Posts filed under ‘Patient Centered Medical Home’

More healthcare is better? You get what you pay for?

The journal Health Affairs just surveyed more than 1,500 patients with employer-provided insurance.   The majority of respondents believe that “more is better, newer is better, you get what you pay for, (and) guidelines limit my doctor’s ability to provide me with the care I need and deserve.”

Healthcare experts can come up with sophisticated ideas for containing healthcare costs.  Congress can simply mandate reductions in Medicare reimbursement.  However, without patient support, we won’t make progress with reducing the burden of the world’s costliest healthcare system.  Lack of patient support is what sunk the healthcare reform efforts of the 1990s.

The question is how to convince the majority of us that “you get what you pay for” but you don’t have to buy everything on the menu or pay more than we should for a therapy when all we have is a scratch or a cough.  When providing the best healthcare possible for our family shows our love and the best means the most costly, when Americans have an innate sense of entitlement for access to the best our healthcare system can provide, we are stuck with in “drive.”   Quick and direct efforts at cost reduction will meet nothing but resistance and failure.

Addressing this challenge will take time.  It took years to convince people to do something as simple and clearly beneficial as wear a seat belt or to not litter.  Healthcare is complex.  We need to develop simple and clear messages, supported with evidence, to change perceptions and the beliefs that are the cornerstone of our society. 

Physicians will play a key role in changing patient beliefs.  Patients will look to their doctor for guidance as to what treatment alternatives are appropriate and which are most beneficial. 

The physician-patient relationship also is complex.  Often, patients listen to their physician without question.  We follow our doctors’ directives solely relying on their judgement.  At other times, patients resist their physician’s guidance and physicians give in to their patient’s demands.  As we are our doctor’s customer, it is a case of “the customer is always right (as long as no harm is done).”  This interaction must be better managed to be more effective.

One approach is to allow doctors more time to educate patients.  This leads us to concepts such as the patient-centered medical home, which we have described in previous blog entries.  Reducing patient loads so primary care physicians can better address patient concerns, providing clinical pathways that guide physician decisions, using EHR to ensure physicians have all data available and redesignining physician and patient incentives to encourage short-and long-term implications of medical decisions will help make the patient-physician interaction more effective and focused on more cost-effective care.

June 4, 2010 at 12:55 PM Leave a comment

Compensation and the Patient-Centered Medical Home

Compensation for a PCMH team must achieve the following outcomes: 1) Reward improvements in outcome, 2) Drive decreases in the utilization of healthcare resources; 3) Encourage cooperation among team members.  Compensation structure should be simple enough for everyone to easily understand, measure their performance and calculate their expected compensation.  In other words, compensation should be evidence- and value-based rather than based on piecemeal work.

Of course, this is easier said than done.  Compensation is the most difficult issue associated with the patient-centered medical home (PCMH).  Understandably, no one wants their income to decrease and everyone wants to be compensated for the work they do (or don’t do).  Primary care physicians want compensation for coordinating the PCMH provider team.  Specialists and institutional providers, such as hospitals, don’t want to see a drop in their current income levels, even if their workload decreases. 

Compensation systems should be based on improved outcomes, both in the short term and the long term.   In many instances, short-term markers will be substituted for more appropriate long-term outcomes.  For example, measuring improvements in HbA1c scores for diabetes patients is more practical than measuring reductions in cardiovascular events and other co-morbidities.

As well, the PCMH should share the cost savings that insurers realize, without double-counting the cost savings associated with improved outcomes.  If the PCMH can realize the same outcomes with a comparable level of risk but fewer diagnostic exams or specialist referrals, the PCMH team should share those savings.  Sharing the cost savings will encourage providers to reduce the services they provide as the impact on their income will be softened.

Measuring the risk associated with reduced levels of care is as important as measuring short-term improvements in outcomes.  For comparison, many US corporations focus on short-term results as that drives their bonuses.  However, the long-term risks rise.  For example, Wall Street executives recognized significant profitability from derivatives and other risky trading and money management strategies in the years leading up to 2008 and the Great Recession.  We must avoid similar behavior with our healthcare status.

