million in estimated payment reductions
across all facilities. Finally, we estimate that the changes to the ETC
model in this final rule will not impact the Model's projected direct
savings from payment adjustments alone.
D. Detailed Economic Analysis
In this section, we discuss the anticipated benefits, costs, and
transfers associated with the changes in this final rule. Additionally,
we estimate the total regulatory review costs associated with reading
and interpreting this final rule.
1. Benefits
Under the CY 2024 ESRD PPS and AKI payment, ESRD facilities will
continue to receive payment for renal dialysis services furnished to
Medicare beneficiaries under a case-mix adjusted PPS. We continue to
expect that making prospective Medicare payments to ESRD facilities
will enhance the efficiency of the Medicare program. Additionally, we
expect that updating the Medicare ESRD PPS base rate and rate for AKI
treatments furnished at ESRD facilities by 2.1 percent based on the CY
2024 ESRDB market basket percentage increase reduced by the CY 2024
productivity adjustment will improve or maintain beneficiary access to
high quality care by ensuring that payment rates reflect the best
available data on the resources involved in delivering renal dialysis
services. We estimate that overall payments under the ESRD PPS will
increase by 2.1 percent.
2. Costs
a. ESRD PPS and AKI
As discussed in section II.B.1.j of this final rule, we are
finalizing a requirement for ESRD facilities to submit data and
information on ESRD PPS claims for renal dialysis services regarding
the number of minutes of hemodialysis treatment received by a
beneficiary in center in an ESRD facility. This patient-level reporting
on resource use will be used to apportion composite rate costs for use
in the case-mix adjustment under the ESRD PPS. We estimate that there
will be an increase in costs for ESRD facilities associated with this
final reporting requirement; however, as we previously noted in the CY
2020 ESRD PPS proposed rule (84 FR 38396 through 38400), we are aware
that many ESRD facilities' EHR systems automatically collect this
information for every dialysis treatment, minimizing the additional
burden of reporting this metric on claims. However, commenters
identified that there are additional burdens associated with
transmitting
[[Page 76488]]
that information from the medical records to the billing system, as
many ESRD facilities do not have such processes in place. Therefore, we
are updating our burden estimate to include the burden associated with
this step in the process.
For those ESRD facilities that use EHRs, we estimate that there
will be only very minimal additional staff time required to record such
time on machine data on the patient's medical records for renal
dialysis services. For those ESRD facilities that do not use EHRs, we
estimate that additional staff time will be required to take note of
the time at which hemodialysis began and the time at which hemodialysis
ended and subtract the start time from the end time to determine the
total number of minutes of hemodialysis. Conservatively, we estimate
this will require no more than 1 minute per treatment.
For all ESRD facilities, we estimate that additional staff time
will be required to compile time on machine data for each patient each
month and enter it into the billing system to be submitted.
Conservatively, we estimate that this will require no more than 5
minutes per patient month.
To calculate the annual additional ESRD facility staff time that
will be associated with recording time on machine data on ESRD PPS
claims for renal dialysis services, we multiply the estimated time per
treatment by the number of dialysis treatments. Based on the most
recent available CY 2022 ESRD PPS claims for this final rule, we
estimate there were approximately 30.6 million treatments. However, as
discussed in section II.B.1.j, we proposed to limit this reporting
requirement to in-center claims. We estimated that approximately 14.8
percent of claims are for home dialysis, and therefore we reduce our
estimate of the total number of treatments by 14.8 percent.
Additionally, we believe it is reasonable to assume that LDOs will
utilize existing systems and processes to document treatment duration
in the EHR and send that information to the claim. Based on the latest
available data as shown in Table 24, approximately 78.4 percent of
treatments were furnished by LDOs. Therefore, we estimate that the
additional costs associated with this time on machine reporting
requirement will be associated with approximately 5.6 million in-
center, non-LDO dialysis treatments per year.
Additionally, ESRD facilities already report time on machine data
monthly in the EQRS for a single dialysis session. This means that for
a patient who receives 156 dialysis treatments per year, the duration
of twelve of those sessions would already be reported in the EQRS. We
do not believe there will be any additional staff time required to
report time on machine data on ESRD PPS claims for the treatments
already reported in EQRS. Therefore, we estimate that the additional
staff time that will be needed for reporting time on machine will be
for 144 out of 156 treatments per year for the typical patient. For our
cost estimate, we multiplied our estimate of 5.6 million in-center
dialysis treatments by a factor of (144/156), which equals
approximately 5.2 million treatments per year.
To calculate the annual additional ESRD facility staff time that
will be associated with calculating and reporting time on machine data
on ESRD PPS claims for renal dialysis services, we multiply the
estimated time per patient month by the number of dialysis patient
months. Based on the most recent available ESRD PPS claims data for
this final rule (from CY 2022), we estimate there were approximately
2.2 million patient months for patients receiving in-center
hemodialysis. Therefore, we estimate that the additional costs
associated with compiling and reporting the data for this time on
machine reporting requirement will be associated with approximately 2.2
million in-center dialysis patient months per year.
To derive wages estimates, we used data from the U.S. Bureau of
Labor Statistics' May 2022 National Occupational Employment and Wage
Estimates. We believe it is reasonable to assume that Medical Records
and Health Information Technicians, who are responsible for organizing
and managing health information data, are the individuals reporting
time on machine data. As discussed in the CY 2016 ESRD PPS final rule
(80 FR 69069), this is consistent with our assumptions about the types
of employees tasked with submitting measure data to CROWNWeb (now EQRS)
and NHSN, as well as compiling and submitting patient records for the
purpose of data validation studies. The most recently available mean
hourly wage of a Medical Records and Health Information Technician is
$24.42 per hour.\345\ We also calculate fringe benefit and overhead at
100 percent. We adjusted these employee hourly wage estimates by a
factor of 100 percent to reflect current HHS department-wide guidance
on estimating the cost of fringe benefits and overhead. We note that
these are necessarily rough adjustments, both because fringe benefits
and overhead costs vary significantly from employer to employer and
because methods of estimating these costs vary widely from study to
study. Nonetheless, there is no practical alternative, and we believe
that these are reasonable estimation methods. Therefore, using these
assumptions, we estimate an hourly labor cost of $48.84 as the basis of
the wage estimates for the estimate of cost associated with the
proposed requirement to report time on machine data on ESRD PPS claims
for renal dialysis services.
---------------------------------------------------------------------------
\345\ https://www.bls.gov/oes/current/oes292099.htm.
---------------------------------------------------------------------------
Based on the figures discussed in the preceding paragraphs, we
estimate that total additional staff time each year for ESRD facilities
associated with the requirement to record time on machine data is equal
to 5.2 million x 1 minute = 5.2 million minutes = 86,667 hours.
Additionally, we estimate that the total additional staff time each
year for ESRD facilities associated with the calculation and reporting
of the time on machine data is equal to 2.2 million x 5 minutes = 11
million minutes = 183,333 hours. We estimate the total annual cost
associated with this requirement is equal to (86,667 hours + 183,333
hours) x $47.34 = $12,781,800 per year.
We recognize that some non-LDO ESRD facilities may also choose to
adopt an automated process, rather than a manual process. Therefore,
the estimate of $12,781,800 represents the upper limit of our burden
estimate. For ESRD facilities that choose to utilize existing systems
and processes to document treatment duration in the EHR and send that
data to the claim, we estimate the burden associated with our
requirement to report time on machine data will be minimal.
b. ESRD QIP
For PY 2026 and PY 2027, we have updated the estimated costs
associated with the information collection requirements under the ESRD
QIP with updated estimates of the total number of ESRD facilities, the
total number of patients nationally, wages for Medical Records
Specialists or similar staff, and a refined estimate of the number of
hours needed to complete data entry for EQRS reporting. We have made no
changes to our methodology for calculating the annual burden associated
with the information collection requirements for EQRS data validation
(previously known as the CROWNWeb validation study) or NHSN data
validation. We have updated our methodology for calculating the annual
burden associated with the information
[[Page 76489]]
collection requirements for EQRS reporting based on our measure updates
for PY 2026, PY 2027, and subsequent years.
We also updated the payment reduction estimates based on our
policies that we have finalized in this final rule, using more recent
data for the measures in the ESRD QIP measure set. We estimate that as
a result of our previously finalized policies and the policies we have
finalized in this final rule for PY 2026, there would be approximately
$120.9 million in information collection burden and an additional $16
million in estimated payment reductions across all facilities, for a
total estimated impact of $136.9 million.
