On January 5, 2011, CMS published a final rule to implement a quality incentive program (QIP) for Medicare outpatient end stage renal disease (ESRD) dialysis providers and facilities. Under the QIP, Medicare payment will be tied to the facility’s performance on selected quality measures (CMS had previously adopted three quality measures pertaining to hemodialysis adequacy and anemia management for the first year of the program). Facilities that do not meet or exceed CMS’s performance standards will be subject to a payment reduction of up to 2%. The first evaluation year under the new system is 2010, and the QIP payment adjustment will apply to items and services furnished to Medicare beneficiaries in 2012. CMS expects about 27% of ESRD dialysis facilities to receive some kind of payment reduction for 2012 under the rule.