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Making Medical Homes Effective: Transitioning from Concept to Real-World Practice

Originally published by the Center for Studying Health System Change

This is the full research document version of this publication by the Center for Studying Health System Change (HSC). For the article summary, visit the main page at /CONTENT/1030/.

P R O V I D I N G I N S I G H T S T H A T C O N T R I B U T E T O B E T T E R H E A L T H P O L I C Y Qualifying Practices as Medical Homes Matching Patients to Medical Homes The Information Exchange Challenge Paying for Medical Homes Policy Perspective Insights into Health Policy Issues NO. 1 • DECEMBER 2008 Making Medical Homes Work: Moving from Concept to Practice W idespread concern about high and rising costs, coupled with increasing evidence that the quality of U.S. health care varies greatly, has put health care reform near the top of the domes- tic policy agenda. Policy makers face mounting pressure to reform provider payment systems to spur changes in how providers are organized and deliver care. In many communities, physician practices, hospitals and other providers are poorly integrated in terms of culture, organization and financing. While these independent arrangements may offer some benefit, such as broadened patient choice, the flip side of independence is fragmentation— across care sites, providers and in clinical decision making for patients. Current payment systems, particularly fee-for-service arrangements, reinforce delivery systems that offer care in silos and reward greater volume but not quality of care. Fee-for-service payment also provides few incentives for providers to invest in improving care for chronic illnesses, which account for a far greater pro- portion of health care spending than do acute illnesses. Among the many proposals for payment and delivery system reform under discussion, the medical home model has gained significant momentum in both the public and private sectors. The Qualifying a Physician Practice as a Medical Home By Ann S. O'Malley, Deborah Peikes and Paul B. Ginsburg Identifying an effective and efficient way to determine if a physician practice has the capabilities to serve as a medical home is a pressing challenge as public and private payers develop pilots to determine whether additional payment to medical homes can improve the quality and efficiency of care. Ensuring that a qualification tool validly captures the capabilities a practice needs to be a medical home can help practices focus on the most important activities to improve care. Most medical home initiatives rely on the joint principles of the patient-centered medical home developed by the primary care physician spe- cialty societies, which lay out the general attributes of a patient-centered medical home. They empha- size four key primary care elements—accessibility, continuity, coordination and comprehensiveness— that research shows positively affect health outcomes, satisfaction and costs. An ideal qualification tool would ensure that medical homes are built on a firm foundation of these critical primary care pillars. A qualification tool that either gives insufficient emphasis to these bedrock primary care elements or gives too much emphasis to factors that may not be related to better performance risks excluding physician practices that truly function as medical homes and including those that don’t. Moreover, overly burden- some documentation requirements for practice structures that ultimately may not improve patient out- comes run the risk of posing a barrier to practices seeking to participate as medical homes and distract- ing physicians from improving care for patients. Continued on p. 3 Continued on p. 2 CONTENTS POLICY PERSPECTIVES are published by the Center for Studying Health System Change. 600 Maryland Avenue, SW Suite 550 Washington, DC 20024-2512 Tel: (202) 484-5261 Fax: (202) 484-9258 www.hschange.org President: Paul B. Ginsburg 8 15 12 1