For PY 2027, we estimate that as a result of our previously
finalized policies and the policies we have finalized in this final
rule for PY 2027, there would be approximately $130.5 million in
information collection burden and $13.8 million in estimated payment
reductions across all facilities, for a total estimated impact of
$144.3 million.
3. Transfers
We estimate that the updates to the ESRD PPS and AKI payment rate
will result in a total increase of approximately $190 million in
Medicare payments to ESRD facilities in CY 2024, which includes the
amount associated with updates to the outlier thresholds, and updates
to the wage index. This estimate includes an increase of approximately
$1 million in Medicare payments to ESRD facilities in CY 2024 due to
the updates to the AKI payment rate, of which approximately 20 percent
is increased beneficiary coinsurance payments. We estimate
approximately $150 million in transfers from the Federal Government to
ESRD facilities due to increased Medicare program payments and
approximately $40 million in transfers from beneficiaries to ESRD
facilities due to increased beneficiary coinsurance payments because of
this final rule.
4. Regulatory Review Cost Estimation
If regulations impose administrative costs on private entities,
such as the time needed to read and interpret this ESRD PPS final rule,
we should estimate the cost associated with regulatory review. Due to
the uncertainty involved with accurately quantifying the number of
entities that will review the ESRD PPS final rule, we assume that the
total number of unique commenters on this year's ESRD PPS proposed
rule, 256, will be the number of reviewers of this ESRD PPS final rule.
We acknowledge that this assumption may understate or overstate the
costs of reviewing this final rule. It is possible that not all
commenters reviewed this year's proposed rule in detail, and it is also
possible that some reviewers chose not to comment on the ESRD PPS
proposed rule. For these reasons we thought that the number of
commenters would be a fair estimate of the number of reviewers of this
final rule. We invited comments on the approach in estimating the
number of entities which will review this final rule but did not
receive any comments on this topic. We also recognize that different
types of entities are in many cases affected by mutually exclusive
sections of this final rule, and therefore for the purposes of our
estimate we assume that each reviewer reads approximately 50 percent of
the rule. We solicited comments on this assumption and none were
received.
Using the wage information from the BLS for medical and health
service managers (Code 11-9111), we estimate that the cost of reviewing
this final rule is $123.06 per hour, including overhead and fringe
benefits (https://www.bls.gov/oes/current/oes_nat.htm). Assuming an
average reading speed, we estimate that it will take approximately 300
minutes (5.00 hours) for the staff to review half of this final rule,
which has a total of approximately 150,000 words. For each entity that
reviews the rule, the estimated cost is $615.30 (5.00 hours x $123.06).
Therefore, we estimate that the total cost of reviewing this regulation
is $157,516.80 ($615.30 x 256).
5. Impact Statement and Table
a. CY 2024 End-Stage Renal Disease Prospective Payment System
(1) Effects on ESRD Facilities
To understand the impact of the changes affecting Medicare payments
to different categories of ESRD facilities, it is necessary to compare
estimated payments in CY 2023 to estimated payments in CY 2024. To
estimate the impact among various types of ESRD facilities, it is
imperative that the estimates of Medicare payments in CY 2023 and CY
2024 contain similar inputs. Therefore, we simulated Medicare payments
only for those ESRD facilities for which we can calculate both current
Medicare payments and new Medicare payments.
For this final rule, we used CY 2022 data from the Medicare Part A
and Part B Common Working Files as of August 4, 2023, as a basis for
Medicare dialysis treatments and payments under the ESRD PPS. We
updated the 2022 claims to 2023 and 2024 using various updates. The
updates to the ESRD PPS base rate are described in section II.B.1.d of
this final rule. Table 24 shows the impact of the estimated CY 2024
ESRD PPS payments compared to estimated Medicare payments to ESRD
facilities in CY 2023.
BILLING CODE 4120-01-P
[[Page 76490]]
[GRAPHIC] [TIFF OMITTED] TR06NO23.041
[[Page 76491]]
[GRAPHIC] [TIFF OMITTED] TR06NO23.042
BILLING CODE 4120-01-C
Column A of the impact table indicates the number of ESRD
facilities for each impact category and column B indicates the number
of dialysis treatments (in millions). The overall effect of the final
changes to the outlier payment policy described in section II.B.1.c of
this final rule is shown in column C. For CY 2024, the impact on all
ESRD facilities because of the final changes to the outlier payment
policy would be an increase in estimated Medicare payments of less than
0.1 percent.
Column D shows the effect of the TPEAPA as described in section
II.B.1.g of this final rule. This adjustment will be implemented in a
budget neutral manner, so the total impact of this change would be 0.0
percent. However, there will be distributional impacts of this final
change, primarily a 25.3 percent increase to payments to Pediatric ESRD
facilities (with more than 50 percent of patients under age 18). This
policy change also corresponds to a 0.8 percent increase to hospital-
based ESRD facilities. Because the budget neutrality factor for this
policy is so small, the impact analysis found no significant decrease
to any ESRD facility as the total decrease in payments for ESRD
facilities that predominantly serve adults will still be less than 0.05
percent.
Column E shows the effect of year-over-year payment changes related
to the post-TDAPA add-on payment adjustment as described in section
II.B.1.i of this final rule and current TDAPA payments. The post-TDAPA
add-on payment adjustment will not be budget neutral; however, we
estimate the difference between total payments in CY 2023 during which
time payment is made using the TDAPA under the ESRD PPS and estimated
total payments in CY 2024 under the final post-TDAPA add-on payment
adjustment would be less than 0.1 percent. Therefore, the total impact
of this change as compared to current TDAPA payments is 0.0 percent.
Column F reflects the effect of the update to the ESRD PPS wage
index as described in section II.B.1.b of this final rule. This update
will be budget neutral, so the total impact of this policy change is
0.0 percent. However, there will be distributional impacts of this
change. The largest increase would be to mid-Atlantic ESRD facilities
that would receive 0.8 percent higher payments because of the final
updated ESRD PPS wage index. The largest decrease will be to ESRD
facilities with more than 20 percent and less than 50 percent pediatric
patients, who will receive 1.1 percent lower payments because of the
updated ESRD PPS wage index.
Column G reflects the overall impact, that is, the effects of the
final outlier
[[Page 76492]]
policy changes, the TPEAPA, the post-TDAPA payment adjustment, the
updated wage index, and the payment rate update as described in section
II.B.1.d of this final rule. The ESRD PPS payment rate update for CY
2024 is 2.1 percent, which reflects the ESRDB market basket percentage
increase for CY 2024 of 2.4 percent and the productivity adjustment of
0.3 percent. We expect that overall ESRD facilities will experience a
2.1 percent increase in estimated Medicare payments in CY 2024. The
categories of types of ESRD facilities in the impact table show impacts
ranging from a 1.4 percent increase to a 28.4 percent increase in their
CY 2024 estimated Medicare payments.
(2) Effects on Other Providers
Under the ESRD PPS, Medicare pays ESRD facilities a single bundled
payment for renal dialysis services, which may have been separately
paid to other providers (for example, laboratories, durable medical
equipment suppliers, and pharmacies) by Medicare prior to the
implementation of the ESRD PPS. Therefore, in CY 2024, we estimate that
the ESRD PPS will have zero impact on these other providers.
(3) Effects on the Medicare Program
We estimate that Medicare spending (total Medicare program
payments) for ESRD facilities in CY 2024 will be approximately $6.7
billion. This estimate considers a projected decrease in fee-for-
service Medicare ESRD beneficiary enrollment of 4.3 percent in CY 2024.
(4) Effects on Medicare Beneficiaries
Under the ESRD PPS, beneficiaries are responsible for paying 20
percent of the ESRD PPS payment amount. As a result of the projected
2.1 percent overall increase in the CY 2024 ESRD PPS payment amounts,
we estimate that there will be an increase in beneficiary coinsurance
payments of 2.1 percent in CY 2024, which translates to approximately
$40 million.
(5) Alternatives Considered
(i) Transitional Pediatric ESRD Add-On Payment Adjustment
As discussed in section II.B.1.g.(4) of this final rule, we
proposed and are finalizing to implement a transitional add-on payment
adjustment of 30 percent for Pediatric ESRD Patients, which we call the
TPEAPA. We also considered, but did not propose, an alternative payment
structure which would phase in the adjustment over 3 years starting at
10 percent for the first year and 20 percent for the second year.
