Minority Nephrologists Against Potential Bundling

Renal Bizblog
December 13, 2007

The Association of Minority Nephrologists released a consensus report on December 10 criticizing the possibility of bundling certain drugs into the ESRD composite rate.

“Approximately half of all U.S. patients with end-stage renal disease are members of racial or ethnic minority groups,” said Gary Puckerin, PhD, president and CEO of the National Minority Quality Forum. “We are extremely concerned that Congress would contemplate altering the payment system without studying the implications of bundling and without testing it as originally mandated under the Medicare Prescription Drug, Improvement and Modernization Act of 2003.”

The U.S. House of Representatives passed legislation this year that would implement bundling separately billable drugs, such as Epogen, into the composite rate reimbursed to dialysis facilities. Policymakers hope the bundling will eliminate the financial incentive to over-prescribe EPO and potentially cut down of costs. The Senate is currently considering bundling in its own legislation.

The Association of Minority Nephrologists, however, believes bundling could have a negative effect on small, independent dialysis facilities in rural and inner-city areas. “On average, African American patients require higher weekly dosages of EPO than white patients to maintain appropriate hemoglobin levels,” the association wrote in its report. “Any payment system, such as the proposed fully bundled payment system, that may lead to undertreatment with EPO will have a proportionally greater negative impact on patients who require larger doses of the drug, including, generally speaking, African Americans.”

The association also pointed out in its report that bundling could create a wider margin of financial gains and losses, which could make it “difficult for many small dialysis facilities to stay in business, possibly forcing them to operate at a loss, given that many small dialysis facilities operate on razor-thin margins.”

The MMA did require the Center’s for Medicare & Medicaid Services to study the possible effects of bundling through demonstration projects. An analysis was to be submitted to Congress in 2005 with a three-year demonstration project to begin in 2006. None of that has happened, and the Association of Minority Nephrologists said it believes it needs to be studied before it’s forced on dialysis clinics.

“The implementation of bundled payment without a test is tantamount to a nationwide uncontrolled human experiment,” the association wrote in the report. “CMS must conduct a controlled demonstration of bundling to ensure that it does not compromise the health care and health status of vulnerable ESRD beneficiaries.”