(Medicare Benefit Policy Manual)

 The ESRD facility and hospital are financially integrat ed, as evidenced by the cost report, which must reflect allocation of hospital overhead to the facility through the required step- down methodology.   CMS does not consider the existence of an agreement between an ESRD facility and a hospital for the referra l of patients, a shared service arrangement between a facility and a hospital, or the physical location of a dialysis unit on the premises of a hospital, to mean that an ESRD facility is hospital -based.   2.  Independent ESRD Facility  Any facility that do es not meet the criteria of a hospital- based ESRD facility.   There are several terms used to describe independent dialysis facilities which include the following:   a.  Renal Dialysis Center - A hospital -based unit, which is approved to furnish the full spectrum of diagnostic, therapeutic, and rehabilitative services required for the care of ESRD dialysis patients (including inpatient dialysis furnished directly or under a rrangement).  A hospital need not provide renal transplantation to qualify as a renal dialysis center.  Under the ESRD PPS CMS refers to renal dialysis centers as ESRD facilities.   b.  R enal Dialysis Facility - An independent unit that is approved to furni sh outpatient maintenance dialysis services directly to ESRD patients.  Under the ESRD PPS CMS refers to renal dialysis facilities as ESRD facilities.   c.  Self -Dialysis Unit -  A dialysis unit that furnishes self -dialysis services and is part of a Medicare certified ESRD facility.   d.  Home Dialysis Training and Support ESRD Facility  A Medicare certified ESRD facility that furnishes home dialysis training and support services.  See 42 CFR 494.100 for more information regarding Medicare certification requirements.  e.  Special Purpose Renal Dialysis Facility   An ESRD facility that is approved to furnish dialysis at special locations, on a short -term basis, to a group of dialysis patients otherwise unable to obtain treatment in their geographical area.   The special locations must be either special rehabilitative (including vacation) locations serving ESRD patients temporarily residing there, or locations in need of ESRD facilities under emergency circumstances.   C.  Renal Dialysis Services   Renal dialys is services are all items and services used to furnish outpatient maintenance dialysis to individuals for the treatment of ESRD in the ESRD facility or in a patients home.   Renal dialysis services include but are not limited to:   All items and services in cluded under the composite rate as of December 31, 2010 (see 20.2.E, 20.3.F, and 70.B of this chapter for more information);    Erythropoiesis stimulating agents (ESAs) and their oral or other forms of administration (see 20.3.A of this chapter for more information);    Injectable drugs and biologicals and their oral or other forms of administration (see 20.3.B, 20.3.C and 20.3.D of this chapter for more information);    Oral or other forms of non -injectable drugs and biologicals (see 20.3 of this chapter  for more information);    Diagnostic laboratory tests (see 20.2 of this chapter for more information);    Home and self -dialysis training (see 30.2 of this chapter for more information); and    All supplies, equipment, and support services necessary for the effective performance of a patients dialysis furnished in the ESRD facility or in a patients home (see 20.4 of this chapter for more information).  See 20 of this chapter for more information regarding renal dialysis items and services.  Services Provi ded Under an Arrangement   A Medicare- certified ESRD facility may enter into written arrangements with a second ESRD facility to provide certain covered outpatient dialysis items or services to patients.  When services are provided under an arrangement, the first ESRD facility retains professional and financial responsibility for those services and also for obtaining reimbursement for them.  The first ESRD facility may bill the patient for the applicable coinsurance and deductible amounts.  The second ESRD f acility is permitted to seek payment only from the first ESRD facility, and may not bill the patient or Medicare.   D.  Types of Dialysis   1.  Types of Outpatient Maintenance Dialysis  - Outpatient maintenance dialysis is furnished on an outpatient basis by a Medicare certified ESRD facility and is paid under the ESRD PPS.  Outpatient maintenance dialysis is not acute dialysis.  Medicare defines acute dialysis services as dialysis that is not covered or paid under the ESRD benefit in 42 CFR 413.174.  For bill ing and payment instructions of acute dialysis services furnished in the hospital see Pub. 100- 04, chapter 4, 200.2 and Pub. 100- 02, chapter 1, section 10.  a. In-facility Dialysis  - Dialysis furnished on an outpatient basis in a Medicare certified ESRD f acility.   b. Home Dialysis -  Dialysis performed at home, including a nursing home, by an ESRD patient or caregiver who has completed an appropriate course of training as specified at 42 CFR 494.100(a).   c. Staff -Assisted Dialysis -  Dialysis performed by t he staff of the ESRD facility in the ESRD facility.   d. Self-Dialysis  - Dialysis performed by an ESRD patient in -facility with the expectation that the patient performs their dialysis treatment with little or no professional assistance.  The patient must have completed an appropriate course of training as specified at 42 CFR 494.100(a).   NOTE:  Self-dialysis and home dialysis include training programs that educate ESRD patients and/or other individuals to assist the patient in performing self -dialysis or home dialysis with little or no professional assistance.   2.  Back -Up Dialysis -  Dialysis given to patients under special circumstances.  Examples are: dialysis of a home dialysis patient in an ESRD facility when the patients equipment fails, inpatient dialysis when a patients illness requires more comprehensive care, and preoperati ve and postoperative dialysis provided to transplant patients.   E.  Home Dialysis -  Supplies, Equipment, and Support Services   ESRD facilities are responsible for furnishing supplies, equipment, and support services for home dialysis.  ESRD facilities are financially responsible and may not bill Medicare or the patient for separate payment.  