(ii) Add-On Payment Adjustment for Certain Renal Dialysis Drugs and
Biological Products After the TDAPA Period Ends
As discussed in section II.B.1.i.(3) of this final rule, we
proposed and are finalizing an add-on payment adjustment for new renal
dialysis drugs and biological products in existing ESRD PPS functional
categories after the end of the TDAPA period. We also considered, but
did not propose, an alternative methodology for calculating this
payment adjustment which would incorporate a reconciliation of all the
formerly separately billable drugs against the calculated post-TDAPA
payment adjustment. Additionally, we considered but did not propose
alternative approaches to applying and calculating this add-on payment
adjustment for specific patient populations.
(iii) Reporting Time on Machine Data on ESRD PPS Claims for Renal
Dialysis Services
As discussed in section II.B.1.j.(3) of this final rule, we
proposed and are finalizing to require ESRD facilities to submit data
and information on ESRD PPS claims for renal dialysis services
regarding the number of minutes of hemodialysis treatment received by a
beneficiary in center in an ESRD facility. This patient-level reporting
on resource use would be used to apportion composite rate costs for use
in the case-mix adjustment. We also considered, but did not propose, to
use dialysis duration data from EQRS to apportion composite rate costs
for this purpose. We discuss why we did not propose this alternative in
further detail in section II.B.1.j.(3) of this final rule.
(iv) Allowing ESRD Facilities Impacted by a Disaster or Other Emergency
To Apply for an Exception From the Treatment Volume Threshold
Requirement for the LVPA
As discussed in section II.B.1.f.(3)(a)(ii), we are finalizing our
proposal to allow ESRD facilities to receive exceptions for some of the
requirements for the LVPA if they are impacted by a disaster or other
emergency. One of these exceptions is for ESRD facilities that exceed
the 4000-treatment volume threshold due to treating patients who were
displaced from an ESRD facility that closed or experienced an
operational disruption due to a disaster or other emergency. To receive
this exception, we proposed that the ESRD facility must submit a
request for the exception, in writing, to CMS by the annual attestation
deadline of November 1st. We are finalizing that the deadline for
requesting this exception be either the annual attestation deadline or
30 days after the end of the cost-reporting year for which the ESRD
facility is attesting, whichever is later. We also considered, but did
not finalize, having a deadline of December 31st for the attestation
for ESRD facilities impacted by a disaster or other emergency and,
therefore, a deadline of December 31st for requesting the exception. We
discuss why we are not finalizing this alternative in further detail in
section II.B.1.f.(3)(a)(ii) of this final rule.
b. Continuation of Approved Transitional Drug Add-On Payment
Adjustments (TDAPA) for New Renal Dialysis Drugs or Biological Products
for CY 2024
(1) Korsuva[supreg] (difelikefalin)
One renal dialysis drug for which the TDAPA was paid in CY 2022 and
CY 2023 will continue to be eligible for the TDAPA in CY 2024. CMS
Transmittal 11295,\346\ implemented the 2-year TDAPA period specified
in Sec. 413.234(c)(1) for Korsuva[supreg] (difelikefalin). The TDAPA
payment period began on April 1, 2022, and will continue through March
31, 2024. As set forth in Sec. 413.234(c), TDAPA payment is based on
100 percent of average sales price (ASP). If ASP is not available, then
the TDAPA is based on 100 percent of wholesale acquisition cost (WAC)
and, when WAC is not available, the payment is based on the drug
manufacturer's invoice.
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\346\ CMS Transmittal 11295 rescinded and replaced CMS
Transmittal 11278, dated February 24, 2022 and is available at:
https://www.cms.gov/files/document/r11295CP.pdf.
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We based the CY 2024 impacts on the most current 72x claims data;
from May 2022, when utilization first appeared on the claims, through
July 2023. During that timeframe, the average monthly TDAPA payment
amount for Korsuva[supreg] was $1,000,000. In applying that average to
the 3 remaining months of the TDAPA payment period in CY 2024, we
estimate $3,000,000 in spending ($1,000,000 * 3 = $3,000,000) of which,
approximately $600,000 ($3,000,000 * 0.20 = $600,000) would be
attributed to beneficiary coinsurance amounts.
(2) Jesduvroq (daprodustat)
On July 27, 2023, CMS Transmittal 12157 \347\ implemented the 2-
year TDAPA period specified in Sec. 413.234(c)(1) for Jesduvroq
(daprodustat). The TDAPA payment
[[Page 76493]]
period began on October 1, 2023, and will continue through September
30, 2025. As stated previously, TDAPA payment is based on 100 percent
of ASP. If ASP is not available, then the TDAPA is based on 100 percent
of WAC and, when WAC is not available, the payment is based on the drug
manufacturer's invoice.
---------------------------------------------------------------------------
\347\ CMS Transmittal 12157, dated July 27, 2023 is available
at: https://www.cms.gov/files/document/r12157cp.pdf.
---------------------------------------------------------------------------
We based our impact analysis on the most current pricing and
manufacturer provided volume estimates at the time of this final rule.
Estimates are based on the most current, reasonable assumptions but are
subject to change based on any changes to the product's label,
indication, recommended dosage, safety profile or changes to applicable
law, regulations and/or the standard of care.
Jesduvroq is currently priced at $3.91 per 1 milligram unit.\348\
Several factors effect dosing, as described in Jesduvroq's Prescribing
Information.\349\ However, total volume is estimated at 2,623,860 units
in CY 2024. Multiplying the 2,623,860 units by the current pricing of
$3.91 would result in approximately $10.3 million in CY 2024 spending
(2,623,860 * $3.91 = $10,259,293), of which, approximately $2.1 million
($10,259,293 * 0.20 = $2,051,859) would be attributed to beneficiary
coinsurance amounts.
---------------------------------------------------------------------------
\348\ CMS ESRD PPS Transitional Drug Add-on Payment Adjustment
web page. Payment Amounts for New Renal Dialysis Drugs and
Biological Products Currently Eligible for the TDAPA. Available at:
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Downloads/Drugs-and-Biologicals-Eligible-for-TDAPA.pdf.
Accessed on September 29, 2023.
\349\ Jesduvroq Prescribing Information Available at: https://gskpro.com/content/dam/global/hcpportal/en_US/Prescribing_Information/Jesduvroq/pdf/JESDUVROQ-PI-MG.PDF. Accessed
on September 29, 2023.
---------------------------------------------------------------------------
c. Payment for Renal Dialysis Services Furnished to Individuals With
AKI
(1) Effects on ESRD Facilities
To understand the impact of the changes affecting Medicare payments
to different categories of ESRD facilities for renal dialysis services
furnished to individuals with AKI, it is necessary to compare estimated
Medicare payments in CY 2023 to estimated Medicare payments in CY 2024.
To estimate the impact among various types of ESRD facilities for renal
dialysis services furnished to individuals with AKI, it is imperative
that the Medicare payment estimates in CY 2023 and CY 2024 contain
similar inputs. Therefore, we simulated Medicare payments only for
those ESRD facilities for which we can calculate both current Medicare
payments and new Medicare payments.
For this final rule, we used CY 2022 data from the Medicare Part A
and Part B Common Working Files as of August 4, 2023, as a basis for
Medicare for renal dialysis services furnished to individuals with AKI.
We updated the 2022 claims to 2023 and 2024 using various updates. The
updates to the AKI payment amount are described in section III.B of
this final rule. Table 25 shows the impact of the estimated CY 2024
Medicare payments for renal dialysis services furnished to individuals
with AKI compared to estimated Medicare payments for renal dialysis
services furnished to individuals with AKI in CY 2023.
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Column A of the impact table indicates the number of ESRD
facilities for each impact category, and column B indicates the number
of AKI dialysis treatments (in thousands). Column C shows the effect of
the CY 2024 wage indices.
Column D shows the overall impact, that is, the effects of the
combined wage index and TPEAPA budget-neutrality adjustment factor,
wage index updates, and the payment rate update of 2.1 percent, which
reflects the ESRDB market basket percentage increase for CY 2024 of 2.4
percent and the productivity adjustment of 0.3 percentage point. We
expect that overall ESRD facilities will experience a 2.0 percent
increase in estimated Medicare payments in CY 2024. The categories of
types of ESRD facilities in the impact table show impacts ranging from
an increase of 0.5 percent to 2.7 percent in their CY 2024 estimated
Medicare payments.
(2) Effects on Other Providers
Under section 1834(r) of the Act, as added by section 808(b) of
TPEA, we proposed to update the payment rate for renal dialysis
services furnished by ESRD facilities to beneficiaries with AKI. The
only two Medicare providers and suppliers authorized to provide these
outpatient renal dialysis services are hospital outpatient departments
and ESRD facilities. The patient and his or her physician make the
decision about where the renal dialysis services are furnished.
