Introduction
This document details the methodology for the End-Stage Renal Disease (ESRD) measure and should be reviewed along with the ESRD Measure Codes List file, which contains the medical codes used in constructing the measure.
Measure Description
Episode-based cost measures represent the cost to Medicare for the items and services provided to a patient during an episode of care (“episode”). In all supplemental documentation, the term “cost” generally means the standardized1 Medicare allowed amount,2 and claims data from Medicare Parts A, B, and D3 are used to construct this episode-based cost measure.
The ESRD episode-based cost measure evaluates a clinician’s or clinician group’s risk-adjusted and specialty-adjusted cost to Medicare for patients who receive medical care to manage ESRD. This chronic condition measure includes the costs of services that are clinically related to the attributed clinician’s role in managing care during an ESRD episode.
Measure Rationale
Medicare expenditures for patients with end-stage renal disease (ESRD) contribute disproportionately to Medicare costs. Beneficiaries with ESRD make up less than 1% of the Medicare population but contribute more than 7% of Medicare fee-for-service payments.4 The most substantial costs incurred by patients with ESRD are dialysis costs.5 The total Medicare fee-for-service spending for patients with ESRD has increased steadily from $47 billion in 2010 to $53 billion in 2019. 6
Performance gaps in treating this population include managing the transition from CKD to ESRD and dialysis-related costs. Preventing or slowing progression CKD to ESRD represents substantial opportunities for improvement for clinicians. Progression of CKD to ESRD further increases cost to Medicare, given that such patients overwhelmingly require hemodialysis.7 Of particular concern are patients initiating hemodialysis with a catheter during or shortly after a hospitalization, sometimes referred to as a “crash start,” which indicates an unplanned transition from CKD to ESRD; this unplanned transition/crash start is costly, and patients who initiate dialysis non-optimally are at higher risk of readmissions and death.8,9 A 2018 review showed that patients with early referral had better outcomes including shorter hospital stay associated with dialysis initiation and 30% lower mortality rates at 5 years after dialysis initiation compared to patients with late referrals.10 ESRD is a costly condition for the Medicare population, associated with high costs for the management of the disease and its complications. As such, a cost measure represents an important opportunity for improvement on overall cost performance.
The ESRD episode-based cost measure was selected for development because of its high impact in terms of patient population, clinician coverage, and Medicare spending, and assesses costs for a condition not captured by other cost measures. This ESRD measure was also developed in consideration of alignment opportunities, particularly the Kidney Care First (KCF) Option of the Kidney Care Choices (KCC) Advanced Alternative Payment Model, and its ESRD cost measure.11 A measure-specific clinician expert measure development workgroup was convened to provide extensive, detailed input on this measure.
Measure Numerator
The measure numerator is the weighted average ratio of the winsorized12 scaled standardized observed cost to the scaled expected13 cost for all ESRD episodes attributed to a clinician, where each ratio is weighted by each episode’s number of days assigned to a clinician. This sum is then multiplied by the national average winsorized scaled observed episode cost to generate a dollar figure.
Measure Denominator
The measure denominator is the total number of days from ESRD episodes assigned to the clinician across all patients.
Data Sources
The ESRD measure uses the following data sources:
- Medicare Part A, B, and D claims data from the Common Working File (CWF)
- Enrollment Data Base (EDB)
- Long Term Care Minimum Data Set (LTC MDS)14
Care Settings
The ESRD measure focuses on the care provided by clinicians practicing in non-inpatient hospital settings for patients with ESRD. The most frequent settings in which an ESRD episode is triggered include: ESRD treatment facility, office, and outpatient hospital.
Cohort
The cohort for this cost measure consists of patients who are Medicare beneficiaries enrolled in Medicare fee-for-service who receive medical care to manage ESRD.
The cohort for this cost measure is also further refined by the definition of the episode group and measure-specific exclusions (refer to Section 4).
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1 Claim payments are standardized to account for differences in Medicare payments for the same service(s) across Medicare providers. Payment standardized costs remove the effect of differences in Medicare payment among health care providers that are the result of differences in regional health care provider expenses measured by hospital wage indexes and geographic price cost indexes or other payment adjustments such as those for teaching hospitals. For more information, please refer to the “CMS Part A and Part B Price (Payment) Standardization - Basics" and “CMS Part A and Part B Price (Payment) Standardization - Detailed Methods” documents posted on the CMS Price (Payment) Standardization Overview page (https://www.resdac.org/articles/cms-price-payment-standardizationoverview).
Claim payments from Part D are payment standardized to allow resource use comparisons for providers who prescribe the same drug, even if the drug products are covered under varying Part D plans, produced by different manufacturers, or dispensed by separate pharmacies. For more information, please refer to the “CMS Part D Price (Payment) Standardization” document posted on the CMS Price (Payment) Standardization Overview page. (https://www.resdac.org/articles/cms-price-payment-standardizationoverview).
2 Cost is defined by allowed amounts on Medicare claims data, which include both Medicare trust fund payments and any applicable beneficiary deductible and coinsurance amounts.
3 Part D branded drug costs are also adjusted to account for post-point of sale drug rebates; more information can be found in the Methodology for Rebates in Part D Standardized Amounts on the CMS.gov QPP Cost Measures Information Page’s About Cost Measures page (https://www.cms.gov/medicare/quality-payment-program/cost-measures/about).
4 National Kidney Foundation. “Kidney Disease: The Basics.” Accessed November 28, 2022. https://www.kidney.org/news/newsroom/fsindex
5 Marrufo G, Colligan EM, Negrusa B, Ullman D, Messana J, Shah A, Duvall T, Hirth RA. “Association of the Comprehensive End-Stage Renal Disease Care Model with Medicare Payments and Quality of Care for Beneficiaries with End-Stage Renal Disease,” JAMA Intern Med. Case 180, no. 6 (2020): 852-860. DOI: 10.1001/jamainternmed.2020.0562.
6 “US Renal Data System 2022 Annual Data Report: Healthcare Expenditures for Persons with ESRD.” United States Renal Data System, (2022): Chapter 9. https://usrds-adr.niddk.nih.gov/2022/end-stagerenal-disease/9-healthcare-expenditures-for-persons-with-esrd
7 Liu, Harry H., and Sophia Zhao. "Savings opportunity from improved CKD care management." Journal of the American Society of Nephrology 29, no. 11 (2018): 2612-2615.
8 Caro Martínez, Araceli, Antonio Olry de Labry Lima, José Manuel Muñoz Terol, Óscar Javier Mendoza García, César Remón Rodríguez, Leticia García Mochón, Pablo Castro de la Nuez, and Nuria Aresté Fosalba. "Optimal start in dialysis shows increased survival in patients with chronic kidney disease." Plos one 14, no. 7 (2019): e0219037.
9Poonawalla, Insiya. "Transition-to-Dialysis Planning, Health Care Use, and Mortality in End-Stage Renal Disease." The American Journal of Managed Care (2023).
10Liu, Harry H., and Sophia Zhao. "Savings opportunity from improved CKD care management." Journal of the American Society of Nephrology 29, no. 11 (2018): 2612-2615.
11CMS, “Kidney Care Choices (KCC) Model,” https://innovation.cms.gov/innovation-models/kidney-carechoices-kcc-model
12For information on how costs are winsorized, please refer to Section 4.7.
13Expected costs refer to costs predicted by the risk adjustment model. For more information on expected costs and risk adjustment, please refer to Section 4.7.
14For information on how LTC MDS data are used in risk adjustment, please refer to Section 4.7.