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Dialyze Direct to acquire Midwest dialysis provider

Published: 09/07/2018


New York–based dialysis-services company Dialyze Direct, which provides onsite dialysis services at skilled-nursing facilities, has agreed to acquire Midwest provider Affiliated Dialysis Centers.

The purchase, for an undisclosed price, is part of Dialyze Direct’s ongoing expansion strategy and comes as the nursing home industry awaits a shift to a new payment model proposed by the Centers for Medicare and Medicaid Services earlier this year, which would take effect in October 2019. The patient-driven model, with a value-based approach, is designed to determine Medicare payments based on clinically relevant outcomes instead of volume of services, according to CMS.

“This is spearheading our expansion into the Midwest,” said Henry Kauftheil, Dialyze Direct’s co-founder and chairman.

Dialyze Direct also expects to grow into six additional states by the end of next year, said Josh Rothenberg, co-founder and chief operating officer. Outside New York, Dialyze Direct provides services in Florida, Texas, New Jersey, Ohio and Pennsylvania. Affiliated Dialysis is based in Chicago.

“Affiliated Dialysis felt that, with the changes that have happened already in health care—where hospitals are looking for outcomes, payers are looking for outcomes—a model that focuses on outcomes is very beneficial,” Rothenberg said.

At Dialyze Direct, that model includes coordination of care with nursing home staff for patients with end-stage kidney disease as well as technology designed to serve patients with multiple comorbid conditions. That can improve outcomes, such as decreasing re-hospitalizations.

Dialyze Direct expects to complete its acquisition of Affiliated Dialysis by the end of the year. Most of the latter’s roughly 120 employees will move to Dialyze Direct, where headcount will reach about 300 and continue to grow, as dozens of positions are available, Rothenberg said. — J.H.