Therefore, this change would have zero impact on other Medicare
providers.
(3) Effects on the Medicare Program
We estimate approximately $70 million will be paid to ESRD
facilities in CY 2024 because of patients with AKI receiving renal
dialysis services in an ESRD facility at the lower ESRD PPS base rate
versus receiving those services only in the hospital outpatient setting
and paid under the outpatient prospective payment system, where
services were required to be administered prior to the TPEA.
(4) Effects on Medicare Beneficiaries
Currently, beneficiaries have a 20 percent coinsurance obligation
when they receive AKI dialysis in the hospital outpatient setting. When
these services are furnished in an ESRD facility, the patients will
continue to be responsible for a 20 percent coinsurance. Because the
AKI dialysis payment rate paid to ESRD facilities is lower than the
outpatient hospital PPS's payment amount, we expect beneficiaries to
pay less coinsurance when AKI dialysis is furnished by ESRD facilities.
(5) Alternatives Considered
As we discussed in the CY 2017 ESRD PPS proposed rule (81 FR
42870), we considered adjusting the AKI payment rate by including the
ESRD PPS case-mix adjustments, and other adjustments at section
1881(b)(14)(D) of the Act, as well as not paying separately for AKI
specific drugs and laboratory tests. We ultimately determined that
treatment for AKI is substantially different from treatment for ESRD,
and the case-mix adjustments applied to ESRD patients may not be
applicable to AKI patients, and as such, including those policies and
adjustments is inappropriate. We continue to monitor utilization and
trends of items and services furnished to individuals with AKI for
purposes of refining the payment rate in the future. This monitoring
will assist us in developing knowledgeable, data-driven proposals.
d. ESRD QIP
(1) Effects of the PY 2026 ESRD QIP on ESRD Facilities
The ESRD QIP is intended to prevent reductions in the quality of
ESRD dialysis facility services provided to beneficiaries. The general
methodology that we use to calculate a facility's TPS is described in
our regulations at Sec. 413.178(e).
Any reductions in the ESRD PPS payments as a result of a facility's
performance under the PY 2026 ESRD QIP will apply to the ESRD PPS
payments made to the facility for services furnished in CY 2026, as
codified in our regulations at Sec. 413.177.
For the PY 2026 ESRD QIP, we estimate that, of the 7,833 facilities
(including those not receiving a TPS) enrolled in Medicare,
approximately 30.56 percent or 2,394 of the facilities that have
sufficient data to calculate a TPS would receive a payment reduction
for PY 2026. Among an estimated 2,394 facilities that would receive a
payment reduction, approximately 64 percent or 1,544 facilities would
receive the smallest payment reduction of 0.5 percent. We are updating
the estimated impact of the PY 2026 ESRD QIP that we provided in the CY
2023 ESRD PPS final rule (87 FR 67293 through 67296). Based on our
final policies, the updated total estimated payment reductions for all
the 2,394 facilities expected to
[[Page 76496]]
receive a payment reduction in PY 2026 would be approximately
$15,990,524. Facilities that do not receive a TPS do not receive a
payment reduction.
Table 26 shows the updated overall estimated distribution of
payment reductions resulting from the PY 2026 ESRD QIP.
[GRAPHIC] [TIFF OMITTED] TR06NO23.045
To estimate whether a facility would receive a payment reduction
for PY 2026, we scored each facility on achievement and improvement on
several clinical measures we have previously finalized and for which
there were available data from EQRS and Medicare claims. Payment
reduction estimates were calculated using the most recent data
available (specified in Table 27) in accordance with the policies
finalized in this final rule. Measures used for the simulation are
shown in Table 27.
[GRAPHIC] [TIFF OMITTED] TR06NO23.046
For all measures except the SHR clinical measure, the SRR clinical
measure, and the STrR measure, measures with less than 11 patients for
a facility were not included in that facility's TPS. For the SHR
clinical measure and the SRR clinical measure, facilities were required
to have at least 5 patient-years at risk and 11 index discharges,
respectively, to be included in the facility's TPS. For the STrR
clinical measure, facilities were required to have at least 10 patient-
years at risk to be included in the facility's TPS. Each facility's TPS
was compared to an estimated mTPS and an estimated payment reduction
table consistent with the final policies outlined in section IV.C of
this final rule. Facility reporting measure scores were estimated using
available data from CY 2022. Facilities were required to have at least
one measure in at least two domains to receive a TPS.
To estimate the total payment reductions in PY 2026 for each
facility resulting from this final rule, we multiplied the total
Medicare payments to the facility during the 1-year period between
January 2022 and December 2022 by the facility's estimated payment
reduction percentage expected under the ESRD QIP, yielding a total
payment reduction amount for each facility.
Table 28 shows the estimated impact of the finalized ESRD QIP
payment reductions to all ESRD facilities for PY 2026. The table also
details the distribution of ESRD facilities by size (both among
facilities considered to be small entities and by number of treatments
per facility), geography (both rural and urban and by region), and
facility type (hospital based and freestanding facilities). Given that
the
[[Page 76497]]
performance period used for these calculations differs from the
performance period we are using for the PY 2026 ESRD QIP, the actual
impact of the PY 2026 ESRD QIP may vary significantly from the values
provided here.
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(3) Effects of the PY 2027 ESRD QIP on ESRD Facilities
For the PY 2027 ESRD QIP, we are updating the estimated effect that
we presented in the CY 2024 ESRD PPS proposed rule (88 FR 42534 through
42536). In this final rule, we estimate that, of the 7,833 facilities
(including those not receiving a TPS) enrolled in Medicare,
approximately 28.88 percent or 2,262 of the facilities that have
sufficient data to calculate a TPS would receive a payment reduction
for PY 2027. Among an estimated 2,262 facilities that would receive a
payment reduction, approximately 70 percent or 1,584 facilities would
receive the smallest payment reduction of 0.5 percent. The total
payment reductions for all the 2,262 facilities expected to receive a
payment reduction is approximately $13,847,479. Facilities that do not
receive a TPS do not receive a payment reduction.
Table 29 shows the overall estimated distribution of payment
reductions resulting from the PY 2027 ESRD QIP.
[[Page 76498]]
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To estimate whether a facility would receive a payment reduction in
PY 2027, we scored each facility on achievement and improvement on
several clinical measures we have previously finalized and for which
there were available data from EQRS and Medicare claims. Payment
reduction estimates were calculated using the most recent data
available (specified in Table 30) in accordance with the policies
finalized in this final rule. Measures used for the simulation are
shown in Table 30.
[GRAPHIC] [TIFF OMITTED] TR06NO23.049
For all measures except the SHR clinical measure, the SRR clinical
measure, and the STrR measure, measures with less than 11 patients for
a facility were not included in that facility's TPS. For the SHR and
SRR measures, facilities were required to have at least 5 patient-years
at risk and 11 index discharges, respectively, to be included in the
facility's TPS. For the STrR clinical measure, facilities were required
to have at least 10 patient-years at risk to be included in the
facility's TPS. Each facility's TPS was compared to an estimated mTPS
and an estimated payment reduction table that incorporates the
previously finalized policies and the policies we have finalized in
this final rule outlined in section IV.D of this final rule. Facility
reporting measure scores were estimated using available data from CY
2022. Facilities were required to have at least one measure in at least
two domains to receive a TPS.
To estimate the total payment reductions in PY 2027 for each
facility resulting from this final rule, we multiplied the total
Medicare payments to the facility during the 1-year period between
January 2022 and December 2022 by the facility's estimated payment
reduction percentage expected under the ESRD QIP, yielding a total
payment reduction amount for each facility.
Table 31 shows the estimated impact of the finalized ESRD QIP
payment reductions to all ESRD facilities for PY 2027. The table
details the distribution of ESRD facilities by size (both among
facilities considered to be small entities and by number of treatments
per facility), geography (both rural and urban and by region), and
facility type (hospital based and freestanding facilities). Given that
the performance period used for these calculations differs from the
performance period we are using for the PY 2027 ESRD QIP, the actual
impact of the PY 2027 ESRD QIP may vary significantly from the values
provided here.
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[[Page 76499]]
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(4) Effects on Other Providers
The ESRD QIP is applicable to ESRD facilities. We are aware that
several of our measures impact other providers. For example, with the
introduction of the SRR clinical measure in PY 2017 and the SHR
clinical measure in PY 2020, we anticipate that hospitals may
experience financial savings as facilities work to reduce the number of
unplanned readmissions and hospitalizations. We are exploring various
methods to assess the impact these measures have on hospitals and other
facilities, such as through the impacts of the Hospital Readmissions
Reduction Program and the Hospital-Acquired Condition Reduction
Program, and we intend to continue examining the interactions between
our quality programs to the greatest extent feasible.
