Primary Care Provides Solid Foundation for State Health Care Reform Efforts

Recently, several states have launched comprehensive health care reform efforts that underscore the importance of primary care and the patient-centered medical home, or PCMH, to improve quality and save costs while enhancing patient access.

Representatives from four of these states -- North Carolina, Vermont, Rhode Island and Colorado -- described various components of their health care reform initiatives here during an Oct. 8 forum sponsored by the Brookings Institution and the National Academy of State Health Policy.

North Carolina's Medicaid care management program, which is known as Community Care of North Carolina, or CCNC, provides care to more than 750,000 Medicaid recipients in that state. The CCNC is based on local clinical organizations that are built on the foundations of primary care and the PCMH, said Allen Dobson, M.D., of Concord, N.C., a family physician and former assistant secretary for health policy and medical assistance at the North Carolina Department of Health and Human Services.

Since its inception in 1999, the CCNC has grown to encompass 15 networks, 3,500 primary care physicians and 1,000 medical homes. It pays physicians 95 percent of Medicare plus a $3 per-member, per-month case-management fee. The state also pays networks a $3 per-member, per-month fee for care and disease management.

In the past nine years, the program has saved North Carolina nearly a half a billion dollars, becoming a driver of quality initiatives in the state and emerging as a model for other states to emulate. Dobson, vice president of Carolina HealthCare Systems, said most of the savings generated by the CCNC result from improving quality and not from cutting costs.

The CCNC serves as a "clinical program, not a financing mechanism," meaning it manages the care of the covered population, said Dobson during the forum. This entails public and private partnerships in which both entities share responsibility for controlling costs and improving care.

One of the keys to the program is managing patients with chronic diseases and making sure these patients do not fall through the cracks when transitioning between primary care physicians, subspecialists and hospitals, Dobson said. It also is imperative to put some of the program's savings back into the program so it can grow, he said.

Vermont has taken some of the same components used in the CCNC and applied them to its own health care initiative, which is known as the Blueprint for Health. The program began as a health care prevention initiative encompassing financial incentives, a greater use of health information technology and self-management workshops to promote healthy behaviors in six communities across the state.

It now has expanded to include integrated pilots comprising primary care providers, prevention specialists and public health specialists. One of the goals of the pilots is to tie prevention and health care delivery together, said Craig Jones, M.D., of the Health Care Reform Commission for the Vermont state legislature.

The state pays providers within the integrated pilots a fee based on how well they adhere to national standards of the PCMH, said Jones. The prevention and public health care specialists are responsible for evaluating community risk factors and designing local prevention strategies to prevent and modify behaviors.

The integrated pilots, which are operating in two Vermont communities, rely on Web-based tracking systems to support patient management and promote care coordination. In addition, the pilots contain a multi-tiered evaluation component that looks at clinical process measures and health outcomes to determine the effect of the programs.

Chris Koller, Rhode Island's health insurance commissioner, focused on the lessons his state has learned from health care reform efforts while also citing the inherent value of primary care in the reform process itself. Medical spending in Rhode Island totals $7 billion annually, but primary care accounts for only a small percentage of that amount, said Koller.

"If you figure out a way to raise money for primary care doctors by 15 (percent) to 20 percent, you have affected your premium budget by just a pittance," Koller said. "All this wailing and gnashing of teeth is (about) $1 million on a $7 billion expense. You can get a lot out of (primary care) for a little bit of money."

Koller added that health care reforms efforts now under way on the state level are about "delivering system change," which may call for more regulation. "This is about change, and sometimes people don't want to change," said Koller. "The regulatory stick is sometimes necessary and appropriate."

Joan Henneberry, executive director of the Colorado Department of Health Care Policy and Financing, said during the question-and-answer period of the forum that Colorado is a state where "we try and use carrots."

"We are very reluctant to use a stick, so we beat people with the carrot," she said, provoking laughter from the audience.

Henneberry described Colorado's health care reform efforts as "staged reform," which began with enrolling children who were eligible for Medicaid and the State Children's Health Insurance Program into medical homes that are linked to primary care providers. The state also has raised provider rates to build and strengthen its provider base, she said.