Center for Medicare & Medicaid Services Comprehensive ESRD Care Model

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By Mandar Gori

1.  Background

  • More than 600,000 Americans have End Stage Renal Disease (ESRD) and require life sustaining dialysis treatments 2-3 times per week. Many beneficiaries with ESRD suffer from poorer health outcomes, often the result of underlying disease complications and multiple co-morbidities. These can lead to high rates of hospital admission and readmissions, as well as a mortality rate that is higher than that of the general Medicare population.
  • According to the United States Renal Data System, in 2014 ESRD beneficiaries comprised less than 1% of the Medicare population, but accounted for an estimated 7.2% of total Medicare fee-for-service spending, totaling over $32.8 billion. Because of their complex health needs, beneficiaries often require visits to multiple providers and follow multiple care plans, all of which can be challenging for beneficiaries if care is not coordinated.
  • In October 2015, the Centers for Medicare & Medicaid Services (CMS) launched a new accountable care organization (ACO) model called the Comprehensive ESRD Care (CEC) Model. Dialysis facilities, nephrologists, and other providers joined together to form ESRD Seamless Care Organizations (ESCOs) that are responsible for the cost and quality of care for aligned beneficiaries. The Model builds on Accountable Care Organization experience from the Pioneer ACO Model, Next Generation ACO Model, and the Medicare Shared Savings Program to test Accountable Care Organizations for ESRD beneficiaries. This model aligns with the Administration’s goal of tying 50 percent of traditional, or fee-for-service, Medicare payments to alternative payment models, such as ACOs, by the end of 2018.
  • The Comprehensive ESRD Care (CEC) Model seeks to create incentives to enhance care coordination and to create a person-centered, coordinated, care experience, and to ultimately improve health outcomes for this population.

 2.  What is Accountable Care Organization (ACO)?

  • Accountable Care Organizations (ACOs) are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to the Medicare patients they serve. Coordinated care helps ensure that patients, especially the chronically ill, get the right care at the right time, with the goal of avoiding unnecessary duplication of services and preventing medical errors. When an ACO succeeds in both delivering high-quality care and spending health care dollars more wisely, it will share in the savings it achieves for the Medicare program. 

.   What is an ESRD Seamless Care Organization (ESCO)?

  •  An “ESCO” or “ESRD Seamless Care Organization” is an Accountable Care Organization (ACO) comprised of providers and suppliers who voluntarily come together to form a legal entity that offers coordinated care to beneficiaries with ESRD through the Comprehensive ESRD Care model. An ESCO is required to have participant owners that include at least one nephrologist or nephrology group practice and at least one dialysis facility.

 4.  What is a Comprehensive ESRD Care (CEC) model?

  • The CEC model is a new ACO model developed under the authority of the Center for Medicare and Medicaid Innovation (Innovation Center) to test innovative payment and service delivery models to reduce program expenditures while preserving or enhancing the quality of care. As the first ACO model with a disease specific focus, the model aims to identify ways to improve the coordination and quality of care for Medicare beneficiaries living with ESRD, while reducing Medicare expenditures.
  • The CEC Model is designed to identify, test, and evaluate new ways to improve care for Medicare beneficiaries with ESRD. Through the CEC Model, CMS will partner with health care providers and suppliers to test the effectiveness of a new payment and service delivery model in providing beneficiaries with person-centered, high-quality care. The Model builds on Accountable Care Organization experience from the Pioneer ACO Model, Next Generation ACO Model, and the Medicare Shared Savings Program to test Accountable Care Organizations for ESRD beneficiaries.
  • In the CEC Model, dialysis clinics, nephrologists and other providers join together to create an ESCO to coordinate care for matched beneficiaries. ESCOs are accountable for clinical quality outcomes and financial outcomes measured by Medicare Part A and B spending, including all spending on dialysis services for their aligned ESRD beneficiaries.
  • In 1972, the Medicare ESRD program was enacted as the only disease-specific entitlement program within CMS. Medicare Part A and B benefits were extended to include any individuals with ESRD (of any age) entitled to receive social security benefits. Changes to reimbursement for dialysis care continued through the 1980s and 1990s, including the establishment of a bundled payment for routine dialysis care and changes in prescription billing. More recently, CMS implemented two important programs to reduce costs and improve quality for this population: the ESRD Prospective Payment System (PPS) and the ESRD Quality Incentive Program (QIP). Through these programs, prospective payments are given to dialysis facilities and include all billable items related to a single dialysis session. The QIP introduced performance measurements alongside the PPS by penalizing dialysis facilities for failing to meet anemia and dialysis quality targets. Combined, these initiatives resemble ACOs with the dual focus of cost reduction and quality improvement. In contrast to the ACO model that attempts to achieve these goals through improved care coordination between inpatient and outpatient settings, the current ESRD model does not include coverage across the continuum of care. In 2013, CMS announced the CEC Model concept to adapt care coordination principles from the ACO Model to the ESRD population, and in October 2015 announced the participating ESCOs.

 5.   How does CMS offer financial incentive to the ESCOs?

  • The CEC Model will use a shared savings and losses model, under which ESCOs will share savings, and in some instances be held accountable for a portion of losses, for the particular ESCO’s aligned beneficiaries. To assess savings or losses to Medicare, CMS will develop an expenditure “baseline,” based on historical Medicare Parts A and B expenditures incurred for beneficiaries who would have been aligned to the ESCO in each of the three years prior to the start of the first performance year for this model.
  • CMS will then trend the baseline forward using national data to develop an expenditure benchmark for the beneficiaries aligned to the ESCO. CMS will calculate savings or losses based on a comparison of the benchmark and the actual Medicare Fee-For-Service (FFS) Part A and B expenditures for the aligned population in a given performance year. The savings will be adjusted based on quality performance.
  • CMS will calculate the ESCO’s Total Quality Score (TQS) for the CEC Model using a set of standardized quality measures. These measures align with the National Quality Strategy priorities and will encourage the ESCO to meet high standards of clinical care, patient-centeredness, and care coordination across multiple care settings for ESRD beneficiaries.
  • The CEC Quality Scoring Methodology includes weights for each quality measure to reflect its respective contribution to the ESCO TQS. The methodology assigns hybrid quality measures a weight of 2, and all other quality measures a weight of 1. The table below contains the quality measure TQS weights by measure, for CY 2018.

6.  Who are the participating organizations (ESCOs) in the CMS CEC program?

* Above list might not be the most up-to-date.









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Mandar Gori


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