Health Care for All: A Framework for Moving to a Primary Care-Based Health Care System in the United States

To ensure health care coverage for everyone in the United States through a foundation of comprehensive and longitudinal primary care.

The intent of this policy document is to give the American Academy of Family Physicians (AAFP) and its Board of Directors the needed advocacy flexibility to consider all options that might come before federal and state governments and the American people in working to achieve the goal of health care coverage for all – a goal based upon AAFP policy which recognizes that health is a basic human right for every person and that the right to health includes universal access to timely, acceptable and affordable health care of appropriate quality.

Introduction

The health care system in the United States is uncoordinated and fragmented and emphasizes intervention rather than prevention and comprehensive health management. Health care costs continue to increase at an unsustainable rate and quality is far from ideal. i,ii

Over the past two decades, policies implemented through the Children’s Health Insurance Program (CHIP) and the Patient Protection and Affordable Care Act (ACA) have extended access to affordable health care coverage to millions of previously uninsured, non-Medicare eligible adults and children. The uninsured population reached a historic low of 8.8% under the implementation of these policies. iii The greatest gains in coverage have occurred among our most vulnerable populations and young adults. However, the rollback of some provisions of these policies has increased the percentage of those uninsured to 15.5%, iv close to what it was one decade ago when our uninsured rate was nearing 17%, with nearly 50 million people uninsured. v

Ensuring that all people in the United States have affordable health care coverage that provides a defined set of essential health benefits (EHB) is necessary in order to move toward a healthier and more productive society. Additionally, our health care system must begin to account for and address social determinants that have a profound impact on individual and population health outcomes and costs, such as socioeconomic status, housing and occupational conditions, food security, and the environment. As noted by the Commonwealth Fund, the design of a system to provide health care coverage to all people “will have a deep impact on its ability to make sustainable and systematic improvements in access to care, equity, quality of care, efficiency, and cost control.” vi

Any successful health system reform designed to achieve health care coverage for all must re-emphasize the centrality of primary care, reinvigorate the primary care infrastructure in the United States, and redesign the manner of primary care delivery and payment. Compelling research demonstrates that the ever-increasing focus of resources on specialty care has created fragmentation, decreased quality, and increased cost. Studies confirm that if primary care practices redesign how they operate so that they are more accessible, promote prevention, proactively support patients who have chronic illnesses, and engage patients in self-management and decision-making, health care quality improves along with the cost efficiency of care. vii

Family medicine and primary care are the only entities charged with longitudinal continuity of care for the whole patient. The patient and primary care physician relationship and its comprehensiveness have the greatest effect on health care outcomes and costs over the long term. However, the current United States health care system fails to deliver comprehensive primary care because of the way primary care has been, and is currently, financed.

According to the Center for Evaluative Clinical Sciences at Dartmouth (now called the Dartmouth Institute for Health Policy and Clinical Practice), U.S. states that rely more on primary care have lower Medicare spending (inpatient reimbursements and Part B payments); lower resource inputs (hospital beds, intensive care unit [ICU] beds, total physician labor, primary care labor, and medical specialist labor); lower utilization rates (physician visits, days in the ICU, days in the hospital, and patients seeing 10 or more physicians); and better quality of care (fewer ICU deaths and a higher composite quality score). viii

The patient-centered medical home (PCMH) is one approach to providing comprehensive advanced primary care (APC) for children, youth, adults, and the elderly. It is a model of health care that facilitates a partnership between an individual patient, the patient’s personal physician, and, when appropriate, the patient’s family or caregiver. Each patient has an ongoing relationship with a personal primary care physician trained to provide first-contact, coordinated, continuous, and comprehensive care. The personal physician leads a team of individuals at the practice level and beyond who collectively take responsibility for the ongoing care of patients. ix

Fundamental change is required to shift the direction of the U.S. health system toward one that covers all people and emphasizes comprehensive and coordinated primary care. Current resources must be allocated differently, and new resources must be deployed to achieve these desired results. Payment policies by all payers must change to reflect a greater investment in primary care to fully support and sustain primary care transformation and delivery. Workforce policies must be addressed to ensure a strong cadre of the family physicians and other primary care physicians who are so integral to a high-functioning health care team. Congress and/or state legislatures must enact comprehensive legislation to achieve this change. If such legislation only addresses the uninsured and fails to fundamentally restructure the system to promote and pay differently and better for family medicine and primary care, any solution will not reach its full potential to achieve the Quadruple Aim of better care, better health, smarter spending, and a more efficient and satisfied physician workforce.

