The End-Stage Renal Disease Treatment Choices (ETC) model, a pay-for-performance program introduced by the Centers for Medicare & Medicaid Services’ (CMS) to improve kidney outcomes, did not significantly increase rates of home dialysis or kidney transplantation over 4 years, according to a new study.

“Together, these findings reinforce that the ETC model did not have a meaningful effect on its targeted outcomes even after prolonged implementation, while imposing widespread and increasing financial penalties,” first author Kalli Koukounas Green, MPH, Department of Health Services, Policy and Practice, Brown University School of Public Health, Providence, Rhode Island, told Medscape Medical News.

The study was published in JAMA Health Forum.

ETC’s Limited Impact

With the US lagging behind other high-income countries in rates of home dialysis or kidney transplantation — both preferred treatments for end-stage kidney disease (ESKD) — the ETC was launched in 2021 as part of the Advancing American Kidney Health initiative.

The mandatory program, implemented in 30% of randomly selected hospital referral regions, is one of the largest randomized tests of pay-for-performance incentives in US healthcare.

Dialysis facilities and nephrologists in selected regions received payment bonuses or penalties based on performance metrics tied to home dialysis use, transplant rates, or waitlisting.

Originally set to run through 2027, the program was terminated early in December 2025 because of limited progress toward its goals.

To evaluate the model’s effectiveness, Green and colleagues conducted a cross-sectional study using Medicare data linked to transplant records from the United Network for Organ Sharing, spanning January 2017 (4 years prior to the model’s implementation) through September 2024 (3.75 years post-implementation).

Among 795,232 patients with ESKD, home dialysis rates increased modestly from 12.8% to 16.7% in ETC regions compared with 13.7% to 17.3% in control regions, yielding a negligible differences-in-differences of 0.1 percentage points.

Kidney transplant rates increased from 3.3 to 4.5 in per 1000 patient-months in the ETC regions vs 3.4 to 4.4 in control regions, corresponding to a nonsignificant differences-in-differences of 0.2 percentage points.

The proportion of patients per month on transplant waitlists decreased from 16.1% to 15.5% in ETC regions and from 17.7% to 16.7% in control regions, for an adjusted differences-in-differences of 0.6 percentage points.

Secondary and subgroup analyses, including those based on patient characteristics, facility attributes, and prepolicy treatment patterns, were consistent with the overall findings.

Penalties A-Plenty

Under the ETC model, providers who exceeded performance benchmarks earned bonuses of up to 6% in 2024, whereas those falling below benchmarks were penalized up to -7%.

The proportion of dialysis facilities receiving penalties rose steadily from 13.8% in 2021 to 25.1% in 2023, with more than 40% penalized at least once during the study period.

“If anything, this may suggest that the thresholds established by the ETC model were difficult for facilities to achieve,” Green said, adding that results on bonus rates in the program were not available.

Previous reports also showed that dialysis facilities serving greater proportions of higher-risk population were more likely to be penalized, prompting CMS to introduce a health equity incentive in 2022. Although this reduced disparities, overall penalty rates continued to rise across all cohorts.

The authors suggested that rising penalties may have further strained under-resourced facilities, limiting their ability to improve performance.

“This may have downstream consequences because now the facility has less funding available to implement model requirements, and may continue to face additional penalties in successive rounds of evaluation,” Green noted.

Many Challenges Beyond Reach of a Payment Model

The study authors emphasized that several barriers to home dialysis and transplantation lie beyond the reach of payment incentives. These include out-of-pocket equipment costs, need for caregiver support, limited access to training, and systemic challenges in organ availability and transplant logistics. This is particularly true given that transplant centers did not receive direct incentives under the ETC model.

Ultimately, “the ETC has demonstrated that executing pay-for-performance incentives in kidney failure care is complicated and nuanced,” Green said.

“Future experiments may need to look beyond simply applying financial incentives to drive performance and consider what areas within the larger care ecosystem can be supplemented to drive tangible change,” she added.

Expert Perspectives

Mallika L. Mendu, MD, chair of the American Society of Nephrology’s Quality Committee, said the findings highlight a key limitation of the model.

“Penalties can hamper investment in programming to improve care delivery,” Mendu told Medscape Medical News. “Increasing home dialysis and transplant rates requires investment and resourcing, and there is an argument to be made that ETC did not adequately fund those investments.”

She also noted that broader national trends, such as growth in Medicare Advantage and alternative payment models, may have confounded the results.

By contrast, CMS’ Kidney Care Choices Model, which includes patients with both advanced and earlier-stage chronic kidney disease and incorporates shared risk and rewards, has shown more tangible results.

“There are encouraging signs from the Kidney Care Choices model that indicate that improvements in clinical outcomes are feasible, though resourcing and investment continue to be paramount,” Mendu said.

Eugene Lin, MD, Department of Medicine, Keck School of Medicine of the University of Southern California, Los Angeles, added that the new findings counter the argument that pandemic-related disruptions limited the ETC model’s early success.

“People thought the initial incentives were too small, which may have blunted a response,” he told Medscape Medical News. “Now, we know that larger incentives didn’t work either.”

Lin noted that home dialysis decisions are highly personal decisions made between patients and care teams and may not be influenced by facility-level decisions.

“Furthermore, ETC primarily assesses the prevalent period of dialysis, the majority of whom have been on dialysis for a while.”

“But most patients do not switch into home dialysis after being on in-center dialysis for a while,” he noted.

Green and Mendu reported having no relevant disclosures. Lin reported receiving grants from National Institute of Diabetes and Digestive and Kidney Diseases.