Transforming Medicaid: A Blueprint for Equitable Care
Acknowledgements
Acknowledgements
Part 1: Introduction to Medicaid
1
This chapter tells the story of Medicaid’s creation, from the early 1960s healthcare financing crisis to the program’s passage. It explores the key players, philosophical debates, and political battles that shaped the program, and sets the stage for the challenges and opportunities that Medicaid would face in the decades to come.
01 Weaving a Safety Net: Medicaid's Origins and Evolution
Part 1: Introduction to Medicaid
2
This chapter examines the complex structure and funding mechanisms of Medicaid, including the rise of managed care and use of waivers. It explores the historical expansions of Medicaid eligibility and the variations across states. The chapter also looks at emerging payment models involving value-based care and how the program’s fragmented nature can create barriers for beneficiaries accessing services.
02 The Medicaid Landscape: Structure, Funding, and Eligibility
Part 2: Public Policy and Controversy
3
This chapter explores the fierce debate surrounding Medicaid expansion under the Patient Protection and Affordable Care Act (ACA). It details the human benefits of expanded healthcare coverage, then dives into the political battle in North Carolina, highlighting the financial incentives that ultimately led to expansion. The chapter concludes by analyzing the impact of expansion on health outcomes, healthcare costs, and broader social and economic factors of Medicaid expansion.
03 The Medicaid Expansion Controversy: Politics, Policy, and Outcomes
Part 2: Public Policy and Controversy
4
This chapter critiques superficial Medicaid social needs screening tools and fragmented referrals, advocating instead for deeper collaboration between healthcare and community organizations to address root causes of poverty and difficulties navigating social services through approaches like housing investment and community health workers. It highlights examples of successful and unsuccessful programs and the increasingly robust research base describing strategies to reduce social risks among Medicaid recipients.
04 Beyond Checkboxes: Rethinking Social Needs in Medicaid
Part 3: Access, Coordination, and Quality
5
This chapter examines the stark care access disparities Medicaid patients face, citing limited specialist availability, administrative burdens disincentivizing provider participation, and prevalence of “ghost networks” falsely implying adequate coverage. It explores attempted remedies like the 340B drug discount program intended to bolster safety net providers, noting questionable impact on intended populations so far. The chapter concludes with a description of several strategies that have the potential to improve access to care for Medicaid beneficiaries and create a more equitable healthcare system.
05 Care Segregation and Network Inadequacy: Medicaid’s Network Challenges and Corrective Attempts
Part 3: Access, Coordination, and Quality
6
This chapter explores worrisome primary care physician shortages and burnout, tracing root causes to inadequate prestige, compensation, and payer fragmentation that stifle the critical impact of primary care providers. It reviews the Comprehensive Primary Care Plus program results, and points to simpler, consistent multi-payer incentives as in Rhode Island that nurtured improvements to primary care infrastructure and outcomes.
06 Reinvigorating Primary Care, Care Access, and Coordination in Medicaid
Part 4: Improving Population Health Access, Quality and Equity in Medicaid
7
This chapter explores the history of mental health and substance use care in the US, from the institutionalization of those with behavioral health needs to community-based programs struggling with provider shortages. It highlights innovative approaches like Certified Community Behavioral Health Clinics and The Collaborative Care Model to integrate mental health expertise into primary care and improve outcomes related to overall healthcare and social costs and patient experience.
07 Bridging Gaps and Building Integrations in Behavioral Healthcare
Part 4: Improving Population Health Access, Quality and Equity in Medicaid
8
This chapter traces maternal mortality’s trajectory in the US and its impact on health disparities, highlighting evidence-based programs like the Centering Pregnancy program and the Nurse-Family Partnership that reduce the risk of maternal death and concurrently improve both perinatal and longer-term pediatric and adolescent health, social and economic outcomes. The chapter also describes broader supportive maternal policies found in peer nations, from universal paid family leave to early education investments.
08 Beyond Survival: Supporting Mothers and Children to Thrive
Part 5: Conclusion and Future Directions
9
As states explore Medicaid integration with Medicare to improve patient experiences and incrementally move toward universal health coverage, this concluding chapter reviews the complex barriers “dual-eligible” patients face today. It reviews challenges experienced in the Medicare Advantage program to illustrate the risks of fragmented systems and misaligned incentives that could undermine the push for a single, streamlined universal healthcare safety-net program.
09 Pursuing Universal Coverage: Cautionary Lessons from Medicare-Medicaid Integration and Medicare Advantage
Endnotes
10
Endnotes
Epilogue: A Vision for Strengthening Medicaid and Advancing Health Equity
11
Epilogue
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Transforming Medicaid:
A Blueprint for Equitable Care

