Medical homes, ACOs offer better business models

The patient-centered medical home model in Arkansas, which has more than 600 participating providers, helps the state's Medicaid program incentivize quality care instead of paying for volume of services. Arkansas officials designed the PCMH payment structure to support primary care doctors in the state, who often rely on high volumes of acute care, to instead implement team-based strategies, coordinate chronic care delivery and achieve better patient outcomes, according to a Health Affairs blog post.

Since the state has a wide array of practices, ranging from highly efficient primary care doctors to clinics with high rates of avoidable emergency room admissions, officials knew that simply rewarding doctors for reducing their spending would have penalized the efficient practices.

Instead, the Arkansas PCMH model rewards providers that hit a targeted, risk-adjusted per-member per-year spending level that doesn't rely on actually spending less. Plus, it offers smaller rewards for less efficient practices that do reduce their spending. Meanwhile, Horizon Blue Cross Blue Shield of New Jersey is making a big push to move the majority of its members to either a PCMH or accountable care organization in the next few years. That would mean a big jump from its 500,000 members enrolled in these types of plans, reported Insurance News Net. Aetna also intends to boost its enrollment in PCMH or ACO plans. The insurer currently has only 135,000 of its 1.1 million New Jersey members enrolled in these plans and hopes to increase that to 215,000 members by the end of the year.