Report: Primary care spending on the decline
The report is a "three-alarm fire,” proclaims one leading physician.
Investment in primary care, as measured by primary care spending, is at an alarming low in the United States. That’s the message in a new report from the Primary Care Collective (PCC), a national nonprofit organization striving to advance primary care. In 2019, primary care spending across commercial payers was only 4.67% of total national commercial healthcare spending, falling from 4.88% in 2017.
The findings support a growing body of literature showing that health systems with a foundation of robust, comprehensive primary care achieve better and more equitable health outcomes and are less costly, according to the report’s authors.
Related: U.S. primary care practices facing $15B hit due to COVID-19
Titled “Primary Care Spending: High Stakes, Low Investment,” the 44-page report was presented at the Primary Care Investment 2.0 State Innovation Workshop, held virtually Dec. 2. That half-day event brought together PCC members, state leaders, policymakers, and advocates to explore the next wave of state-level efforts to measure and set targets for levels of primary care investment.
When considered in the context of COVID-19, which has financially impacted primary care practices, the report is particularly relevant — with implications for primary care clinicians and their ability to care for patients, including those from marginalized and vulnerable communities.
“This report is a three-alarm fire,” said Ann Greiner, PCC’s president and chief executive officer. “The primary care platform was shrinking — and then the pandemic hit. Primary care practices were slammed financially and did their best to respond to patients’ needs, but they have been hamstrung. Patients, particularly those in vulnerable and marginalized communities, are the collateral damage.”
Here are three key findings of the report, which is available for free:
- Spending across states varies: The primary care spending percentage across states ranged from a low of 3.14% in Kentucky to a high of 9.48% in Michigan in 2019 using a narrow definition of primary care providers and services. Using a broad definition, the spending percentage ranged from a low of 5.57% in Pennsylvania to a high of 16.64% in Mississippi.
Both the narrow and broad definitions vary by a factor of 3 between the highest- and lowest-spending states. (PCC defined “narrow” primary care to include family medicine, internal medicine, pediatric medicine, and general practitioner, while “broad” primary care includes nurse practitioner, physician assistant, geriatric medicine, adolescent medicine, and gynecology.)
- Spending in most states keeps falling: The negative trend in primary care spending between 2017 and 2019 was observed across 39 states when using a narrow definition of primary care clinicians and services and across 30 states when using a broad measure.
- Higher spending has health benefits: This year’s report, like PCC’s 2019 report on state-level spending in primary care, documents an association between higher primary care spending at the state level and fewer emergency department visits, hospitalizations, and preventable hospitalizations.
“This study and others have shown that, unfortunately, the U.S. is moving away from primary care, despite the evidence that it is associated with better value, including enhanced population health, greater equity, and more efficient use of healthcare resources,” said Darilyn Moyer, chair of the PCC’s board of directors and executive vice president and chief executive officer of the American College of Physicians.
In her presentation, Ann Kempski, the PCC study’s lead author, noted potential causes of decreases in primary care spending. They include a demand-driven decline due to rising deductibles and cost-sharing, along with spending in the rest of the health care system outpacing primary care spending.
Kempski also reported positive news regarding primary care physician workforce growth, specifically citing an increase in nurse practitioners in both urban and rural areas. Meanwhile, the median density of primary care physicians in both areas remained relatively stable.
“This is a call to action,” Howard Haft, executive director of the Maryland Primary Care Program (which provides funding and support for the delivery of advanced primary care throughout the state), said following Kempski’s presentation. He likened the potential collapse of the nation’s primary care system to a “natural disaster that’s looming.”
To that end, a section of the PCC’s report provides updates on state governments’ actions toward increasing their investments in primary care in 2019 and 2020. To date, 12 states have reported or committed to report primary care spending, and some states are setting spending targets for primary care, according to the report.
To develop the report, the PCC used data from FAIR Health on healthcare claims for people of all ages enrolled in private insurance plans (both fully insured and self-insured), including employer-sponsored, individual, and Medicare Advantage plans, in all 50 states. The PCC used the definition of primary care spending of the percentage of total annual spending on medical care services and prescription drugs that is spent on primary care services.
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