Payer Investment May Improve Delaware Primary Care Access

January 18, 2019 - Payers can expand primary care access in Delaware by progressively increasing primary care spending until it accounts for 12 percent of all healthcare investment, according to a report from Delaware’s Primary Care Collaborative.

Investment should primarily focus on value-based care models that can reduce spending and improve population health.

Delaware currently lacks the primary care resources necessary to meet the needs of the population, the report stated. Approximately one in four residents live in a primary care shortage area, and between 2008 and 2015, the supply of primary care physicians decreased from 80.3 physicians per 100,000 patients to 71.4 physicians.  

The state’s inadequate primary care capacity is reflected in the well-being of its residents. The report noted that while Delaware has the fourth highest healthcare spending in the country, residents experience below-average health outcomes.

“As the entry point to the healthcare system, primary care facilitates access to effective preventive care, early management of health problems, and the reduction of unnecessary or inappropriate specialty care,” the report said.

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“The consequences of these healthcare trends, if not addressed, will be further reductions in access to primary care and preventive services, forcing Delaware patients to seek care in more expensive settings with poor continuity of care.”

To better understand issues contributing to the primary care crisis, the Primary Care Reform Collaborative gathered input from stakeholders representing the healthcare and patient community. The collaborative held six public meetings between September 2018 and December 2018 to develop recommendations for sustaining primary care in Delaware.

The group stated that increased investments in patients’ primary care will help to enhance access throughout the state.

“The State should mandate payers to progressively increase primary care spending to reach percentage milestones that eventually account for 12 percent of total healthcare spending,” the report said.

“Primary care spending should constitute an investment of these funds to effectively meet the medical, behavioral, and social determinants of health of Delaware’s diverse population of patients.”

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The collaborative set the target at 12 percent after evaluating the successful experiences of other states.

In Rhode Island, primary care spending grew 37.2 percent between 2008 and 2012, but total healthcare costs decreased by 14 percent. Currently, the state requires that primary care spending represent at least 10.7 percent of total commercial medical spending.

Oregon saw similar results when it increased primary care spending: over a three-year period, primary care expenditures increased from 2.7 percent in year one to 6.0 percent in year three, while the total cost of healthcare decreased by an average of 4.2 percent each year.

The Delaware collaborative mandated that this primary care spending growth should increase by one percentage point per year or within five years, whichever is faster.

“This standard will apply to at least Medicaid, MA, self-insured, fully insured, and state employees’ health plans. Performance will be measured by a standard definition of primary care spending and total medical spending,” the report stated.

READ MORE: Value-Based Payment Adoption Drives 5.6% Reduction in Care Costs

In addition, the group advised that the increase in primary care spending should not be strictly an increase in fee-for-service rates. The state should invest in resources that encourage high-quality, cost-effective, and team-based models of primary care.

“Current efforts to increase value-based payments have not been as successful in Delaware as in other states. Increased upfront investment are essential to encourage broader engagement in value-based payments,” the collaborative wrote.

“Increases in primary care spending should prioritize high-value care through a reasonable value-based payment model with some downside risk that supports the sustainability of small and large primary care practices in the adoption of a team-based care model.”

The collaborative also said that primary care expenses should encourage innovative measures that will stabilize primary care practices in the short-term as well as the long-term. The group suggested that payers fund grant or loan programs to enable practices to actively participate in value-based models.

The group noted that enforcing these directives will require increased regulatory oversight.

“Recognizing the challenge of containing the growth in total cost of care while increasing primary care spending, this regulatory body will assess rates holistically, including specialty and hospital care, with a view to limiting the growth in healthcare spending and ensuring the sustainability of access across the spectrum of facilities,” the report said.

“This regulatory body will also be able to establish a cap on hospital rates to ensure the growth in the total cost of care is limited.”

Finally, to ensure these suggestions are carried out, the collaborative stated that Delaware should gather multiple stakeholders, including providers, payers, and policymakers, to further discuss the state of primary care in Delaware.

The collaborative expects to improve the primary care crisis in Delaware with these recommendations.

“The State must take a leadership role in fixing the current crisis; no other stakeholder has taken ownership of the problem, has the breadth of authority to influence the healthcare system in Delaware, or has the magnitude of budgetary interest in addressing the primary care system and health care spending in general,” the report concluded.

“The Collaborative developed these recommendations to address these concerns through increased investment by the healthcare system to improve quality and access to primary care across Delaware.”