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The Medical Home: Dream Castle Or Just A Buzzword?

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The next big idea in health finance reform may be the “medical home.”

The definition of the term medical home is still evolving, but policymakers now apply it to efforts to have a patient’s primary care doctor do more than give the patient checkups and care for bad colds. The primary care doctor who runs a modern medical home is also supposed to maintain detailed electronic health records for a patient; ensure that the patient gets help with managing any health conditions, such as diabetes, depression or substance abuse; and manage and coordinate the patient’s use of specialty care and hospital care.

Congress included funding for a Medicare patient-centered medical home demonstration project in Section 3502 of the new Patient Protection and Affordable Care Act and dozens of other pilot projects are either under way or in the planning stages.

CIGNA Corp., Philadelphia, has teamed with Dartmouth-Hitchcock Healthcare System to launch a medical pilot that serves 17,000 plan members in New Hampshire. CIGNA also has newer, smaller medical home pilots in other markets. Other carriers with high-profile medical home pilots include UnitedHealth Group Inc., Minnetonka, Minn., and several of the Blues, such as Blue Cross and Blue Shield of Detroit, Michigan and CareFirst Inc., Owings Mills, Md.

America’s Health Insurance Plans, Washington, has issued a statement of principles supporting efforts to develop and test the medical home concept. A successful medical home system “would replace episodic care with a sustained relationship between patient and physician,” providing patients with “more personalized and coordinated health care,” AHIP says.

“Certainly, not all of the answers are there,” says Warren Skea, a health care consultant in the Dallas office of PricewaterhouseCoopers L.L.P. “But this is not just dipping our toe in here. We’re definitely going to move in this direction.”

The medical home effort “is high priority,” says Jordan Bazinsky, a vice president at Verisk Health Inc., Waltham, Mass., a health data analysis firm. “It’s really front and center…. It will be meaningful in the lives of everyday people.”

Although the term “medical home” has been around since the 1960s, “there are still some questions about what a medical home would look like, and what structures within the medical home work best,” Bazinsky says.

The National Committee for Quality Assurance, Washington, the most visible health plan quality grader, has developed a set of medical home recognition requirements to create a standardized definition of “medical home.”

When the NCQA evaluates whether an organization really is a medical home, it looks at factors such as patient communication and access; patient tracking; care management; patient self-management support; electronic prescribing; test tracking; referral tracking; and electronic communications systems, according to an NCQA fact sheet.

Ensuring that the primary care practice is in charge is another key factor, says Melinda Abrams, an assistant vice president at the Commonwealth Fund, New York.

Many health insurers, wellness vendors, disease management vendors and others offer care-management services.

Abrams argues that primary care physicians and their staffs are the best care coordinators; that counselors who at least occasionally see patients face to face, in a physician’s office, are probably more effective than counselors who communicate with patients only over the telephone; and that the physician-run system is easier on the physicians.

If several large insurers each send a care manager to a group practice each week to perform comparable services, but using different procedures, the group practice will have to spend time and money to help the care coordinators. Physicians will feel as if they are running separate health care kiosks for each carrier, Abrams says.

Years ago, family doctors had the time to know their patients and look after their care from cradle to grave. But today, even the best family doctors lack the electronic health record systems, data analysis tools and on-staff care counselors and coordinators to identify patients who need extra attention in a systematic fashion and to provide that attention where needed, Abrams says.

Other big new health finance ideas have come and gone over the decades. In the 1990s, for example, health maintenance organizations persuaded many primary care doctors to accept a flat fee, or capitation payment, for each patient served.

Many physicians miscalculated their costs, however. Some tried to deliver the care they had promised and faced serious financial problems. Plaintiffs’ lawyers have accused others of killing or injuring patients by denying necessary care to some.

In recent years, policymakers have tried to get patients to control their own use of care by encouraging individuals and employers to combine high-deductible health coverage with health savings accounts or health reimbursement arrangements. The more that HSA and HRA owners save, they more cash they get to keep in their accounts.

But, so far, HSA and HRA holders have not had much more luck than owners of traditional coverage at dickering for lower appendectomy prices.

Now policymakers are coming back to the idea of putting primary care physicians in charge of managing patient care and costs, just as they were supposed to back in the days of HMO capitation contracts.

With the HMO and the medical home, “the underlying principles and objectives are similar,” Skea says.

Some medical home pilot projects involve new and improved versions of capitation.

But a medical home physician also could be compensated using a traditional fee-for-service approach and a medical home compensation arrangement could involve any combination of fee-for-service, capitation fees, care coordination and management fees, extra payments for high-risk patients and quality and efficiency incentive payments, Bazinsky says.

If extra payments for coordination and education services increase primary care physicians’ take-home pay, that would be a good thing, Abrams says.

“The lifestyle of the primary care practice is very long hours, lots of paperwork, and very hard problems to diagnose,” Abrams says. Yet primary care doctors earn only half as much as specialists, he notes.

Most primary care doctors in the Silent Generation and many in the Baby Boomer Generation are preparing to retire. And the Journal of the American Medical Association in September 2008 published a paper by researchers who found that only 2% of medical students planned to be primary care physicians.

A successful shift to a medical home model could ease the shortage, by improving management of physicians’ time and reducing their level of stress, Abrams says.

Robert Reid and other researchers affiliated with Group Health Cooperative, Seattle, a nonprofit staff model HMO, recently reported on two years of results from a medical home pilot program that started in 2006. They found medical home system patients were using a little more specialty care than patients at control clinics but they were 29% less likely to use the emergency room and 6% less likely to enter the hospital.

The pilot saved about $10.30 per patient per month, and diagnostic tests showed that the physicians in the pilot were less burned out than physicians in the control group, the researchers report.

For producers in the commercial market, the medical home could serve another purpose: It could shield patients against the effects of the new health system change laws on access to care.

A well-run medical home that makes sure to have strong ties to good hospitals and respected specialists could help patients get access to the care needed during times when other patients have signed up for appointments far in advance.


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