Developing a value- and evidence-based system that provides compensation based on improved outcomes, cost savings and acceptable levels of risk is a complex, time-consuming and costly endeavor.  It is predicated on the widespread implementation of EHR, the funding of comparative effectiveness research, and gaining consensus on outcomes, risk and cost-savings metrics and their measurement.  Therefore, compensation systems that enhance the effectiveness of PCMH will be phased in over time and increase in scope, complexity and benefit to the healthcare system over time.

As hinted at above, effective compensation systems requires sharing of rewards among the PCMH team.  That argues for further integration of providers to facilitate such sharing.  We’ll explore that issue next week. 

Take care and have a fun holiday weekend.

May 28, 2010 at 6:47 PM Leave a comment

Implementing EHR and PCMH

Implementing EHR is a requirement for implementing the PCMH concept.  However, it can be a costly requirement.   PriceWaterhouseCoopers’ report “Rock and a Hard Place: An Analysis of the $36 Billion Impact From Health IT Stimulus Funding” estimates that a three-physician practice could spend anywhere from $173,750 to $296,000 for an EHR package complete with software, implementation, training and software maintenance.  The cost of maintaining the data in the system, developing procedures and adding enhancements to the system over time are not included.

That cost exceeds the funding available through The American Recovery and Reinvestment Act of 2009 .  The act makes up to $44,000  available to  individual physicians to upgrade their practices from paper-based records to EHRs  between 2011 and 2015.

Then, why will physician practices implement EHR?  One significant incentive is that, beginning in 2017, the government will reduce Medicare payments to physicians who do not implement an EHR by 1% per year for as many as five years.  Hospitals could see even larger reductions for failing to implement EHR systems.  This will provide an incentive for practices to implement an EHR. 

A second incentive is that, over time, CMS, private payers, medical specialty societies and researchers will mine the data available through EHR systems.  They will use the data to drive value-based and evidence-based medicine and identify pathways for improving outcomes.  For example,  the  data will affect treatment algorithms and prior authorization requirements as well as ensuring compliance with them.  Therefore, once most physician practices have adopted EHR the remaining practices will be forced to follow suit or face expulsion from the healthcare delivery system. 

Simply maintaining competitiveness with other physician practices will not encourage adoption of EHR.  Very few patients will ask a primary care physician if he or she uses electronic or paper records. 

Qualifying for NCQA certification as a PCMH, which requires an EHR, will not be a significant incentive.   The certification might generate a few more chronically-ill patients but it is not clear that the revenue from these patients will outweigh the additional costs fo the systems. 

Also, for some practices, the timing difference between implementing the PCMH and generating more patients will be affordable for small physician practices.

As EHR moves towards a requirement for physician practices over the next 7 to 12 years, small physician practices are left with the challenge of  affording it.   Borrowing funds from a bank is one avenue.  However, the initial capital outlay for the system and the costs of implementing it will occur years before additional revenues are realized.

More likely is that providers will consolidate their practices to gain economies of scale from implementing the system.  EHR implementation will be simpler for single specialty rather than multi-specialty groups due to the uniformity of requirements.   However, the formation of larger multi-specialty groups will facilitate the success of PCMH and other approaches to delivering lower cost, higher quality care.

Integration of physician practices with hospitals is the least likely approach to affording EHR.  On the positive side, many hospitals have available the capital required to implement EHR for the physician practices.  Also, physician-hospital organizations offer opportunities to integrate the delivery of care.  Unfortunately, as the 1990s demonstrated, the political issues of developing an effective physician-hospital relationship are very challenging.

In summary, the advent of PCMH and developing the EHR systems required for its success is likely to contribute to the changing profile of the healthcare delivery system.  Larger physician groups, more multi-specialty groups and possibly the resurgence of some physician-hospital organizations will help drive the success of PCMH and the delivery of lower cost, higher quality care.

