Alternative Payment Methodology
A revolution in health care delivery is beginning to take shape in Oregon. For the past year and a half, Gil Muñoz, CEO of Virginia Garcia Memorial Health Center, has been part of a team of health care systems, providers and state agencies studying alternative ways to pay for health care. When the Oregon legislature passed the health reform bill in February, included was an alternative payment methodology (APM) amendment that would change the way providers are reimbursed for Oregon Health Plan (Medicaid) members.
“The alternative payment methodology amendment is the culmination of the committee’s work, with input from providers and stake holders around the state,” said Muñoz. “If the APM amendment passes, we will be reimbursed for care to our OHP patients based upon health outcomes, rather than individual visits with a provider. This will put an emphasis on wellness, preventative care and disease management. It will help us to look carefully at the health of each individual, and also at the overall health of our patient populations.”
Under the APM, health care providers would be reimbursed per member per month for Oregon Health Plan patients, shifting the paradigm from number of visits to overall health outcomes. For Virginia Garcia, moving away from a traditional fee for service practice to a more holistic approach to patient care will not be a sea change. In fact, Virginia Garcia clinics have been building up to this kind of health care delivery for several years with the evolution of its medical home. The medical home model aligns well with caring for patients outside the one-on-one visit with a provider. In the medical home team providers have the opportunity to review a patient’s needs and determine who can best meet those needs at any given time. For example, a patient with diabetes could meet with the team’s medical assistant for regular blood screenings medication review and then be seen by their primary care provider for more acute concerns. This would give the physician the ability to focus on the acute, rather than the routine, in the continuum of diabetes care.
“The challenge in fully implementing the patient centered medical home has been the reimbursement,” according to Muñoz. “Under the current fee-for-service system, we haven’t been able devote the time necessary for our teams to come up with long term treatment plans for our patients. The emphasis on health outcomes in the APM allows for that. It gives the medical home team, as well as the patient, more options for care.”
Under the APM, a much greater emphasis will be placed upon proactive, preventative care. Virginia Garcia has lead the way in developing programs like Reclaiming Your Health and Centering Pregnancy that focus on wellness. Participants in these programs learn how to manage their health through better nutrition and exercise. They also have the benefit of participating in group classes where they receive additional resources and support.
“The alternative payment methodology will help us expand the teaching, education and follow up we’re already providing for our patients,” said Laura Byerly, M.D., co-medical director. “The difference is that essentially the whole team in the medical home, not only the physician, is reimbursed for the care they provide.”
The Virginia Garcia clinics, the OHSU Richmond clinic in Portland and the Mosaic Medical clinic in Bend have been selected to spearhead APM. A three year pilot program will give the clinics a chance to roll out APM, and the state a chance to scrutinize and learn from the model. Oregon Primary Care Association received a Robert Wood Johnson Foundation grant to fund the transition at Virginia Garcia. “The grant will help us develop a new system for receiving and billing claims,” according to Muñoz. “It will also support the development of a new metric for evaluating costs and outcomes – both key in the transition to the new payment methodology.”
Muñoz anticipates that APM will go into effect this summer, probably in June or July. Virginia Garcia will focus on internal staff trainings throughout the spring so that the provider teams can prepare. “It’s not a transition that will happen overnight,” said Muñoz. “But we have the advantage of having a continuous quality improvement system (LEAN), in place so we can address concerns under the APM as they come up.”
Once again, Oregon will be in the national health care transformation spotlight. The APM has been the piece that’s missing in fully realizing the medical home and reaching the “triple aim” of improved patient experience, population health and controlling cost, according to Muñoz. “We’ve had a good partnership in developing the APM as well as support and leadership at the state level from the Governor on down.”