Patient-Centered Medical Homes in statewide populations have unstoppable momentum and major constituencies in support of them, so valid analysis of their outcomes is probably as futile as it will be unwelcome. However, the math speaks for itself, at least in the mother of all statewide medical homes, North Carolina Medicaid’s Community Care Access Model.
I write this after having analyzed the actual data from this project’s outcomes report, rather than the stated conclusion of the report, a conclusion that continues to be cited in support of the many states considering or implementing medical home models for their Medicaid populations.
The conclusion makes North Carolina looks like a huge win for PCMH: $300-million in reported savings. However, readers should have (but largely didn’t) observe a number of curiosities about the data in support of that conclusion:
(1) Every element of resource use declined. People have to be getting their care from somewhere, but inpatient, ER, outpatient, physician, drug, and other expenses somehow all declined vs. trend.
(2) The decline in physician practice expense is especially counterintuitive: Why are the doctors so supportive if they are working harder but making less money?
(3) Even though somehow savings were shown in physician expense, per capita doctor visits did indeed increase. More concerning was that specialist visits –which are supposed to decline in a PCMH model – also increased.
(4) Inpatient expense fell 47%. This was achieved despite the fact that all the AHRQ’s “Ambulatory Care –Sensitive Conditions” total to about 20% of admissions in most populations.
(5) The evaluators (William M. Mercer) are on record as saying that “choice [emphasis mine] of trend has a large impact on estimates of financial savings.” Perhaps it is possible that Mercer, having given themselves this latitude, “chose” a trend that would make the study look good.
Those observations merely suggest that the study was done wrong. But one other “finding” invalidates the entire study: the 54% reduction in spending on babies under one year of age, accounting for the majority of the entire $300-milllion in spending. (Any nontrivial savings whatsoever in this category should have raised eyebrows since PCMH is mostly about managing chronically ill patients.) The components of spending in that category include physician expense, which should rise since doctors get paid more to be more accessible, and drug expense, which should rise for the same reason. This means that the entire 54% savings across the category must be concentrated in neonatal expense. Since neonatal expense is about half of total spending in the age category, it would have to decline by a mathematically impossible 100%+ in order for the category to average a 54% reduction.Continue reading…