Patient-centered medical home program decreased hospital use, lowered care costs

In the 3 years since its introduction, CareFirst Blue Cross Blue Shield’s Patient-Centered Medical Home model has resulted in reduced hospital utilization, lower health care costs to members and increased reimbursements for participating panels, Blue Cross Blue Shield announced in a press release.

The company provided 3-year results from their Patient-Centered Medical Home program, which was implemented in 2011. Over 80% of all primary care providers located in the CareFirst service area, which includes parts of Northern Virginia, the District of Columbia and Maryland, are participants.

Since its inception, the program has resulted in a reduction to the overall rate of increase of medical spending for its members, which has lowered from an average increase of 7.5% per year in the 5 years before the program’s introduction to 3.5% during 2013, according to the release.

In addition to the positive trends for overall medical spending, CareFirst also reported improvements in costs of care for the more than 1.1 million members covered by the program. When measured against the expected cost of care for this population, program members incurred $130 million less, or a 3.2% savings, which has increased from a 1.5% savings in 2011 and 2.7% in 2012. Overall, when measured against the projected cost of care from 2011-2013, the program resulted in $267 million in savings, according to the release.

Beyond the financial savings reported for the program, CareFirst stated in the release that the program performed well on several key quality indicators measuring positive impact on CareFirst members. Quality indicators were tracked and comparisons were made between members seeing physicians in the program and those being treated by non-program doctors.

Compared with patients under the care of non-program physicians, those treated by patient-centered medical home providers achieved the following per 1,000 CareFirst members:

6.4% fewer hospitalizations
11.1% fewer days in the hospital
8.1% fewer all-cause readmissions; and
11.3% fewer visits to outpatient facilities

According to CareFirst president and CEO Chet Burrell, these improvements are probably not entirely related to the program, but they are nonetheless very encouraging.

“Increasingly, the data we are seeing on quality and cost for the physicians participating in our [Patient-Centered Medical Home] program and our members under their care give us confidence that our program is taking hold and headed in the right direction,” Burrell said in the release. “With this said, given national trends downward over the last few years, it would be unfair to attribute these shifts solely to our program, but we believe [it] has had a significant contributory effect.”

The organizational structure of the program, which includes more than 4,000 primary care providers, involves the grouping of between five and 15 physicians into panels aimed at collaborating on the care of the members who have chosen them as practitioners. Through this team effort, panels can achieve Outcome Incentive Awards based on the level of quality and degree of savings achieved compared with projected outcome figures. In 2013, roughly 69% of the panels participating in the program earned OIAs, which are awarded through increased reimbursements during 2014 and 2015. The percentage of OIAs earned has also increased from 66% in 2012 and 60% in 2011. For the panels that have earned OIAs in 2013, this will amount to an average 36% increase in primary care fees paid by CareFirst, in addition to the 12% fee paid to program providers for their participation, according to the release. Overall, this translates to an increase in average revenue for the average patient-centered medical home primary care physician of roughly $25,000 to $30,000.

“What is impressive to us is that the awards have steadily increased despite a slowing in the rise of health care costs,” Burrell said in the release. “This suggests that there is ample room for improving outcomes for our members on a sustained basis, which we are greatly encouraged by.”