New Obamacare Program May Make Medical Homes More Common

The model of care is proven to improve health outcomes and save billions of dollars, but it hasn't been widely embraced. A new initiative could change that.
by | April 12, 2016
Asthmatic children treated in patient-centered medical homes are hospitalized less than those treated in traditional clinics. (AP/Charles Rex Arbogast)

More than six years after the Affordable Care Act (ACA) was first signed into law, President Barack Obama on Monday announced plans to address what many had hoped the act would do all along: move the nation's health-care system away from a traditional fee-for-service model.

The newly announced Comprehensive Primary Care Plus program, which will be part of the ACA, will impact the way 20,000 doctors serve 25 million patients. The five-year program, which will launch in January 2017, will pay participating providers a fixed monthly fee, along with bonuses for meeting various health goals. Traditionally, those providers have been reimbursed based on the number of patient visits or procedures they log. That approach has long been lambasted by health-care experts as a big reason for rising costs.

The new move could incentivize states to adopt the "health-care home" model of care that's been shown not only to improve health outcomes but also to save billions of dollars. Despite the promising potential of that model, it hasn't been widely embraced by states.

One state that has become a model for health-care homes is Minnesota, which has saved more than $1 billion over the past five years by investing in that form of care, according to a study by the University of Minnesota earlier this year. These health-care homes embody precisely what advocates of a coordinated health-care system want: a one-stop shop for a patient to get all of her health needs met in as few visits as possible.

In 2008, before the Affordable Care Act had been introduced, then-Minnesota Gov. Tim Pawlenty formed a task force to study how to cut health-care costs across the board. The state had a maternal and child health-care coordination program, which parents had been happy with, so the state expanded that program to transform all primary care clinics into patient-centered health-care homes.

Eight years later, 54 percent of Minnesota's primary care clinics are certified health-care homes. Nationwide, only about 15 percent of primary care clinics are considered health-care homes.

In traditional clinics, patients meet with a primary care doctor, who then may refer them to an outside specialist for further care, or a pharmacy to pick up a prescription. In a health-care home, however, all those functions -- including primary and specialist care, pharmacy assistance, mental health specialists and more -- are housed under one roof. “The staff, even down to the front desk assistant, are part of a care team. Even the intake is different; you don’t fill out forms because staff that morning already had a huddle about the needs of each patient that day," said Marci Nielsen, president and CEO of the national Patient-Centered Primary Care Collaborative. "The idea is for all of your medical needs [to] meet you where you are, instead of a 15-minute visit where you’re rushed out of the door."

The medical home model traces back to a 1960s movement to provide better care for special needs children. Pockets of the country, along with insurers like Kaiser Permanente and Group Health, have embraced the concept of a patient-centered medical home. But the nationwide dependence on fee-for-service has prevented the model from becoming widespread. Even in Minnesota, there are still parts of the state -- particularly rural areas -- that don’t have access to these homes.

“In Minnesota, we just decided to go whole hog on it. People in this state just care about improving health care, period,” said Douglas Wholey, a health policy professor at the University of Minnesota who co-wrote the report. While it was a significant investment up front, “it works because it reduces costs overall and improves the quality of care."

In addition to saving around a billion dollars, the University of Minnesota's report highlights improvements in health. For example, 39 percent of asthmatic children treated in medical homes met health-care goals such as fewer hospitalizations; compared to only 19 percent in traditional primary care clinics. There were also modest but positive health improvements in patients with vascular issues, diabetes and depression.

While the health data is overwhelming, the state doesn't have data on how satisfied the doctors themselves are with this model.

“We don’t have the cold data, but we’ve heard anecdotally that having that support from the state really improves workforce culture,” said Bonnie LaPlante, director of Minnesota’s health-care home program. Doctors are actually able to do what they are trained to do, instead of having to wade through paperwork and middlemen to make sure a patient gets care, she said.

“And for patients, they feel like that have an advocate. They have a care coordinator that calls them and makes sure all of their appointments are in one day. You know you’re part of a team-based care system,” said LaPlante.

The new push from the Obama administration could incentivize more states to adopt a model similar to Minnesota’s. “This model is really vital for the future of health care," said LaPlante. "It establishes a really strong foundation to move away from fee-for-service once and for all."

Nielsen, of the Patient-Centered Primary Care Collaborative, agrees. “It truly is exciting, and it’s just in time," she said in reaction to Monday's announcment. "So much of what we’ve been saying is important is embedded in the language of Comprehensive Primary Care Plus. We’re optimistic that this will help providers stuck on the hamster wheel of fee-for-service and give them more options.”