New Data Associates Positive Health Outcomes with Comprehensive Primary Care

March 14, 2016

New Data Associates Positive Health Outcomes with Comprehensive Primary Care

Comprehensive Primary Care

This month the Patient-Centered Primary Care Collaborative (PCPCC) issued an update to their longitudinal study of the impact of patient-centered medical homes on healthcare costs and quality. On February 2nd, they shared the information with the bipartisan Congressional Primary Care Caucus on Capitol Hill to help lawmakers assess implications for Medicare payment reform.

Patient-Centered Medical Homes Explained

To level set on the term, PCPCC defines a patient-centered medical home (PCMH) as a model of care that embraces the relationship between the primary care team and the patient. In the PCMH model, the primary care team supports patients, families and caregivers to develop and adhere to care plans. It takes a whole-person care approach addressing both physical and behavioral health needs; including prevention and wellness services, acute care and chronic condition management.

The PCMH helps coordinate care across the full health system from specialty care to lab and imaging services to home health care and community support. Under the PCMH model, patients have greater access to their primary care team. This means shorter waiting times, enhanced office-hours, and 24/7 electronic or phone access. PCMHs embrace technology both in delivery of services and measuring outcomes.

Primary care has been undervalued in today’s healthcare marketplace. Fifty-five percent of all medical office visits are for primary care; however, this represents just 4 to 7 percent of overall healthcare spending. The PCMH model is aimed at getting more value out of our most cost-effective healthcare delivery channel.

The Results are In – PCMHs Reduce Healthcare Spending

The updated PCPCC study pooled results from 30 PCMH studies nationwide. These studies show a clear trend that PCMHs help control healthcare costs in a number of important ways, including:

  • Reduced emergency department visits
  • Reduced inpatient hospitalizations
  • Reduced hospital readmissions
  • Reduced drug spending

Some specific examples of cost savings included:

  • The UCLA Health System experienced a 12 percent reduction in ED utilization totaling $1.4 million in annual savings
  • The Colorado Multi-Payer PCMH pilot experienced an 8 percent reduction in ED visits and a 13.9 percent reduction in ED costs
  • Blue Cross Blue Shield of Michigan Physician Group Incentive Program saved $16.73 per member per month (PMPM) versus a control group after three years
  • New York’s Hudson Valley Initiative saw a 6 percent reduction in specialist visits after one year
  • Rochester Medical Home Initiative decreased drug spending by $11.75 PMPM despite increasing utilization of prescription drugs

The vast majority of programs studied are seeing increasing savings results the longer the PCMHs are in place.

Aligning Incentives Critical for Success

The fee-for-service payment model is fundamentally at odds with the PCMH model. The PCMH programs experiencing the highest levels of savings tend to be those who participated in multi-payer collaboratives with incentives and measurements in place linked to quality, utilization and patient engagement instead of to volume. Some of the more innovative payment designs include:

  • UCLA Health uses population-based capitation and risk-sharing contracts
  • The Colorado Multi-payer PCMH pilot awards bonuses to practices for meeting quality and utilization benchmarks
  • Blue Cross Blue Shield of Michigan offers up to 20% increased reimbursement for regular office visits, reimburses providers for care coordination services and provides added bonuses for achieving high quality scores
  • Colorado Accountable Care Collaborative participants receive a share of the total savings on medical expenditures and bonuses for meeting key performance indicator targets

To date, there is no indication that a single payer model is outperforming the multi-payer model in terms of overall cost savings.

Data supporting the value of enhanced primary care as a means of controlling healthcare spending and improving population health continues to mount. CMS is taking note of these findings as they formulate policy around value-based payment models.

Many employers don’t want to wait for a government-driven solution. Instead they are opening their own onsite and near-site primary care centers based on the medical home model. Paladina Health’s direct primary care medical home approach to employer-sponsored healthcare offers employers an opportunity to begin realizing the benefits of a medical home approach today.

To learn more, contact Paladina Health today at 1-866-808-6005 or request a meeting online.

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