Sanjay Basu, MD, PhD

Medicaid serves over 70 million low-income Americans, yet its promise of healthcare access is constrained by fragmented bureaucracy, strained budgets, provider shortages, and political headwinds. In this book, Dr. Sanjay Basu MD PhD, an epidemiologist and primary care provider, confronts the paradoxes underlying barriers to equitable, high-value care for Medicaid recipients. By tracing Medicaid's evolution and spotlighting cracks missed by checkbox reforms, he presents a blueprint for long-term solutions. From addressing social determinants of health more holistically to integrating behavioral healthcare to preventing maternal mortality, the book's chapters chart specific evidence-based programs to improve Medicaid and achieve the goals of access, quality, and equity across one of the largest safety net programs in the United States.

Part 3: Access, Coordination, and Quality

06 Reinvigorating Primary Care, Care Access, and Coordination in Medicaid

In the bustling halls of a local hospital, a frail man from Nepal sat quietly in his wheelchair, his eyes fixed on the floor. His name was Anil, and he had been battling tongue cancer for months. The disease had robbed him of his ability to speak, eat, and even swallow. But as his primary care physician, I knew there was more to his story than just his medical condition.

Anil had spent his entire life in Nepal, where chewing betel nut was a common practice. The habit, deeply ingrained in South Asian culture, had ultimately led to his cancer. By the time he arrived at our hospital, the tumor had already spread, and the prognosis was grim.

The specialists worked tirelessly to treat Anil’s cancer. The surgeon skillfully removed his tongue, while the oncologist administered round after round of chemotherapy. The radiation oncologist targeted the cancer cells in his face with precision. But as the treatments progressed, Anil’s quality of life deteriorated. He could no longer eat, and a feeding tube was inserted through his skin, directly into his stomach.

Despite the best efforts of the medical team, something was missing. Anil’s eyes told a story of a man who had lost more than just his ability to eat and speak. He had lost his sense of purpose, his connection to his loved ones, and his hope for the future.

One day, I sat down with Anil and a translator, to understand Anil’s true wishes. Through a series of handwritten notes and gestures, Anil revealed his deepest desire: to comfort his wife before he passed away and to return home, where he could place a morsel of food in his mouth, even if he couldn’t swallow it.

It was a simple request, but one that had been overlooked in the whirlwind of medical treatments. In a meeting with the specialists I shared Anil’s wishes. At first, there was resistance. The oncologist argued that stopping treatment would reduce Anil’s chances of survival. The surgeon expressed concern about the risk of infection if Anil attempted to eat. But as we discussed the matter further, a consensus emerged: Anil’s quality of life and personal goals should be the guiding principles of his care.

We decided to pause Anil’s cancer treatment and focus on his comfort and well-being. Arrangements were made for him to return home, where he could spend his final days with his wife by his side. The feeding tube was removed, and Anil was encouraged to enjoy the taste of food with what remained of his tongue.

In the end, Anil passed away peacefully, surrounded by the love and comfort of his family. His story reminds me of the importance of whole-person health and the crucial role of primary care physicians in advocating for patients’ goals and priorities.

Beyond individual patient stories, research has consistently shown that primary care availability is associated with better health outcomes and longer life expectancy across entire populations. A few years ago, my colleagues and I published a statistical analysis that examined the relationship between different types of medical specialties and health outcomes in every county in the United States. After controlling for factors such as tobacco smoking rates, poverty, and education, the results were consistent across the country. While having more cardiologists was associated with lower death rates from heart disease and having more oncologists was associated with lower death rates from cancer, only one specialty was associated with lower death rates from every major cause of death and with overall life expectancy: primary care.

The reason for this powerful impact lies in the unique role that primary care physicians play in disease prevention, early detection, and long-term health management. Primary care doctors are often the first point of contact for patients, and they are trained to identify and address health issues before they become severe or symptomatic.

For example, high blood pressure remains the leading cause of heart attacks and strokes, but it often has no symptoms in its early stages. It is through regular check-ups with a primary care physician that high blood pressure can be detected and treated, preventing devastating cardiovascular events down the line. Similarly, many cancers, such as breast and colorectal cancer, are most treatable when caught early through screening tests like mammograms and colonoscopies. These tests are typically ordered and followed up on by primary care doctors, who can ensure that patients receive the necessary screenings based on their age and risk factors.

Beyond early detection, primary care physicians also play a crucial role in helping patients manage chronic conditions and make lifestyle changes that can have a profound impact on their health. Whether it’s providing guidance on nutrition, helping patients quit smoking, or encouraging them to reduce their alcohol intake, primary care doctors are uniquely positioned to support patients in making the long-term behavioral changes that can add years to their lives.

