Patient-Centered Medical Home Repair: Flat Fee Reduces Imaging Volume

July 11, 2020

Study of program in Oregon suggests that fee-for-service may be the reason for the underwhelming results for patient-centered medical homes.

An Oregon Medicaid program that paid community health centers on a fixed, per member, per month basis decreased the use of primary services by 42%, mainly by reducing the use of imaging, according to research results reported in the July issue of Health Affairs.

The results may help rehabilitate the somewhat tattered reputation of the patient-centered medical home (PCMH) beause they suggest that the problem with PCMHs is not inherent to the delivery model but continued fee-for-service payment that undermined its goals of making care more coordinated.

The Oregon Medicaid program introduced the fixed, per member, per month payment scheme in 2013. During 2013-2018, 15 community health centers with a total of about 150,000 members elected to participate in the program, which is called the Alternative Payment and Advanced Care Model (APCM). The fixed payment was pretty limited and covered primary care services; it did not include behavioral health, dental or obstetrical services provided at the clinics nor did it include any services provided outside the clinic, such as emergency department visits, specialists, or hospital visits.

The researchers, led by Stephan Lindner, an assistant professor at the Oregon Health & Science Science University in Portland, compared patients at the community health centers participating in APCM to patients at centers those that didn't. Lindner aused price-weighted volume of services to compare the APCM Medicaid beneficiaries to the non-APCM Medicaid beneficiaries.

The price-weighted volume of traditional primary care services average $35.20 per member, per month prior to APCM. In the second year afterward, the relative difference in the price-weighted volume between the APCM and the non-APCM beneficiaries was $14.90, almost all of it due to reduced use of imaging. Importantly, further analysis showed that reduced imaging wasn't because the beneficiaries decided to get the imaging services elsewhere.

"These types of easily quantifiable and billable services are often overused when payment structures incentivize a high volume of services, and they are leading contributor to low-value care," wrote Lindner and his fellow researchers. An earlier qualitative study indicated that flat fee payment was associated with greater use of e-visits and telephone consultations

A single study isn't going to rehabiliate the reputation of the patient-centered medical home entirely but these findings are another indication fee-for-service and reform of American healthcare are incompatiable.