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Remarks to KidneyX Developers & Medical Professionals

Eric D. Hargan
KidneyX Developers & Medical Professionals
April 29, 2019
Washington, D.C.

We are gathered here because today’s options are not good enough, and the work you all are doing and hopefully will continue to do can create better options for patients tomorrow.

As Prepared for Delivery

Good afternoon, everyone, and welcome to the inaugural KidneyX Summit. It’s an honor to be here with you and to talk about innovative ways we can prevent, diagnose and treat kidney disease.

Whether you’re a patient, a physician, an innovator, a researcher, an engineer, or involved in some other way, you are all here today because you have a passion for seeking to improve the lives of so many Americans affected by kidney disease.

It’s an exciting time to be in the kidney care field because I believe we now have the chance to make major advances in a sector that has not seen the same kind of progress we’ve seen in other areas of healthcare.

In fact, if you’re new to the kidney care community, I want you to know that you’re especially welcome. The complexity of this challenge requires the collaboration of people in this room but also beyond it.

I also want to thank my colleagues at HHS who are involved in KidneyX, along with our partners at the American Society of Nephrology. Your hard work and partnership in fighting this disease is invaluable.

For all of the successes of American healthcare, you all know that kidney care is in need of significant improvement.

Together, we’re all focused on transforming kidney care in this country, and earlier this year, Secretary Azar laid out a path for us to get there.

First, we need more efforts to prevent, detect, and slow the progression of kidney disease.

One reason we can make strides on prevention is that we have so far to go on awareness and detection. Ninety-six percent of Americans with kidney damage or mildly reduced kidney function are unaware of it, and as many as 48 percent of Americans with stage four kidney disease who aren’t on dialysis still don’t know they have it.

We believe we can do a much better job of preventing or slowing progression to later stages of kidney disease and kidney failure—and in doing so, we can also set up patients better to choose from a range of options if they do need to go on dialysis.

That brings me to our second goal: Patients with kidney failure deserve more options for treatment, from both today’s technologies and those of the future.

Today, 88 percent of Americans with ESRD start treatment with center-based dialysis. Just 12 percent start treatment at home with hemodialysis or peritoneal dialysis. This is the complete opposite of the situation in some of our peer nations, such as Hong Kong, where more than 80 percent of patients benefit from some form of in-home dialysis.

Improving this situation dramatically, as we ought to do, will mean examining the payment incentives in our programs today, expanding access to new technologies, and improving patient education.

Really, there may be no better example of how outdated payment systems distort Americans’ healthcare, and lower its quality, than what we have in kidney care today.

As many of you know, while peritoneal dialysis or home hemo may not be possible for absolutely everyone, they can often be more convenient, better for patients’ independence and self-sufficiency, and better for their health. But in many ways, today’s policies bias providers toward center-based dialysis.

In particular our payment incentives probably encourage dialysis centers to attract and retain patients, creating incentives to add patients to existing centers rather than allow for the most appropriate mode of care.

But that isn’t providing the care patients deserve, and we have the role and responsibility at HHS to test out significant payment changes to provide the best options for care including home dialysis.

More importantly, our payment policies don’t encourage the kind of innovative product development that you all can deliver and that patients deserve. We are gathered here because today’s options are not good enough, and the work you all are doing and hopefully will continue to do can create better options for patients tomorrow.

This fits right into our third goal, to deliver more organs for transplants and develop wearable and implantable artificial kidneys, so we can help more Americans escape the burdens of today’s dialysis altogether.

One key step is, again, reorienting our payment incentives. Today, dialysis companies are actually disincentivized from helping patients get ready for and find a transplant.

Ideally, we’d want to offer dialysis providers incentives to get patients off dialysis through transplants. We want to make the outcome that’s good for the patient and good for the system good for their business, too.

We’re also looking at ways to make more kidneys available for transplant, including by doing more to improve support for Americans who are generous enough to consider being a living kidney donor.

As I mentioned, the goals of improving options for patients and expanding the possibilities of transplants or artificial kidneys are directly relevant to the work that many of you are doing.