May 27, 2010 at 3:37 AM Leave a comment

PCMH Solutions

Last week, I wrote about some of the challenges facing PCMH implementation. These include:
– Universal implementation of EHR
– Integrating EHR data to facilitate sharing across all healthcare delivery sites
– Compensation systems that encourage cooperation among providers and drive improvements in outcomes while reducing the cost of care
– Shortage of primary care physicians, which will be exacerbated by the reduced patient loads primary care physicians can carry in a PCMH system
– Need for certifying PCMH-qualified primary care practices as a first step towards certifying PCMH-qualifed care teams (eg, primary care physicians, specialists, hospitals. diagnostic labs)

As demonstrated by the success of the PCMH concept at the Group Health Cooperative (Washington state) and other pilot studies, addressing these challenges can deliver significant cost savings and, hopefully, improvements in the quality of care. While the pilot studies have demonstrated these goals can be achieved in the short-term. there is a belief that even more can be accomplished in the long-term. Also, there is a belief that PCMH can achieve beneficial results outside of the controlled setting of pilot studies. Therefore, it is worthwhile to search for solutions to the challenges facing PCMH.

The solutions should recognize limitations of our healthcare delivery system that might not exist in controlled settings.

– Most primary care physicians have relationships with multiple insurers. Each insurer can offer different incentives and requirements. This could cause confusion for primary care physicians as well as an increased cost associated with learning and complying with each set of requirements.

– Specialist physicians have relationships with many primary care physicians and insurers. Specialists face similar challenges as described above for primary care physicians and, perhaps, even more so due to being another level along the healthcare delivery chain than the primary care physicians,

– Primary care practices will become more complex than they are today with the addition of physician’s assistants and the need for closer relationships with other allied health providers, such as dietitians, speech pathologists, occupational therapists and more.

– Not all insurers and providers will support the PCMH concept to the same degree. Some insurers and providers will support the concept whole heartedly while others will not support the PCMH at all. This disparity of support could hinder the development and coordination of the PCMH team.

– Support among individual insurers and providers will change over time. That is, hopefully, the number of supporters of PCMH who have made the necessary investments will increase over time. Members. providers and insurers who prefer to avoid involvement with PCMH could change referral sources and insurer relationships, creating instability in the healthcare delivery system.

– Development of the PCMH will take time and will be implemented in stages. Therefore, solutions can be implemented in stages. In some ways, this makes it easier to implement solutions as they can focus on a limited portion of the PCMH team. In other ways, it can be harder to implement solutions as each stage’s solution has its own costs and training requirements.

Over the next few days, I’ll look at potential solutions to the challenges associated with the successful implementation of PCMH. We’ll look at the lessons learned in the 1990s from a strong gatekeeper model as to what we should avoid with PCMH. We’ll also see what we compromises are required to contribute to a better financial performance for our healthcare system.

May 24, 2010 at 9:22 PM Leave a comment

PCMH and NCQA Certification

Since 2008, NCQA has offered physician practices the opportunity to earn a certification as a patient-centered medical home (PCMH).  The certification is supported by the American College of Physicians, the American Academy of Family Physicians, the American Academy of Pediatrics and the American Osteopathic Association and Bridges to Excellence. 

The NCQA PPC-PCMH certification measures nine aspects of a practice:
• Access and Communication
• Patient Tracking and Registry Functions
• Care Management
• Patient Self‐Management Support
• Electronic Prescribing
• Test Tracking
• Referral Tracking
• Performance Reporting and Improvement
• Advanced Electronic Communications

The certification sets requirements for a primary care practice to enter the world of PCMH and stay at the vanguard of this trend. Practices that achieve NCQA’s PCMH Recognition are positioned to take advantage of financial incentives offered by health plans and employers, as well as of federal and state-sponsored pilot programs. However, certifying primary care practices is not enough to drive the PCMH concept to success.

As we’ve previously discussed, the success of the PCMH relies on an integrated approach throughout the healthcare system. The support and active involvement of health plans, specialists, non-physician providers, diagnostic labs and other members of the healthcare community is required to achieve all goals of the PCMH. Without the support of the complete healthcare community, an NCQA certified primary care practice is like an All-Star playing on a team with .200 hitters. The team is still bound to end up in last place despite one person’s outstanding performance.

