Characteristics of Patient-Centered Medical Home Initiatives that Generated Savings for Medicare: a Qualitative Multi-Case Analysis

Some Minnesota payers required practices to generate and submit monthly claims for each eligible demonstration patient rather than paying practices a single monthly lump sum encompassing all of the demonstration fees for a practice’s attributed patients. This approach was burdensome enough that many practices chose to forego demonstration payments entirely. In interviews, Minnesota providers often told us that their billing systems were not set up to generate a claim without a face-to-face visit, and the costs to modify their billing systems exceeded their expected revenues from these demonstration payments. Meanwhile, some Minnesota payers offered providers ACO shared savings-style contracts, which rewarded providers for reducing their total spending and thus gave them a disincentive to collect demonstration fees from these payers.

For example, CMS has hired a contractor to conduct such an analysis of its various primary care demonstrations and initiatives.