Primary Care Innovation: Wins, Losses and Lessons

“Intelligence is the ability to adapt to change.”

- Stephan Hawking

Insufficient capacity and a hampered business model

The challenging state of primary care across the country is well known, studied and documented. Health Affairs published a very good study documenting the barriers to innovation and sustainability in primary care business models. They found the top three barriers to innovation to be:

• Coding based financial incentives vs of total cost of care incentives, with a focus on documenting patient health status to drive a higher patient risk scores, resulting in upside financial incentives.

• Limited capitated provider contracts in the commercial insurance market vs the common fee-for-service payment structure.

• Small rural patient panels making extended clinic-based care teams difficult to afford and justify.

Test driving a primary care innovation pilot

We were part of a team that launched a 12-month primary care innovation pilot, seeking ways to adapt to the challenging primary care landscape. The pilot was based on the hypothesis that a shared enterprise business model aligning provider group and health insurance company financial incentives would reduce administrative costs and increase care quality. The belief was by shifting to a fully capitated, shared-risk model, patient panel size and operational efficiency could both increase when compared against sister clinics operating on a fee-for-service basis. While the clinic-wide patient cohort was not limited to a single insurance company, the majority of the patient panel were insured by the insurance carrier sponsoring the pilot.

Portions of the hypothesis proved better than expected, while a few aspects faced headwinds. Rolling out a creative new patient onboarding workflow reduced the wait time for a new patient appointment enormously. Leaning into virtual follow-up visits with a primary care physician (PCP) allowed for larger patient panels and increased in-clinic efficiency. And locating a navigator employed by the insurance company in-clinic greatly improved the patient experience.

Wins: virtual onboarding

Prior to the pilot, patients new to the provider group were required to schedule a new patient intake visit with a PCP. These longer visits were used to complete the patient’s medical history and build out their chart in the EMR. And there was not time allocated to addressing any medical complaints as part of the initial visit. Because of the duration required, only a handful of these timeslots were made available each month, driving long wait times for new patients to join the practice.

The pilot rolled out a new workflow based on a telephonic intake session with the patient and a nurse. During the call the patient’s chart was started, medical history documented, and administrative tasks completed. The result was greatly reduced wait times for future visits. When the patient had a medical need, they could make an appointment or have a telephonic PCP visit without scheduling an extended onboarding appointment first.

Wins: embedded resources

The insurance company placed a fulltime insurance navigator and a part time care manager in-clinic. Prior to the pilot, when a patient in the exam room asked the doctor or nurse how much a diagnostic test or procedure or drug would cost, they had no answer. Health insurance is not their area of expertise. As part of the pilot, the insurance navigator was called to the exam room and provided a cost estimate based on the patient’s insurance plan, out-of-pocket maximum and deductible. Adding this resource had a large, positive impact on the patient experience.

Locating an insurance company care manager in-clinic part time empowered expanded data sharing and a reduction in workload for clinic staff. Out of network specialist referrals were reduced to near zero. The number of clinic assigned patients engaged by care management jumped nearly 80% over sister clinics. And assigned patients who ended up in a skilled nursing facility saw a 19% reduction in length of stay.

Losses: provider compensation

Optimally a value based care model is founded on a capitated reimbursement agreement between the insurance company and the provider group. As part of the pilot, the clinic was paid on a capitated, risk based reimbursement basis. However the providers were paid on a work RVU basis (wRVU) basis, with a minimum weekly wRVU target required. The entire concept of wRVU provider compensation runs completely counter to the ideal of value based care. Unfortunately, the provider group enterprise was unwilling to change their provider compensation model, leaving the pilot clinic with the Catch-22 of either chasing volume to increase weekly wRVUs or managing their patients in the most efficient, non-volume driven way.

Losses: redirected incentives

The promise of value based care with incentives for improved outcomes and patient experience is great, as long as the incentives land back with the teams delivering those outcomes. The pilot clinic surpassed sister clinics in patient experience metrics, financial performance, and care management. But when the financial incentives were distributed from the insurance company to the provider group enterprise, those incentives landed in a shared pool. The result was the clinic team working hard to innovate and improve the primary care model did not directly see a portion of the financial rewards that would have allowed them to invest in new, creative programs and services. Needless to say this did not sit well with the clinic team and may have influenced the decision by some to move to another organization.

What does this all mean?

The pilot documented achievable primary care innovations with minimal new investments required. What was needed was an open mind by key participants and a willingness to try new ways of working. An enterprise level shared commitment between payer and provider was critical in aligning financial incentives between the organizations. Without that shared financial skin in the game, and shared resources in-clinic, the payer and provider would have found themselves chasing targets in opposing directions.

Launching a similar primary care model like this pilot can reduce wait times, increase clinic efficiency and improve patient experience metrics. But forming a payer/ provider partnership and shifting to a value based compensation model will always remain prerequisites to success.

Copywrite 2itive 2024

2itive is a Portland based consultancy founded by Erik Goodfriend, offering a unique combination of market intelligence, knowledge of healthcare payment systems and creative business strategy insights. Feel free to contact us at info@2itive.com