Primary care may finally be getting the attention it deserves. For far too long, the U.S. has spent less than most developed countries on primary care in proportion to other services — between 5 and 7 percent of health care spending — yet, arguably experiences higher overall costs and worse health outcomes as a result. In response, state legislatures across the nation are passing bills to increase health spending devoted to primary care, including in Colorado, Delaware, Hawaii, Maine, Missouri, Oregon, West Virginia, and Vermont. The Patient-Centered Primary Care Collaborative and the Robert Graham Center recently released a report that found an association between increased primary care spend and fewer hospitalizations and emergency room visits. And the Centers for Medicare & Medicaid Services recently announced its Primary Cares Initiative, which includes two payment models intended to reduce provider burden and strengthen primary care: Primary Care First and Direct Contracting. At the heart of this emerging trend of primary care investment is a desire to strengthen the backbone of the health care system and recognize primary care as the driver for high-value, lower cost, patient-centered care.

Primary Care is Critical for Medicaid Populations

A strong primary care system is particularly vital for low-income and Medicaid populations, which experience significant obstacles to care and health disparities. Recognizing the importance of primary care, state Medicaid agencies are looking to support advanced primary care models that focus not just on traditional competencies such as access and continuity of care, but also on comprehensiveness and quality. Medicaid is asking not only if an individual has a relationship with a primary care provider (PCP), but also whether that patient and PCP is adequately supported by a multidisciplinary care team, and how that team addresses the diverse needs of patients, including behavioral health and related social needs. With 39 states (soon to be 40) using risk-based managed care, covering nearly 70 percent of all Medicaid beneficiaries, the majority of state Medicaid agencies are well-positioned to use their purchasing levers to drive more widespread adoption of advanced primary care models.

State Managed Care Approaches to Bolster High-Performance Primary Care

Over the past year, five states participating in the Center for Health Care Strategies’ (CHCS) Advancing Primary Care Innovation in Medicaid Managed Care initiative, made possible by The Commonwealth Fund, have worked on strategies for supporting high-performing primary care systems for vulnerable populations through their Medicaid managed care programs. Several state participants leveraged Medicaid managed care organization (MCO) contract procurement or amendment cycles to drive health plan investment and innovation in primary care. For example, Hawaii and Louisiana drafted requests for proposals for their Medicaid managed care programs, requiring plans to advance population health strategies in partnership with primary care teams. Pennsylvania released a significant revision of its managed care contract to include, among other things, requirements for physical health MCOs and patient-centered medical homes (PCMHs) to screen for social needs.

Tips for States Seeking to Promote Primary Care Innovation

Based on the experiences of these states, following are tips for states interested in encouraging adoption of advanced primary care within managed care programs:

  1. Create a shared state vision for primary care innovation, and involve providers, health plans, patients, and community organizations. Pennsylvania used its PCMH Advisory Council — which includes PCPs, behavioral health providers, pharmacists, health systems, MCOs, among others — as well as a broader request for information to shape its MCO contracting strategy to meet beneficiaries’ social needs.
  2. Be clear about roles and responsibilities. In the context of the managed care contract, states must consider goals, roles, and responsibilities for all parties involved in primary care innovation — including Medicaid agencies, health plans, providers, community-based organizations, community health workers, and other state and local agencies. Clear contract language can help crystallize tricky issues such as: (1) how and whether to delegate traditional MCO functions, such as care management, to primary care practices; (2) who should screen for social needs, including the state, MCO, primary care practices, and/or community health workers; and (3) how to integrate community health workers into the formal health care system without “medicalizing.”
  3. Learn from the leaders to initiate the next wave of innovation. Explore existing leading-edge programs, such as New Mexico’s Project ECHO initiative; Vermont’s Community Health Teams; and Minnesota’s community health worker program. In addition, George Washington University’s recent in-depth review of primary care-related provisions in Medicaid managed care contracts offers a helpful look at how states are addressing primary care quality.
  4. Business-as-usual will not cut it. To partner with and hold MCOs accountable for driving primary care innovation, states will likely need to up their game in how they monitor and partner with their MCOs, strengthening their quality and reporting strategies. MCOs may need to work together to develop a standardized approach that makes sense for PCPs and reduces fragmentation, such as in Pennsylvania’s Telephonic Psychiatric Consultation Service Program. States may also consider how to streamline their existing MCO contract requirements, eliminating low-value reporting and box-checking exercises.
  5. Enhance and accelerate existing state initiatives, such as PCMH programs. States such as New York, Ohio, and Oregon have leveraged PCMH programs to expand beyond primary care basics and enhance care delivery. States without a robust primary care system or with many small practices may need to consider ways to build that capacity — potentially as external supports to primary care practices (e.g., through community care teams or other shared supports).
  6. Reduce provider burden. PCPs frequently complain of red tape, particularly in treating low-income patients. They often have difficulty getting prior approval from Medicaid for procedures or prescriptions and report losing valuable time dealing with managed care companies to get tests and medications approved. States can make policy decisions that foster clinicians’ capacity to adopt PCI strategies without adding to administrative burden or provider burnout.

Resources to Support Primary Care Innovation via Medicaid Managed Care Approaches

As state and federal policymakers increasingly focus on primary care, states can use Medicaid managed care to help direct investments most efficiently. To help guide states on how to use managed care to accelerate primary care innovation, CHCS developed a practical, hands-on toolkit drawing from the experiences of states in the Advancing Primary Care Innovation in Medicaid Managed Care initiative. The toolkit summarizes strategies used by innovative states, including design considerations, sample contract and procurement language and examines how three states — New York, Ohio, and Oregon — promote enhanced care delivery transformation.

To continue spurring Medicaid primary care innovation, CHCS, with support from The Commonwealth Fund, is launching a second phase of its learning collaborative. CHCS invites all Medicaid agencies operating risk-based managed care programs to submit applications by September 18, 2019. For more information, contact Diana Crumley, CHCS senior program officer, at dcrumley@chcs.org.

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Janelle McDonald

Great to see this long needed industry shift in Medicaid.