California study links increased primary care spending to better outcomes
If providers increased investment in primary care, it could drive $2.4 billion per year in savings from reduced ER visits and hospitalizations.
Greater investment in primary care is linked to better quality care and fewer hospital visits, a new study of California health plans has found.
The study, released by the California Health Care Foundation, “Investing in Primary Care: Why It Matters for Californians with Commercial Coverage,” was sponsored by a coalition of groups and looked at data from state eight health plans, covering 80% of commercially insured adults in the state—13.9 million Californians. The study also examined primary care spending of 180 provider organizations, including data from 8.5 million adults in HMO plans, which is nearly half of the state’s commercially insured adults.
The researchers concluded that if provider organizations that showed lower spending on primary care matched those who spent more, 25,000 acute hospital stays, and 89,000 emergency room visits could be avoided. Overall, $2.4 billion in overall health savings could be seen in a single year, the study’s authors found.
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“This study is the first analysis of health plan-level primary care investment in California and also the first to delve into primary care spending at the provider organization level, allowing for more granular analysis on the impact of primary care on quality and cost,” said Dolores Yanagihara, with Integrated Healthcare Association and a coauthor of the study. “Our analysis adds to the growing body of evidence that investing in primary care produces higher value and better outcomes for patients and purchasers.”
Results from health plans
The study found that among the 14 health plan products studied, primary care spending percentage, when adjusted for age, gender, and clinical risk score, ranged from a low of 4.9% to a high of 11.4%. Broken down among insurance models, the average adjusted primary care spending percentage was 7.9% for HMO products, 6.0% for PPO products, and 5.8% for EPO (exclusive provider organization) products.
The researchers then looked at the relationship between primary care spending and quality measurements. They found that a one-percentage-point increase in adjusted primary care spending percentage across the HMO population would represent $923 million in lower total spending per year, over the state’s HMO population.
“Higher percentages of spending on primary care were associated with better clinical quality, better patient experience, lower utilization, and lower total cost of care,” the study said.
Similar findings for provider groups
Among provider organizations (POs) the results were similar. With California POs, larger investments in primary care were associated with higher quality, better patient experience, and fewer visits to hospitals and emergency rooms.
“If provider organizations in the lower brackets of primary care spending matched those in the highest bracket of spending, 25,000 acute hospital stays and 89,000 emergency room visits would be avoided, and $2.4 billion in overall health care spending would be saved in a single year,” the study said.
The study made the case that, as with so many things, Californians get what they pay for when it comes to health care, and greater investment in primary care will lead to better health outcomes.
“Increased investment and focus on primary care has the potential to provide more coordinated, cost-effective, and quality care for millions of California consumers,” said Anthony Wright, executive director of Health Access California, a statewide health care consumer advocacy coalition. “An insurance card is necessary but not sufficient: patients need a primary care provider, one who proactively prioritizes prevention upfront, and who can guide them through the health challenges they end up facing, through our complex health care system of different specialists and treatments.”
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