Key Elements of the Framework

Everyone will have affordable health care coverage providing equal access to age-appropriate and evidence-based health care services.
Everyone will have a primary care physician and a medical home.
Insurance reforms that have established consumer protections and nondiscriminatory policies will remain and will be required of any proposal or option being considered to achieve health care coverage for all. Those reforms and protections include, but are not limited to, continuation of guaranteed issue; prohibitions on insurance underwriting that uses health status, age, gender, or socioeconomic criteria; prohibitions on annual and/or lifetime caps on benefits and coverage; required coverage of defined EHB; and required coverage of designated preventive services and vaccines without patient cost sharing.
Any proposal will reflect at least a doubling of the percentage of health care spending invested in primary care. x This investment must result in a payment model for primary care that supports and sustains primary care medical home transformation and reduces the current income disparity between primary care and subspecialty care to ensure an adequate primary care physician workforce.
Federal, state, and private funding for graduate medical education will be reformed to establish and achieve a national physician workforce policy that produces a primary care physician workforce sufficient to meet the nation’s health care needs. Additionally, U.S. medical schools will be held to a higher standard in regard to producing the nation’s needed primary care physician workforce.
A defined set of visits and services to a primary care physician will not be subject to cost-sharing.
In any system of universal coverage, the ability of patients and physicians to voluntarily enter into direct contracts for a defined or negotiated set of services (e.g., direct primary care [DPC]) will be preserved. Additionally, individuals will always be allowed to purchase additional or supplemental private health insurance.

To achieve health care coverage for all, the AAFP supports bipartisan solutions that follow the above referenced principles, are supported by a majority of the American people, and involve one or more of the following approaches, with the understanding that each of these have their strengths and challenges:

A public option with aBismarck approach is a form of statutory health insurance involving multiple nonprofit payers that are required to cover a government-defined benefits package and to cover all legal residents. Physicians and other clinicians operate independently in a mix of public and private arrangements. The public option would be an administered plan directly competing for customers with private insurance plans could be national or regional in scope. Physicians and other clinicians would continue to operate independently.

A single-payer model approach that is clearly defined in its organization, financing, and model of delivery of health care services would be publicly financed and publicly or privately administered, with the government collecting and providing the funding to pay for health care provided by physicians and other clinicians who work independently or in private health systems.

A primary care coverage for all approach where every individual has access to essential primary healthcare services regardless of their income, location, or socioeconomic status. This coverage typically includes annual wellness visits, preventive care, treatment for common illnesses, and management of chronic conditions.

As noted in the AAFP’s Discussion Paper on Health Care Coverage and Financing Models, which was commissioned by the AAFP Board of Directors in 2017, each of these options for achieving health care coverage for all has its strengths and challenges, which need and deserve to be debated by the American people and their elected officials and representatives. These include, but are not limited to, the following important issues:

Level of administrative and regulatory burden for physicians, clinicians and other health care providers, and patients/consumers
Impact on overall health care costs to government, employers, and individuals
Level of patient, consumer, physician, and clinician satisfaction
Level of tax burden
Impact on the timely delivery of health care services (wait times) and delays in scheduling elective health care services
Clarity of the financing model and levels of payment to physicians, clinicians, and other health care providers
Inclusion of family physicians on payment, delivery, and other health care decision-making boards
A description of and clarity on a core set of essential health care benefits available to all, especially primary and preventive care, management of chronic illnesses, and protections from catastrophic health care expenses
Impact on the equitable availability and delivery of health care services
Impact on quality and access
Determination of whether there are global budgets and price/payment negotiations
Need for a clear and uniform definition of a “single-payer health care system”

Comprehensive Primary Care

Advanced primary care embodies the principle that patient-centered primary care is comprehensive, continuous, coordinated, connected, and accessible for the patient’s first contact with the health system. APC aims to improve clinical quality through the delivery of coordinated, longitudinal care that improves patient outcomes and reduces health care spending. The AAFP believes APC is best achieved through the medical home model of practice. We define a primary care medical home as one that is based on the Joint Principles of the Patient-Centered Medical Homeix and has adopted the five key functions of the Comprehensive Primary Care Plus (CPC+) initiative, which establishes a medical practice that provides comprehensive care and a partnership between patients and their primary care physician and other members of the health care team, as well as a payment system that recognizes the comprehensive work of providing primary care. The key functions of a primary care medical home are:

