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Three-way deal for the future of kidney care

Sarah Pringle
Mar 21, 2022
Money image on an IV bag

Illustration: Aïda Amer/Axios

Fresenius Health Partners, InterWell Health and Cricket Health are joining forces to create a new value-based kidney care company valued at $2.4 billion.

Why it matters: Kidney care has historically focused on dialysis patients, but the management of the kidney disease population prior to kidney failure has remained largely untapped. The combination acknowledges that the market is ripe for transformation.

  • There are 600,000 Americans on dialysis today, but the last 50 years have witnessed little innovation when it comes to the remaining 36,000 Americans with kidney disease, Robert Sepucha, CEO of Cricket and incoming CEO of the new InterWell Health, tells Axios.
  • “Dialysis has gotten safer and helped people live longer lives, which is terrific, but not much has been done in terms of really helping the entire patient and managing the entire disease prior to kidney failure and throughout," Sepucha says.

Details: The new organization, operating under the InterWell Health brand, accounts for $6 billion of medical costs under management and 100,000-plus covered lives.

  • The merger combines InterWell's 1,600-plus nephrologists, Cricket's tech-enabled patient engagement model, and Fresenius Health Partners' expertise in value-based kidney care contracting.
  • Supporting the transaction are Cricket investors Valtruis, a Welsh, Carson, Anderson & Stowe company, Oak HC/FT, Cigna Ventures and Blue Shield of California.

Between the lines: Cricket is focused on early patient engagement to delay disease progression, preventing stage 4 chronic kidney disease patients from crashing and ending up in costly emergency department or hospital settings, as well as transitioning patients to home-based dialysis.

  • "For us, it’s all about empowering the physician to do more for patients," Sepucha says. “Nephrologists don’t have the time or resources to do all of the things you need to do to really thrive and succeed in value-based care."
  • Cricket typically engages with patients 10 times a month, versus an average of once a quarter, while 40% of its patients start dialysis in the home (4x the national average), the CEO says.
  • Cricket can already deliver on those three legs, but "in order to make an impact, you need enough nephrologists (and dialysis capabilities)," Oak HC/FT partner Vig Chandramouli tells Axios. "This is a way for us to get a large population of patients and roll this out and impact more people."

State of play: The need and appetite for risk-taking models in high-spend areas like kidney care are obvious.

  • Nephrology and kidney care lend to a total addressable market of $170 billion.
  • If a patient crashes from dialysis and ends up in the ED, it can be a $100,000 episode, Chandramouli notes.
  • By 2025, the new entity expects to manage the care of 270,000-plus Americans living with kidney disease, boosting its medical costs under management to $11 billion.

The bottom line: Preventative, holistic kidney care can lead to significant reductions in hospitalizations and lower costs to payers, while ultimately improving the quality of life for patients.

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