Study: Costs of Increasing Medical Home Activities Are Modest

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In the last several years, the "medical home" model of primary care has been championed as a means of ensuring that patients receive timely, effective, and coordinated medical services. Little is known, however, about how much it costs a physician practice to become a medical home and to progressively add new medical home attributes.

In the new Commonwealth Fund report, Incremental Cost Estimates for the Patient-Centered Medical Home, a team of researchers supported by the Fund and the American College of Physicians and led by the Urban Institute's Stephen Zuckerman, Ph.D., present findings from a study of nearly three dozen physician practices on the relationship between costs and medical home features, including night and weekend office hours, consultations through e-mail and telephone, electronic health record systems, and care management services. Study practices attested to their medical home status using the National Committee for Quality Assurance Physician Practice Connections–Patient-Centered Medical Home recognition tool.

According to the analysis, there was less than a $1-per-patient difference in costs per month between the one-third of study practices with the highest medical home "scores" — which measure the intensity of medical home services — and the two-thirds of practices with the lowest scores. Only health IT costs increased as scores increased. Nearly all the practices delivered at least the basic medical home attributes; therefore, the study was not able to estimate the costs that practices might have incurred in achieving medical home status.

Because of data limitations, the authors say their findings should be viewed with some caution. Still, they argue that the study's approach to estimating medical home costs — relating actual practice costs to a practice’s level of medical home services — is a promising one. The authors point out that what it costs to become and sustain a medical home is distinctly different than what payers may be willing to pay, which could reflect medical homes’ ability to improve quality and reduce other health care costs.