Value Based Insurance Design and the Synergies with the Medical Home, P4P, HIT and Disease Management. We've Only Just Begun

More than a year ago, the Disease Management Care Blog posted a prediction. It said that the key to achieving improved population-based outcomes at lower cost will lie in the combined five-fold synergies of: 1) Ver 2.0 care/disease management, 2) the patient centered medical home (PCMH), 3) provider pay-for-performance (P4P), 4) the electronic medical record (EMR) and 5) consumer directed health plans. It turns out that the DMCB was slightly wrong in several domains. It's not necessarily just 'pay for performance' but flexible provider compensation that includes enhanced fee-for-service, risk-adjusted capitation, P4P and gain sharing. It's not just the EMR, but EHRs plus decision support and registries. And it's not consumer directed health plans but value based insurance designs (VBID).

What is VBID? It's any commercial insurance product that includes adjustments of patients' out-of-pocket costs and provider reimbursement for specific services based on their clinical benefit. The greater the benefit to the patient, the lower that patient's cost share and the higher the provider payment. It can be tailored to certain services (for example, lipid testing) and/or for certain conditions (diabetes mellitus) and/or condition severity (enrollees with recurrent hospitalizations) and/or level of participation (in care management). It's not necessarily easy to implement, since there are Federal and State regulations to consider, the possibility of employee push-back over perceptions of unfairness, a still evolving business model and questionable scalability across a network.

You can read more about it here and view this helpful YouTube video here.

VBID was an important topic that was discussed by Mark Fendrick at the Patient Centered Primary Care Collaborative Stakeholder's meeting that was held in Washington DC on March 30. His presentation (the PowerPoint is not yet available on line) was timed to match the release of this PCPCC white paper. It's worth downloading and reading. It describes in some detail how the PCMH and VBID can be integrated through reduced patient out-of-pocket expenses for medical home-based visits as well as for referrals coordinated by the medical home, increased health reimbursement/savings accounts to pay for medical home services and co-pay tiering that favors testing and medications ordered by medical home team members.

The March 30 meeting also featured Dr. Blumenthal of ONC, who spoke rather extensively about the synergies of health information technology (HIT) and the medical home. Unlike discussion of VBID, however, there was little else that was particularly new in this discussion, including the assertion that this time, and we really REALLY mean it this time, that "meaningful use" combined with luster of federal funding will cause all those hold-out physicians relent and spend tens of thousands on an outpatient EHR.

What was missing from both Dr. Fendrick's and Blumenthal's presentations, however, was how HIT, VBID and the medical home are probably more than the sum of any of its parts. For example, HIT-based decision support tapping into registries can help prompt value-based interventions coordinated by PCMH team members even if the patient is not physically present.

The DMCB says toss in the right kind of provider reimbursements and the option of distance telephonic support to help coach the patient using principles of shared decision making and....

Well, the DMCB thinks anyone can see the potential here.

Years ago, the DMCB also submitted a paper to Health Affairs on the topic of an overlapping and mutually supportive five-way approach to population-based care. After some tantalizing positive reviewer feedback and requests for revisions, it was ultimately rejected. The thinks it was ahead of its time. The manuscript is in some folder in the DMCB World Headquarters somewhere. Maybe it's getting time to dust it off.

And maybe at a next PCPCC confab, it'll be realized that PCMH-VBID or PCMH-HIT dyads are only the beginning.

First Impression Notes From the March 30 Patient Centered Primary Care Collaborative's Stakeholder's Meeting

It's been a long but rewarding day. The Disease Management Care Blog attended the Patient Centered Primary Care Collaborative's Stakeholders' Working Group meeting at Washington D.C.'s Ronald Reagan Building. You can download most of the presentations here. While the DMCB will be reflecting on some of the Conference's more interesting speakers' over the next few days, here are some immediate insights:

The PCPCC has come a long way with an energetic and impressive leadership that has ably harnessed the talents of a cast of thousands. There was a sense of real momentum in the room.

The "Patient Centered Medical Home" clearly continues to be hot, not only because of its inclusion in health reform, but because conferences on the topic can now attract U.S. Surgeon Generals and National Coordinators for Health Information Technology. Surgeon General Benjamin extolled her many past ties to organized medicine and demonstrated her understanding of clinical practice in small town poverty, making the DMCB wonder why she wasn't more visible during the Administration's recent legislative travails. As for Dr. Blumenthal, the irony of his "I'm from the government and I'm here to help" doctors adopt meaningfully useful electronic records speech at the Reagan Center was almost too much for the DMCB to bear. Lots of coffee helped maintain focus.