2 Center for Studying Health System Change Policy Perscpective No. 1 • December 2008 2 concept has been promoted by primary care physician societies. And a broad range of insurers and payers—for example, United HealthCare, Aetna, the Blue Cross Blue Shield Association, and Medicaid programs—are developing medical home initiatives. Likewise, Congress has mandated a medical home demonstration in fee-for-service Medicare. Although medical home definitions vary and continue to evolve, at the heart of a medical home is a physician practice com- mitted to organizing and coordinating care based on patients’ needs and priorities, communicating directly with patients and their families, and integrating care across settings and practitio- ners. If enough physician practices become medical homes, a criti- cal mass might be attained to transform the care delivery system to provide accessible, continuous, coordinated, patient-centered care to high-need populations—usually considered to be patients with chronic illnesses. Some advocates ascribe a broader goal to the medical home model—to improve the quality of care, reduce the need for expen- sive medical services and generate savings for payers. Medical homes are expected to accomplish this goal by changing how phy- sicians practice medicine. Y et despite the enormous energy and resources invested in the medical home model to date, relatively little has been written about moving from theoretical concept to practical application, particularly on a large scale. What would an effective medical home program look like? And how should it be implemented? Forging ahead with medical home initiatives without such analyses to ground their design and identify potential pitfalls and solutions may result in ineffective programs that alienate patients and/or physicians. That would put at risk not only the resources invested by clinicians and payers/insurers in early initiatives, but also the political viability of the model itself in the long-term as a vehicle for wider health care reform. The Center for Studying Health System Change (HSC) and Mathematica Policy Research (MPR) are uniquely positioned to address operational issues related to medical homes. Along with conducting independent and collaborative research relevant to medical homes, care coordination, payment policy and the orga- nization of care delivery, HSC and MPR researchers have direct experience with both public- and private-sector medical home initiatives, including leading the design of the Medicare medical home demonstration. Based on these experiences, we’ve identified four critical opera- tional issues in the implementation of most medical home models that we believe have potential to make or break a successful pro- gram: (1) how to qualify physician practices as medical homes; (2) how to match patients to their medical homes; (3) how to engage patients and other providers to work with medical homes in care coordination; and (4) how to pay practices that serve as medical homes. Drawing on published data and our on-the-ground exper- tise, we hope that these analyses will guide clinicians, payers and policy makers as they attempt to build a solid foundation for suc- cessful medical home initiatives. Doing so will improve the chanc- es that the medical home concept can serve as a stepping stone to broader reforms in health care payment and delivery systems. Making Medical Homes Work, continued from p. 1 Paul B. Ginsburg, Ph.D., HSC president, is nationally recognized for his work in health economics and health policy, especially health care market changes and cost trends. Prior to founding HSC in 1995, he served as executive director of the Physician Payment Review Commission (now the Medicare Payment Advisory Commission) and as deputy assistant director of the Congressional Budget Office. He received his doctorate in economics from Harvard University. Myles Maxfield, Ph.D., MPR vice president and director of health research for the W ashington, D.C., office, has conducted research on the operational design of value-based purchasing programs, quality measurement of physicians, the design and performance measurement of disease management programs, and the design of health informa- tion technology to support physician quality of care. He received his doctorate in economics from the University of Maryland. Ann S. O'Malley, M.D., M.P .H., HSC senior health researcher, has conducted research on Medicare beneficiaries’ access to high-quality primary care and preventive services, and on low-income populations’ access to primary care. She is a graduate of the University of Rochester School of Medicine, is board certified in preventive medicine and is a fellow of the American College of Preventive Medicine. Deborah Peikes, Ph.D., M.P .A., MPR senior researcher, has conducted research on care coordination and disease management programs, medical home pilots, and programs to promote functioning for people with severe disabilities. She received her doctorate in public policy from Princeton University and currently teaches a course on program evaluation at Princeton. Hoangmai H. Pham, M.D., M.P .H., HSC senior health researcher, is a practicing general internist at a safety net clinic in W ashington, D.C. Her research focuses on care delivery; pay for performance and quality reporting; quality improvement processes; trends in physician and hospital markets, including provider responses to payment policy; and health disparities. She received her medical degree from T emple University. About the Authors

2 23 Center for Studying Health System Change Policy Perspective No. 1 • December 2008 Building Medical Homes on a Solid Primary Care Foundation P ublic and private payers are launching patient-centered medi- cal home (PCMH) experiments as one strategy to improve the quality and coordination of care, potentially lower costs, and increase financial support to primary care physicians. These experi- ments seek to test a medical home concept that emphasizes the central importance of primary care to an organized and patient- centered health care system.1-3 The medical home concept posits that primary care physicians’ direct and trusted relationship with patients, coupled with a depth and breadth of clinical training across body systems, position them to assess an individual’ s health needs and to tailor a comprehensive approach to care across condi- tions, care settings and providers. Not all primary care practices are set up to function as a PCMH. In part, this shortcoming results from inadequate financial support for such activities as care coordination, along with inad- equate training of providers on how to work together as a team. In an attempt to remedy this, payers are experimenting with provid- ing additional payment to participating practices that can dem- onstrate the capabilities of a patient-centered medical home. Most current pilots and demonstrations require practices to “qualify” as a medical home via an objective measurement tool. The tool’s measures, in effect, are a blueprint for practices’ efforts to build medical-home capabilities. Primary Care and Chronic Care Models While there are different views about what makes a physician prac- tice a medical home, the specialty societies’ joint principles are the widely accepted starting point for most current demonstrations and pilots. 4 The joint principles originate from two distinct con- ceptual frameworks, the primary care model 1, 2, 5 and the chronic care model, 6 each of which was developed for different purposes. The primary care model 1, 2, 5 focuses on all patients in a practice and emphasizes whole-person care over time, rather than single- disease-oriented care. The primary care model identifies four elements as essential to the delivery of high-quality primary care: accessible first contact care, or serving as the entry point to the health care system for the majority of a person’s problems; a con- tinuous relationship with patients over time; comprehensive care that meets or arranges for most of a patient’s health care needs; and coordination of care across a patient’s conditions, providers and settings in consultation with the patient and family. 1, 2, 5 The chronic care model focuses on “system changes intended to guide quality improvement and disease management activities” for chronic illness. 6 The chronic care model includes six interrelated elements—patient self-management support, clinical information systems, delivery system redesign, decision support, health care organization and community resources. Three aspects of the model in particular—self-management support, delivery system design and decision support—used in combination have improved single chronic condition care, in particular for diabetes. 6-8 The designers of the chronic care model assumed that before implementation “every chronically ill person has a primary care team that orga- nizes and coordinates their care. ” 6 In other words, the chronic care model is meant to be developed on a “solid platform of primary care. ” 6, 9, 10 Consequently, both the primary care and chronic care models suggest that a medical home qualification tool must first capture and measure the four defining primary care elements before emphasizing capabilities to treat individual chronic diseases. Recognizing the benefits and evidence behind each of the key primary care elements—accessibility, continuity, coordination and comprehensiveness—on patient and population health outcomes, patient and provider satisfaction, and costs, the joint principles require the medical home to provide each. 2, 5, 11-18 T o the four pri- mary care elements, the physician societies added aspects of the chronic care model—team functioning in a physician-directed practice, quality and safety tools for evidence-based medicine, decision support, performance measurement, quality improve- ment, enlisting patient feedback and “appropriate” use of informa- tion technology. 4 Common attributes across the primary care and chronic care models can inform selection of the most relevant measures for a patient-centered medical home qualification tool (see Table 1 for a summary of elements of the two care models as they align with the physician societies’ joint principles). In sum, these concep- tual frameworks and the evidence supporting them suggest that a tool to determine whether a practice is a medical home would ideally measure that a practice has in place processes to ensure that care is accessible, continuous, coordinated and comprehen- sive. Capabilities that could help support these elements include a searchable patient registry, a mutual agreement between the patient and the medical home team on their respective roles and expectations, tools for comprehensive care such as planned visits that include pre- and post-visit planning, the use of care plans when appropriate, and enhanced access via phone and same-day appointment availability. Lastly, because of the time and resource constraints under which primary care practices already operate, it is particularly important that the qualification tool not create an onerous documentation burden for participating practices. Qualifying Physician Practices, continued from p. 1

