Medicare to pay health centers to coordinate care

Federally qualified centers certified as medical homes are eligible for $6 per Medicare patient per month under a demonstration program.

By Doug Trapp — Posted June 20, 2011

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Federally qualified health centers will have a chance to receive federal care coordination fees to help provide medical homes to Medicare patients.

The Dept. of Health and Human Services announced on June 6 that $42 million is available over three years under the initiative. The demonstration project, known as the Federally Qualified Health Center Advanced Primary Care Practice, could provide up to 500 centers $6 per Medicare beneficiary per month for coordinating care. Some qualifying facilities will be invited to participate by the Centers for Medicare & Medicaid Services.

"This project will go a long way toward creating comprehensive and coordinated health care opportunities for the many people with Medicare who rely on [federally qualified health centers] as their primary medical providers," said CMS Administrator Donald M. Berwick, MD. The project could involve up to 195,000 Medicare enrollees.

To qualify for the funding, centers will be expected to become level 3 patient-centered medical homes, according to National Committee for Quality Assurance standards. This level requires centers to meet six major standards, including identifying patient populations and managing their care, offering access to care after normal office hours, and following up after tests and referrals.

"Dollar-wise, it's not going to be enormous," said Erwin Teuber, PhD, executive director of Oregon Health & Science University Family Medicine at Richmond Clinic in Portland, Ore., which has nearly 1,300 Medicare patients and plans to pursue a project grant. "But it's one more reinforcement -- I would say a significant reinforcement -- for going in a direction that we're already committed to going in."

The additional funding will help the Richmond Clinic better manage Medicare patients' chronic conditions and address their mental health issues, among other improvements, Teuber said. Patients are less likely to visit emergency departments if they have steady contact with health centers such as Richmond Clinic, he added.

One caveat to such demonstration projects is that health centers receiving the fees could become even more important sources of care for Medicare and Medicaid patients at the expense of other facilities and private practice physicians, said Charles Kilo, MD, MPH, chief medical officer at Oregon Health & Science University. Funding formulas already favor health centers over private physicians, and some states are reducing Medicaid physician pay even more to help close budget deficits.

Still, he said the U.S. health system needs more coordination at the primary care level. "If primary care is broken down, it's really hard to control quality and costs," said Dr. Kilo, who worked with Dr. Berwick at the Institute for Healthcare Improvement, a research organization in Cambridge, Mass., that helped create the concept of patient-centered medical homes.

Dr. Kilo agreed that $6 per patient per month is not a windfall, but it could enable some health centers to hire a care coordinator, for example. "That's the kind of thing that primary care needs."

HHS is accepting applications for the demonstration program until Aug. 12.

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Fees for Medicare coordination

Federally qualified health centers are eligible to apply for a share of $42 million in funding for coordinating care for Medicare beneficiaries under a three-year demonstration program announced in early June. The program:

  • Is limited to centers that provided primary care to at least 200 Medicare patients in the past 12 months.
  • Is restricted to Medicare enrollees who had fee-for-service coverage in the past 12 months and who are not enrolled in hospice care or private Medicare plans.
  • Will pay $6 per Medicare enrollee per month to provide patients with a "person-centered, coordinated, seamless primary care practice."

Source: "Federally Qualified Health Center Advanced Primary Care Practice (FQHC APCP) Demonstration Fact Sheet," Dept. of Health and Human Services (link)

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