There is a telling absence of breaking news about cost savings, a.k.a. claims expense reductions, a.k.a., bending the curve, a.k.a, return on investment from the medical home pilots. The focus on payment reform, blended capitation/fee-for-service/P4P/shared savings models and an interesting discussion on an alternative approach to reimbursement for measurable outcomes that are 'delegated' to medical homes made the DMCB suspect that the pilots have begun to run into the same issues that plagued early versions of the disease management industry. Hang in there says the DMCB. Not only is the science of cost analytics evolving, so is the patient centered medical home itself, including combined approaches that leverage the best of health information technology, value based insurance and modern versions of disease management. More on that in a later post.

The not-for-profit community health plans, represented by ACHP, also have yet to demonstrate hard savings from their PCMH initiatives, but there are some promising "early indicators." The DMCB also does not blame ACHP or its members for being annoyed at being swept up in the anti-insurer bombast of Ms. Sebelius.

Last but not least, the language of "Patient Centered Medical Homes" may have shifted away from jargon about 'the medical home' to rhetoric about "patient centeredness." This sometimes drifted into a parallel universe of perfectly-practiced medicine, special PCP-patient intimacy, appointments whenever wanted, limitless access to caring specialists and virtuous declines in health care costs. It also included, and the DMCB is not making this up, being a role model for "student-centered schools." The DMCB endorses the concept and votes for commuter-centered DC Metro trains, working wireless-centered wirelessness at last night's cheapo hotel and, as always, DMCB-centered spousing.

This means that in workplace meetings, conferences and career laddering sword-play with colleagues, the thousands of regular DMCB readers once again have a critical advantage. You can once again demonstrate your complete mastery of this topic by minimizing use of 'medical home' in favor of the much preferred term 'patient centeredness':

Incorrect: "This initiative is designed to promote quality and consumer value by leveraging the principles of the medical home in our network!"

Correct: "This initiative will capitalize on consumerism, leading to heightened health care value by focusing on patient centeredness in our network!"

Observations About Today's Patient Centered Primary Care Collaborative Annual Summit. Most Important: The Value of Magic Nurse Stuff.

The Disease Management Care Blog spent an extremely rewarding day at the Washington DC Primary Care Patient Centered Collaborative's Annual Summit on the Patient Centered Medical Home. It caught up with colleagues, got some valuable scientific updates and got to share in the growing enthusiasm for a very compelling approach to care. It also grabbed a copy of this report that was released today, 'Proof In Practice,' that will be the topic of a future DMCB post.

Random observations from today's meeting in no particular order:

This time the PCPCC Meeting was held in a very large room in the Washington DC Convention Center. There were over 400 attendees and the crowd was very supportive. The Patient Centered Medical Home appears to have gained considerable momentum - and that's putting it mildly.

Several Congressional staffers were there along with a House Representative who gave the keynote. Based on their comments, it's pretty clear that some version of the PCMH will be in the final health reform bill. The DMCB suspects that 'pilots' will be used in lieu of 'demonstrations' in FFS Medicare. In D.C.-speak, pilots have a better open-ended political prognosis than 'demonstrations.'

One key Congressional staffer pointed out that there seem to be many iterations of the PCMH ('means different things to different people') with variable outcomes ('for example, it doesn't consistently reduce repeat hospitalizations'). While some prefer to 'lump,' Congress is leaning toward 'split' by recognizing two models of the medical home: 1) 'high intensity' and 2) 'low intensity.' Each warrant different levels of funding support. Watch for this in the final health reform bill.

One physician audience member pointed out that his Medicare Advantage (MA) Plan has been offering a version of the PCMH for years. He pointed out that if MA funding is cut, this could mean its demise. The panel responded by noting that most MA Plans have not used their allegedly high fees to support versions of the PCMH. In response, MA funding cuts are politically inevitable, but there is a chance that bonuses will be offered to MA Plans that offer care coordination. Look for this in the final health reform bill also.

Why aren't commerical insurers and self-insured employers stampeding toward the PCMH? Three reasons were offered: 1) the PCMH is very much a function of managing 'locations' in a network that depends on local physician adoption; it's easier to just manage the benefit design, 2) it's still all about a short term focus on costs, not a long term emphasis on 'value,' and 3) irrefutable and solid 'proof of concept' is still lacking.

That's not stopping the Veteran's Administration. All 820 of their primary care sites are going to be transformed to PCMHs over the next two years thanks to a combination of experiential learning collaboratives, learning colleges, consultation teams, demonstration labs and an abundance of communication. The VA's challenges are 1) promoting 'top of license' care among members of the PCMH team, 2) limited phone based care experience, 3) the usual challenges in retooling for chronic care activities, 4) limited experience in managing transitions between the hospital and the outpatient setting, 5) while the VA's EHR is robust, its decision support capabilities are minimal.

