‘Health Equity Incentive’ Added to ESRD Treatment Choices Model

Nov. 1, 2021

CMS to stratify achievement benchmarks based on the proportion of attributed beneficiaries who are dually eligible for Medicare and Medicaid or receive the Low-Income Subsidy

David Raths

Executives of the Centers for Medicare & Medicaid Services (CMS) and the Center for Medicare & Medicaid Innovation (CMMI) have stressed this year that health equity will be central to the changes they are making. Perhaps the first concrete example is a new final rule on payment for care of patients with kidney disease.

The ESRD (End-Stage Renal Disease) Treatment Choices (ETC) Model is a mandatory alternative payment model (APM) that encourages greater utilization of home dialysis and kidney transplants for Medicare beneficiaries with the chronic condition.

The changes to the ETC Model policies in the newly published final rule aim to encourage dialysis providers to decrease disparities in rates of home dialysis and kidney transplants among ESRD patients with lower socioeconomic status.

According to CMS Office of Minority Health studies on racial, ethnic and socioeconomic factors, disadvantaged Medicare patients suffer from ESRD at higher rates. They are also more likely to experience higher hospital and costs, as well as receive in-center hemodialysis because their kidneys are no longer able to perform their function. Studies also indicate non-white ESRD patients are less likely to receive pre-ESRD kidney care, become waitlisted for a transplant or receive a kidney transplant.

In the final rule, CMS said it would “stratify achievement benchmarks based on the proportion of attributed beneficiaries who are dually eligible for Medicare and Medicaid or receive the Low-Income Subsidy (LIS) during the MY (Model Year), in recognition that beneficiaries with lower socioeconomic status have lower rates of home dialysis and transplant than those with higher socioeconomic status.”

CMS is introducing a “Health Equity Incentive” to the improvement scoring methodology used in calculating the payment adjustment. “CMS expects that the Health Equity Incentive will encourage ETC Participants to decrease disparities in renal replacement modality choice among beneficiaries with lower socioeconomic status by rewarding ETC Participants that demonstrate significant improvement in the home dialysis rate or transplant rate among their attributed beneficiaries who are dual-eligible or LIS recipients,” the rule stated.

In August, the CMS leadership team published a blog post in Health Affairs stating that “the Innovation Center should make equity a centerpiece of every model. Models to date have been largely Medicare-oriented, and voluntary models have primarily drawn only those healthcare providers and organizations with resources and capital to apply and participate, resulting in limited attention to Medicaid and safety net providers. From here on, the Innovation Center will embed equity in every aspect of its models by seeking to include more providers serving low- and modest-income, racially diverse, and/or rural populations; the Innovation Center will aim to ensure everyone has access to providers at the leading edge of transformation.”