This report originally appeared in the November 2010 issue of DOTmed Business News

Northwest Kidney Centers was the world’s first outpatient dialysis center. Back when it first began and was known as the Seattle Artificial Kidney Center, it only had three beds and nowhere near enough dialysis units to meet demands. This meant an anonymous group of community leaders had to be given the unenviable task of deciding which patients would be treated and would be turned away.

Those community members had to make such tough choices more than 10 years before Medicare became the primary caretaker of dialysis patients, a program that annually spends more than $70,000 per dialysis patient, according to the U.S. Renal Data System.
Today, the industry is on the cusp of a major reimbursement transformation, thanks to a new Centers for Medicare and Medicaid Services End-Stage Renal Disease Prospective Payment System. The anticipated changes ushered in by the new PPS, coupled with the proposal for a Quality Improvement Program, are driving manufacturers to address the needs of providers, who are now, arguably more than ever, looking to improve the quality of care and reduce costs.

Dialysis market
The global market for dialysis equipment is projected to reach $12.6 billion by 2015, according to a recent report by Global Industry Analysts, a Calif.-based market intelligence firm. The report credits the expected growth to the rising incidence of ESRD, an aging population, shortage of transplant donors and rising rates of comorbidities such as diabetes and hypertension. Europe, the U.S., and Japan account for more than 75 percent of the sales in the worldwide dialysis equipment and supplies market, according to the report.

Manufacturers have seen a decline in new equipment purchases, as U.S. economy woes put major capital investments and new construction projects on hold. Along with the economic conditions, the industry has experienced a lot of anxiety because of the new PPS rule.

“The CMS bundling rate for Medicare has a decrease in reimbursement rates for most providers,” says Samuel Amory, VP, renal therapies division for B. Braun Medical. “Over the last year or so, that by itself has put a big cloud on the overall market. Everybody was really concerned about what the changes were going to be.”

Concerns over the new PPS aside, OEMs say that disposables sales have been steady. Baxter, a major player in the dialysis market, is seeing gains in its peritoneal dialysis solutions.

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