Building Medical Homes in State Medicaid and CHIP Programs

Author(s): Neva Kaye; Mary Takach, MPA The Commonwealth Fund, 2009

The Commonwealth Fund

With 47 million uninsured Americans, double digit inflation in medical spending and health outcomes that lag far behind other nations, comprehensive health care reform that addresses access, cost and quality issues is a national priority. A primary-care-oriented system may have benefits for population health, equity in health, and cost containment and has been shown to reduce racial and ethnic disparities, and result in significantly lower health care costs and improved life expectancy diseases for those with chronic diseases.

A medical home is an enhanced model of primary care in which care teams attend to the multi-faceted needs of patients and provide whole-person comprehensive and coordinated patient-centered care. First advanced by the American Academy of Pediatrics in the 1960’s for certain pediatric populations, the medical home concept has evolved to embrace all populations. In 2007, four major physician groups agreed to a common concept of the patient centered medical home (PCMH) defined by seven "Joint Principles." Supporters of the PCMH model have joined together to form the Patient Centered Primary Care Collaborative (PCPCC) that represents employers, medical specialty societies, health plans and other organizations.

Since 2006 more than 30 states have initiated projects to improve Medicaid and Children’s Health Insurance Programs (CHIP) to advance medical homes. Several states also are driving state-wide transformation by using their purchasing leverage to make changes in state health benefits plans and in the private sector. This paper summarizes these activities and provides state policy makers with examples of promising practices, lessons learned and ideas they can adapt to work in their state.

This paper was informed by research that started with a brief survey of Medicaid and CHIP directors and targeted Internet research. A working meeting of eight leading states (Colorado, Idaho, Louisiana, Minnesota, New Hampshire, Oklahoma, Oregon and Washington) convened in July 2008 provided for a significant amount of NASHP's research. These eight states—in addition to North Carolina and Rhode Island which have well-developed medical home initiatives—helped us identify five major strategies for other states to consider in developing their own plans:

  1. Forming partnerships with key players (including patients, providers and private sector payers) whose practices the state seeks to change.
  2. Defining medical homes to help establish provider expectations and implementing processes to recognize primary care practices that meet those expectations.
  3. Aligning reimbursement and purchasing to support and reward practices that meet performance expectations,
  4. Supporting practices to help advance patient-centered care.
  5. Measuring results to assess whether their efforts are succeeding in containing costs, improving quality and patient experience. Forming key partnerships.

State Medicaid agencies play a key role in advancing medical homes but they are not doing this alone. All 10 study states are partnering with other stakeholders such as other payers, primary care providers and the organizations that represent them, patients and advocacy groups to affect broad system change. These partnerships take many different forms including multi-payer stakeholder collaboratives—bringing commercial insurers and other purchasers such as state employees’ health benefit groups to the table to further spread transformation. Other states have formed formal stakeholder groups that participate in planning the state initiative. Finally, all study states are using means such as surveys and public meetings to get feedback on their plans from a broad range of stakeholders.

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