Financial Ties, Market Structure, Commercial Prices, and Medical Director Compensation in Dialysis.

Growing consolidation in the dialysis industry has raised concerns about market power and the potential need for antitrust enforcement, but a lack of data previously prevented a systematic analysis of these issues.To document the consolidation of dialysis facilities through chain ownership and vertical integration between dialysis facilities and physicians, as well as study associations between consolidation and commercial prices for outpatient hemodialysis and medical director compensation.This economic evaluation combined data from Freedom of Information Act requests, Medicare claims, cost reports, commercial prices, and physician registries to conduct a retrospective study of market structure, compensation, and prices in the dialysis industry from 2005 to 2019. Those evaluated include dialysis facilities in the US, physicians involved with dialysis for patients enrolled in Medicare, and patients with end-stage renal disease enrolled in Medicare or one of the commercial insurers in claims data provided by the Health Care Cost Institute. Data were analyzed from April 2024 to April 2025.Chain ownership, physician ownership, and medical directorship of dialysis facilities in the US from 2005 to 2019.Chain ownership of dialysis facilities, share of population living in markets with different levels of chain ownership, share of facilities with physician owners, levels of medical director compensation, and commercial prices for outpatient hemodialysis in markets with different numbers of chain- and physician-owned facilities.Between 2005 and 2019, the market share of DaVita and Fresenius increased from 59.1% to 77.1%, with 32.5% of the national population living in a hospital service area (HSA) without access to a dialysis facility other than these 2 chains in 2019. The share of facilities with a physician owner increased from 11.4% to 29.1%. Markets with only 1 large chain had $495.08 (95% CI, $371.21-$619.85) higher mean commercial prices for outpatient hemodialysis and $564.56 (95% CI, $429.03-$700.10) higher medical director compensation per patient than markets that did not have large chain facilities.In this economic evaluation, market concentration in the US dialysis industry increased from 2005 to 2019 and was associated with higher commercial prices for outpatient hemodialysis. Physician ownership of facilities also increased, and medical directors received higher pay in markets where large chains operate.

Duke Scholars

Author James W. Roberts Economics