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Structuring Payment to Medical Homes After the Affordable Care Act

The Issue

The patient-centered medical home (PCMH) model aims to transform primary care practice through the use of multidisciplinary teams and a shift from "reactive visit-based care to proactive population health management." Currently, medical home providers are reimbursed with a blend of fee-for-service payments and additional compensation for services provided outside of office visits, including care coordination. Writing in the Journal of General Internal Medicine, Harvard Medical School’s Samuel T. Edwards, M.D., and colleagues consider how the PCMH payment model could evolve to keep pace with health care payment reforms launched by the Affordable Care Act, most notably the "shared savings" approach used by many accountable care organizations (ACOs).

What the Study Found

PCMHs and ACOs are complementary approaches to improving care delivery. Medical homes require strong links to specialists and hospitals, while ACOs—which are accountable for the full continuum of health services—require a strong grounding in primary care. The authors suggest the following payment approaches to promote integration of PCMHs and ACOs:

  • ACO contracts could include dedicated payments to support enhanced primary care services.
  • ACOs could invest in PCMHs by hiring more primary care providers, expanding office hours, developing information technology and care coordination infrastructure, supporting coaching and learning collaboratives, and dedicating resources to urgent care.
  • ACOs could align physician performance and resource allocation to support PCMHs. For example, measures of care coordination and communication could be considered when assessing physician performance. Primary care physicians could be paid according to the size and complexity of their patient panels, and specialists could be given incentives to work with medical homes.


As a promising model of care delivery, the PCMH "can serve as a lynchpin of ACOs," the authors say. For their part, ACOs will need to support this model within their organizations.

Publication Details

Publication Date: April 7, 2014
Citation: S. T. Edwards, M. K. Abrams, R. J. Baron et al., "Structuring Payment to Medical Homes After the Affordable Care Act," Journal of General Internal Medicine, published online April 1, 2014.


Melinda K. Abrams
Senior Vice President, Delivery System Reform and International Innovations, The Commonwealth Fund
Robert A. Berenson
Senior Fellow, Urban Institute
C. Boyden Gray Professor of Health Economics and Policy, Harvard T.H. Chan School of Public Health
Professor of Health Care Policy, Harvard Medical School