There is lots of talk about the "Medical Home." It is seen by many as one of the ways to turn around our healthcare system. Yet if you ask most physicians, hospital administrators, and politicians, most probably could not explain to you what it is. In fact, the Happy Hospitalist reports that some in congress believe it involves physicians making house calls. So here is my attempt to explain the medical home, show who wins, who loses, and why it could really help our ailing system.

Below is a diagram of the traditional model of medicine delivery/reimbursement:


Some things to note:

  • Insurance companies are the thoroughfare for all transactions except for copays and the percent of care that is not covered.
  • The green lines indicate where the money flows. As you see, the insurance companies are at the center.
  • Accountability as to the necessity of care and the quality is through billing to the insurance company.
  • Businesses are buffered from providers of care through the insurance providers. Any reports they get about the effectiveness of the money they are spending comes through the insurance plan's reports to them.
  • Care management is done through penalizing physicians and hospitals through withholding payment from unnecessary procedures.

From an information standpoint, the insurance companies are at the center of the universe in this model, despite the fact that:

  1. Businesses are footing the bill (and to a lesser extent, consumers)
  2. Patients are getting the care
  3. Doctors and hospitals are providing the care.

All information about cost and quality is filtered through the insurance industry. This would be fine if they were unbiased, but the fact that they are publicly held companies means that their goal is to maximize their profits for shareholders. This is a huge conflict of interest, kind of like having the fox guard the chicken coop.

As an alternative, the medical home (or at least, my take on it) would look like this:


In this model there are the following differences:

  • Businesses pay physicians directly in exchange for reporting. I will detail this more later.
  • The consumer (patient) is also getting a report from the physician.
  • Insurance companies lose some of their role as managers.

Reporting is one of the main differences in this model. Reports are given to both employers and patients.

Employer reports contain generic information about the overall health of their employees (not on specific employees). These reports contain such data as:

  • Preventive care - how are employees using preventive services?
  • Disease management - How are patients with diseases such as diabetes, heart disease, etc. doing with their diseases?
  • Utilization - The goal of this is to keep the workforce healthy and at work. If preventive services and disease management are done, the utilization of hospitals, specialists, and PCP's will be less. I realize some may debate this (since it is not proven), but the assumption is that "a stitch in time saves nine."
  • Access - One of the cornerstones of this plan is to give freer access to the PCP through non-traditional means. E-Visits are encouraged because they potentially can decrease employee absences. The patient also has reports and online access (PHR) of chart information.

Patient reports contain specific information about their overall health. It is basically a "report card" as to how they are doing and what upcoming care is needed. Ideally this is combined with the idea of a PHR (Personal Health Record) in which the patient has online access to information directly from the PCP and has the ability to assure that this information is accurate and up-to-date.

Winners and losers

Here is how the various players fare in this set-up:

  • Primary care physicians - Since they are keepers of the medical home, they are reimbursed with a global fee to manage the care they give. The groups advocating medical home are primary care oriented (AAP, ACP, and AAFP), so it should benefit the PCP financially. Plus, since the money comes directly to the PCP from the business, the "middle man" is eliminated.
  • Specialists - This model does not effect these physicians as much, as it is more focused on primary care. Some specialists (like endocrinologists, cardiologists, and OB/GYN's) are lobbying to be included as caretakers for the medical home.
  • Hospitals - The goal of preventive care and disease management is to decrease cost and improve health. Presumably this will decrease ER visits and hospitalizations which may hurt hospitals overall, but that is unclear.
  • Employers - They are greatly empowered with information and with tools to maximize their workforce. The ideal end-game here is that they are able to offer medical home plus a high-deductible insurance policy to their employees and so manage the cost of insurance.
  • Patients - Most people are blind in their care.  With the Medical Home operating in this way, people will know where they stand in terms of prevention and disease management.  They also now have much better access to their physicians in ways that are non-traditional.  They may be the big winners with this version of the MH.
  • Insurance companies - They take the biggest hit here. Some of their "managed care" role is taken away (which is a means to control the cash-flow) and in the end they potentially will be transformed back to a more traditional type of insurance (like life or disability, that insure groups based on overall risk but do not manage the day-to-day care). The money flowing through insurance companies is less, so they have less opportunity for profit (which is one of the main point of this idea).

There is no question that information technology is one of the cornerstones of the Medical Home. Practices need to be able to make the reports quickly and accurately which can only happen with a well-executed EMR (and not simply a E/M compliance machine). The ability to communicate securely with patients is also essential.

My main area of skepticism of this is whether it can actually be pulled off. There are a whole lot of people making a whole lot of money off of the current system that will greatly resist change (using a whole lot of lobbyists and lawyers) or water it down, minimizing the positive impact. The insurance companies will fight to remain the information conduit, which should be avoided for the reasons I gave above. Physicians who refuse to use IT will think it is unfair to favor doctors who do and will try to get a reporting system based on billing data or less rigorous clinical data.

There are also many unanswered issues, such as the uninsured, unemployed, and elderly populations. This model does not in and of itself address these issues.

All in all, however, I at least see this as someone trying to think ahead as to what healthcare should be and an attempt to start shaping it positively.