Last but not least, much of what appeared in the many panel discussions and on screen in the PowerPoints was filled with nursing concepts and terminology. To the DMCB, it's pretty clear that the core of any PCMH is high-end primary care nursing. Sure, we need physician leadership, information technology, teaming, payment reform etc, but let's face it: when it comes to assembling and managing the resources necessary to care for patients with chronic illness, physicians can best lead by getting out of the way. To us docs, it's magic nursey stuff. The good news is that it seems to work not matter what you call it and that the nursing profession is finally going to get the recognition that it deserves.

Go To the Annual PCPCC Annual Summit. Even If You Can't, Here Are Some Links So You Can Learn More About the Patient Centered Medical Home (PCMH)

Want to be an expert on the latest news about the Patient Centered Medical Home? Well, in addition to regularly reading the Disease Management Care Blog, you could be the U.S. President or one of his health care advisors and simply ask the folks from the Patient-Centered Primary Care Collaborative (PCPCC) to stop by and provide their insights. Or better yet, you could plan on going to the October 22 PCPCC Annual Summit: All Eyes On the PCMH that will be at the Washington Convention Center from 8:00 - 4:30. You can register here. The Agenda is packed with informative experts, Washington DC is a beautiful city in the Fall and what's more, you can say hi to the DMCB, which will be sitting in the back and taking notes.

This is an exciting time for the PCMH. News from the many commercial insurer pilots should start arriving soon. What's more, CMS's Medical Home Demo is going to be getting underway in the not too distant future. Last but not least, PCMH pilots are highly likely to survive intact in the current versions health reform legislation.

Even if you're not a Presidential advisor and cannot make it to D.C. three weeks from now, thanks to the DMCB and the PCPCC, you now have access to their list of peer reviewed publications or analyses, which are below with links to what you'll need and more. Thanks to keeping the DMCB on your reading list, you can now access and review the same established evidence base that was shared with the White House.

The folks at PCPCC were kind to provide these to the DMCB - which is greatly appreciated.....

Group Health Cooperative of Puget Sound - Reid R, Fishman P, Yu O et al: A patient-centered medical home demonstration: a prospective, quasi-experimental, before and after evaluation. Am J Manag Care. 2009;15(9):e71-e87. Reviewed previously by the DMCB, this twelve month study comparing a PCMH clinic with control clinics found an additional cost of $16 per patient per year was associated with offsetting cost reductions, with the net result being no overall increase in total costs with a reduction in inpatient and emergency room costs with climbs in HEDIS-defined quality. (Link)

Community Care of North Carolina - Steiner, B.D et al: Community Care of North Carolina: Improving care through community health networks. Ann Fam Med 2008;6:361-367. Community Care of North Carolina found that circuit-riding nurses and compensating primary care offices for PCMH-based care coordination was associated with savings totalling $135 million for TANF-linked populations and $400 million for the aged, blind and disabled population. Likewise examined by the DMCB here, here, and here. (Link)

Health Partners uses "BestCare" practices to improve care and outcomes, reduce costs. It must be true if the Institute for Healthcare Improvement says Health Partner's medical homes had a 39% decrease in emergency room visits, a 24% decrease in admissions and a 20% decrease in inpatient costs for behavioral health patients. Diabetes care measures increased and clinic waiting times decreased. (Link)

Geisinger Health System and ProvenHealth Navigator. As far as the DMCB is aware, it's not been published in any formal or peer review setting, but at a recent DMAA Forum 09 meeting, their powerpoint quoted a 7% reduction in overall costs, a 25% reduction in readmissions, a 15% reduction in admissions accompanied by quality increases in diabetes, coronary artery disease, preventive care and member satisfaction. It hears a publication is in the works somewhere. (Link)

Johns Hopkins Guided Care PCMH Model - Leff B, Reider L, Frick K et al: Guided care and the cost of complex health care: a preliminary report. Am J Managed Care 2009; 15:555-559. The folks at Hopkins call this version of the PCMH 'Guided Care.' Primary care clinics owned by Hopkins and Kaiser had 'pods' consisting of 2-5 primary care physicians and 7 were randomized to an intervention consisting of a care manager nurse while 7 others served as controls. Based on 8 months of data involving 485 patients in the PCMH pods versus the 415 patients in the usual care pods, the intervention patients had a 24% reduction in total hospital inpatient days and a 15% fewer ER visits. Based on a Medicare fee schedule, that's an annual savings of $1364 per patient. (Link)

Genesee Health Plan. In another report from the Institute for Healthcare Improvement, the Genesys Health System started the Genesee Health Plan to serve 25,000 previously uninsured adults in Michigan. The insurance benefit emphasized the PCMH and, compared to competing health plans, Genesee had a 10% to 25% lower cost, declining ER utilization and increased enrollee healthy behaviors. (Link)

