Bundling: A Venture into the Unknown

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Kam Kalantar-Zadeh, MD, MPH, PhD
Kam Kalantar-Zadeh, MD, MPH, PhD

Many nephrologists feel increasingly bewildered by heightened discussion about the upcoming bundling system for dialysis patients.

The dialysis industry is a unique and giant enterprise serving nearly a half million Americans with end-stage renal disease (ESRD). Medicare, the primary insurance of three-fourths of all U.S. dialysis patients, usually sets the reimbursement amount and provides a single rate for outpatient dialysis services.

It also reimburses for the injectable medications, including erythropoietin (EPO), active vitamin D, iron, and antibiotics. The average monthly composite rate, which varies according to age, gender, and body size (the so-called “case-mix adjustors”) and geographic wage index, is currently around $130 to $160.

In the new bundling system, slated to be phased in by 2011, one single reimbursement will be paid for both dialysis treatment services and injectable medications. The bundling system is justified by the Government Accounting Office (GAO) and Medicare Payment Advisory Commission (MedPAC) as an effective system to save funds for our challenged health care system.

Critics believe that bundling may change our practice pattern significantly, especially by encouraging the use of less expensive medications, such as iron instead of EPO. Among injectable irons or active vitamin D compounds, the cheapest ones may be favored. Would the science justify this new practice pattern?

And what about oral medications, which may or may not be included in the bundle? If their inclusion is inevitable, should only ESRD-related oral drugs be included? Or should the inclusion be restricted to oral equivalents of injectables such as vitamin D and iron agents? Would the latter lead to cessation of the development of injectable medications in the R&D sector for fear of being included in the bundle?

These and other unanswered questions prompt some nephrologists to think they are entering uncharted territories in the history of American nephrology. The unknown can lead to concerns and fear, which may make us susceptible to manipulations.

A good approach to bundling-related questions is to try to acquire a better understanding and more accurate knowledge about the new system and its implications for patient care and physician practice.

For starters, I invite you to review the series of articles on published by Renal & Urology News in recent months. The next article in the series, which will appear in the November issue, is on the possible effects of bundling on nephrology training.

Kamyar Kalantar-Zadeh, MD, MPH, PhD is Associate Professor of Medicine and Pediatrics, and Director, Dialysis Expansion & Epidemiology, Harbor-UCLA Division of Nephrology & Hypertension. He is the Renal & Urology News Medical Director for Nephrology.

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