Giving primary care practices a stronger role can help stem rising healthcare costs.
A large regional US health insurer was concerned about its rising costs, especially because the cost increases did not appear to reflect better quality of care. The company believed that the best way to tackle both issues would be to strengthen the primary care practices in its region so that they could take on a larger role in coordinating patient care and delivering preventive services.
However, the company did not know what approach it should use to work with its primary care providers or how it could ensure that the changes it was encouraging would produce the desired cost and quality improvements. Therefore, it asked McKinsey to help with this problem.
Over the course of a year, the team helped the client develop and implement a pilot program to strengthen several primary care practices. It began by quantifying the savings that could be achieved through better care coordination. The team then designed a new payment model that gave the practices incentives for both absolute performance and the extent of performance improvement. In addition, it developed a new model for care delivery; as part of this model, each practice would have an office-based nurse care coordinator who would be paid for by the client and who would spend most of his or her time focusing on high-risk patients.
Once these models were developed, the team worked directly with physicians in the pilot practices to pinpoint the biggest opportunities to improve outcomes while controlling costs and to test interventions that might enable the practices to capture these opportunities. It began by gathering a wide range of information from the clinical literature, interviews with experts, the client’s databases, and elsewhere to identify promising ideas. Each idea was then assessed in terms of its feasibility and impact. This approach enabled the team and physicians to pinpoint the four sets of solutions that were most likely to deliver the desired results:
- build a foundation for change in each practice (e.g., by expanding the role of patient care coordinators and using stratification tools to identify high-risk patients)
- improve team-based care (e.g., by allowing all staff members to practice at the top of their licenses and developing high-impact care plans for high-risk patients)
- expand access to primary care services to lower the number of patients seeking emergency room care (e.g., by adding online- and telephone-based tools for care delivery and reaching out to patients with high emergency room (ER) utilization rates)
- reduce the number of patients needing hospital admission or readmission (e.g., by deploying evidence-based care protocols for chronic disease and establishing group visits for patients with high-priority conditions)
During the pilot, the McKinsey team worked in the practices to help the physicians and their staffs adopt the new care delivery model. This hands-on approach made it clear that each of the practices was at a different starting point, and none were likely to be able to implement all the identified solutions.
In response, the team created a “playbook” for the practices — a simple but comprehensive guide that would help each practice implement the solutions it wanted to focus on first. In addition, the team set up physician learning collaboratives to encourage information sharing, and it helped the client establish regular performance-review sessions with each practice.
Within the first year, the program accomplished the following:
- significantly lowered the cost of care for high-risk patients in the pilot practices, primarily because the patients' ER utilization, hospitalization, and readmission rates decreased between 20% and 25%. However, the program also increased the use of generic drugs
- improved the practices' score on quality metrics (e.g., for cancer screening and diabetes control) by up to 10%
- received an enthusiastic reaction from most participating physicians. They note that the program has empowered and incentivized them to work more proactively with patients, focus on outcomes, and improve care quality
As a result, the client is rolling out the program more broadly.