Access and Continuity
Planned Care and Population Health
Care Management
Patient and Caregiver Engagement
Comprehensiveness and Coordination

All proposals or options to provide health care coverage for all will be required to cover a defined set of essential health benefits. At a minimum, these would include items and services in the following benefit categories:

Ambulatory patient services
Emergency services
Hospitalization
Maternity and newborn care
Mental health and substance use disorder services, including behavioral health treatment
Prescription drugs
Rehabilitative and habilitative services and devices
Laboratory services
Preventive and wellness services and chronic disease management
Pediatric services, including oral and vision care

In addition to requiring coverage for EHB, all proposals or options will ensure that primary care is provided through the patient’s primary care medical home. To foster a longitudinal relationship with a primary care physician, all proposals or options will provide the following services independent of financial barriers (i.e., deductibles and co-pays) if the services are provided by the patient’s designated primary care physician:

a. Evaluation and management services
b. Evidence-based preventive services
c. Population-based management
d. Well-child care
e. Immunizations
f. Basic mental health care

Affordability

To achieve the goal proposed in this paper: “to ensure health care coverage for everyone in the United States through a foundation of comprehensive and longitudinal primary care,” it will not be sufficient to focus on health care coverage and primary care alone. There will need to be an effort aimed at identifying and reducing the costs of health care services including the administrative costs of delivering those services.

A health care system that is comprehensive and prioritizes primary care must also emphasize the cost and affordability of care. This is important not only for consumers, but also for the decision-making of physicians, clinicians, payers, and government agencies. Affordability is a critical component in efforts to reform the United States health care system.

Prevention & Public Health – there should be increased investment in preventive care, specifically those preventive services that have been proven to reduce the prevalence of preventable diseases (e.g., access to free vaccines and screening programs). A focus on reducing preventable diseases likely would reduce or, at minimum defer, future high-cost spending for preventable diseases. In addition, there should be an increased focus on identifying societal and environmental factors that contribute to increased health care spending.

Transparency – an increased investment in primary care and the medical home allows health plans to not only reduce the costs of treating high-risk patients but improve the quality of health services. xi This increased investment should be supported by aggressive efforts to establish price transparency for all health care services. Such transparency likely will contribute to reducing excessively high health care costs by informing the public about their costs of care and creating more competition in the health care industry.

Consolidation – consolidation in the health system is cause for concern when it comes to affordability. Although consolidations between health systems may allow for reductions in internal costs, such as operating expenses, they create a less competitive market which leads to higher health care costs and insurance premiums. xii

Site-Neutral Payment Policies – for many health care services, current payment policies often are highly variable depending on the site of service (payment higher for the same service performed in a hospital versus an ambulatory surgery center versus a physician’s office for example) despite no significant differences in quality or outcomes of care. Such payment policies contribute to excessive spending in our current system. In addition, such payment policies incentivize consolidation, decrease competition between providers of care, and facilitate over-utilization of high-cost health care services. This issue could be addressed effectively through site-neutral payment policies and the elimination of some facility fees.

Administrative Costs – a share of the overall costs of health care in United States health care is due to high administrative costs. Much of these high administrative costs is due to complexities in billing which is exasperated by multiple payers. Countries with lump-sum budgets and fewer health care payers have seen lower costs in administrative spending. xiii Of all hospital spending in the United States, 25% is dedicated to administrative costs--- nearly $200 billion. In comparison, Canada dedicates only 12% of hospital spending to administrative costs, while England spends 16% on administrative costs. Additionally, no link has been found between higher administrative costs and higher quality care.

Pharmaceutical & Biologics – advances in pharmaceuticals and biologics have improved the health of millions of people, decreased the prevalence of preventable diseases, and allowed for chronic diseases to maintained over a prolonged period of time. These advances have extended life expectancy for millions of people, especially those with chronic diseases and some cancers. These advances should be celebrated for the positive impact they have had on millions of people. However, the escalating costs of pharmaceuticals and biologics places these interventions and treatments out of reach for far too many people. Policies should be established that allow purchasers of health care, including Medicare, to negotiate the costs of prescription drugs. Additionally, there should be greater flexibility in the design of formularies that allow for increased use of generic and bio-similar products.

The AAFP believes all primary care physicians should be compensated in a manner that is consistent with the AAFP’s comprehensive payment model for family medicine and primary care, the Advanced Primary Care Alternative Payment Model (APC-APM). The AAFP believes the APC-APM is a foundational element of a greater investment in primary care that is essential to a better system of care in the United States.