HSC, FUNDED IN PART BY THE ROBERT WOOD JOHNSON FOUNDATION, IS AFFILIATED WITH MATHEMATICA POLICY RESEARCH, INC. Center for Studying Health System Change Policy Perspective No. 1 • December 2008 Journal of the American Medical Association, Vol. 279, No. 17 (May 6, 1998). 49. Pham, Hoangmai H., et al., “Care Patterns in Medicare and Their Implications for Pay for Performance, ” New England Journal of Medicine, Vol. 356, No. 11 (March 2007). 50. Simon, Samuel, et al., “Identification of Usual Source of Care Providers for Frail Medicare Beneficiaries: Development and Use of a Claims-Based Approach. ” Paper presented at the AcademyHealth Annual Research Meeting, Orlando, Fla. (June 2007). 51. Sullivan, Eric, et al., “Patient-Centered Medical Home Program, ” UnitedHealthcare Health Services (2008). 52. Schoen, Cathy, et al., “U.S. Health System Performance: A National Scorecard, ” Health Affairs, Web exclusive (Sept. 20, 2006). 53. Scholz, John C., The Earned Income Tax Credit: Participation, Compliance, and Antipoverty Effectiveness, Discussion Paper No. 1020-93, Institute for Research on Poverty, Madison, Wis. (September 1993). Available at: http://www.irp.wisc.edu/publi- cations/dps/pdfs/dp102093.pdf. 54. Pham, Hoangmai H., et al., “Primary Care Physicians’ Links to Other Physicians through Medicare Patients: The Scope of Care Coordination, ” Annals of Internal Medicine, forthcoming. 55. Grossman, Joy M., Thomas S. Bodenheimer and Kelly McKenzie, “Hospital-Physician Portals: The Role of Competition in Driving Clinical Data Exchange, ” Health Affairs, Vol. 25, No. 6 (November/December 2006). 56. Estimates of payments in the Medicare demonstration are based on assumptions that each medical home physician treats 250 beneficiaries per year, with 86 percent eligible for the demonstration and participating for the entire year. Average payments for the lower and higher tier of medical-home capabilities are equal to $40.40 and $51.70 per beneficiary per month, respectively. Based on these assumptions, each medical home physician could earn $104,232 or $133,386 per year for meeting the lower or higher tier of medical-home capabilities, respectively. 57. Berenson, Robert A., and Jane Horvath, “Confronting the Barriers to Chronic Care Management in Medicare, ” Health Affairs, Web exclusive (Jan. 22, 2003). 58. Anderson, Gerard F ., “Medicare and Chronic Conditions, ” New England Journal of Medicine, Vol. 353, No. 3 (July 21, 2005).

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