Medicare Finalizes Quality Incentive Program Rules For Dialysis Services

February 2011

In late December, the Centers for Medicare and Medicaid Services (“CMS”) issued a final rule (“QIP Rule”) that, as required by 2008 Congressional legislation, will reduce starting in 2012 up to two percent (2%) of the payments to dialysis providers who failed to meet in 2010 certain performance standards. Effective January 1, 2011, subject to a phase-in period, CMS will pay dialysis providers on a prospective payment basis. With the QIP Rule, dialysis providers will be penalized for poor quality of services provided to dialysis patients. The QIP Rule will apply only to 2012; CMS has not yet issued additional guidance as to the required QIP payment reductions for 2013 and future years.

The payment reductions under the QIP Rule are based on three weighted performance results (each, a “QIP Score”) that measure anemia management and hemodialysis adequacy results for services performed in 2010 as compared to the 2008 national standards for each performance result or the 2007 actual performance results of each provider, whichever are lower. Special rules apply for dialysis facilities that first opened after 2007, that treat a small number of patients or that provide home dialysis services to its patients.

The QIP Rule also indicates that CMS will notify dialysis providers of the weighted results of their QIP Scores at least thirty (30) days prior to posting of same on the Dialysis Facility Compare website and requires all providers to print onto 8 1/2” x 11” paper and post in a prominent location at each facility a copy of the certificate that CMS will send each provider electronically that contains the weighted results of its QIP Scores.

CMS indicated in the preamble to the QIP Rule that it will likely expand and/or change the performance standards for 2013 and future years and will use the measurement standards as “floors” to encourage dialysis providers to improve performance on a year over year basis. Moreover, the QIP payment reductions for 2013 will likely be based on 2011 performance as compared to the standards that apply for that payment year.

For further information about the impact of the QIP Rule on dialysis providers, please contact Ralph Levy of the Dickinson Wright Healthcare Practice Group.

Ralph Z. Levy, Jr. is Of Counsel in Dickinson Wright’s
Nashville office and can be reached at 615.620.1733 or

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