Research Highlights the Enigma of Primary Care Spending

Evidence Shows It Works, so Why Don't We Do More of It?

May 29, 2019 11:09 am News Staff – It's a pretty simple formula that's been borne out by exhaustive research: the more money invested in primary care, the greater the return for all stakeholders. Higher quality, lower costs, better outcomes -- what's not to like?

Methodology

The research team examined spending for all Medicare beneficiaries 65 and older with 12 months of Medicare Part A and Part B fee-for-service medical coverage and Part D prescription coverage in 2015. More than 16.2 million people were included in the analysis.

The research team used two discrete data sets in their analysis -- spending by primary care practitioner type and spending on primary care services -- each of which was further broken down into narrow and broad definitions.

The narrow definition of PCPs was limited to the specialties of family medicine, internal medicine, pediatrics and general practice, and the broad definition was expanded to include nurse practitioners and physician assistants and the specialties of geriatrics and gynecology. Both definitions excluded hospitalists.

The narrow definition of primary care services was limited to Healthcare Common Procedure Coding System codes on professional claims for evaluation and management visits; preventive care visits; care transition or coordination services; and in-office preventive services, screening and counseling. The broad definition included all professional services billed by PCPs, excluding those that were ordered but not performed directly by PCPs.

The researchers measured primary care spending as a percentage of total medical and prescription spending at the state and national levels, as well as by various patient characteristics.

Findings

Depending on the definition and scope of services, primary care spending among Medicare beneficiaries represented between 2.1% and 4.9% of total medical and prescription spending, with the highest percentages in the broad PCP/broad primary care service category.

Across virtually all definitions, primary care spending percentages were lower among beneficiaries 85 and older, blacks and Native Americans, those who were eligible for both Medicare and Medicaid, and those with chronic medical conditions (with the exception of hyperlipidemia in the narrow PCP/narrow and broad primary care service definitions), and higher among Asians and beneficiaries 65 to 74.

Primary care spending percentages also differed considerably from state to state, ranging from 1.59% of total spending in North Dakota using the narrow PCP and service definitions to exactly twice as high (3.18%) in Hawaii, and from 2.12% in the District of Columbia to 4.74% in Iowa for the narrow PCP/broad service category.

Finally, the researchers found no significant association between primary care spending percentages and PCP headcounts, suggesting that simply counting the number of PCPs in a given state might not be an accurate way to measure investment in primary care.

AAFP Advocacy

It's important to note that nationally, the AAFP supports an increase in spending on primary care through its Health Care for All policy, which calls for U.S. primary care physicians to be compensated in a manner consistent with the Academy's Advanced Primary Care Alternative Payment Model. The Academy maintains that the APC-APM will support greater investment in primary care, allow primary care practices to achieve and sustain success through simplified payment structures and decreases in administrative burden, and result in better patient outcomes and more favorable experiences.

Most recently, AAFP Vice Speaker Russell Kohl, M.D., of Stilwell, Kan., joined with executives from HHS and the Center for Medicare & Medicaid Innovation in April to unveil a handful of new payment models included in CMS' Primary Cares Initiative that were influenced, in part, by the APC-APM.