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Investing in primary care. Why it matters for Californians with commercial coverage
Investing in primary care. Why it matters for Californians with commercial coverage
- Collection:
- Health Policy and Services Research
- Alternate Title(s):
- Why it matters for Californians with commercial coverage
- Author(s):
- Yanagihara Dolores, author
Hwang, Ann, author - Contributor(s):
- California HealthCare Foundation, issuing body.
- Publication:
- [Oakland, CA] : California Health Care Foundation, April 2022
- Language(s):
- English
- Format:
- Text
- Subject(s):
- Health Expenditures -- statistics & numerical data
Primary Health Care -- economics
Primary Health Care -- statistics & numerical data
Health Maintenance Organizations -- economics
Preferred Provider Organizations -- economics
California - Genre(s):
- Technical Report
- Abstract:
- Primary care has been associated with important benefits, including better health in areas with more primary care physicians, better health among people who receive care from primary care physicians, better quality of care, and lower spending. Given these benefits, this study sought to understand the level of primary care investment in California and how it varies across health plans and provider organizations. This study further analyzed how spending related to quality, patient experience, utilization, and cost performance, suggesting where there might be potential opportunity for improving outcomes and controlling health care spending. Using health plan data from 2018 for 13.9 million commercially insured adults in California (about 80% of the commercially insured adult population), the first part of this analysis examined variation in the percentage of health care dollars spent on primary care for each type of product--that is, health maintenance organization (HMO), preferred provider organization (PPO), and exclusive provider organization (EPO)--offered by each of eight health plans. Among a total of 14 health plan–product combinations (health plan products), primary care spending as a percentage of total health care spending averaged 7.5% and ranged widely, from a low of 3.5% to a high of 12.7%. After adjustment for population age, gender, and clinical risk score, primary care spending percentages ranged from 4.9% to 11.4%. The average adjusted primary care spending percentage was 7.9% for HMO products, 6.0% for PPO products, and 5.8% for EPO products. While methodological details vary, these rates are in the same range as those found in other states and studies. Relationships between adjusted primary care spending percentages and measures of clinical performance, utilization, and cost were mixed at the health plan product level. Among the 14 health plan-product combinations, higher primary care spending percentage was associated with better performance for clinical quality and marginally lower acute hospital utilization, but with slightly higher emergency department (ED) utilization and total cost of care. The second part of the analysis focused on the 8.5 million adults in the data set who were enrolled in HMO products. Commercial HMOs in California are organized around a capitated, delegated model of care. In this payment model, provider organizations (POs) assume responsibility and financial risk for managing the care of their assigned patients. The analysis included 180 POs distributed across the state; among them, primary care spending percentage averaged 7.6%, with a range from 2.8% to 15.4%. The total cost of care on a per-member per-month basis averaged $365, with a range of $99 to $740. Performance of POs based on quartiles of primary care spending percentage was compared to better understand whether the relationship between primary care spending and performance varied by level of spending. POs in the highest quartile of primary care spending percentage had better performance on clinical quality, patient experience, utilization, and total cost of care. To demonstrate the potential scale of the observed associations between primary care spending percentage and performance, these findings were extrapolated across all of the POs. Specifically, if performance for POs in the three lower quartiles of primary care spending percentage equaled the average performance of those in the highest quartile, up to 196,000 more members would receive recommended care, 147,000 more members would rate their overall care ≥9 out of 10, and there would be 25,000 fewer acute hospital stays along with 89,000 fewer ED visits. In total, health care expenditures would be $2.4 billion lower. While primary care spending percentage at the health plan product level was not consistently associated with better outcomes, primary care spending percentage at the PO level was consistently and statistically significantly associated with better performance on measures of clinical quality, patient experience, utilization, and cost. This novel examination of primary care spending percentage among POs contributes new evidence supporting the important role of primary care and its relationship to positive quality and cost outcomes. The findings highlight an important opportunity for policymakers, purchasers, health plans, and providers to measure primary care spending percentage and enhance primary care investment, particularly within POs with the lowest primary care spending percentage.
- Copyright:
- Reproduced with permission of the copyright holder. Further use of the material is subject to CC BY-NC-ND license. (More information)
- Extent:
- 1 online resource (1 PDF file (25 pages))
- Illustrations:
- Illustrations
- NLM Unique ID:
- 9918573688306676 (See catalog record)
- Permanent Link:
- http://resource.nlm.nih.gov/9918573688306676