January 16, 2016

PCMH Programs Increase While Incentives Fail to Meet Needs

According to a recent report by the National Committee for Quality Assurance (NCQA), patient-centered medical home (PCMH) initiatives are growing rapidly throughout the country, capitalizing on the value of PCMH in reducing overall health care costs while improving quality of care.

Today there are more than 160 PCMH incentive programs (up from 29 in 2009) covering 48 states, Puerto Rico and Washington, D.C. The initiatives, supported by commercial insurance, public and multi-payer funding, utilize an array of financial incentives to support providers as they adopt PCMH and payment reform. However, a whopping two-thirds of those initiatives do not meet the $6-$8 per member-per month (PMPM) that recent studies indicate is needed to sustain transformation. Most PCMH initiatives are tied to a recognition program from either NCQA or other national accrediation bodies.

The report demonstrated that while primary care is quickly moving toward PCMH, resources to aid practice transformation and improved payment and incentive programs will go a long way toward speeding that transition and ensuring its long-term success.

New York State recently increased Medicaid incentives for practices achieving PCMH under NCQA’s more demanding 2014 standards ($6 PMPM for Level 2, $8 PMPM for Level 3), while significantly reducing incentives for practices that remained on NCQA 2011 standards. The increase can provide primary care practices with substantial revenue. Commercial insurers are also increasingly incentivizing practices who demonstrate their ability to operate as a PCMH.