Hybrid payment model touted as lifeline for primary care physicians: study

“Just do it!”

That, in a layperson’s terms, is one of the main takeaways of an article published Monday in Health Affairs, uttered by one of the three authors, Hoangmai (Mai) H. Pham, M.D. Pham told Fierce Healthcare that it’s time to stop all the experimenting with how to enhance primary care in the U.S. Now, it’s time to act.

“There’s no debate about primary care’s role in addressing mental health and addressing the social factors of health,” says Pham. “What’s the problem here? Why are we still experimenting? We’ve tried for 10 years to experiment.”

Pham and co-authors Robert A. Berenson, M.D., and Sean Cavanaugh argue for a hybrid system for paying primary care physicians that would increase their pay by 30%.

“And we’re saying that’s the bare minimum floor,” said Pham. “I’d rather see it double.”

Right now, the U.S. spends about 3% of its healthcare budget (in inflation-adjusted dollars) on primary care; that’s down from approximately 5% a few years ago. “It’s not unreasonable to spend 6% of the healthcare dollar on primary care,” said Pham. “Most advanced countries spend like 10% to 15% so if we doubled it, we’d still be way behind.”

That Pham issued a call to action rather than pushed for continued experimentation with payment models is telling. Her long list of career accomplishments includes serving as one of the founding officials of the Center for Medicare and Medicaid Innovation and working as co-director of research at the Center for Studying Health System Change. Pham currently serves as president and CEO of the Institute for Exceptional Care, a not-for-profit healthcare advocacy organization for people with intellectual or developmental disabilities.

When people hear the argument about raising payment for PCPs by the amounts Pham suggests, “everybody freaks out. They say, ‘it has to come from somewhere.’ Well, yes, if you’re assuming a zero-sum game, and if you’re politically beholden to everybody else. So, everyone, get a grip, and grow a little bit of spine and just do it.”

Pham, Berenson and Cavanaugh’s Health Affairs article argues to change the payment structure of PCPs employed in ACOs that are physician-run and not connected to hospitals. The ACOs would take on two-sided risk, where PCPs would reap the financial rewards for providing cost-effective care. The physician practices would be paid half through fee for service and half on population-based payment (PBP) metrics.

“PBPs would take the form of a monthly, per-beneficiary amount and would account for most of a provider’s payment,” the article states. “PBPs would give practices flexibility to optimize the mix of compensated services they currently offer and support diverse activities practices perform but are not paid for now, such as team-based care, emails, and phone calls.”

The larger portion of the PCP office visit would be part of the PBP, and the remainder per-visit payment would use a single code for all visits.

Though the plan would pay for a lot of services PCPs provide for free now, the article begins: “Primary care practices provide most mental health services that patients receive, in place of, or in collaboration with, mental health specialists.”

Pham told Fierce Healthcare that “it’s become kind of common parlance to refer to the mental health crisis in the country. I think it’s been in crisis mode for many years. But I think COVID just really drew a lot of attention to it. Mental illness is having a moment in the policy world right now. And, and that’s great—to the extent that it brings more resources or brings more policy attention to it.”

She praised actions taken such as the launch of the new 988 crisis intervention number, which people anywhere in the country can call. However, Pham wants to dispel the notion that mental health specialists are the main suppliers of mental health care in the U.S.

“The reality is that most people get their mental health care from primary care practice,” said Pham. “There are never going to be enough mental health specialists. If you want to solve this problem, you must invest in primary care, because right now, primary care practices do not have the time to adequately provide mental health support. They do what they can. They are the place where most people go to access it, but they’re running on a treadmill.”

The hybrid payment model discussed in the article would pay PCPs for being the first line of care for mental illness and give them more flexibility in how that care can be delivered. “They don’t have to treat every person exactly the same, crammed into a 10-minute visit.”

The PCP must think of the whole person, and a lot of the job involves giving advice for an individual to meet healthcare goals.

“And all of that takes time, and relationships, and trust and judgment,” said Pham. “There’s a certain intellectual function that primary care clinicians do, that many other clinicians do not.”

A cardiologist can be a valve specialist and a gastroenterologist might only do colonoscopies. The PCP must consider the whole person.

“At some point, we all become complicated creatures, right?” Pham said. “Whether we’re a young person with a mental health crisis, or we’re an elderly patient with early dementia and heart disease, they’re the combinations of things that a person lives with. These things interact with each other. And oftentimes, what a primary care clinician is doing is solving a mystery. And trying to get to the optimal solution, and the optimal solution is not going to be the best choice just for the heart, or the best choice just for the colon. It's going to be something that takes all of that into account.”

Pham hopes one of the offshoots of the payment method for PCPs that she and her co-authors propose will be to make primary care a more attractive field to get into. About 15% of medical school students choose to go into primary care, she says. Student debt can be paid off faster if you’re a cardiologist rather than a PCP.

“Even after you take the financial considerations out—they’re a huge consideration—but even aside from that, the lifestyle is not attractive, right? Let’s say you’re an orthopedic surgeon or a neurosurgeon. You can afford to hire lots of nurses and nurse practitioners and other supplemental staff. That makes a huge difference in your day and your practice and in what you can offer to patients. If you don’t have that margin, you can’t do that. And then you have a much more burdensome, stressful work life," she said.

Pham returned to one of the main thrusts of the Health Affairs article: “We’re saying stop experimenting. Just do it. Stop waiting for the results. Just do it.”