New ESRD 2023 Payment Model and Dual Status Impact

Starting with the January 2023 payment month, health plans will see the impact of dual status on their End-Stage Renal Disease (ESRD) members change from prior years. In 2023, CMS implements the changes to the ESRD payment models that were announced in the 2023 advance notice. The revised ESRD payment model is calibrated on more recent data and now uses encounter data only. Relative to dual status, the new models incorporate changes previously made to the Part C CMS-HCC model, specifically the clinical updates and revised segmentation, which accounts for differential cost patterns within the dual eligible population.

What does this mean?

Before 2023, the increased capitation plans received for dual eligible ESRD members was based upon the members age, gender, and original reason for entitlement to Medicare. There was no differentiation in increased cap amount based on whether the dual eligible was a full dual or a partial dual. For 2023 payments, there is now differentiation in payment based on the type of dual (Partial vs. Full), and the HCC composition of the member.

Specifically, plans will no longer see increased capitation payments for partially dual eligible ESRD members in dialysis status, new enrollees in dialysis status, or new enrollees in functioning graft status. Plans will receive an increased capitation for full dual members in these statuses.  HCCs will impact the overall risk score for full dual members in these statuses, but that impact is not segmented to the HCC level.

For continuing enrollees in the functioning graft status, there is a modest bump for partial dual beneficiaries based strictly on whether the member is Aged or Nonaged. For full dual beneficiaries, the increase capitation will be based on the member’s age and gender, and there is further segmentation to the HCC level for full dual beneficiaries.

Bottom line, the dual status for ESRD members is vitally important in 2023 and beyond. Full dual beneficiaries provide a significantly higher capitation amount to health plans than partial dual beneficiaries.

If your health plan has questions about the new ESRD payment model, the Centauri Health Solution team of experts can help. Reach out to us at


Brian Smith
Director, Operational Planning and Analysis
Centauri Health Solutions, Inc.