Editor's Note: Welcome to Medical Economics' blog section which features contributions from members of the medical community. These blogs are an opportunity for bloggers to engage with readers about a topic that is top of mind, whether it is practice management, experiences with patients, the industry, medicine in general, or healthcare reform. The opinions expressed here are that of the authors and not UBM / Medical Economics.
Three years ago, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) became law, kick starting the shift from a fee-for-service system to value-based payments for Medicare and Medicaid. The passage has pressured both health systems and payers to identify new ways to deliver on the triple aim of better health, better care, at lower costs.
Our work at Family Medicine for America’s Health (FMAHealth), a collaboration between the eight leading family medicine organizations in the United States, has found that greater investment in primary care is needed to spur the innovation necessary for true reductions in the total cost of care.
The U.S. spends a mere 4 percent to 7 percent of our healthcare dollars on primary care. But recent research has shown that for every $1 invested in primary care, $13 is saved in downstream costs. Further, according to the American Academy of Family Physicians, if the U.S. spent closer to 12 percent of its healthcare dollars on primary care, it would cut per-patient costs and lead to a decrease in overall healthcare expenditures. We know that this level of spending is possible by looking at more efficient, modern health systems in Northern Europe that invest close to twice as much as the U.S. on primary care.
In their shift toward a value-based system, hospitals and clinics have created care pathways that focus on efficiency and elimination of waste. While these efforts have yielded some cost savings, they are often focused on single diseases or diagnosis groups, not on the full continuum of care.
Many primary care practices have embraced the shift from volume to value, with some implementing the principles of the patient-centered medical home—health clinics that place patients at the center, coordinating patient care in collaboration with other health professionals, like nurses, specialists, and pharmacists. However, without proper investment in primary care practices, implementation of these programs can have mixed results both on cost containment (since more services are being provided) and on sustainability, with teams often experiencing burnout in trying to keep up with the added demands and little or no additional resources provided. Despite this, we know that when payers and health systems are willing to collaborate and invest more in primary care, achieving high-quality care at lower costs is possible.
The need for a system-wide solution
Through the Primary Care Innovator’s Network, a collaboration between FMAHealth, the Family Medicine Education Consortium, and Employer Advantage Health Solutions, we have been working at a nexus of innovative collaborations between primary care medical groups and self-insured employers. These employers have much to gain from securing high-value, accountable primary care services for their employees, as healthcare costs continue to rise and consume more of their profit margins.
Some self-insured employers have embraced direct primary care (DPC)—a new payment arrangement whereby employers purchase a robust set of primary care services for their employees with a fixed per member per month payment system. Under this innovative arrangement, DPC practices are able to enhance their primary care offerings to include longer appointments, e-visits, after-hours phone services, complex case management, and an expanded scope of practice, permitting primary care physicians to perform more services under one roof, instead of referring out to more costly specialty care.
DPC— and models like it that rely on non-traditional payers such as individuals, employees, and unions—can work well in certain situations but are difficult to scale in the current environment and could further strain the primary care workforce since these practices have a lower clinician to patient ratio.
The current problem calls for a system-wide solution. Without an added investment in primary care, innovation will be stifled, and we will not see substantial reductions in overall cost of care. Only a strong collaboration between payers and health systems, between self-insured employers and primary care groups, can achieve this outcome—one that measures the return on investment regardless of primary care delivery venue. That collaboration must start with a greater investment in primary care—the best buy in healthcare.
Glen R. Stream, MD, FAAFP, MBI, is a family physician in La Quinta, Calif., and president of Family Medicine for America’s Health, which sponsors the Health is Primary campaign. Michael Tuggy, MD, is a family physician in Winthrop, Wash., and a clinical professor at the University of Washington School of Medicine. Tuggy is also the board vice chair of Family Medicine for America’s Health.