(5) Effects on the Medicare Program
For PY 2027, we estimate that the ESRD QIP would contribute
approximately $13,847,478.73 in Medicare savings. For comparison, Table
32 shows the payment reductions that we estimate will be applied by the
ESRD QIP from PY 2018 through PY 2027.
[[Page 76500]]
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(6) Effects on Medicare Beneficiaries
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\350\ In the CY 2022 ESRD PPS final rule, we adopted a special
scoring methodology and payment policy for PY 2022 due to
significant impacts related to the COVID-19 public health emergency
(86 FR 61918 through 61919). Under this policy, we did not apply any
payment reductions to ESRD facilities for PY 2022.
---------------------------------------------------------------------------
The ESRD QIP is applicable to ESRD facilities. Since the Program's
inception, there is evidence of improved performance on ESRD QIP
measures. As we stated in the CY 2018 ESRD PPS final rule, one
objective measure we can examine to demonstrate the improved quality of
care over time is the improvement of performance standards (82 FR
50795). As the ESRD QIP has refined its measure set and as facilities
have gained experience with the measures included in the Program,
performance standards have generally continued to rise. We view this as
evidence that facility performance (and therefore the quality of care
provided to Medicare beneficiaries) is objectively improving. We are in
the process of monitoring and evaluating trends in the quality and cost
of care for patients under the ESRD QIP, incorporating both existing
measures and new measures as they are implemented in the Program. We
will provide additional information about the impact of the ESRD QIP on
beneficiaries as we learn more. However, in future years we are
interested in examining these impacts through the analysis of available
data from our existing measures.
(7) Alternatives Considered
In section IV.C.5 of this final rule, we are finalizing the
removals of the Ultrafiltration Rate reporting measure and the
Standardized Fistula Rate clinical measure, beginning with PY 2026. We
considered not removing these measures. However, we concluded that
removing these two measures was appropriate under our previously
finalized measure removal factors. This approach will help to ensure
that a facility's performance is assessed based on measures that
continue to be meaningful parts of the ESRD QIP measure set.
e. ETC Model
(1) Overview
The ETC Model is a mandatory payment model designed to test payment
adjustments to certain dialysis and dialysis-related payments, as
discussed in the Specialty Care Models final rule (85 FR 61114), the CY
2022 ESRD PPS final rule (86 FR 61874), and the CY 2023 ESRD PPS final
rule (87 FR 67136) for ESRD facilities and for Managing Clinicians for
claims with dates of service from January 1, 2021, to June 30, 2027.
The requirements for the ETC Model are set forth in 42 CFR part 512,
subpart C. We proposed to revise our regulations at Sec. 512.390 to
acknowledge the ability of the CMS Administrator to review the results
of ETC Participants' targeted review requests. For the results of the
detailed economic analysis of the ETC Model and a description of the
methodology used to perform the analysis, see the Specialty Care Models
final rule (85 FR 61114).
(2) Data and Methods
A stochastic simulation was created to estimate the financial
impacts of the ETC Model relative to baseline expenditures, where
baseline expenditures were defined as data from CYs 2018 and 2019
without the changes applied. The simulation relied upon statistical
assumptions derived from retrospectively constructed ESRD facilities'
and Managing Clinicians' Medicare dialysis claims, transplant claims,
and transplant waitlist data reported during 2018 and 2019, the most
recent years of complete data available before the start of the ETC
Model. Both datasets and the risk-adjustment methodologies for the ETC
Model were developed by the CMS Office of the Actuary (OACT).
Table 33 summarizes the estimated impact of the ETC Model when the
achievement benchmarks for each year are set using the average of the
home dialysis rates for year t-1 and year t-2 for the HRRs randomly
selected for participation in the ETC Model. We estimate that the
Medicare program would save a net total of $43 million from the PPA and
HDPA between January 1, 2021, and June 30, 2027 less $15 million in
increased training and education expenditures. Therefore, the net
impact to Medicare spending is estimated to be $28 million in savings.
This is consistent with the net impact to Medicare spending estimated
for the CY 2022 ESRD PPS final rule, in which the net impact to
Medicare spending was also estimated to be $28 million in savings (86
FR 62014 through 62016). Making administrative review available to ETC
Participants who wish to seek additional review of a targeted review
determination is not expected to change this estimate.
(3) Medicare Estimate--Primary Specification, Assume Rolling Benchmark
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[[Page 76501]]
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In Table 33, negative spending reflects a reduction in Medicare
spending, while positive spending reflects an increase. The results for
this table were generated from an average of 400 simulations under the
assumption that benchmarks are rolled forward with a 1.5-year lag. For
a detailed description of the key assumptions underlying the impact
estimate, see the Specialty Care Models final rule (85 FR 61353) and
the CY 2022 ESRD PPS final rule (86 FR 60214 through 60216).
(4) Effects on the Home Dialysis Rate, the Transplant Rate, and Kidney
Transplantation
The changes in this final rule will not impact the findings
reported for the effects of the ETC Model on the home dialysis rate or
the transplant rate described in the Specialty Care Models final rule
(85 FR 61355) and the CY 2022 ESRD PPS final rule (86 FR 62017).
(5) Effects on Kidney Disease Patient Education Services and HD
Training Add-Ons
The changes in this final rule will not impact the findings
reported for the effects of the ETC Model on kidney disease patient
education services and HD training add-ons described in the Specialty
Care Models final rule (85 FR 61355) and the CY 2023 ESRD PPS final
rule (87 FR 67136).
(6) Effects on Medicare Beneficiaries
Providing the option for ETC Participants to seek administrative
review of targeted review determinations will not impact the findings
reported for the effects of ETC Model on Medicare beneficiaries in lieu
of the ETC Model's likelihood of incentivizing ESRD facilities and
Managing Clinicians to improve access to home dialysis and
transplantation for Medicare beneficiaries. Further details on the
impact of the ETC Model on ESRD Beneficiaries may be found in the
Specialty Care Models final rule (85 FR 61357), the CY 2022 ESRD PPS
final rule (86 FR 61874), or the CY 2023 ESRD PPS final rule (87 FR
67136).
(7) Alternatives Considered
In this final rule, we are finalizing the proposal to revise our
regulations at Sec. 512.390 to acknowledge the availability of
administrative review of targeted review requests. We considered
retaining our current process, in which targeted review determinations
are final with no further review or appeal; however, we believe that
providing for administrative review of targeted review determinations
is important to provide ETC Participants with transparency regarding
the avenue that is available should they wish to seek review of their
targeted review determination, to vest accountability for the decisions
of CMS in a principal officer, and to bring the
[[Page 76502]]
ETC Model into alignment with other CMS programs.
E. Accounting Statement
As required by OMB Circular A-4 (available at Https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/circulars/A4/a-4.pdf), we have prepared an accounting statement in
Table 34 showing the classification of the impact associated with the
provisions of this final rule.
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F. Regulatory Flexibility Act Analysis (RFA)
The Regulatory Flexibility Act (RFA) requires agencies to analyze
options for regulatory relief of small entities if a rule has a
significant impact on a substantial number of small entities. For
purposes of the RFA, small entities include small businesses, nonprofit
organizations, and small governmental jurisdictions. We do not believe
ESRD facilities are operated by small government entities such as
counties or towns with populations of 50,000 or less, and therefore,
they are not enumerated or included in this estimated RFA analysis.
Individuals and states are not included in the definition of a small
entity. Therefore, the number of small entities estimated in this RFA
analysis includes the number of ESRD facilities that are either
considered small businesses or nonprofit organizations.
According to the Small Business Administration's (SBA) size
standards, an ESRD facility is classified as a small business if it has
total revenues of less than $41.5 million in any 1 year. For the
purposes of this analysis, we exclude the ESRD facilities that are
owned and operated by LDOs and regional chains, which would have total
revenues of more than $8.1 billion in any year when the total revenues
for all locations are combined for each business (LDO or regional
chain), and are not, therefore, considered small businesses. Because we
lack data on individual ESRD facilities' receipts, we cannot determine
the number of small proprietary ESRD facilities or the proportion of
ESRD facilities' revenue derived from Medicare payments. Therefore, we
assume that all ESRD facilities that are not owned by LDOs or regional
chains are considered small businesses. Accordingly, we consider the
462 facilities that are independent and 357 facilities that are
hospital-based, as shown in the ownership category in Table 24, to be
small businesses. These facilities represent approximately 10 percent
of all ESRD facilities in our data set.
