Medicare hasn't put the finishing touches on its new dialysis reimbursement policy quite yet (you have until December 16 to get your comments in) -- but has decided to invest in educating the public on various dialysis treatment options. It's part of a longer term effort to give patients more of a say in managing their chronic diseases, and in changing some of the inefficient ways Medicare pays for kidney care.

More than 350,000 Medicare patients with end stage renal disease undergo dialysis. Most patients undergo out-patient treatment three times per week at either an independent or hospital based facility -- in the United States, fewer than a tenth are treated at home. (Rita Rubin of USA Today notes that three treatments per week is the standard not necessarily because it is "optimal but because that's the way it has been done for nearly four decades.")

But Medicare's education campaign will help patients make more informed decisions about where and how often they are treated. 

"These education sessions will provide patients with chronic kidney disease information they need to understand their treatment options and participate in better management of their own care," Dr. James Sloand, senior medical direct of Baxter's North American renal business, told the Chicago Tribune recently. "This program empowers individuals to take measures to slow the progression of their kidney failure."

One option, as Bruce Japsen explained in that Tribune story, is for more patients to get dialysis at home. It's less expensive -- and research suggests that it is more effective as patients can "dialyze" more frequently, for longer periods of time and on their own schedule. 

As Japsen explains, reimbursement for dialysis is complicated by Medicare's current payment structure, a  "prospective payment system known as the basic case-mix adjusted composite payment system." In case you need a translation  -- dialysis outpatient facilities bill Medicare for the routine dialysis service separately from some injectable medications and non-routine laboratory tests. These separately billable items account for 40 percent of total Medicare payment per dialysis treatment -- and are billed on a fee-for-service basis.

But, in September, the Centers for Medicare and Medicaid Services released a proposed rule to change that.  Beginning January 1 of 2011, Medicare will "bundle" all the routine dialysis outpatient care  -- the dialysis itself, the drugs and those lab tests -- into a single base payment (around $200 but adjusted for location and patient characteristics). (Look at this presentation for more specific details.)

Since 1972, the government has financed dialysis treatment regardless of the ESRD patient's age -- it cost an annual $10,000 per dialysis patient then, and more than $73,000 now. But Medicare believes that by bundling the payment, unnecessary medications will be eliminated and patients will receive efficient, quality and patient-centered care.

 "Combining a fully bundled prospective payment system with required performance standards would encourage facilities to operate more efficiently and ensure that beneficiaries receive high quality care, while saving dollars for both beneficiaries and the Medicare program," said Jonathan Blum, director of the agency's Center for Medicare Management. (Here is another recent post about another form of bundled payment.) Not only will patients receive efficient and high quality care -- but they will be able to make an informed choice concerning the treatment option that works best for them.