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Making Margin with the Medical Home

Karen Minich-Pourshadi, for HealthLeaders Media, September 13, 2011
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“With a medical home, the outcomes are what you are focusing on, and it may take a long time to see financial returns and return on investment based on pediatric patient outcomes,” says Thomas Long, MD, fellow at the American Academy of Pediatrics and chair of the Committee on Child Health Financing, and senior partner for San Ramon Valley Primary Care Medical Group in California. “And with the way the government structured the Medicare ACO, though, there’s not enough upside—not enough reward—to justify getting into these models.”

A pediatrician, Long has seen the patient benefit of creating a patient-centered medical home in his group practice, which consists of 13 primary care physicians, eight pediatricians, five internists, and one nurse practitioner. Long’s practice is part of a larger independent practice association, Hill Physicians Medical Group, which has established contracts with payers that support improving the quality of patient care.

Long explains that at his California practice, the insurers provide a quality payment to the group for meeting quality benchmarks based on national and regional standards. It’s a step in the right direction, but it doesn’t pay for all the care that goes into a medical home. 

“If you’re looking at the medical home in the short-term, say 1–2 years, you’re not going to see a return. This is a long-term investment, just like the market—but it’s worth making the investment,” he says.

Long says that the quality incentives he receives from payers help the practice keep this program funded, though he adds that a change in the current payment structure would make it more financially viable for more practices.

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