Problem Addressed

• Inadequate health IT: The United States lags behind other nations in the adoption of health IT,¹ particularly in physician offices. The leaders of many practices, especially smaller ones, often believe they cannot afford such technology. Although the Federal government and some State governments have begun offering financial incentives, adoption of health IT remains low.
• Lack of multidisciplinary teams and other resources: Ensuring the provision of effective, well-coordinated preventive and chronic care services often requires the assistance of a multidisciplinary team, including social workers, behavioral health specialists, home health care services, and other community-based support typically not available within a primary care practice. In addition, these resource-constrained practices often do not have the staff or systems to promote easy access to care (e.g., extended hours, 24-hour telephone lines) or to coordinate care across settings.
• Few financial incentives: The current fee-for-service (FFS) payment system creates a strong incentive for physicians to maximize the volume of patients seen, often leaving inadequate time to address all preventive and chronic care needs during the short time allotted for a visit. In addition, practices operating in an FFS environment do not generally benefit from the cost savings generated by investments in higher-quality, better-coordinated care, as few payers offer to share these savings. As a result, practices have little or no incentive to make such investments. The Institute of Medicine has identified payment reform as a critical strategy for improving the quality of the nation's health care system.²
• Unrealized potential of state-sponsored support: State governments are often well positioned to develop multifaceted programs to support practices in providing such services, including mandated insurer funding of incentives and other types of support. Yet relatively few states currently provide such support.

Description of the Innovative Activity

• Authorizing legislation: In April 2010, the Maryland legislature passed a bill (HB929/SB855) requiring the Maryland Health Care Commission to establish and conduct a 3-year pilot test of a program to promote the development of patient-centered medical homes (PCMHs) in a limited number of practices. The law requires the state’s five largest commercial insurers—Aetna, CareFirst BlueCross BlueShield, CIGNA, Coventry, and United Healthcare—to participate in the program. The law also requires the Commission to establish a mechanism to assess the program’s impact on quality, cost, patient and provider satisfaction, physician payment levels, and racial and ethnic disparities. (See the Planning and Development Process section for more information on this evaluation.)
• Detailed agreements specifying participant obligations: Each of the 52 physician practices that participate in the program and the five commercial carriers noted above must sign a participation agreement. The State Medicaid Office signed a memorandum of understanding, which governs six Medicaid management care organizations (Amerigroup, Coventry, Maryland Physicians Care, Medstar, Priority Partners, and United Healthcare). Made with the Maryland Health Care Commission (which oversees the initiative), these agreements outline the specific roles, responsibilities, obligations, and requirements of each party. For practices, provisions focus on what it means to become and operate as a PCMH, while for payers the focus is on providing funding and incentives to support the practices in their efforts, as outlined below.
  • Practice requirements focused on PCMH transformation: Participating practices must work toward becoming a medical home, including putting in place specific practices designed to enhance access to team-based, coordinated, high-quality care. Specific requirements include the following:
    • Working toward medical home designation: Participating practices agree to work toward designation as a PCMH per the standards set forth by the National Committee for Quality Assurance Patient-Centered Medical Home™ (NCQA-PCMH™) program. Practices are responsible for collecting information on their performance as part of achieving NCQA recognition.
    • Specific initiatives to enhance access and quality: As part of their transformation efforts, participating practices agree to put in place the following:
      • Access-enhancing programs: Practices must hold extended office hours, provide same-day appointments to urgent-care patients, and offer “24/7” telephone access to patients.
      • Electronic health records (EHRs): Practices must develop and use EHRs to manage patients with chronic conditions (e.g., diabetes) and must post laboratory results electronically for patient review.
      • Team-based care coordination: Practices must have a team to coordinate patient care, including tracking referrals to specialists and updating medications, and must assign care coordinators to patients.
      • Other quality-enhancing services: Practices must conduct medication reconciliation at every visit, track reports from specialists, follow up with patients after hospital discharge, and develop individualized care plans.
  • Payer requirements focused on funding practice support: Participating payers provide funding to practices (in addition to standard fee-for-service payments) to support development of the infrastructure necessary to transform into a PCMH. These payments include a fixed “transformation” payment designed to cover the costs of investments made by participating practices, along with separate incentive payments in which the savings generated by the program are shared. The authorizing legislation requires the insurers to fund these incentive payments based on the size of the practice and its NCQA-PCMH^TM designation level. The State Medicaid program contributes to payments through a different methodology, largely based on the number of active enrollees at participating practices. The State Medicaid program invested $1,500,000 in year 1 and $2,890,000 in year 2. These funds were paid to practices based on NCQA level and number of Medicaid enrollees attributed as of a certain date. More details on each type of payment are provided below:
    • "Transformation" payments: This fixed payment, distributed prospectively every 6 months, supports practices in their efforts to bolster infrastructure, including hiring additional staff, conducting staff training, and making IT upgrades. Transformation payments amount to approximately $3 million every 6 months.
    • Shared savings, contingent on quality performance: Practices receive between 30 percent and half of all savings generated by the program, such as by reducing avoidable inpatient admissions and emergency department visits. To qualify for the shared-savings payments, practices must meet certain quality targets and utilization reduction thresholds. Each practice reports its performance on up to 21 measures applicable to the organization, including measures related to preventive care (e.g., tobacco use, weight screening, colorectal cancer screening, immunization); chronic disease care (e.g., care of asthma, diabetes, hypertension, and other conditions); mental health (e.g., antidepressant use); and pediatric care (e.g., asthma assessment, weight assessment and counseling, immunization status). The shared savings methodology consultant for the Maryland Health Care Commission is Discern Consulting.
• Technical support via learning collaborative: Practices receive technical support from the Maryland Learning Collaborative, a separate venture funded by the Maryland Health Care Commission, the Maryland Community Health Resources Commission, and various pharmaceutical firms and led by clinicians from the University of Maryland School of Medicine and Johns Hopkins School of Medicine. Maryland Learning Collaborative activities help practices build the systems needed to earn NCQA-PCMH™ recognition (see the Tools section for more information), and the collaborative holds regional collaborative meetings every 6 months. Past meeting topics include workflow issues, team functioning, health IT, quality measurement and reporting, a review of the shared savings methodology, and comprehensive pharmacy management. As part of the collaborative, coaches perform site visits at participating practices to assist with transformation issues. Remedy HealthCare, LLC is the lead practice transformation coach for the Maryland Learning Collaborative.
• Management and oversight: The Maryland Health Care Commission provides oversight and management of the program. As part of this responsibility, technical experts at the Commission’s Center for Health Information Technology and Center for Analysis and Information Services help practices with data mining, advise the learning collaborative on data-related issues, and manage analysis and reporting for the program.

