Kidney Dialysis Centers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 8,300 kidney dialysis centers in the US provide dialysis treatment for patients with end stage renal disease (ESRD), also known as chronic kidney failure. Patients with ESRD require dialysis treatments or a kidney transplant to sustain life. Dialysis is the removal of toxins, fluids, and salt from the blood of patients by artificial means.
Competing with Large Companies
The US kidney dialysis center industry is dominated by two large players – Fresenius Medical and DaVita – which together have 72% of the market.
Dependence on Government Reimbursements
Kidney dialysis centers earn the majority of their revenue through reimbursements from Medicare and Medicaid, since all ESRD patients are covered by Medicare, regardless of their age or financial circumstances.
Industry size & Structure
A typical kidney dialysis center has 16-17 employees and generates about $3-4 million in revenue.
- The kidney dialysis center industry in the US consists of 450 firms operating about 8,300 centers, employing 130,600 workers, and generating $28 billion in annual revenue.
- The industry is highly concentrated, as the two largest firms – Fresenius Medical and DaVita – treat about 80% of kidney dialysis patients in the US and account for 72% of outpatient dialysis centers.
- Other large kidney dialysis firms include US Renal Care, Dialysis Clinic, Inc., American Renal Associates, and Satellite Healthcare.
- There are about 558,000 patients receiving dialysis treatment in the US.
- 89% of US dialysis patients receive hemodialysis treatment, usually at a kidney dialysis center. Just over 1% receive hemodialysis at home. About 12% of dialysis patients received peritoneal dialysis, usually at home.
Industry Forecast
Kidney Dialysis Centers Industry Growth
Recent Developments
May 6, 2023 - President Biden Ends Covid-19 National Emergency
- President Biden signed in April a congressional resolution to bring the US national emergency to respond to the COVID-19 pandemic to a close after three years — weeks before it was set to expire alongside a separate public health emergency. The resolution ends several waivers for federal health programs Medicare, Medicaid, and the Children's Health Insurance Program. Ending the national emergency early could also terminate some of flexibility for the Continuation of Health Coverage program. The Biden administration had set a May 11 deadline for both the national emergency and the public health emergency, giving states the go-ahead to begin winding down the measures enacted under them.
- A longer interval between last dialysis session and a surgical procedure significantly correlates with an increased risk of 90-day postoperative mortality among Medicare beneficiaries with end-stage kidney disease, according to research published in JAMA Network. Undergoing hemodialysis treatment on the same day as surgery is associated with a lower risk of mortality. “Although experts recommend performing hemodialysis either on the day prior to surgery or on the day of surgery, there are no consensus statements or guidelines to address the timing of preoperative hemodialysis,” researchers at the Stanford University school of medicine and colleagues wrote.
- Administrators of independent dialysis clinics said in a letter to Congressional leaders that intervention is needed to avoid staffing cuts because of inadequate Medicare payments. The letter cites a recent study by Prima Health Analytics which found that dialysis facilities have accumulated $1.7 billion in losses over the last 3 years. On average, facilities lost 42% of operating expenses in excess of revenues, totaling $320,000 per facility per year. “A mere 3% increase to the base rate for [calendar year] 2023 is woefully inadequate in this time of economic and staffing instability. With absent action from Congress, access to care and the quality of care for individuals relying on Medicare for their dialysis services will be jeopardized,” the letter said.
- About 20% of patients who recover kidney function and discontinue dialysis subsequently restart dialysis, according to a paper published in the Clinical Journal of the American Society of Nephrology. The risk for dialysis re-initiation is higher for patients who are older at first dialysis start or who have cystic conditions, diabetes, or hypertension. Among 34,530 adult Medicare beneficiaries who started dialysis (96% hemodialysis) but had recovery of kidney function, 7217 patients (21%) restarted dialysis within 3 years of recovery (absolute rate of 11.5 per 100 person-years). At any point during follow-up, 26.4% restarted dialysis (absolute rate of 8.8 per 100 person-years). The investigators defined kidney function recovery as 90 days or more without dialysis.
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