If an ESRD facility arranges for a supplier to furnish renal dialysis supplies and equipment, the supplier may seek payment only from the ESRD facility and may not bill  Medicare or the patient for separate payment.   Method Selection   For home dialysis services furnished prior to January 1, 2011, a beneficiary selected one of two methods to secure home dialysis items and services.  Under Method I, the ESRD facility with which the patient is associated, assumes total responsibility for furnishing all home dialysis items or services.  Under Method II, the beneficiary dealt directly with a dialysis supplier to secure home dialysis items and services.  Beginning January 1, 2011, Method II is no longer an option for home dialysis items and services under Medicare.  Therefore, beginning January 1, 2011, all home dialysis patients are Method I.   Under Method I, Medicare payment for all modalities of home dialysis is made to the E SRD facility under the ESRD PPS.  Renal dialysis items and services may be furnished directly by the facility or under arrangement with a supplier.   The ESRD facility or home dialysis supplier may not bill the beneficiary directly for renal dialysis supplies, services, or equipment.  For further discussion on Method I payment refer to 20.1 of this chapter.   1.  Home Dialysis Equipment - Home dialysis equipment includes all of the medically necessary equipment ordered by the attending physician, including ( but not limited to) artificial kidneys, automated peritoneal dialysis machines, and support equipment.  Home dialysis supplies and equipment may be covered if used by an ESRD beneficiary in a nursing home or a SNF.  See 40.C and 40.D of this chapter for more information.   2.  Installation -  Installation includes (but is not limited to) the identification of any minor plumbing and electrical changes required to accommodate the equipment, the ordering and performing of these changes, delivery of the equipme nt and its actual installation (i.e., hookup), as well as any necessary testing to assure proper installation and function.  Minor plumbing and electrical changes include those parts and labor required to connect the dialysis equipment to plumbing and elec trical lines that already exist in the room where the patient will dialyze.  Medicare does not cover wiring or rewiring of the patients home or installing any plumbing to the patients home or to the room of the home where the patient will dialyze.   3.  M aintenance -  Maintenance includes (but is not limited to) travel to the patients home, transportation of the equipment to a repair site, the actual performance of the maintenance or repair, and necessary parts.  Water purification equipment maintenance in cludes replacing the filter on a reverse osmosis device, regenerating the resin tanks on a deionization device, using chemicals in a water softener, and periodic water testing to assure proper performance.   Routine maintenance customarily performed by a pa tient is not a covered service except for the cost of parts involved in the maintenance furnished by the ESRD facility to the patient.   4.  Supplies -  Supplies include all durable and disposable items and medical supplies necessary for the effective performance of a patients dialysis.  Supplies include (but are not limited to): dialyzers, forceps, sphygmomanometer with cuff and stethoscope, scales, scissors, syringes, alcohol wipes, sterile drapes, needles, topical anesthetics, and gloves.   5.  Suppo rt Services  See 30.1.A of this chapter.  6.  Support Equipment -  Support equipment is equipment used in conjunction with the basic dialysate delivery system.  Such equipment includes (but is not limited to) pumps, such as blood and heparin pumps, alarms , such as bubble detectors, water purification equipment used to improve the quality of the water used for dialysis, and adjustable dialysis chairs.    F.  Overview of Medicares ESRD Payment Policy   1.  ESRD Prospective Payment System (ESRD PPS)  Section 153(b) of Pub. L. 110- 275, the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) amended section 1881(b) of the Social Security Act to require the implementation of an ESRD bundled payment system effective January 1, 2011.  Under MIPPA, the ESRD PPS replaced the basic case- mix adjusted composite rate payment system and the methodologies for the reimbursement of separately billable outpatient renal dialysis items and services.   The ESRD PPS provides a case -mix and facility -level adjusted s ingle payment to ESRD facilities for renal dialysis services provided in an ESRD facility or in a beneficiarys home.  (See 10.C of this chapter for the items and services considered to be renal dialysis services.)   To account for higher resource utilizat ion, the ESRD PPS applies case -mix adjusters to the base rate and, when applicable, also includes an add- on for home and self -dialysis training and an outlier payment.   The ESRD PPS provided for a 4 year transition period under which facilities may have re ceived a blend of the payment methodology prior to January 1, 2011 (that is, the basic case -mix adjusted composite rate payment system) and the ESRD PPS.  In 2014, all ESRD facilities that receive Medicare payment are paid 100 percent under the ESRD PPS.   The ESRD PPS combines payment for what had previously been composite rate and separately billable outpatient renal dialysis items and services into a single base rate for both adult and pediatric patients.  The per dialysis treatment base rate is subsequen tly adjusted to reflect:    Patient -level adjustments for: o case- mix, (see 60.A.1 of this chapter for adult patient adjustments and 60.A.6 of this chapter for pediatric patient adjustments)   o An onset of dialysis adjustment for adult patients that have Medicare ESRD coverage during their initial 4 months of dialysis, (see 60.A.4 of this chapter)    Facility -level adjustments for: o A low- volume facility adjustment for ESRD facilities that meet certain criteria, (see 60.B.1 of this chapter)   o A wage index ad justment to reflect differences in wage levels among the urban and rural areas in which ESRD facilities are located, (see 60.B.2 of this chapter)   o A rural adjustment, effective January 1, 2016