Some might argue that having specialists available for every disease would negate the need for primary care. However, this view overlooks the importance of having a healthcare provider who can see the full picture of a patient’s health and coordinate their care across multiple specialties. Primary care doctors are trained to be experts in diagnosis, able to decipher ambiguous symptoms and determine the most appropriate course of action.

Consider a patient who presents with a chronic cough. The three most common causes of chronic cough are asthma, gastroesophageal reflux disease (GERD), and post-nasal drip. If the patient were to see a pulmonologist, a gastroenterologist, and an ear, nose, and throat (ENT) specialist separately, each would likely offer a different solution, with only a one-third chance of addressing the underlying problem. In contrast, a primary care doctor can take a comprehensive approach, considering all the possible causes and guiding the patient through a process of elimination to find the most effective treatment.

As a more complex and consequential example, primary care providers are frequently required to quarterback a patient’s care to keep them safe amidst conflicting recommendations. For example, such providers often see patients taking a cardiology medication that has adverse effects on kidney outcomes, or a dermatology prescription that affects the liver. The primary care provider has to monitor the panoply of possible competing recommendations to ensure a patient is safe.

The importance of having a single primary care doctor who knows a patient well extends beyond diagnosis and treatment. Research by my colleague Bob Phillips has shown that having a continuous relationship with a primary care physician is associated with better quality care and care that is more aligned with patients’ goals and values.

In the United States, there is a growing recognition of the need for “whole-person health,” which emphasizes the importance of addressing not just physical health, but also mental health, social well-being, and other factors that contribute to overall health and quality of life. Primary care physicians are uniquely positioned to provide this kind of comprehensive, patient-centered care, serving as advocates and coordinators for their patients across the healthcare system.

As the population ages and the burden of chronic disease continues to grow, the demand for primary care physicians will only increase. Ensuring an adequate supply of well-trained primary care doctors, and supporting them with the resources and systems they need to provide high-quality, coordinated care, will be essential for improving health outcomes and reducing healthcare costs in the long run.

At the same time, it is important to recognize that primary care physicians cannot do it alone. They need the support of specialists, physicians assistants, nurses, social workers, and other healthcare professionals to provide the best possible care for their patients. They also need the support of policymakers and healthcare leaders to create a system that values and rewards the crucial role that primary care plays in promoting health and well-being.

Despite their importance, the supply of primary care physicians in the United States has decreased. Between 2005 and 2015, the mean primary care physician supply per 100,000 population decreased from 46.6 to 41.4. This decline was particularly pronounced in rural areas.

Concurrently, the number of specialist physicians increased from 68.0 per 100,000 population in 2005 to 71.3 per 100,000 population in 2015. Despite this increase in specialist supply, primary care was the only medical specialty consistently associated with lower death rates from every major cause of death and with overall life expectancy.

One factor contributing to the decline of primary care is the significant prestige gap between primary and specialty care. At the nation’s top medical schools, the highest performing students are systematically shuttled into “lifestyle professions” such as ophthalmology and dermatology. My dean at Yale was so reluctant to write “primary care” in my residency recommendation letter that she instead wrote that I was still deciding on a field of specialization and could be “persuaded to become an infectious disease specialist.”

Another factor is the salary gap between primary care physicians and specialists. Primary care physicians earn substantially lower incomes and accumulate considerably less wealth over their lifetimes compared to their specialist counterparts. Narrowing this wealth gap would require either substantial reductions in specialists’ practice income or increases in primary care physicians’ practice income by more than $100,000 per year.

The systemic bias in reimbursement models, as exemplified by the Relative Value Scale Update Committee (RUC), also favors procedural specialties over cognitive specialties like primary care. The RUC, a committee of the American Medical Association, plays a significant role in determining the relative values of medical services, which in turn influence reimbursement rates. The RUC has been criticized for over estimating the time and complexity of procedures while underestimating the time and expertise required for cognitive tasks, such as listening to patients, thinking critically about their symptoms, and making complex diagnostic and treatment decisions.

For example, based in part on the RUC’s recommendations, Medicare reimburses physicians 3 to 5 times more for common procedural care than for cognitive care, illustrating the financial pressures that may contribute to the US healthcare system’s emphasis on procedural care. A recent study demonstrated that two common specialty procedures can generate more revenue in 1 to 2 hours of total timethan a primary care physician receives for an entire day’s work. This bias in reimbursement creates a powerful financial incentive for physicians to specialize in procedural areas rather than in primary care.

