End-Stage Renal Disease (ESRD) is the final, permanent stage of chronic kidney disease, where kidney function has declined to the point that the kidneys can no longer function on their own. Patients may experience a wide variety of symptoms such as fatigue, drowsiness, decrease in urination or inability to urinate, dry skin, itchy skin, headache, weight loss, nausea, bone pain, skin and nail changes, and easy bruising.

Beneficiaries may become entitled to Medicare based on ESRD in which benefits based on ESRD are for all covered services, not only those related to the kidney failure condition. Payer to group health plans (GHPs) is Medicare but it is a secondary payer for individuals entitled to Medicare based on ESRD for a coordination period of 30 months irrespective of the number of employees and the coverage is based on current employment status.

The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule which states that up-gradation in payment policies and rates under the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) for renal dialysis services furnished to beneficiaries on or after January 1, 2021. Moreover, this rule brings updates to the acute kidney injury (AKI) dialysis payment rate for renal dialysis services provided by ESRD facilities to AKI individuals and proposes certain changes to the ESRD Quality Incentive Program (QIP).

Apart from annual technical updates for the ESRD PPS, the proposed rule proposes the following:

  • ESRD PPS Background
  • ESRD PPS base rate Upgradation
  • Wage Index Upgradation on an annual basis
  • Outlier Policy Upgradation
  • Eligibility criteria and determination process
  • Deadlines for the TPNIES
  • Updating ESRD PPS Base Rate for the inclusion
  • Of Calcimimetics

Let's look at above pointers in detail to understand changes and updates to the ESRD PPS for CY 2021 issued by CMS:

Background of ESRD PPS

For the costs associated with furnishing renal dialysis services, Medicare expects to pay USD 10.3 billion to approximately 7,400 ESRD facilities under the ESRD PPS for CY 2021. The bundled payment under the ESRD PPS includes all renal dialysis services furnished for outpatient maintenance dialysis, including drugs and biological products (except oral-only ESRD drugs until 2025) and other renal dialysis items and services which were formerly separately payable under the previous payment methodologies.

Based on various factors relating to patient characteristics the bundled payment rate is adjusted. Moreover, The ESRD PPS also provides for a transitional drug add-on payment adjustment (TDAPA) and the TPNIES.

The rule also proposes the inclusion of facility-level adjustments for ESRD facilities that have a low patient volume, for facilities in rural areas, and the wage index. Apart from this, The ESRD PPS provides a training add-on payment adjustment for home and self-dialysis modalities, and, for high-cost patients, an ESRD facility may be eligible for outlier payments.

ESRD PPS base rate up gradation

If we look at the proposed CY 2021 ESRD PPS base rate, it is USD 255.59; an increase of USD 16.26 to the current base rate of USD 239.33. This amount is the application of certain below factors:

  • Proposed wage index budget-neutrality adjustment factor (.998652)
  • The proposed addition to the base rate of$12.06 to include calcimimetics
  • A proposed productivity-adjusted market basket increase as required by section 1881(b)(14)(F)(i)(I) of the Act (1.8 percent), equaling USD 255.59 ((USD 239.33 x .998652) + USD 12.06) x 1.018= USD 255.59)

Wage Index Up gradation on an annual basis

The wage index is applied to the labor-related share of the payment rate to account for differing wage levels in areas in which ESRD facilities are located. Labor-related share in the proposed CY 2021 is 52.3 percent.

Outlier Policy up gradation

Based on the use of the latest available data, the proposed FDL amount for pediatric beneficiaries would increase from USD 41.04 to USD 47.73 and the MAP amount would increase from USD 32.32 to USD 33.08, as compared to CY 2020 values. Updating in the proposed FDL amount from USD 48.33 to USD 133.52, and the MAP amount from USD 35.78 to USD 54.26 for adult beneficiaries.

Eligibility Criteria and Determination Process Deadlines

For the TPNIES

Changes to the TPNIES eligibility criteria have been proposed by CMS considering the changes implemented in CY 2020 to provide bi-annual coding cycles for code applications for new Healthcare Common Procedure Coding System (HCPCS) Level II codes for durable medical equipment, orthotics, prosthetics, and supplies (DMEPOS) items, and services.

The Food and Drug Administration (FDA) marketing authorization must be submitted to CMS by the HCPCS Level II code application deadline for the equipment or supply to become eligible for the TPNIES in the following year.

Updating ESRD PPS Base Rate for the inclusion of Calcimimetics

To include calcimimetics in the ESRD PPS bundled payment, CMS proposed the methodology for modifying the ESRD PPS base rate such as add USD 12.06 to the ESRD PPS base rate beginning in CY 2021.


CMS is proposing the following update for the AKI the dialysis payment rate for CY 2021.The payment rate update factor (1.8 percent) The proposed wage index budget neutrality factor (.998652). In addition to the ESRD PPS base rate which includes calcimimetics .The proposed CY 2021 payment rate is USD 255.59, which is the same as the base rate proposed under the ESRD PPS for CY 2021.

ESRD Quality Incentive Program (QIP)

ESRD QIP is authorized by section 1881(h) of the Act. Under these programs, CMS is empowered to assesses the total performance of each facility on measures specified for a payment year and applies an appropriate payment reduction to each facility that does not meet a minimum total performance score (TPS), and publicly reports the results.

Moreover, this proposed rule proposes several programmatic updates to the ESRD QIP such as updating the scoring methodology for the Ultrafiltration Rate Reporting Measure to score facilities based on the number of eligible patient-months as compared to facility-months.

We are team of professionals to help practice with billing and compliance, improve your practice’s efficiency and building a business partnership to strengthen your revenue stream. Click here to know more about our services.

Published By - Medical Billers and Coders
Published Date - Jul-30-2020 Back

Looking for a Medical Billing Quote?

Are you looking for more than one billing quotes?



Looking for a Medical Billing Quote?

Are you looking for more than one billing quotes ?





Would You like to Increase Your Collections?