WASHINGTON BUREAU — The Obama administration has set up a 3-year, $42 million Medicare pilot program that will test the ability of the “patient-centered medical home” to lower the cost of care and improve quality.

A section of the Patient Protection and Affordable Care Act of 2010 (PPACA) provided the funding for the medical home pilot project, which has been dubbed the Federally Qualified Health Center Advanced Primary Care Practice (FQHC APCP) demonstration project.

Federally qualified health centers provide essential primary care services for seniors and others in underserved communities.

The pilot program is supposed to test the effectiveness of doctors and other health professionals working in 500 teams to improve care for up to 195,000 Medicare patients, according to officials at the U.S. Department of Health and Human Services (HHS).

The demonstration project will be operated by the Centers for Medicare and Medicaid Services (CMS) in partnership with the Health Resources Services Administration (HRSA).

“FQHCs in this project can increase access to important primary care services and thus reduce the need for costly hospitalizations or emergency department visits,” says Dr. Mary Wakefield, the HRSA administrator.

Participating FQHCs must help patients manage chronic conditions, and actively coordinate care for patients, officials say.

CMS will help the FQHCs invest in patient care and infrastructure by paying them a monthly care management fee for each eligible Medicare beneficiary receiving primary care services, HHS officials say.

In return, FQHCs must agree to adopt care coordination practices that meet standards set by the National Committee for Quality Assurance (NCQA), Washington. CMS and HRSA will help the FQHCs achieve these goals, officials say.

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