"Providers can share the evidence report with payers to show that they should be supporting the PCMH because it is good for their bottom line and for their patients. It's a win, win… It's not just about making the transformation, it's about sustaining the new model of care. It does cost more because you are adding hours to increase access and investing in technology and electronic health records," he says.
"Studies show there is a pretty substantial ROI depending on the population a practice cares for. So, looking at the evidence and showing payers the ROI of the model will help them want to do it. Payers are realizing increasingly that it is a good investment on their part."
Other Payment Arrangement Options
In addition to the PMPM model, Cotton says some larger practices are entering into shared savings arrangements with payers to fund the PCMH.
"It takes a pretty sophisticated practice to take that on," he says. "It's very challenging, but the idea is that if the PCMH is reducing cost for patients by keeping them out of the ED and hospital, then the provider can share in those savings."
A more common approach, Cotton says, is for the primary care practice to use a separate billing code for the PCMH's care management program, which allows it to collect from the payer for those extra services that are being provided.
"Only a PCMH can bill for that because one key to success is to carefully manage that patient through the care management program."
The two biggest challenges for an organization looking to launch or sustain a PCMH, Cotton says, are assuring adequate funding through payer negotiations and having consistent leadership support.
"The number one thing is to make sure you have sufficient resources to sustain it because it does cost more to be a PCMH. You have to make sure the practice is being reimbursed enough to sustain it," he says.
"Also, leadership within the practice at the top is so important for making sure you have all members of the team understanding that they are in this together. You need to have leadership committed in order to have buy-in throughout the practice."