Punishing Primary Care with Medical Homes

Context matters in health care. This is because outcomes are about the patient, community resources, social determinants, environments, situations, behaviors,  housing, and other personal and community factors. Outcomes are predominantly not about clinical interventions. This is a very difficult to understand but most important concept. Clinical interventions are small change regarding health outcomes.

The context for this blog response is a recent Commonwealth Review of PCMH. There were changes in a few outcomes, but overall there was little change. "PCMH initiatives were not associated with changes in the majority of outcomes studied, including primary care visits, emergency department visits, inpatient visits, and four quality measures." The article claims that context matters, and may explain the lack of outcomes for primary care medical home. 



High Cost for Little Change Via PCMH - the Opposite of Value

Primary care medical home costs run about $80,000 to $100,000 per primary care physician (Annals FM). This is about 20% of the typical revenue generation of a primary care physician. Spending 20% to return a few % or no percent in change is not sustainable in primary care. Primary care is already in decline with stagnant revenue and increasing costs for areas beyond primary care medical home costs, and many can ill-afford any additional costs much less major costs.

Fire, Aim, Ready Innovations

An incredible amount of time, effort, grant funding, and promotion has gone into primary care medical home. There is little explanation for PCMH other than
  • Innovation Worship after decades of stagnation in primary care
  • The need for marketing primary care in locations where enough primary care is present to result in competition. 
The massive outlays have always been questionable with primary care finances so marginal.

Studies have demonstrated serious issues with PCMH from the start such as lack of a uniform definition and variations in application. Recent studies and reviews have indicated variations in the outcomes measured, problems with comparison groups, and one huge issue.

Innovation and Accountable Care Has Much To Be Accountable For
  • The lack of value due to high cost of PCMH without significant outcomes improvements
  • The lack of PCMH where most Americans most need care
  • The poor assumptions made by those who push innovation without understanding most Americans in need of care and those who serve them.
  • Primary care associations that support innovative policies that make practice difficult for most of their members.
  • Rapidly rising cost of delivery
  • Accelerating morale, productivity, and turnover problems
  • Innovations that lack an evidence basis for significant outcomes improvements such as PCMH and Pay for Performance
  • Regulations such as MACRA that exceed the design specifications of Congress and the consultant for the regulation (RAND)
Serious Consequences from Innovation Dysfunction

Primary care medical home and other innovative changes have clearly contributed to the increasing levels of burnout and morale problems.

Turnover is already over $300,000 per lost primary care physician and turnover is another problem when team members are so stressed by the primary care financial design. Training for PCMH is most difficult when team members trained in primary care are lost.

Poor Primary Care Medical Home Distribution May Have a Reason

PCMH has had poor penetration into lower physician concentration counties. PCMH has often involved those most organized who can lobby for grants and special funding.

The practices that have had lower payments and higher costs of delivery have not been in a position to consider a much higher overhead model such as PCMH. Small practices and practices where physicians are nearing retirement face many challenges involving PCMH, EHR, and measurement focus.

The cost to change billing and payments has been substantial. Obamacare did temporarily increase Medicaid payments to the level of Medicare, but then this expired after two years. Dr. David Sundwall estimated that the cost of these changes negated the extra revenue. Once again the designers underestimated the consequences of their design.

Despite the problems, there are articles that tend to label physicians not very progressive for not embracing new innovations. More understanding is needed by those who do not understand primary care facing the most challenges with the least support - for decades.

The innovators are asking for costly innovations from people who know their practices, their situations, and the sad financial design that most impairs what their team members can do already.

Financial  Compromise Via Decades of Payment Designs

Large practices and systems have been receiving increasing revenue via higher payments from two methods - greater negotiating power and annual contracted escalation clauses. Smaller practices, primary care practices, and practices in locations with few insurers have been falling behind decade after decade.

The risks are much greater for smaller practices with patients that have greater challenges and lesser outcomes.

More Complex Patients in Primary Care, Especially Lower Concentration Settings

For decades physicians have been paid based on the assumption that subspecialized care was more complex. Studies have now demonstrated the complexity of primary care. Fellowship training may take more years but this is no reason to send so many more dollars for services that take little time. Complex care needs support, not punishment.

The most complex patients are found in lowest physician concentration counties where there are higher concentrations of disabled, diabetics, elderly, poor to fair health status, and deficits in health literacy and local resources to go with lesser concentrations of health care workforce.

These local, population, and community factors set outcomes at lowest levels such as 48% of preventable deaths for this 40% of the population. Pay for Performance is clearly discriminatory, resulting in even lower payment for those least paid already.

The deficits are the result of decades of lowest payments for primary care plus even lower payments where care is needed plus lower still because small practices have no negotiating power with regard to payers.