Additionally, we identified in our analytic file that there are 796
facilities that are considered nonprofit organizations, which is
approximately 10 percent of all ESRD facilities in our data set. In
total, accounting for the 370 nonprofit ESRD facilities that are also
considered small businesses, there are 1,245 ESRD facilities that are
either small businesses or nonprofit organizations, which is
approximately 16 percent of all ESRD facilities in our data set.
For the ESRD PPS updates in this final rule, a hospital-based ESRD
facility (as defined by type of ownership, not by type of ESRD
facility) is estimated to receive a 3.4 percent increase in Medicare
payments for CY 2024. An
[[Page 76503]]
independent facility (as defined by ownership type) is likewise
estimated to receive a 2.7 percent increase in Medicare payments for CY
2024. As shown in Table 24, we estimate that the overall revenue impact
of this final rule on all ESRD facilities is a positive increase to
Medicare payments by approximately 2.1 percent.
For AKI dialysis, we are unable to estimate whether patients will
go to ESRD facilities, however, we have estimated there is a potential
for $70 million in payment for AKI dialysis treatments that could
potentially be furnished in ESRD facilities.
For the ESRD QIP, we estimate that of the 2,394 ESRD facilities
expected to receive a payment reduction as a result of their
performance on the PY 2026 ESRD QIP, 406 are ESRD small entity
facilities. We present these findings in Table 25 (``Estimated
Distribution of PY 2026 ESRD QIP Payment Reductions'') and Table 27
(``Estimated Impact of ESRD QIP Payment Reductions to ESRD Facilities
for PY 2026'').
Regarding the ETC Model, in the Specialty Care Models final rule,
we described our assumption, for the purposes of the regulatory impact
analysis, that the great majority of Managing Clinicians are small
entities by nature of meeting the SBA definition of a small business,
but that the greater majority of ESRD facilities are not, as they are
owned, either partially or entirely, by organizations that do not meet
the SBA definition of a small entity. We described the low volume
threshold exclusions and aggregation policies used in the ETC Model and
our assessment that, in conjunction with the fact that the ETC Model
affects Medicare payment only for select services furnished to Medicare
FFS beneficiaries; the ETC Model will not have a significant impact on
spending for a substantial number of small entities. For the purposes
of this final rule, we have determined that the policy to clarify the
ability of the CMS Administrator to review targeted review
determinations will not change the assessment that the ETC Model will
not have a significant impact on spending for a substantial number of
small entities.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 604 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a metropolitan
statistical area and has fewer than 100 beds. We do not believe this
final rule would have a significant impact on operations of a
substantial number of small rural hospitals because most dialysis
facilities are freestanding. While there are 121 rural hospital-based
ESRD facilities, we do not know how many of them are based at hospitals
with fewer than 100 beds. However, overall, the 121 rural hospital-
based ESRD facilities will experience an estimated 2.2 percent increase
in payments. Therefore, the Secretary has certified that this final
rule would not have a significant impact on the operations of a
substantial number of small rural hospitals. Clarifying the ability of
the CMS Administrator to review ETC Model targeted review
determinations is not expected to change the Secretary's assessment.
G. Unfunded Mandates Reform Act Analysis (UMRA)
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any 1 year of $100
million in 1995 dollars, updated annually for inflation. In 2023, that
threshold is approximately $177 million. This final rule will not
impose a mandate that will result in the expenditure by State, local,
and Tribal governments, in the aggregate, or by the private sector, of
more than $177 million in any 1 year. Moreover, HHS interprets UMRA as
applying only to unfunded mandates. We do not interpret Medicare
payment rules as being unfunded mandates but simply as conditions for
the receipt of payments from the Federal Government for providing
services that meet Federal standards. This interpretation applies
whether the facilities or providers are private, State, local, or
Tribal.
H. Federalism
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a proposed rule (and subsequent
final rule) that imposes substantial direct requirement costs on State
and local governments, preempts State law, or otherwise has federalism
implications. We have reviewed this final rule under the threshold
criteria of Executive Order 13132, Federalism, and have determined that
it will not have substantial direct effects on the rights, roles, and
responsibilities of State, local, or Tribal governments.
I. Congressional Review Act
This final regulation is subject to the Congressional Review Act
provisions of the Small Business Regulatory Enforcement Fairness Act of
1996 (5 U.S.C. 801 et seq.) and has been transmitted to the Congress
and the Comptroller General for review.
VIII. Files Available to the Public
The Addenda for the annual ESRD PPS proposed and final rule will no
longer appear in the Federal Register. Instead, the Addenda will be
available only through the internet and will be posted on CMS's website
under the regulation number, CMS-1782-F, at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/End-Stage-Renal-Disease-ESRD-Payment-Regulations-and-Notices. In addition to the
Addenda, limited data set files (LDS) are available for purchase at
https://www.cms.gov/Research-Statistics-Data-and-Systems/Files-for-Order/LimitedDataSets/EndStageRenalDiseaseSystemFile. Readers who
experience any problems accessing the Addenda or LDS files, should
contact CMS by sending an email to CMS at the following mailbox:
[email protected]. Chiquita Brooks-LaSure, Administrator of the
Centers for Medicare & Medicaid Services, approved this document on
October 24, 2023.
List of Subjects
42 CFR Part 413
Diseases, Health facilities, Medicare, Puerto Rico, Reporting and
recordkeeping requirements.
42 CFR Part 512
Administrative practice and procedure, Health care, Health
facilities, Health insurance, Medicare, Penalties, Reporting and
recordkeeping requirements.
For the reasons set forth in the preamble, the Centers for Medicare
& Medicaid Services amends 42 CFR chapter IV as set forth below:
PART 413--PRINCIPLES OF REASONABLE COST REIMBURSEMENT; PAYMENT FOR
END-STAGE RENAL DISEASE SERVICES; PROSPECTIVELY DETERMINED PAYMENT
RATES FOR SKILLED NURSING FACILITIES; PAYMENT FOR ACUTE KIDNEY
INJURY DIALYSIS
0
1. The authority citation for part 413 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395d(d), 1395f(b), 1395g, 1395l(a),
(i), and (n), 1395m, 1395x(v), 1395x(kkk), 1395hh, 1395rr, 1395tt,
and 1395ww.
[[Page 76504]]
0
2. Section 413.178 is amended by revising paragraphs (a)(8) and (c) to
read as follows:
Sec. 413.178 ESRD quality incentive program.
(a) * * *
(8) Minimum total performance score (mTPS) means, with respect to a
payment year except payment year 2023, the total performance score that
an ESRD facility would receive if it performed at the 50th percentile
of national ESRD facility performance on all clinical measures during
the baseline period, and it performed at the median of national ESRD
facility performance on all reporting measures using data from the most
recently available year before the performance period.
* * * * *
(c) ESRD QIP measure selection, retention, and removal--(1) ESRD
QIP measure selection. CMS specifies measures for the ESRD QIP for a
payment year and groups the measures into domains. The measures for a
payment year include:
(i) Measures on anemia management that reflect the labeling
approved by the Food and Drug Administration for such management;
(ii) Measures on dialysis adequacy;
(iii) To the extent feasible, a measure (or measures) of patient
satisfaction;
(iv) To the extent feasible, measures on iron management, bone
mineral metabolism, and vascular access (including for maximizing the
placement of arterial venous fistula);
(v) Beginning with the 2016 payment year, measures specific to the
conditions treated with oral-only drugs and that are, to the extent
feasible, outcomes-based; and
(vi) Other measures that CMS specifies.
(2) Use of endorsed measures--(i) General rule. Measures specified
by CMS under paragraph (c)(1) of this section will be endorsed by the
entity with a contract under section 1890(a) of the Social Security
Act, unless the exception in paragraph (c)(2)(ii) of this section
applies.
(ii) Exception. CMS may specify a measure under paragraph (c)(1) of
this section that does not meet the requirement in paragraph (c)(2)(i)
of this section if:
(A) CMS has determined that a specified area or medical topic is
appropriate for inclusion in the ESRD QIP;
(B) CMS has not identified a feasible and practical measure with
respect to that specified area or medical topic that has been endorsed
by the entity with a contract under section 1890(a) of the Social
Security Act; and
(C) CMS has given due consideration to measures that have been
endorsed or adopted by a consensus organization.