May 20, 2010 at 2:54 PM 3 comments

PCMH — Compensation is the key

    One of the most significant challenges facing the patient-centered medical home (PCMH) is a compensation scheme that works.  The compensation scheme will motivate physician behavior as well as determine their level of support.  Therefore, a thoughtful and properly structured compensation scheme is critical to the success of PCMH.The compensation scheme should motivate optimal outcomes as the concept is “patient centered.”  It is an assumption, but a relatively safe one, that in the long term, improved quality of care will help reduce costs.  However, how many years is the “long term?”  Can a “what have you done for me lately” society with runaway cost of care wait that long?

    From whose pocket should the system take the reduced cost of care?  Hospitals and other institutional providers?  Diagnostic companies?  Specialists?  Primary care physicians?  Unless all of the above share in the reduced cost of care, no one group will  support the PCMH concept.   Without physician support, patients will not accept limits on their access to care.

    Should the compensation scheme encourage a reduction in the the level of service or also reduce compensation flevels for each service?

    Can the US healthcare system afford a reduction in the number of providers and support companies (eg, diagnostic companies) that will accompany a reduction in compensation (ie, cost of care)?

    All of these issues are complex and their solutions will drive the success of the PCMH.

May 19, 2010 at 1:48 PM Leave a comment

PCMH — Overcoming a shortage of PCPs

As we explored last week, the patient centered medical home (PCMH) is a concept that is quickly gaining popularity.   Through the use of sophisticated information systems and a strong primary care physician as a coordinator of a team of providers, PCMH has been proven to deliver reductions in cost and improvements in quality of care.

These demonstrations have been conducted in carefully controlled environments with providers and patients dedicated to its success.  The question remains: Can the PCMH successfully transition to settings that are less controlled?  If so, when?

Some of the challenges we’ve already described are: 1)  a lack of widespread implementation of electronic health records among primary care physicians, specialists, hospitals and other providers; 2) patient and specialist acceptance of the primary care physician’s role as the central coordinator of care.  (Note: Under the PCMH model, any physician specialty can act as the central coordinator of care.  However, for most patients, the primary care physician will take on that role.  For example, for patients suffering from primary immune deficiency, quite often the immunologist should act as the central coordinator of care.  But, for patients suffering from Crohn’s disease or ulcerative colitis, the primary care physician should act as the central coordinator of care once the condition is in remission.)

Today, let’s look at the next issue facing the patients centered medical home: a growing shortage of primary care physicians.  The American Association of Family Practice (AAFP) is predicting a shortage of 40,000 family physicians in 2020, when the demand is expected to spike. The U.S. health care system has about 100,000 family physicians and will need 139,531 in 10 years. The current environment is attracting only half the number needed to meet the demand.

One factor contributing to the shortage is that medical students are not opting for primary care, as illustrated below.

The PCMH will exacerbate the shortage.  Today, according to an article that appeared in The New England Journal of Medicine entitled “What’s Keeping Us So Busy in Primary Care?” on average each day, a primary care physician writes 17 e-mail messages , reviews 14 consultation reports , answers 24 phone calls, reads 11 imaging reports, and refills 12 prescriptions.  This is in addition to seeing at least 18 patients per day.

The PCMH will increase the primary care physician’s work outside of direct patient care.  A more formal process to coordinate care among various providers, even with the support of more sophisticated information systems, will require more phone calls, emails and report reviews.  This will necessitate the primary care physician decreasing their patient volume by more than 20%  For example, during the Group Health Cooperative’s experience published in 2009, primary care physicians decreased their patient volume from 2,300 per year to 1,800 per year.  Decreasing the primary care physicians patient volume will further exacerbate the shortage of primary care physicians.

Next week we’ll look at more challenges with the PCMH (eg, a growing shortage of primary care physicians).  But, more importantly, we’ll look at solutions to the issues we’ve identified.  AS the saying goes, nothing worthwhile comes easily.

May 17, 2010 at 4:17 PM Leave a comment

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