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Medicare Study

Study: Medicare penalties for poor-quality dialysis centers not assisting

Dialysis centers hit with financial penalties for poor performance don’t tend to improve afterward, calling into question a set of U.S. federal programs intended to improve health care nationwide, a new report says. Dialysis centers face up to a 2% reduction in their annual Medicare reimbursements if they get a low score on a set…


Dialysis centers hit with financial penalties for poor performance do not tend to enhance afterward, calling into question some of U.S. federal programs meant to improve health care nationally, a new report says.

Dialysis centers face around a 2% decrease in their annual Medicare reimbursements if they receive a very low score on a set of quality measures made from the U.S. Centers for Medicare and Medicaid Services.

The steps aren’t only bureaucratic box-checking: Kidney patients treated at low-scoring programs tend to have a higher risk of death in their first year of dialysis, researchers said in background notes.

About 1 in 5 U.S. dialysis centers received such monetary penalties in 2017, based on their performance two years earlier, said lead researcher Dr. Kyle Sheetz, a research fellow with the Center for Healthcare Outcomes and Policy at the University of Michigan.

However, those dialysis facilities did not consistently improve their performance in either 2017 or 2018, despite the fines, Sheetz said.

“Getting penalized was not associated with future improvement in quality,” Sheetz said. “The primary leverage that the program has over centers to improve quality didn’t work.”

Tying Medicare reimbursements to performance is a rather recent development, encouraged by the Affordable Care Act’s focus on enhancing U.S. health care.

Launched in 2012, the End-Stage Renal Disease Quality Incentive Program”was the first pay-for-performance program that CMS implemented, where the payment for dialysis was pegged to performance in specific quality measures,” said Dr. Paul Palevsky, president of the National Kidney Foundation.

Subsequent CMS”value-based programs” monitor hospitals and penalize them for poor purchasing practices, also many readmissions, or even a surge in diseases and disorders acquired by patients during their hospitalization. Other applications affect the pay of doctors, nursing facilities, and home health care suppliers.

But the whole movement might have been wrongheaded, based on these findings, Palevsky said.

Programs can miss the mark

“This article raises serious questions about the methodology that’s been used for trying to drive quality improvements through payment policy,” Palevsky said. “Essentially, what this study has shown is that it didn’t work. It didn’t change the performance on the specific measures that facilities were being penalized on.”

About a half a million people are on dialysis in the United States, and CMS spends about $100,000 per individual every year for kidney patients on dialysis — greater than 6% of the total Medicare funding, researchers said.

Sheetz and his colleagues examined CMS data on dialysis centers, including if the centers had obtained a financial penalty for their own performance.

Centers in 2015 were judged on such matters as if their patients suffered from anemia or blood infections, whether they needed hospitalization, if their dialysis was adequate to keep them healthy, and whether the dialysis was performed using best practices.

One reason centers didn’t improve might be that the superior measures have a tendency to change from year to year, creating a frustrating moving target for them to strike, Sheetz said.

“If You’re being punished based on your performance two years ago on results tha

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