(3) Updating of measure specifications. CMS uses rulemaking to make
substantive updates to the specifications of measures used in the ESRD
QIP. CMS announces technical measure specification updates through the
QualityNet website (https://qualitynet.cms.gov) and listserv
announcements.
(4) Measure retention. All measures specified for the ESRD QIP
measure set remain in the measure set unless CMS, through rulemaking,
removes or replaces them.
(5) Measure removal factors--(i) General rule. CMS may remove or
replace a measure based on one or more of the following factors:
(A) Factor 1. Measure performance among the majority of ESRD
facilities is so high and unvarying that meaningful distinctions in
improvements or performance can no longer be made.
(B) Factor 2. Performance or improvement on a measure does not
result in better or the intended patient outcomes.
(C) Factor 3. A measure no longer aligns with current clinical
guidelines or practice.
(D) Factor 4. A more broadly applicable (across settings,
populations, or conditions) measure for the topic or a measure that is
more proximal in time to desired patient outcomes for the particular
topic becomes available.
(E) Factor 5. A measure that is more strongly associated with
desired patient outcomes for the particular topic becomes available.
(F) Factor 6. Collection or public reporting of a measure leads to
negative or unintended consequences.
(G) Factor 7. It is not feasible to implement the measure
specifications.
(H) Factor 8. The costs associated with a measure outweigh the
benefit of its continued use in the program.
(ii) Exception. CMS may retain a measure that meets one or more of
the measure removal factors described in paragraph (c)(5)(i) of this
section for reasons including, but not limited to, that the measure
addresses a gap in quality that is so significant that removing the
measure would lower the quality of care furnished by facilities, or
that the measure is statutorily required.
(iii) Patient safety exception. Upon a determination by CMS that
the continued requirement for facilities to submit data on a measure
raises specific patient safety concerns, CMS may elect to immediately
remove the measure from the ESRD QIP measure set. CMS will, upon
removal of the measure--
(A) Provide notice to facilities and the public at the time CMS
removes the measure, along with a statement of the specific patient
safety concerns that would be raised if facilities continued to submit
data on the measure; and
(B) Provide notice of the removal in the Federal Register.
* * * * *
0
3. Section 413.198 is amended by revising paragraphs (a) and
(b)(3)(iii) and adding paragraphs (b)(5) and (6) to read as follows:
Sec. 413.198 Recordkeeping and cost reporting requirements for
outpatient maintenance dialysis.
(a) Purpose and scope. This section implements sections
1881(b)(2)(B)(i) and 1881(b)(14) of the Act by specifying recordkeeping
and cost reporting requirements for ESRD facilities under part 494 of
this chapter. The records and reports will enable CMS to determine the
costs incurred in furnishing outpatient maintenance dialysis as defined
in Sec. 413.170(a).
* * * * *
(b) * * *
(3) * * *
(iii) Flow from the provision of luxury items or services (items or
services substantially in excess of or more expensive than those
generally considered necessary for the provision of needed health
services); or
* * * * *
(5) Each ESRD facility must submit data and information of the
types and in the formats established by CMS for the purpose of
estimating patient-level and facility-level variation in resource use
involved in furnishing renal dialysis services. Beginning January 1,
2025, the data and information must include, but is not limited to the
following:
(i) Information reported on ESRD prospective payment system (PPS)
claims for renal dialysis services regarding the number of minutes
between the start and end of hemodialysis treatment, without accounting
for any interruptions, received by a beneficiary in center in an ESRD
facility;
(ii) Information reported on ESRD PPS claims about the total number
of billing units (or the expected number of billing units, for renal
dialysis drugs and biological products provided to beneficiaries for
use while receiving home dialysis services as defined in Sec. 413.217
of this chapter or oral forms of renal dialysis drugs and biological
products), of any discarded amount of a renal dialysis drug or
biological product from a single-dose container or single-use package
that is paid for under the
[[Page 76505]]
ESRD PPS, using the JW modifier (or any successor modifier that
includes the same data); and
(iii) Information reported on ESRD PPS claims about any renal
dialysis drug or biological product from a single-dose container or
single-use package that is paid for under the ESRD PPS for which there
is no discarded amount (or no discarded amount expected, for renal
dialysis drugs and biological products provided to beneficiaries for
use while receiving home dialysis services as defined in Sec. 413.217
of this chapter or oral forms of renal dialysis drugs and biological
products), using the JZ modifier (or any successor modifier that
includes the same data).
(6) Beginning January 1, 2025, each ESRD facility must document in
the beneficiary's medical record any discarded amounts of a renal
dialysis drug or biological product from a single-dose container or
single-use package that is paid for under the ESRD PPS.
0
4. Section 413.230 is amended by revising paragraphs (d) and (e) and
adding paragraph (f) to read as follows:
Sec. 413.230 Determining the per treatment payment amount.
* * * * *
(d) Any transitional drug add-on payment adjustment under Sec.
413.234(c);
(e) Any transitional add-on payment adjustment for new and
innovative equipment and supplies under Sec. 413.236(d); and
(f) Any add-on payment adjustment for new renal dialysis drugs or
biological products in existing ESRD PPS functional categories after
the payment period for the transitional drug add-on payment adjustment
has ended, as described in Sec. 413.234(c)(3) and (g).
0
5. Section 413.232 is amended by revising paragraphs (b)(1) and (2) and
(g) introductory text and adding paragraphs (g)(5) and (6) to read as
follows:
Sec. 413.232 Low-volume adjustment.
* * * * *
(b) * * *
(1) Furnished less than 4,000 treatments in each of the 3 cost
reporting years (based on as-filed or final settled 12-consecutive
month cost reports, whichever is most recent, except as specified in
paragraphs (g)(4) and (5) of this section) preceding the payment year;
and
(2) Has not opened, closed, or received a new provider number due
to a change in ownership (except where the change in ownership results
in a change in facility type) in the 3 cost reporting years (based on
as-filed or final settled 12-consecutive month cost reports, whichever
is most recent) preceding the payment year, except as specified in
paragraph (g)(6) of this section.
* * * * *
(g) To receive the low-volume adjustment, an ESRD facility must
include in its attestation provided pursuant to paragraph (e) of this
section a statement that the ESRD facility meets the definition of a
low-volume facility in paragraph (b) of this section. To determine
eligibility for the low-volume adjustment, the MAC on behalf of CMS
relies upon as filed or final settled 12-consecutive month cost
reports, except as specified in paragraphs (g)(4) and (5) of this
section, for the 3 cost reporting years preceding the payment year to
verify the number of treatments, except that:
* * * * *
(5) For payment year 2024 and subsequent payment years, an ESRD
facility may attest in the attestation specified in paragraph (e) of
this section that it would have met the requirements of paragraph
(b)(1) of this section, except that for one or more of the most recent
3 cost reporting years the facility furnished 4,000 or more treatments
because of temporary patient-shifting as a result of the closure or
operational disruption of another ESRD facility due to a disaster or
other emergency. For the purposes of the exception in this paragraph
(g)(5), temporary patient-shifting is defined as providing renal
dialysis services to one or more displaced patient(s) at any time
through the end of the CY following the 12-month period beginning when
an ESRD facility first begins providing renal dialysis services to one
or more displaced patients. For any facility that so attests--
(i) The facility must also attest that it furnished treatments
equal to or in excess of 4,000 in the cost reporting year due to
temporary patient-shifting as a result of the closure or operational
disruption of an ESRD facility resulting from a disaster or other
emergency;
(ii) The facility must request an exception under this paragraph
(g)(5) from CMS, in the form and manner specified by CMS, no later than
the attestation deadline specified in paragraph (e) of this section or
30 days after the end of the cost reporting year, whichever is later,
for each cost reporting year that the facility furnishes treatments
equal to or in excess of 4,000 due to temporary patient-shifting as a
result of the closure or operational disruption of an ESRD facility
resulting from a disaster or other emergency;
(iii) Within 30 days of CMS's receipt of the facility's request,
CMS will review the request and either approve the request based on a
determination that the ESRD facility furnished treatments equal to or
in excess of 4,000 in the cost reporting year due to temporary patient-
shifting as a result of the closure or operational disruption of an
ESRD facility resulting from a disaster or other emergency, or deny the
request, and will notify the facility and the MAC of its decision;
(iv) If CMS approves the request, the ESRD facility is paid the
low-volume adjustment on claims for Medicare beneficiaries, on the
basis of the exception in this paragraph (g)(5), during the payment
year in which the temporary patient-shifting occurred, so long as all
other requirements for the low-volume adjustment are met. For any
future payment year, the ESRD facility would not be prevented from
receiving the low-volume adjustment if the ESRD facility meets or
exceeds the 4,000 treatment threshold in a cost reporting year due to
temporary patient-shifting as a result of the disaster or other
emergency that resulted in another ESRD facility's closure or
operational disruption, so long as all other requirements for the low-
volume adjustment are met; and
(v) The facility must maintain documentation of the number of
displaced patients treated and information about the ESRD facility or
facilities that closed or experienced operational disruptions due to a
disaster or other emergency and previously treated those patients, and
must provide such supporting documentation to CMS and the MAC upon
request.
