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 Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 7,760 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 7,900 centers, employing 132,800 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
                              Source: Vertical IQ and Inforum

                              Coronavirus Update

                              Apr 25, 2022 - CMS Waivers Cancelled
                              • The Centers for Medicare and Medicaid Services (CMS) issued guidance in early April that terminates numerous blanket waivers applicable to skilled nursing facilities (SNFs), inpatient hospices, intermediate care facilities for individuals with intellectual disabilities (ICF/IIDs), and end-stage renal disease (ESRD) facilities. CMS expressed concern “about how residents’ health and safety has been impacted by the regulations that have been waived, and the length of time for which they have been waived.” A CMS waiver of the requirement for on-time preventive maintenance of dialysis machines and ancillary dialysis equipment is among those cancelled.
                              • Maintenance dialysis patients with one to two vaccines shots against COVID-19 showed better immunity to infection and severe illness than unvaccinated patients, according to an analysis of several studies. Patients who received one vaccine were 41% less likely to become infected with COVID-19 compared with nonvaccinated patients. Those with two vaccinations were 69% less likely to catch the virus. Similarly, those with at least one vaccination were 46% less likely to develop severe COVID-19 compared with nonvaccinated patients, and those with two vaccinations were 83% less likely.
                              • A US study found that antibody responses following COVID-19 vaccination wane over time across vaccine types in patients on dialysis. “The decline in antibodies was noted as early as two months after vaccination, and levels were undetectable in about half of patients at six months after vaccination,” said lead author Caroline Hsu, MD, of Tufts Medical Center. “We therefore strongly advocate for a standardized approach of providing additional vaccine doses to all patients receiving maintenance dialysis, particularly with the rise of the omicron variant. Furthermore, there may be an important role for serial monitoring of antibody levels, with re-dosing of vaccine when the antibody response has waned.”
                              • The numbers of patients with kidney failure who started treatment such as dialysis or transplant decreased as much as 30% during the first 4 months of the coronavirus pandemic, according to findings published in JAMA Network Open. "These substantial declines were actually unprecedented nationwide," said lead author Kevin Nguyen said. Plausible reasons for kidney treatment delays include cost of care, fear of COVID-19 infection, or shared decision-making by patients and providers to delay therapy. While the study didn't examine these influences, "I imagine a combination of them were driving this change," Nguyen said. Industry experts say that the results provide nephrologists and public health officials with key insights to improve kidney failure treatment during any further COVID-19 waves or a future pandemic.
                              • Kidney damage can occur among people who recover from relatively mild COVID-19 infection at home, and escalates with the severity of COVID-19, according to a study published in the Journal of the American Society of Nephrology. About 7.8 extra people need dialysis or a kidney transplant per 10,000 of these mild-to-moderate COVID-19 patients. “This is not a small number, if you multiply by the huge number of Americans and also globally who might be ending up with end-stage kidney disease,” said Ziyad Al-Aly, director of the clinical epidemiology center at the Veterans Affairs St. Louis Health Care System in Missouri. “This is really huge, and it will literally shape our lives for probably the next decade or more.”
                              • Many individuals with kidney failure are at high risk for COVID-19 due to limited ability to self-isolate because they require dialysis treatments in clinics several times a week, according to a study published in the Clinical Journal of the American Society of Nephrology. The findings confirm the high rates of symptomatic COVID-19 among patients receiving in-center dialysis and suggest sources of transmission both within dialysis units and patients' home communities. The work also suggests that in addition to isolation of confirmed cases, addressing factors that might reduce transmission from patients without suspected or confirmed disease might provide an additional opportunity to further modify the impact of COVID-19 in this population.
                              • People undergoing long-term dialysis are almost 4 times more likely to die from COVID-19 according to a study published in Canadian Medical Association Journal. Top risk factors for COVID-19 infection in people on dialysis include hemodialysis at a hospital facility as compared to home dialysis and living in a long-term care facility.
                              • Many industry leaders say that use of home dialysis is increasing due to the coronavirus pandemic. “People recognized it would be better if they did it at home,” said Dr. Susan Quaggin, president-elect of the American Society of Nephrology. “And certainly, from a health provider’s perspective, we feel it’s a great option.” Nearly half a million people in the US are on dialysis, according to the National Institute of Diabetes and Digestive and Kidney Diseases. Roughly 85% of them go to a clinic for their treatments.
                              • The development of acute kidney injury (AKI) in patients hospitalized with COVID-19 is associated with dramatically higher than usual mortality rates, and a significant proportion of patients with AKI do not recover kidney function by the time they are discharged, according to a study published online in the Journal of the American Society of Nephrology. The study "shows a marked contrast to other forms of AKI, where over 80% of patients recover their renal function by 10 days," according to Lili Chan, MD, of the Icahn School of Medicine at Mount Sinai, New York City. "We may be facing an epidemic of post-COVID-19 kidney disease and that, in turn, could mean much greater numbers of patients who require kidney dialysis and even transplants," said senior author Girish Nadkarni.
                              • CMS plans to pay more for dialysis equipment used at home to move more treatment outside dialysis centers during the coronavirus pandemic. CMS said that the “transitional add-on payment for new and innovative equipment and supplies,” or TPNIES, would allow greater access to home dialysis machines, making it easier to get them to Medicare beneficiaries. Industry experts say that the move is CMS’ latest attempt to use dollars to steer patients with end-stage renal disease (ESRD) out of dialysis centers.
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