References/Related Articles

Contact the Innovator

Innovator Disclosures

Results

• 100-percent achievement of medical home status: As of September 2012, all 52 participating practices have achieved Level 1, 2, or 3 designation by the NCQA-PCMH™ program.
• Positive feedback from physicians and patients: Anecdotal feedback from patients and physicians suggests that the program has improved access and the quality of care and services within these practices, including the ability to coordinate care. Quantitative data on the program's impact on clinical quality, patient outcomes, and patient and physician satisfaction are not yet available, but should be released as part of the State-mandated program evaluation in 2013.
• Significant cost savings potential: While most pilot programs do not realize savings in the first year of operation, the fixed transformation payment is set at approximately 25 percent of the potential theoretical shared savings. Shared savings for year 1 of the program are being calculated in September 2012.

Evidence Rating (What is this?)

Context of the Innovation

Planning and Development Process

• Creating advisory panel: The Commission invited a number of individuals to serve on an advisory panel to help develop and oversee the program. The panel includes representatives from provider groups, health plans, purchasers, State agencies, and community organizations.
• Recruiting practices for pilot test: Practices across the state received notice about the opportunity to participate in a 3-year pilot test of the program. The Commission held six regional meetings with invited practices to explain the program. Interested practices completed an application.
• Reviewing applications: After reviewing roughly 200 submitted applications, the Commission invited 53 primary care practices to participate. Selected practices varied in terms of size (number of providers and patients), geographic location, provider mix, and stage of medical home development, and represented a mix of system-affiliated and independent organizations. One practice elected to leave the program, resulting in 52 total participating practices; as of September 2012 no practices have been asked to leave the program.
• Designing financial incentives: An outside contractor designed the financial incentives with input from payers.
• Creating learning collaborative: The Commission worked with the University of Maryland School of Medicine and Johns Hopkins School of Medicine to create the learning collaborative and to identify clinicians to serve as coaches to assist practices with transformation.
• Designing participation agreement: The Commission designed a participation agreement and began signing the agreement with participants.
• Contracting with external evaluator: The Commission contracted with Impaq International to manage an evaluation of the program's impact (a step mandated by the authorizing legislation). Impaq International subcontracted with the Johns Hopkins Bloomberg School of Public Health and the University of Maryland School of Pharmacy's Pharmaceutical Health Services Research Department to assist with this effort. These organizations are responsible for conducting a multifaceted evaluation, including a quantitative assessment of the program's impact on quality (based on claims data), a qualitative assessment based on site visits to nine representative practices, an online survey of physicians, and a patient satisfaction survey.

Resources Used and Skills Needed

• Staffing: While hard data are not available, participating practices have hired new staff as part of their efforts to earn PCMH designation.
• Costs: The costs of program development and ongoing operations have not yet been calculated. Payers distribute approximately $6 million to participating practices each year in the form of transformation payments; data on shared savings payments are not yet available.

Funding Sources

Tools and Other Resources

Getting Started with This Innovation

• Mandate payer participation: A legislative mandate ensures that all large payers fund medical home development, thus making it more likely that practices will want to participate as well.
• Ensure stakeholder buy-in: Involve representatives from participating payers and practices at every stage of program development so as to ensure their buy-in and support.
• Use formal agreements with participants: Detailed, formal participation agreements ensure that each party understands its roles and responsibilities.

Sustaining This Innovation

• Cultivate culture change: Team-based, patient-centered care requires clinicians and staff at participating practices to interact and coordinate care in a dramatically different way than they have in the past. These cultural changes tend to evolve naturally over time after some initial hesitation. However, the program will not be sustainable until a culture of team-based care has been firmly established.
• Leverage experience with process improvement: Individuals with training and/or experience in process improvement and other quality-improvement methods can play a critical role in supporting the development of medical homes and a team-based approach to care.
• Emphasize quality and efficiency: Physicians and other providers will continue to support the program if they recognize its value in improving care for patients and enhancing their own efficiency. To help providers recognize this value, regularly share data that documents the program's impact on quality, costs, and efficiency.
• Ensure adequate reimbursement to medical homes: Adequate reimbursement for medical home activities is critical to sustaining this type of initiative. In particular, practices must be sufficiently reimbursed for the time it takes to coordinate care. In Maryland, the authorizing legislation requires payers to reimburse participating practices for this service.