Primary Care
Primary care is an essential component of a high-value healthcare system. However, in the United States, there is a large and growing shortage of primary care physicians, many primary care physicians are burning out, and most medical students don’t want to go into primary care. The reason is that neither the current fee-for-service system nor current value-based payment systems provide payments that are appropriately structured or adequate in size to support and sustain primary care practices.
Primary care practices need to be paid so that: (1) each patient can receive high-quality care appropriate for their specific needs, and (2) primary care practices with different types of patients receive sufficient revenues to cover the costs of the services their patients need. Under a patient-centered payment system, a primary care practice would receive five types of payment for patients who enroll with the practice for ongoing care:
- Monthly Payments for Wellness Care.
- Monthly Payments for Chronic Condition Management. Higher amounts should be paid during the initial month following diagnosis and for patients with complex conditions.
- A Fee for Diagnosis and Treatment of a Non-Emergency Acute Event.
- Monthly Payments for Integrated Behavioral Healthcare Services.
- Fees for Individual Procedures and Tests.
In order to assure that each individual patient receives appropriate, high-quality care, a primary care practice receiving these payments would be required to:
- Deliver Evidence-Based Care. The primary care practice would only bill and be paid if the practice delivered all appropriate services to the patient during the month or acute care visit that are consistent with applicable, evidence-based Clinical Practice Guidelines (CPGs) or the practice had documented the reasons for deviation from those guidelines in the patient’s clinical record; and
- Monitor Patient Needs and Outcomes. The practice would only bill for and be paid the monthly payments if it has a system to proactively identify and prioritize any problems the patient is experiencing and to determine whether the practice’s services are effectively addressing the patient’s needs.
The payment amounts should be based on the estimated cost for a primary care practice to deliver each category of service, considering the amount of time needed to deliver evidence-based services, the types of personnel who are most appropriate to deliver the services and their compensation levels, and non-personnel costs such as information systems, equipment, and space.
For patients with insurance, cost-sharing amounts must enable and encourage patients to use the primary care practice. There should be no cost-sharing for wellness care or chronic condition management, and a modest co-payment for acute care visits.
It is clear that payments to primary care practices need to be higher than they have been in the past. However, the percentage of total healthcare spending that goes to primary care practices is a poor indicator of the adequacy of primary care payment from a payer or purchaser. The amount spent on primary care relative to the amount spent on other services depends on the characteristics of the patient population and the amounts paid for services to other providers as well as the amounts paid for primary care services. For example:
- For a relatively healthy group of individuals, a high proportion of the services they need could likely be delivered by a primary care practice, so a high percentage of total healthcare spending for this group would be expected to be used for primary care.
- A relatively unhealthy group of patients will likely need many services that cannot be delivered by a primary care practice, such as care from specialists and surgeries and treatments that have to be delivered in hospitals or other specialized facilities. For these patients, a large amount will need to be spent on these expensive non-primary care services, so even if primary care practices are receiving adequate payments, those payments will likely only represent a small percentage of total spending on the patients.
- A health plan that pays higher amounts than other plans for services delivered by specialists, hospitals, and other providers will spend more on those services even if its members are using those services at similar rates. That could cause the percentage of total spending on primary care services for that plan to be lower than other plans, even if the plan is paying primary care practices higher amounts for services than other payers.
Because of this, it is both inappropriate and problematic to set targets for the percentage of total healthcare spending that primary care practices should receive. No matter what target amount is used, it may be too low or too high depending on the characteristics of the patient population and the community where they are receiving care. Moreover, if a payer implements other initiatives to reduce utilization rates or payment amounts for specialty services that cause total healthcare spending to decrease, this does not mean that payments for primary care should be reduced in order to maintain the same percentage of total spending.
Spending on primary care will only be adequate if the amounts paid for primary care services are sufficient to allow primary care practices to spend the time and hire the appropriate staff to deliver those services. That is the appropriate criterion for determining whether primary care payments are adequate, not the amount by which spending has changed or the percentage of total spending going to primary care.