(6) In the case of an ESRD facility that closes due to a disaster
or other emergency and later reopens, the ESRD facility may attest in
the attestation specified in paragraph (e) of this section that CMS has
granted an exception to the requirements specified in paragraph (b)(2)
of this section because it closed due to a disaster or other emergency.
For any facility that so attests--
(i) The ESRD facility would need to request such an exception from
CMS, in the form and manner specified by CMS, within 60 days of the
facility's closure, and the ESRD facility must inform the MAC of this
request in writing;
(ii) With 30 days of CMS's receipt of the facility's request, CMS
will review the request and either approve the request based on a
determination that the ESRD facility closed due to a disaster or other
emergency, or deny the request, and will inform both the facility and
the MAC of its decision; and
(iii) If CMS approves the request, the exception under this
paragraph (g)(6) will be applicable for a period
[[Page 76506]]
consisting of the remainder of the cost reporting year (based on as-
filed or final settled 12-consecutive month cost reports, whichever is
most recent, except as specified in paragraph (g)(4) of this section)
in which the closure occurred and the following full 2 cost reporting
years. After this period the ESRD facility would follow the general
attestation process for the low-volume adjustment specified in
paragraph (e) of this section and this paragraph (g).
(iv) The ESRD facility that attests under this paragraph (g)(6) to
have closed due to a disaster or other emergency would need to notify
CMS and the MAC, in the form and manner specified by CMS, within 30
days reopening and providing renal dialysis services. Within 30 days of
CMS's receipt of the facility's notification, CMS will confirm receipt
to the facility and the MAC of the facility's notification and the ESRD
facility will be able to receive the low-volume adjustment as of the
date of reopening, so long as all other requirements for the low-volume
adjustment are met.
(v) The ESRD facility must maintain documentation regarding its
closure, and must provide such supporting documentation to CMS and/or
the MAC upon request.
* * * * *
0
6. Section 413.234 is amended by:
0
a. Adding paragraph (b)(1)(iii);
0
b. Revising paragraph (c)(1)(i); and
0
c. Adding paragraphs (c)(1)(ii), (c)(3), and (g).
The additions and revision read as follows:
Sec. 413.234 Drug designation process.
* * * * *
(b) * * *
(1) * * *
(iii) The new renal dialysis drug or biological product is paid for
using the add-on payment adjustment described in paragraphs (c)(3) and
(g) of this section, referred to as the post- transitional drug add-on
payment adjustment (TDAPA) add-on payment adjustment.
* * * * *
(c) * * *
(1) * * *
(i) Following payment of the transitional drug add-on payment
adjustment, the new renal dialysis drug or biological product is paid
the post-TDAPA add-on payment adjustment as set forth in paragraphs
(c)(3) and (g) of this section.
(ii) Following payment of the transitional drug add-on payment
adjustment the ESRD PPS base rate will not be modified.
* * * * *
(3) For any new renal dialysis drug or biological product that is
eligible for payment using the transitional drug add-on payment
adjustment described in paragraphs (b)(1)(iii) and (c)(1) of this
section, CMS applies a post-TDAPA add-on payment adjustment to all ESRD
PPS claims that is calculated using the methodology set forth in
paragraph (g) of this section. CMS will apply the post-TDAPA add-on
payment adjustment beginning 8 calendar quarters after the first
calendar quarter in which the transitional drug add-on payment
adjustment is paid for the applicable product, and ending 12 calendar
quarters after the end of the last calendar quarter in which the
transitional drug add-on payment adjustment is paid for the applicable
product. If CMS stops receiving the latest full calendar quarter of ASP
data for the applicable renal dialysis drug or biological product
during the applicable time period specified in paragraph (c)(1) of this
section or during the 3-year period following such applicable time
period, CMS will not pay any post-TDAPA add-on payment adjustment for
such product in any future year.
* * * * *
(g) Post-TDAPA add-on payment adjustment methodology. CMS uses the
following methodology to calculate the post-TDAPA add-on payment
adjustment described in paragraph (c)(3) of this section:
(1) CMS bases the calculation on the most recent 12-month period of
utilization for the new renal dialysis drug or biological product and
the most recent available full calendar quarter of ASP data. If the
most recent full calendar quarter of ASP data reflects zero or negative
sales, then the calculation is based on 100 percent of WAC and, when
WAC is not available, the payment is based on the drug manufacturer's
invoice.
(2) CMS calculates the post-TDAPA add-on payment adjustment
annually as the expenditure for the new renal dialysis drug or
biological product divided by the total number of ESRD PPS treatments
during the same period.
(3) CMS applies a reduction factor to the post-TDAPA add-on payment
adjustment for case mix standardization to reflect estimated increases
resulting from the application of the patient-level adjustments as
described in paragraph (g)(5) of this section. This reduction factor is
calculated based on the patient-level adjustments (as described in
Sec. 413.235) applicable to the most recent 12-month period of
utilization of ESRD PPS claims.
(4) The amount of the post-TDAPA add-on payment adjustment is equal
to 65 percent of the amount calculated in paragraph (g)(2) of this
section, multiplied by the reduction factor specified in paragraph
(g)(3) of this section, and multiplied by the latest available forecast
of annual growth in the ESRD bundled market basket composite price
proxy for pharmaceuticals.
(5) The post-TDAPA add-on payment adjustment that is applied to an
ESRD PPS claim is adjsuted by any applicable patient-level case-mix
adjustments under Sec. 413.235.
0
7. Section 413.235 is amended by revising paragraph (b) to read as
follows:
Sec. 413.235 Patient-level adjustments.
* * * * *
(b) CMS adjusts the per treatment base rate for Pediatric ESRD
Patients in accordance with section 1881(b)(14)(D)(iv)(I) of the Act as
follows:
(1) To account for patient age and treatment modality; and
(2) Beginning January 1, 2024, to provide a per-treatment
transitional add-on payment adjustment of 30 percent of the per
treatment payment amount under Sec. 413.230 for renal dialysis
services furnished to Pediatric ESRD Patients during calendar years
2024, 2025, and 2026.
* * * * *
0
8. Section 413.236 is amended by revising paragraph (b)(2) to read as
follows:
Sec. 413.236 Transitional add-on payment adjustment for new and
innovative equipment and supplies.
* * * * *
(b) * * *
(2) Is new, meaning a complete application has been submitted to
CMS under paragraph (c) of this section within 3 years of the date of
the Food and Drug Administration (FDA) marketing authorization;
* * * * *
PART 512--RADIATION ONCOLOGY MODEL AND END STAGE RENAL DISEASE
TREATMENT CHOICES MODEL
0
9. The authority citation for part 512 continues to read as follows:
Authority: 42 U.S.C. 1302, 1315a, and 1395hh.
0
10. Section 512.390 is amended by removing paragraph (c)(5) and adding
paragraph (d).
The addition reads as follows:
Sec. 512.390 Notification, data sharing, and targeted review.
* * * * *
[[Page 76507]]
(d) Review of targeted review decisions. The Administrator may
review a targeted review request when administrative review is
requested by an ETC Participant within 15-calendar days of a targeted
review request determination made by CMS.
(1) Administrative review. Within 45 days of the date of the ETC
Participant's request for administrative review, the CMS Administrator
may act as follows:
(i) Decline to review a targeted review request determination made
by CMS;
(ii) Render a final decision based on the CMS Administrator's
review of the targeted review request determination; or
(iii) Choose to take no action on the request for administrative
review.
(2) Administrative review determinations. The targeted review
determination made by the CMS Administrator is final if the CMS
Administrator declines an ETC Participant's request for administrative
review or if the CMS Administrator does not take any action on the ETC
Participant's request for administrative review by the end of the 45-
day period described in paragraph (d)(1) of this section. CMS-1782-F
Dated: October 25, 2023.
Xavier Becerra,
Secretary, Department of Health and Human Services.
[FR Doc. 2023-23915 Filed 10-27-23; 4:15 pm]
BILLING CODE 4120-01-P