PCMH & Reimbursement Michigan State Medical Society Mary Beth Bolton, M.D.,FACP, CMO & SVP Health Alliance Plan

Patient-Centered Medical Home: A Critical Opportunity Patient-centered medical home presents a critical opportunity To improve current and future performance in many areas: Quality of care and service Efficiency, effectiveness and cost of health care services Informed choice and access to health care services Patient / member satisfaction with their overall HAP experience HAP has the experience and tools to capitalize on this opportunity: Primary care physicians with substantial experience with the concepts and reality of the patient-centered medical home HAP programs and tools, including: physician reports, quality improvement, “reward for quality” physician incentive program, web tools like Health Risk appraisal and Member Health Manager HAP has leaders and physician networks with: Demonstrated interest in the medical home Ability to make substantial and rapid progress in its implementation Innovations in practice redesign underway 2 2

Expenditures vs Primary Care Score Also documented in Patient Centered Medical Home, Maine Center for Public Health, October 15, 2008, by Josh Cutler, MD, Director 3

Primary-care score vs health outcomes 4

Average spending on health per capita ($US Purchasing Power Parity) Purchasing Power Parity (PPP) – A theory developed in 1920 by Gustav Cassel, states that “in an ideally efficient market, identical goods should have only one price”. Source: K. Davis, C. Schoen, S. Guterman, T. Shih, S. C. Schoenbaum, and I. Weinbaum, Slowing the Growth of U.S. Health Care Expenditures: What Are the Options?, The Commonwealth Fund, January 2007, updated with 2007 OECD data 5

USA worse/19 Industrialized nations Countries’ age-standardized death rates, list of conditions considered amenable to health care Source: E. Nolte and C. M. McKee, Measuring the Health of Nations: Updating an Earlier Analysis, Health Affairs, January/February 2008, 27(1):58–71 6

The Value of Primary Care Evidence suggests that access to high quality primary care results in lower overall health care costs and lower use of higher cost and lower value services, i.e., specialists, ER, inpatient care Adults with a primary care physician rather than a specialist as their personal physician had a 33% lower annual adjusted cost of care and 19% lower adjusted mortality Increased primary care to population ratios are associated with reduced hospitalization rates for sixteen ambulatory sensitive conditions Health care costs are higher in regions with higher ratios of specialists to generalists Primary care currently operates on a transaction-based model and reimbursement does not recognize the value of (and specifically reimburse for) individualized, comprehensive care management There is a significant reduction in physicians in primary care specialties with associated poor access to primary care for patients and escalation of care into higher cost settings Sixteen Ambulatory Care Sensitive Conditions by the Agency for Healthcare Research and Quality: Short and long-term diabetes complications Uncontrolled diabetes Lower extremity amputation among diabetic patients Perforated appendix Pediatric asthma Adult asthma Chronic obstructive pulmonary disease Pediatric gastroenteritis Hypertension Angina without procedure Congestive heart failure Low birth weight Dehydration Bacterial pneumonia Urinary Tract infection 1 Source: Paul Grundy MD, MPH, Director, IBM Healthcare Technology and Strategic Initiatives, “Patient Centered-Primary Care Collaborative,” NCQA Policy Conference, December 7, 2007 7

Patient Centered Medical Home The Patient Centered Medical Home is an approach to providing comprehensive primary care for adults and children that emphasizes personal physician, physician directed practice, “whole Person” care orientation, coordinated care, quality and safety, enhanced care access, and full value payment Recommended new payment model to consider: Bundled, severity-adjusted care coordination fee paid on a monthly basis for the following: The physician and non-physician clinical staff work required to manage care outside a face-to-face visit The health information technology and system redesign incurred by the practice Combined with per visit FFS payment and Performance based bonus payments based on evidence based measures of care 1 Source: Paul Grundy MD, MPH, Director, IBM Healthcare Technology and Strategic Initiatives, “Patient Centered-Primary Care Collaborative,” NCQA Policy Conference, December 7, 2007 8

Patient-Centered Medical Home National Consensus Principles – AAAFP, AAP, ACP, AOA (March 2007) Element Explanation Comments Personal physician Ongoing relationship with a personal physician: first contact, continuous and comprehensive care Members are assigned to a PCP at all times Physician directed medical practice Personal physician leads team at practice level that collectively take responsibility for ongoing care of patients Team effectiveness is evident in higher / improved performance. Whole person orientation Providing or arranging all the patient’s health care needs – preventive, acute, chronic – at all stages of life PCP accountability for quality and efficient care Coordinated / integrated care Across all providers and settings and the patient’s community. Facilitated by registries, IT, health info exchange to assure that patients get the indicated care when and where they need it in a culturally and linguistically appropriate manner Documented use of registries and / or HAP MHM. Clinician/group CAHPS Quality and safety Are hallmarks of the patient-centered medical home HEDIS quality & safety measures exceed threshold Enhanced access to care Open scheduling, expanded hours and new options for communications between patients, personal physician and office staff Office hours beyond 9-5 M-F Non-traditional hours & weekends Open access scheduling E-visits Payment recognizes added value to patients More rational (and higher) payment for primary care Fee schedule, pay-for-performance, public recognition These principles are recognized and supported in NCQA’s updated Physician Practice Connections recognition program and the BCBSM PGIP program 9

The Patient-Centered Medical Home The patient centered medical home concept is supported by a large multi-stakeholder group reflecting a broad range of physician professional associations, major employers, major insurers and others that have formed an organization called the “Patient Centered Primary Care Collaborative” Over 80 members including: HAP, General Motors, Delphi, Walgreens, AIAG, IBM, AARP, Blue Cross Blue Shield Assoc, United Healthcare, CIGNA, AETNA, Wellpoint, Medical Network One, most of the primary care focused major physician associations and two major health systems (Geisinger and University of Pittsburgh Medical Center) The basis for support is evidence that care delivered through primary care physicians increases the value of care, as reflected in improved quality and reduced expense 10

PCMH in Michigan The Michigan Primary Care Consortium convened a group of representatives from insurance companies, health plans, and professional associations to develop statewide consensus on the PCMH definition, identification, and metrics The group determined the joint principles of: Personal physician Physician directed medical practice Whole person orientation Care that is coordinated and/or integrated Quality and safety Enhanced Access Payment The group then added the following Michigan footnotes: Patient-centered model of care that recognizes the patients as stewards of their own health Personal physician may be of any specialty, but the practice must meet all requirements Clinical outcomes, safety, resource utilization and clinical and administrative efficiency are consistent with best practices Transformational change in healthcare financial incentives should occur simultaneously with, proportionally to, and in alignment with PCMH adoption HAP’s focus initially is to support primary care physicians to develop processes and tools to support PCMH 11

Components of Patient-Centered Medical Home Electronic prescribing (eRx) Clinical information systems: registries, Electronic Health Record (EHR), access to lab, radiology and other test results Use of registries for chronic care patient identification and tracking of tests and missing chronic care and preventive services Follow up on abnormal test or subspecialty recommendations I.e. coordination and continuity Advance planning for visits Extended access/after hours coverage/same day acute care visits E-visit or secure e-mail Chronic care coordination through multidisciplinary teams, home monitoring, family involvement 12

Additional Features of Patient-Centered Medical Home Patient engagement Integration of behavioral issues especially depression Provider transparency cost/quality/patient satisfaction Group visits for chronic care patients Medication reconciliation between hospital/office/nursing home 13