The model builds on previous programs and years of research showing the benefits of movement away from fee-for-service (FFS) payment and increased support for population-based care. It better supports small and independent practices and reduces administrative burden in the health care system.

Key Components of the APC-APM

For any health care system to achieve its goals, there will be a need for greater investment in primary care. The AAFP strongly supports increased investment in primary care as part of any U.S. health care system.

Family physicians, other primary care physicians, and primary care teams provide comprehensive primary care through two distinct functions: direct patient care and non-face-to-face care, which we label as “population-based care.” The AAFP has concluded that traditional FFS payment is largely incongruent with these core functions. The APC-APM, which is outlined in Figure 1, is better designed to recognize the value of these complementary, yet distinct, functions.

The APC-APM establishes a payment model built on the realization that high-quality primary care is delivered through both direct patient care and the population-based services that are provided by the primary care team. Additionally, we believe the revenue cycle for primary care must move to a prospective payment model with a retrospective evaluation for performance and quality. Therefore, our model establishes prospective payments for a direct patient care global payment, a population-based global payment, and a performance-based incentive payment.

Building on our belief that primary care should remain comprehensive, the APC-APM maintains an FFS component as a means of driving comprehensive care at the primary care level. The presence of this FFS component recognizes that a comprehensive primary care practice will provide episodes of care that are beyond the scope of the direct patient care global payment.

We believe the APC-APM will support a greater investment in primary care and will allow primary care practices of all sizes and in any location to achieve and sustain success through its simplified payment structure and dramatic reduction in administrative burden. More importantly, we believe patients will achieve better outcomes and have a more favorable experience through this model.

FIGURE 1. KEY COMPONENTS OF THE APC-APM PAYMENT

Summary

This framework offers important policy options for the AAFP to move the United States toward a primary care-based health care system in which all people have appropriate and affordable health care coverage, are provided a medical home, and have primary care-oriented benefits. This can be achieved only if Congress and/or state legislatures act to ensure that these policy objectives are implemented. All people in the United States must have appropriate and affordable health care coverage, but this is not sufficient by itself. A fundamental change in the health care system to move toward a primary care-based system is essential to achieve improvements in access, quality, and cost. Extensive worldwide research supports the value of a primary care-based health care system in which all people are covered.xiv This framework is grounded upon the documented value of primary care in achieving better health outcomes, higher patient satisfaction, and more efficient use of resources. The United States will only achieve the type of health care system that our people need, and our nation deserves through a framework of health care coverage for all that is foundationally built on primary care.

References

i. Institute of Medicine Committee on Quality of Health Care in America. Crossing the quality chasm: a new health system for the 21st century. Washington, DC: National Academies Press; 2001.

ii. Institute of Medicine Committee on Quality of Health Care in America. To err is human: building a safer health system. Washington, DC: National Academies Press; 2000.

iii. Barnett JC, Berchick ER. Health insurance coverage in the United States: 2016. Washington, DC: U.S. Government Printing Office. 2017. Current population report no. P60-260. Accessed July 1, 2018.

v. DeNavas-Walt C, Proctor BD, Smith JC. Income, poverty, and health insurance coverage in the United States: 2009. Washington, DC: U.S. Government Printing Office. 2010. Current population report no. P60-238. Accessed July 1, 2018.

vi. Collins S, Schoen C, Davis K, Gauthier A, Schoenbaum S. A roadmap to health insurance for all: principles for reform. October 1, 2007. Accessed July 1, 2018.

vii. Bailit M, Hughes C. The patient-centered medical home: a purchaser’s guide. Washington, DC: Patient-Centered Primary Care Collaborative; 2008. Accessed July 1, 2018.

viii. Dartmouth Atlas of Health Care Working Group. The care of patients with severe chronic illness: an online report on the Medicare program by the Dartmouth Atlas Project. 2006. Accessed July 1, 2018.

ix. American Academy of Family Physicians, American Academy of Pediatrics, American College of Physicians, American Osteopathic Association. Joint principles of the patient-centered medical home. March 2007. Accessed July 1, 2018.

x. Koller C. Getting More Primary Care-Oriented: Measuring Primary Care Spending. Accessed July 5, 2018.

xiv. Patient-Centered Primary Care Collaborative. Results and evidence. Accessed July 1, 2018.