One of my key overall goals as Deputy Secretary has been to examine how HHS can do a better job of supporting innovation, including in areas where there is a particular need for improvement, like kidney care.

One example of this work is the Deputy Secretary’s Innovation and Investment Summit, a collaboration I’ve launched between healthcare innovation and investment professionals and HHS personnel.

Through DSIIS, we have heard about a number of issues, including concerns in particular around how some of HHS’s payment and regulatory policies can be a deterrent to innovators. We want our policies to be acting as the exact opposite: encouraging innovation in the spaces where we need it most, like kidney care, not discouraging it.

Happily, we do have many efforts going on to address this issue, and one of them is KidneyX, which HHS launched last year. I’m so glad to be here at this summit, where, later, we’ll be announcing the phase I winners of the first KidneyX competition, “Redesign Dialysis,” which prompted innovators to propose new technologies and approaches that could usher in the next generation of renal replacement products that are more effective and give patients their lives back.

We need this next generation of technologies because, as most of you know, the way we treat kidney disease in this country hasn’t changed very much over the years. There are a few reasons for this. First, kidneys are complex organs and their functions are hard to replicate and manufacture.

Second, dialysis, while costly both physically and financially, does effectively work, for a time, to stabilize a patient. So understandably, investors and researchers don’t see an obvious need to embark upon creating an initially expensive alternative with no guarantee for success.

Third, to the innovator and private investor, regulatory processes and requirements may seem insurmountable and difficult to navigate. Considering the inefficiencies and regulatory burdens imposed by our current kidney care system, it’s no surprise that private investors, by themselves, haven’t found a way to solve all the problems posed by kidney disease.

There has not been the kind of appetite for investment in the kidney space that patients desperately need, and HHS finds that unacceptable. When faced with a challenge as significant as kidney care, HHS is taking proactive, appropriate steps to partner with the private sector on creating the solutions and care that patients battling kidney disease deserve.

That’s one of the reasons why we’re so excited about KidneyX. It’s designed to provide a pathway toward transformational technologies in the kidney space, including, eventually, the possibility of artificial kidneys.

But there’s a lot more we can do besides just prize competitions. We are also looking at how our payment and regulatory policies can help provide a pathway for new technologies in this space.

One example is a proposal we included in Medicare’s inpatient payment rule for next year, which we released last week. Medicare already provides a certain add-on payment for new technologies on top of the standard DRG payment to treat a specific ailment or injury.

But we believe that add-on may not currently be sufficient for certain innovative technologies. So, we’ve proposed to increase the maximum possible add-on from 50 percent above the cost of the existing technology to 65 percent.

In addition, we are proposing for medical devices that are part of the Food and Drug Administration’s Breakthrough Devices Program, CMS would waive certain criteria to be eligible for the new technology add-on payments.

These are an important example of a carefully considered decision to align the regulatory and scientific work we do at FDA with the payment policies we have at CMS.

Moreover, this is an opportunity to highlight those innovative solutions that contribute to the betterment of health outcomes for people with kidney disease.

We’ve heard this kind of alignment can be hugely important to investors, and we want to be responsive to that. In fact, some of the technologies that come out of KidneyX may end up being categorized as breakthrough technologies, which may make these innovative solutions eligible to be considered for this new potential payment.

These are just some of the steps that will be necessary to build an environment where American kidney patients get the quality care they deserve. President Trump, Secretary Azar, and I all believe we’ve waited long enough for better solutions and treatments in the realm of kidney care—and I know all of you agree.

KidneyX and other efforts can set us on a trajectory that offers real hope to those suffering from this debilitating disease.

The work all of you are doing is going to make a difference: It’s going to renew a determination to improve kidney care in this country and help spur the creation of the policies to achieve that goal.

I look forward to seeing the collaborative ideas, projects, and outcomes that are a result of this competition, this summit, and the work all of you are doing. Thank you again for having me here today.

Content created by Assistant Secretary for Public Affairs (ASPA)
Content last reviewed on April 29, 2019