OBJECTIVES: According to 2009 figures from the US Renal Data System, 17% of all patients received their first dialysis with private insurance coverage. Ferric citrate (FC) is a phosphate binder (PB) in clinical development for the treatment of hyperphosphatemia in ESRD patients. Patients receiving FC in clinical studies experienced reductions in serum phosphorus, and increases in serum ferritin and saturated transferrin (TSAT). In an observational study analyzing data of a large dialysis provider, similar increases in ferritin and TSAT in patients with stable hemoglobin were associated with reduced doses of intravenous (IV) iron and erythropoiesis-stimulating agents (ESAs) such as epoetin alfa. Reduced IV iron and ESA use could lower costs of ESRD treatment for insurers. METHODS: We created a managed care cost-offset model that considered annual treatment costs of ESRD patients prescribed FC versus alternative PBs. The model assumed similar efficacy and cost neutrality between FC and other PBs. Baseline input values were derived from published sources as well as a database analysis from a large US dialysis provider. Monte Carlo simulations were performed using varying model inputs such as the number of patients insured, proportion of ESRD patients on PBs, number of dialysis sessions, estimated cost for dialysis, and ESA and iron costs from observed dose ranges.  RESULTS: Results of the simulation were used to derive a 90% confidence interval for the potential annual cost savings realized with FC use. Simulations show a 90% probability that an insurer serving 500 dialysis patients could save between $389,000 and $829,000 annually with the use of FC. The model was most sensitive to the number of dialysis sessions per month, health plan size, ESA cost, and proportion of ESRD patients receiving PBs. CONCLUSIONS: The use of FC over alternative PBs could create a meaningful cost-offset savings and help reduce the economic burden of treating patients with ESRD.