An analysis using the Community Tracking Study (CTS) Physician Survey revealed that procedural medical specialties earned 37.5 percent more than family medicine, compared to 15.3 percent for non-procedural medical specialties.

The growing workload and time demands on primary care physicians further exacerbate the problem of fewer medical students wanting to enter the profession. According to a 2022 study, primary care physicians (PCPs) need 26.7 hours per day to provide recommended care to an average number of patients. This breaks down to: 14.1 hours for preventive care, 7.2 hours for chronic disease care, 2.2 hours for acute care, and 3.2 hours for documentation and inbox management. Primary care physicians spend more than one-half of their work-day, nearly 6 hours, interacting with the electronic health record (EHR) during and after clinic hours. Clerical and administrative tasks accounted for nearly one-half of the total EHR time (157 minutes, 44.2%), while inbox management accounted for another 85 minutes (23.7%).

A more recent cross-sectional study involving 307 primary care physicians across 31 primary care clinics found substantial variation in EHR time among individual physicians and clinics. On a per-visit basis, physicians spent a median of 36.2 total minutes on the EHR, 6.2 minutes of “pajama time” (i.e., time spent on the EHR between 5:30 pm to 7:00 am and on weekends), and 7.8 minutes on the electronic inbox. The study also found that organization-level factors, such as greater team collaboration on orders, the presence of specific clinic staff, and practicing in a community health center, were associated with significantly lower per-visit EHR time across multiple categories.

The growing crisis in primary care is not only a matter of declining physician supply and inadequate reimbursement for long hours of work, but also a profound issue of moral injury and burnout among primary care physicians. Moral injury occurs when healthcare professionals are unable to provide the care they believe is ethically necessary due to constraints beyond their control, such as insurance denials, prior authorization requirements (requiring that an insurance official authorize treatment before it can be dispensed), and limited access to specialty care. This disconnect between a physician’s moral compass and the realities of the healthcare system can lead to feelings of powerlessness, frustration, and ultimately, burnout.

Burnout, characterized by emotional exhaustion, depersonalization, and a reduced sense of personal accomplishment, is alarmingly prevalent among primary care physicians. A 2019 survey found that 50% of family medicine physicians reported symptoms of burnout, the highest rate among all medical specialties. The consequences of burnout are far-reaching, including decreased job satisfaction, reduced quality of care, and increased medical errors.

Moral injury and burnout among primary care providers (PCPs) can significantly impact the delivery of healthcare, including the availability and timeliness of specialty care. The excessive workload and administrative requirements, such as prior authorizations and dealing with insurance denials, contribute to burnout and professional dissonance, where PCPs experience a conflict between their professional values and the realities of primary care practice. This dissonance can lead to a sense of undervaluation and an authority-responsibility mismatch, which may affect PCPs’ ability to provide timely referrals and manage specialty care effectively.

One of the most significant contributors to moral injury and burnout in primary care is the lack of timely access to specialty care. Primary care physicians often serve as the first point of contact for patients with complex medical conditions that require specialist expertise. However, long wait times for specialist appointments, coupled with insurance barriers and prior authorization requirements, can delay necessary care and leave primary care physicians feeling helpless and frustrated.

A recent study found that a patient can typically expect to wait 20.3 days for a new patient appointment with a board-certified obstetrics and gynecology subspecialist. Alarmingly, callers presenting with Medicaid insurance experienced significantly longer new patient appointment wait times than callers with commercial insurance, with a 44% longer wait time for Medicaid patients. The study evaluated the mean appointment wait time for a new patient visit to female pelvic medicine and reconstructive surgery, gynecologic oncology, maternal-fetal medicine, and reproductive endocrinology and infertility when presenting with Medicaid vs commercial insurance. These findings highlight the disparities in access to specialty care based on insurance type, with Medicaid patients facing significant barriers to timely care.

The impact of prior authorizations (PAs) on patient outcomes varies across different medical specialties and conditions, but the overarching theme is that PAs can lead to delays in care, which may adversely affect patient outcomes. For instance, in gynecologic oncology, patients experienced over a two-week delay in care when prior authorization occurred. In the context of oral anticancer drugs, the introduction of anew PA policy was associated with increased odds of prescription discontinuation and delays in medication access. Similarly, for infusible medications used to treat rheumatologic conditions, PAs were associated with treatment delays and greater glucocorticoid exposure (meaning, more exposure to an inferior class of treatments with major side effects) following a PA request.

