Market Overview

Fresenius Medical Care Achieves Improved Health Outcomes and Savings through National Medicare Demonstration Program

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Results of Centers for Medicare & Medicaid Program Administered by
Fresenius Medical Care Demonstrate Reduced Readmission and
Hospitalization Rates, Significant Savings

Fresenius Medical Care North America (FMCNA), the country's leading
provider of kidney care products and services, announced today the first
performance year results from its End Stage Renal Disease Seamless Care
Organizations (ESCOs). The results, which cover the period from October
2015 through December 2016, show improved health outcomes for patients
receiving care coordination through the ESCOs. This success was
validated by an independent report from Lewin Group, which showed a
nearly nine percent decrease in hospitalization rates for these patients
during the same time. As a result, Fresenius Medical Care ESCOs together
generated more than $43 million in gross savings, an average 5.47%
reduction in expenditures per patient, with all six of its first-year
ESCOs exceeding the shared savings benchmark.

FMCNA's ESCO programs, known as Fresenius
Seamless Care
, were established through an agreement with the
Centers for Medicare & Medicaid Services (CMS) as part of CMS'
Comprehensive End Stage Renal Disease (ESRD) Care (CEC) Demonstration
Program, the nation's first disease-specific shared savings program.
This program was designed to identify, test and evaluate new ways to
improve care for Americans with ESRD. Under each ESCO, local
nephrologists and dialysis providers partner to develop innovative care
models based on highly coordinated, patient-centered care. Patients
retain all of their Medicare benefits and the freedom to choose their
providers.

The first-year report covers the period from October 2015 through
December 2016 and includes results of FMCNA's first six ESCOs, including
Philadelphia, Pa.; Charlotte, N.C.; Dallas, Texas; San Diego, Calif.;
Columbia, S.C. and Chicago, Ill. In January 2017, Fresenius
Medical Care added 18 new ESCOs
for a total of 24, giving the
company the largest ESCO presence of any dialysis provider in the nation
with approximately 800 physician partners. Including FMCNA, there are
currently seven dialysis organizations participating in the program
across 37 ESCOs.

"Since the launch of the ESCO program, we've enjoyed a strong working
relationship with CMS and have appreciated the opportunity to help shape
the future of care for this vulnerable patient population," said William
McKinney, president of FMCNA's Integrated Care Group. "The first year
results offer validation that our approach to ESRD patient care, placing
the patient at the center of an intensely focused, highly collaborative
care team, is key to improving patient outcomes, and we're pleased that
CMS allowed us to expand our services to cover more patients in 2017."

The success of the Fresenius Seamless Care ESCOs can be largely
attributed to the unique structure of the patient care team. It is a
collaboration between local care providers and FMCNA's Care Navigation
Unit (CNU), a team of specialized dialysis nurses and service
coordinators who work together closely to provide around-the-clock care
management and patient support. By focusing on the unique clinical and
psycho-social needs of each patient, the CNU anticipates issues before
they arise and helps patients, their families and their providers
respond more quickly.

"We are excited to bring a holistic and high level of care management
and quality focus to these cities, states and regions," said Frank
Maddux, MD, chief medical officer and executive vice president for
clinical and scientific affairs, FMCNA. "The reduction in readmissions
and hospitalizations, as well as the cost savings, are only the
beginning. We are looking to measure quality outcomes even more closely
so we can continue to improve and innovate care models for the
betterment of our patients."

As a result of their participation in this advanced alternative payment
model (Advanced APM), all of the nephrologists in FMCNA's ESCOs achieved
"qualifying provider" status and are eligible for a 5% increase in their
2019 Medicare fee schedule. Participation in the ESCO program reinforces
FMCNA's support of physicians and the healthcare system to improve care
and reduce costs.

About Fresenius
Medical Care North America

Fresenius Medical Care North America is the premier health care company
focused on providing the highest quality care to people with renal and
other chronic conditions. Through its industry-leading network of
dialysis facilities, outpatient cardiac and vascular labs, and urgent
care centers, as well as the country's largest practice of hospitalist
and post-acute providers, Fresenius Medical Care North America provides
coordinated health care services at pivotal care points for hundreds of
thousands of chronically ill customers throughout the continent. As the
world's largest fully integrated renal company, it offers specialty
pharmacy and laboratory services, and manufactures and distributes the
most comprehensive line of dialysis equipment, disposable products and
renal pharmaceuticals. For more information, visit the FMCNA website at https://fmcna.com.

The statements contained in this document are solely those of the
authors and do not necessarily reflect the views or policies of CMS. The
authors assume responsibility for the accuracy and completeness of the
information contained in this document.

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