Higher Primary Care Functions Are the Goal of All Primary Care Practices

Primary Care Home Advocates act as if primary care practices desire to function poorly This assumption is wrong. This assumption is a major problem for a number of reasons.
  • Studies indicate better outcomes from small practices of 9 or less physicians (Casalino, Health Affairs). 
  • Small practices know their patients and their community. 
  • Small town practice facilitates working with the community in ways that can impact outcomes not available to those in larger, more concentrated settings
  • Numerous family medicine doctors of the year and rural health awardees demonstrate outreach, coordination, services integration, Community Oriented Primary Care, and other endeavors.
  • Payment changes are needed to support primary care higher functions. 
  • Primary care offices need to be doing higher functions, not doing the administrative work that should be done by insurance payers


This rural family physician in the 1980s was working with the health department, a weight control group, local social workers on teenage pregnancy prevention, and was a part of the local ministerial alliance as well as other community group efforts. He proposed one of the first assisted living operations - despite being paid the least by state, by Area 99 codes for the state, and by being a new physician via ReaganCaree. Reasonable support would have facilitated a longer stay and more interactions. From this perspective, the claims and promotions make primary care look bad as if it is lacking in more than just finances.

Higher primary care functions such as integration, coordination, and outreach require more team member support. In primary care, the largest budget item is personnel and the team members that deliver the care are essential. When supplies, computer, EHR, health info maintenance, and other costs increase by necessity or regulation, the team members that deliver care are compromised. This is clearly seen with declines in productivity and morale with increasing burnout.

Rapid Change Often Favors Those Already Doing Well

Primary care medical home is not established, has substantial variation, is costly at a time when primary care margins are too thin already, places greater challenges upon team members, and requires substantial changes.

One theme to remember in this time of innovation worship is that the only insurance companies, systems, practices, and hospitals that are able to decreased costs and improve outcomes are those
  • that were paid well (or overpaid) 
  • that had the least complex patients with inherently the best outcomes, and
  • that generally have had the ability to figure out that they can do well financially with an innovation.
The innovation bandwagon works against those that are not well paid, that have the most complex patients, and that have the highest costs of delivery

Actual Compromise of Health Outcomes - Follow the Money

Designs that ship scarce health care dollars outside of lowest concentration settings compromise team members and also outcomes. Health, education, economic, and other outcomes are dependent upon dollars that stay in a community.

Dollars shipped in to communities and dollars retained in communities for human interactions and for support of humans are dollars that improve outcomes.
Dollars shipped out of communities in most need of dollars
help shape disparities. 

Dollars shipped out for certifications and regulations, dollars shipped out to practice consultants, dollars shipped to mail order pharmacies by innovative designs that compromise local pharmacies, dollars redirected by school consolidations, dollars not sent by states to lowest property value school districts, dollars concentrated in highest concentration settings by paying more for highly specialized care with least payment flowing to primary care and lowest concentration settings, payment designs that have compromised small practices and hospitals, and various innovations all steal dollars from places in most need of dollars for a widening of disparities and a worsening of outcomes.

It is important to examine the context of health care dollar distributions with over $30,000 per person expended in 79 top physician concentration counties and less than 3500 dollars sent to 2621 lowest physician concentration counties - a 9 times disparity.

Improvements in health, education, economic, and other outcomes
require disparities in a wide range of areas to be addressed
specific to patient, student, worker, and community.

Increased Costs Have Consequences - Especially in Health Care

Two Forces Shaping Declines in Outcomes indicates that spending billions more for innovations adds to health care costs and fuels across the board cuts, austerity focus, and compromise of domestic discretionary spending - contributing to worse outcomes.

Most Needed Health Access Requires a Better Design, Not Poor Assumptions

There are many poor assumptions regarding primary care. My son at age 3 had a saying, "Sometimes it just be's." Basic health care services need not be fancy, but they should exist. The fact that many if not most Americans lack for basic health access is indication for different payment designs to support this foundational care.

People want basic services and primary care provides these services.
Primary care exists for basic services.

Why Castigate Higher Volume?

Even former insurance CEOs indicate that office services do not break the bank. With 55% of services for just 6% of annual health spending, primary care is a great bargain. Higher volume is actually indicated as it is the only solution for resolving access to care barriers.

Volume of care is both a friend and an enemy
  • Higher volume for primary care where needed is a friend
  • Higher volume where patients can access care and can overutilize care is an enemy 
  • Four times greater volume of specialty services in a number of metro areas is an enemy shaping concentrations of workforce, greater competition, and increased numbers of such services to support concentrations of workforce
  • Higher volume of highest paid services that are multiple times more likely in populations without access barriers may well be responsible for cost overruns.
In places where most of the US population resides in counties with lowest concentrations of physicians, volume is not the enemy. About 90% of the local services are basic generalist and general specialty services - primary care, mental health, basic surgical services. The lack of volume in these areas is a huge problem.

When you see primary care leaders pontificating about volume as a problem in primary care and basic services - you are seeing them repeat academic and policy designer concepts. They are not passing on information important for

Restoring Basic Access to Care.

Jumping on bandwagons, innovation worship, and assumptions from designers immersed in highest concentration settings are killing access, local health workforce, health outcomes, and human beings where Americans remain behind in lowest concentration settings.

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