According to Millennium Research Group (MRG), the global authority on medical technology market intelligence, the new reimbursement system from the Centers for Medicare & Medicaid Services (CMS) for end stage renal disease will have a mixed but mostly negative effect on the market for ESRD treatment devices. Medicare bears the largest cost burden for ESRD treatments for an increasing elderly and diabetic population, and its reimbursements drive the market for treatment devices such as specialized catheters, hemodialysis dialyzers and arteriovenous (AV) access grafts.
Until the end of 2010, Medicare employed a basic case-mix adjusted composite payment system that covered costs for dialysis-related services and items for outpatient dialysis care facilities, with separately billed items such as laboratory test and drugs. Since January 1, 2011, under its new bundle reimbursement system called End-Stage Renal Disease Prospective Payment System (PPS), CMS will make a single bundled payment to the dialysis facilities for both dialysis services and those previously billable separately.
"This change will place cost constraints on clinics," says April Lee, analyst at MRG. "They will probably increase the use of less-expensive devices such as reusable dialyzers. These have a higher up-front cost, but tend to be more cost-effective in the long run. If clinics try to save staffing costs by encouraging home hemodialysis or peritoneal dialysis (PD), this will increase PD catheter use, while negatively affecting sales of hemodialysis catheters and AV access grafts. Although PD catheters are a small but growing part of the entire ESRD market, revenue gains in the PD catheter market will not be enough to outweigh losses in the other market segments."
End-stage renal disease (ESRD) is a classification of kidney disease in which the patient's kidney function has declined to approximately 10% of normal function. The most common causes of ESRD in the US are type 2 diabetes and high blood pressure, and its incidence increases dramatically with age. ESRD patient numbers are expected to increase steadily in the US as a result of the aging US population and a rising number of diabetes sufferers.
Millennium Research Group's US Markets for End-Stage Renal Disease Treatment Devices 2011 covers sales of hemodialysis dialyzers, hemodialysis catheters, PD catheters and AV access grafts.
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