Published by Inside Health Policy

HHS on Friday (Sep. 28) announced about $2.6 million in prize money for the KidneyX: Redesign Dialysis competition, and Ed Simcox, HHS chief technology officer, said at a briefing that the while the prize competition can encourage innovation, coordination between FDA and CMS to improve patient access will also be part of the KidneyX initiative.

Simcox said the Government Accountability Office has found that Medicare spends about 7 percent of its budget on beneficiaries with end-stage renal disease. KidneyX is designed to create incentives for new therapies by offering money through a series of prize competitions that target gaps in kidney care, he said. It is also designed to provide coordination across the National Institutes of Health, Centers for Disease Control, FDA and CMS to clarify paths to commercialization and patient access. That, in turn, will decrease risks that dissuade research in this area, Simcox said.

Dialysis was a medical breakthrough decades ago, but it has changed little since its invention, Simcox said.

The KidneyX: Redesign Dialysis competition “challenges the public to develop better treatment options for patients with kidney failure,” according to a release from HHS. The prize is the first in a planned series.

Prizes will run in two phases. The first phase will include up to 15 prizes of $75,000 each. It is set to launch in late October and run through February 2019. The first phase will ask participants to design solutions that can replicate normal kidney functions and improve patient quality of life.

The second phase, planned to run from April 2019 to January 2020, will ask participants to develop prototypes, and comes with up to three prizes of $500,000. Participants may compete in the second phase without being part of the first phase, according to HHS.

Simcox said HHS officials also recognize they need to clarify regulatory, coverage and pay pathways to avoid keeping participants away, “which should also lead to increases in private investment and ultimately the development of better products.”

Simcox told Inside Health Policy that while he can’t speak for CMS, “there’s an idea around possibly updating regulations to modernize things to allow for more innovation to occur at the point of dialysis.”

At the briefing, Simcox said CMS has done a great job reimbursing for dialysis, but the way pay is set up doesn’t allow for a lot of innovation in that structure.

“You can begin to imagine some innovation on that side as well. But I think payment a lot of time drives behavior, right, so our hope is we can kind of turn the corner and see innovation percolating up through things like that as well,” Simcox said.

Allen Nissenson, chair of Kidney Care Partners, said the ESRD entitlement in Medicare has been a tremendous benefit for patients, but there’s no question that the rigid payment system has stifled innovation. Bringing in new products and expecting to be paid is not realistic, he said so it’s hard to get a return on investment for new products in that environment, he said.

However, Nissenson said CMS has been doing great work with delivery reforms and pay models, and pointed to the End-Stage Renal Disease Seamless Care Organizations and other efforts to look at a more global pay structure that doesn’t keep Medicare Parts A and B so separate.

He said the combination of revising the pay system and programs like KidneyX could really spur change for kidney care.

Michael Shapiro, president of the Renal Physicians Association, raised concerns with a number of CMS policies, including the proposed changes to evaluation and management coding, which he said would compromise efforts to coordinate care and delay progression of kidney disease, and the absence of a pass-through payment or similar innovation adjustor in the dialysis pay bundle, which he said hurts innovation.

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