The opportunity for health plans to improve quality and reduce costs by embracing primary care medical homes.

BACKGROUND: The large and growing costs of healthcare will continue to burden all payers in the nation's healthcare system-not only the states that are struggling to meet Medicaid costs and the federal government, but also the private health plans that serve commercial, Medicare Advantage, and Medicaid beneficiaries. Cost will increasingly become a concern as millions more people become newly insured as a result of the Patient Protection and Affordable Care Act (ACA). Primary care delivery through patient-centered medical homes (PCMHs) and other coordinated-care models have improved care and reduced costs. Health plans have a strategic opportunity to promote better care at a lower cost by embracing medical homes and encouraging their growth. Health plans can play an important role in transforming the US healthcare system, as well as better position themselves for long-term corporate success. OBJECTIVES: To discuss several examples of organizations that serve a variety of beneficiaries and have been successful in promoting medical homes and coordinated primary care, and to suggest steps that health plans can take to improve the quality of care and reduce costs. DISCUSSION: The models discussed in this article take a number of different approaches to create incentives for high-quality, cost-effective, coordinated primary care. Several health plans and groups use enhanced fee-for-service or per-member per-month payment models for primary care physician (PCP) practices that reach a specified level of medical home or electronic health record certification. Most of the examples addressed in this article also include an additional payment to encourage care management and coordination. The results showed a significant decline in costs and in the use of expensive medical services. One Medicaid coordinated-care program we reviewed saved almost $1 billion in reduced spending over 4 years, and achieves savings of approximately 15% within 6 months of the beneficiaries' enrollment into their program. Another PCMH payer program led to an approximate 28% reduction in acute care hospital admissions among Medicare beneficiaries and an approximate 38% reduction in admissions among commercial beneficiaries. CONCLUSION: Based on the review of real-world examples, we recommend 6 steps that health plans can use to take advantage of the opportunity to embrace medical homes as a means to improve healthcare quality and to reduce costs. These recommendations include getting feedback from PCPs to improve plan provider networks, creating value-based primary care reimbursement systems, encouraging biannual visits with high-risk patients, funding case managers for high-risk patients, considering Medicaid coordinated-care models, and promoting ACA policies that support primary care.

Navigating Medicare drug coverage: Part B vs. Part D.

One of the gray areas of Medicare Part D coverage is determining when a prescription falls under Part D and when it falls under Part B. Most Part B drug spending is for drugs billed by a physician and provided incident to the physician's services for a Medicare patient. Medicare Part D medications are dispensed via a prescription and are usually self-administered. Here are examples of situational rules that determine whether a patient is covered under Part B or Part D. Many situations exist where a particular drug for a specific patient is covered under both Part B and Part D, albeit with different delivery and cost-sharing aspects. Understanding which applies when is important to gaining access to medically necessary prescriptions for patients. Giving this information to the prescription plan when writing a prescription order will assure that the medication is provided efficiently, rather than having to deal with denials and an appeal process.

Medicare advantage: understanding special needs plans.

It has long been argued that managed care plans cherry picked members in an effort to encourage enrollment by healthy people who required fewer medical services. To prevent this practice, the federal government began to risk-adjust payments to managed care plans, based on the care needs of each member, thus removing any disincentives of enrolling sicker beneficiaries. The MMA gives plans the ability to focus on specific populations, so that services and systems can be tailored to those groups. Special Needs Plans (SNPs) can address 1 of 3 target populations: institutionalized beneficiaries, the dually eligibles, and beneficiaries with chronic or disabling conditions. By focusing on these groups, managed care plans can pull together unique systems of care to provide services in the most efficient and effective manner.