Colorado Medical Home. The State's Medicaid program enrolled 88,000 Medicaid and 62,000 CHP+ children in medical homes as of March 1, 2009. Since then, ER visits and hospitalizations were lower with annual costs being $785 for PCMH children compared with $1,000 for children being cared for outside of a PCMH. In an evaluation specifically examining children in Denver with chronic conditions, PCMH children had lower median costs ($2,275) than those not enrolled in a PCMH practice ($3,404). More children also had well child visits. (Link)

Intermountain Healthcare Medical Group Care Management Plus PCMH Model - Dorr DA, Wilcox AB, Brunker CP, et al: The effect of technology-supported, multidisease care management on the mortality and hospitalization of seniors. J Am Geriatr Soc. 2008;56(12):2195-202. Intermountain instituted a multidisease care management program called 'Care Management Plus' relying on dedicated nurses in seven clinics. Their outcomes were compared to those in six control clinics. In the 1144 intervention patients versus the 2,288 control patients, mortality was lower at 1 year (6.2%, vs 10.6% for controls) and at 2 years (12.9% vs 18.2%). The hospitalization rate was lower (21.0%, vs. 24.2% for controls) at 1 year and substantially more so at the 2-year follow-up. Hypothesized savings from decreased hospitalizations was $17,384 to $70,349, but access to the abstract and not the full article doesn't allow the DMCB to compare the savings to the costs of the program. (Link)

Rosenthal, T. C., M. E. Horwitz, et al: Medicaid Primary Care Services in New York State: Partial Capitation vs Full Capitation. J Fam Practice 1996;42(4):362-368. According to a write up by the folks in the PCPCC, during the 1990s, Erie County in New York State implemented a primary care medical home program for dual eligible Medicaid-Medicare beneficiaries. The abstract itself says claims data was used by the New York State Department of Social Services to compare the costs for matched cohorts enrolled in partial capitation programs, in which the primary care physician is paid an ambulatory primary care monthly fee for its assigned Medicaid recipients. This partial capitation program worked as well as full capitation and saved the state 38% compared with a matched control group enrolled in traditional, fee-for-service settings. The PCPCC also says quality measures and patient satisfaction for partial and full capitation programs were equivalent and there were savings of $1 million for every 1000 enrollees (No Link Available at the Journal of Family Practice but a reproduced abstract is here).

Geriatric Resources for Assessment and Care of Elders (GRACE) Model - Counsell SR, Callahan CM, Clark DO, et al: Geriatric care management for low-income seniors: a randomized controlled trial. JAMA. 2007;12;298(22):2623-33. Researchers at the Indiana University Center for Aging Research and Regenstrief recruited medically indigent outpatients aged more than 65 years from six community-based health centers affiliated with Wishard Health Services, a university-affiliated urban health care system in Indianapolis, Indiana, between January 2002 and August 2004. Over 900 patients were randomly assigned to usual care versus the GRACE intervention. This involved an advanced practice nurse and social worker who worked in close collaboration with the primary care physician and a geriatrician-led geriatrics interdisciplinary team. The cumulative 2-year ED visit rate per 1000 was statistically significantly lower in the intervention group (1445 vs 1748), but hospital admission rates were not significantly different. However, in a predefined group at high risk of hospitalization (comprising 112 GRACE and 114 usual-care patients), ED visit and hospital admission rates were lower for the GRACE patients in the second year (848 vs. 1314 and 396 vs. 705, respectively). (Link)

Support the Patient Centered Primary Care Collaborative

The Disease Management Care Blog has been alerted to the posting of a copy of an important letter addressed to Charlene Frizzera, CMS' Acting Administrator and Peter Orszag of the OMB expressing concern over possible changes in the upcoming Medicare Medical Home demonstration. The letter is from the folks over at the Patient Centered Primary Care Collaborative. Apparently, OMB is actively considering restricting participation in the demonstration to primary care sites that have obtained Tier III recognition in the NCQA's Patient Practice Connections/Patient Centered Medical Home (PCC-PCMH). As readers may recall, Medicare initially planned to use its own Level I and II certification process.

The letter correctly points out that, while it was going to be difficult for small physician owned practices to participate at a Level I or II, it will be far more difficult for these clinics to attain the highest NCQA Tier III level. It takes considerable resources to attain this, and the inevitable failure to do so will effectively shut out about 1/2 of all the U.S. primary care physicians from participation. As a result, we will have no idea if the the Medical Home is a viable and generalizable option in fee for service Medicare in all corners of the country.

What are they thinking?

You're welcome to sign onto the letter to express your concern. Readers can contact Relja Ugrinic, at rugrinic@pcpcc.net, directly by COB Tuesday, April 21st, to add your name to the letter.