We provide detailed information on the structure, payment models, and transformation processes of the extant PCMH demonstration projects across the country. There is substantial diversity in not only the size and scope of current PCMH demonstration projects, but also in the design and conceptualization of the pilots. This diversity should be useful in providing insights into the design elements that are most crucial to facilitating the broader adoption of the PCMH model of primary care.
A number of key findings emerge from this study. First, we identified a large number of current and planned pilots, including 26 currently active demonstrations with payment reform in 18 states, as well as at least 68 demonstrations in 25 states planned for launch in the future. Current demonstrations include over 14,000 physicians caring for nearly 5 million patients. Undoubtedly there are additional projects that we failed to identify. These numbers suggest substantial enthusiasm for the PCMH model of care from diverse stakeholders throughout the country.
Second, the PCMH did not arise in a vacuum. Many of these projects are natural extensions of health plan or area-wide quality improvement initiatives. Thus, many of the demonstrations build upon an infrastructure of teamwork and shared resources that may be difficult to replicate when implementing the PCMH on a larger scale. Finally, we found substantial variability related to the basic requirements and definition of a PCMH, optimal payment methods, and methods for facilitating the transformation of existing primary care practices to highly functioning patient-centered medical homes.
Even in the presence of external payment reform, the PCMH pilots’ chances of achieving positive results hinge upon successful transformation, particularly given the relatively short time periods specified in many of the demonstrations (usually about two years). We identified two core models for helping practices transform themselves to a PCMH—implementation of the chronic care model supported by quality improvement coaching, and a model featuring external transformation consultants. The CCM identifies aspects of care systems that must be addressed to lead to significant improvements in chronic disease care. As applied to practice transformation, it provides guidance to practices on the types of initiatives they should undertake, working collaboratively with other practices within a learning collaborative. A plurality of pilots surveyed used this model of change and most of these did not use external consultants. In contrast, the consultative model of transformation involved proscriptive practice change most often carried out by external facilitators hired by the pilot who help to organize assessment and transformation around core modules. This model requires substantial additional up-front resources to support these facilitators.
Whether either of these models will be sufficient to support practice transformation on a large scale is not known. Prior research on implementation of the CCM through quality improvement collaboratives suggests that practices can achieve modest improvement in processes of care, but little definitive change in outcomes or cost savings have been observed17–22
. Similarly, practices participating in the recently completed TransforMED national demonstration project found it challenging to achieve transformative care changes12
. This suggests that transformation is difficult to achieve12,23,24
. One key distinction is that these studies all occurred in the absence of external payment reform; the extent to which payment reform will serve as an enabler of practice transformation is a key issue to be answered by current pilots.
External payment reform is a cornerstone principle of the PCMH, and how individual health plans and demonstration projects structure payments is likely to be among the most important determinants of success. Most of the demonstrations adopt the “three part” payment model espoused by the PCPCC. This model includes ongoing fee-for-service payments, a fixed (usually monthly) case management fee, and potential for additional bonuses based on clinical performance. Across the demonstrations, however, we found a large range of additional revenue potential ranging from approximately $1000 to over $90,000 per physician per year, with most of the incremental revenue coming from the fixed case management fees. Many, but not all, of the demonstrations not only maintain FFS payment at existing levels, but still utilize it as their core payment system. In addition, participating health plans base payments on their own enrollees, and few of the projects attempt to add sufficient additional resources to cover costs for the entire practice. The timing of the payments might also play a significant role. Several of the demonstration projects include up-front payments that can be used to support investments needed for transformation that might be otherwise difficult to finance with incremental monthly or quarterly revenue.
Finally, we note that the NCQA PPC-PCMH tool has emerged as the de facto, if partially flawed25
, method for evaluation of “medical homeness.” Some pilots view NCQA certification as a desired outcome and base their payment structure on achieving pre-specified levels. Others view such certification as a starting point, recognizing that the tool defines a baseline set of core capabilities but does not capture all of the key aspects required of a fully functioning medical home. Still other demonstrations use it as an external benchmark to inform practice transformation. How well outcomes correlate to NCQA level, and what consequences (intended and otherwise) emerge from tying payment to NCQA levels are questions deserving future empiric study.
Our findings yield several important implications for policy, practice, and research. The heterogeneity in program design suggests an urgent need to incorporate evaluation in all programs’ designs. Less than half of the programs had well-specified evaluation plans that were designed in conjunction with the pilot. In most cases, although evaluation is considered important, the evaluation designs had not been pre-specified, thus necessitating a reliance on existing data, and funding had not been secured to support a robust evaluation. Furthermore, many of the pilots do not identify adequate control groups against which to compare the intervention practices.
Program evaluation should look broadly at the impact on service cost/utilization; quality of care as measured by patient experiences, processes, and outcomes; and physician/staff experiences. If physician experiences are not improved within the medical home, the future may yield few PCPs to provide care under this model. An evaluator collaborative funded by the Commonwealth Fund is also working to develop uniform methods for measurement in each of these areas that will facilitate comparisons across pilots. Finally, we must be clear about the implications of the medical home on costs and cost growth. It is likely that implementing the medical home will not lead to immediate direct cost savings because of the initial increase in resources needed to implement this model. There is hope that the PCMH will impact the rate of cost growth in the future if it leads to a more rational model of care.
The PCMH model has captured the attention of providers, payers, purchasers, and policymakers nationwide, resulting in the development of numerous demonstration programs throughout the country. In addition, the PCMH is being looked at as a means of reorganizing care under current health reform proposals. The diversity in the design of the pilots suggests that significant unanswered questions remain about how the PCMH model should be implemented. Whether the PCMH model delivers on its promise of better quality and patient experience at lower costs will be in large part determined by how demonstrations address core questions around transformation, payment policy, medical home certification, and the adequacy of their evaluation plans.