In the case of diabetes medications, delays in receiving medication due to PAs were associated with less reduction in hemoglobin A1c levels, indicating poorer glycemic control. For pediatric patients with inflammatory bowel disease, PAs were linked to prolonged initiation times for biologic therapies and increased healthcare utilization. In multiple sclerosis, insurance restrictions including PAs delayed necessary treatments and increased the likelihood of disease activity.

These findings suggest that while PAs are intended as a cost-containment strategy, they can have unintended consequences on patient care, leading to delays in treatment initiation, increased health care utilization, and potentially worse clinical outcomes. It is important for healthcare providers to be aware of these potential impacts when navigating the PA process for their patients.

The prior authorization process is often time-consuming and bureaucratic, requiring physicians and their staff to spend hours on the phone or filling out paperwork to justify medically necessary care.This administrative burden takes time away from direct patient care and can delay or even prevent patients from receiving the treatments they need. For primary care physicians who are already stretched thin by the demands of patient care and documentation, prior authorization requirements can be a significant source of stress and frustration.

The challenges of dealing with insurance denials for medications or services further exacerbate moral injury, as PCPs may feel they are unable to deliver the care they deem necessary for their patients, violating their ethics and principles of beneficence and non maleficence. This can lead to decreased job satisfaction, increased risk of job abandonment, and potentially-compromised patient care quality.

Our research has highlighted a particularly troubling trend in Medicaid, where critical drugs like antipsychotics and epilepsy medications are often denied due to minor insurance issues, such as being picked up a few days early or being supplied for a few extra days beyond what the insurance company allows. These denials can have devastating consequences for patients, particularly those with serious mental health or chronic health conditions. Without access to their medications, these patients are at risk of decompensation, hospitalization, and even death. The irony is that, from a pure cost perspective, these denials are often a net loss for Medicaid. When patients are unable to access their medications and end up in the emergency room or hospital, the costs are far higher than the price of the denied medication.

For primary care physicians who are often the ones prescribing these critical medications and dealing with the fallout of insurance denials, the emotional toll can be significant. Knowing that their patients are suffering needlessly due to bureaucratic barriers can lead to feelings of moral distress and helplessness. Over time, this chronic stress can contribute to burnout and even the decision to leave primary care altogether.

While Medicaid is a significant payer for primary care services, it is just one of many payers that primary care physicians must navigate. This fragmentation creates a number of barriers to delivering high-quality, comprehensive primary care.

One of the fundamental challenges is that primary care physicians typically approach patient care without considering the patient’s insurance status. Ideally, physicians should provide the same high-quality care to all patients, regardless of their insurance coverage. However, the reality is that different payers have different reimbursement rates, prior authorization requirements, and quality metrics, which can influence the care that patients receive.

In recent years, there has been a growing interest in value-based care (VBC) arrangements as a way to align incentives and improve primary care delivery. Under VBC models, providers are rewarded for delivering high-quality, cost-effective care, rather than simply being paid for the volume of services they provide. Medicaid has been aleader in implementing VBC arrangements with the goal of improving access to preventive care, reducing unnecessary hospitalizations and emergency department visits, and improving overall health outcomes.

However, while VBC arrangements with Medicaid may help to focus on prevention, access, and quality, they are limited in their impact because Medicaid is just one of many payers that primary care physicians work with. A typical primary care practice may have contracts with multiple commercial insurers, Medicare, and Medicaid plans, each with its own set of rules and incentives. As a result, any given VBC arrangement may only affect a small fraction of a provider’s patient population, limiting its ability to drive meaningful changes in care delivery.

To truly improve primary care, there is a need for multi-payer alignment and consistent rules and incentives across payers. One example of a multi-payer initiative aimed at improving primary care is the Comprehensive Primary Care Plus (CPC+) program, which was implemented in 18 regions across the United States. CPC+ was designed to test a new model of primary care delivery that included enhanced payments, care delivery requirements, data feedback, learning, and health information technology support.

The program was structured as a two-track system, with practices in Track 1 receiving enhanced payments for providing comprehensive primary care services, and practices in Track 2 receiving additional payments for taking on more advanced care delivery requirements and financial risk (being responsible for overall care costs for a patient population). The initiative involved numerous complex billing codes, IT integrations and reporting requirements.

The results of the CPC+ program were mixed. While the program was associated with some positive outcomes such as decreases in emergency department visits and hospitalizations, it did not lead to discernible changes in total expenditures. In fact, the program resulted in increases in expenditures, including enhanced payments to participating practices. Additionally, CPC+ was not associated with meaningful changes in quality-of-care measures. Medicaid participated in some but not all states, and the particular payer and provider participants were also complex and varied by geography.

Further analysis of the CPC+ program revealed some interesting findings. For example, participation in CPC+ was associated with increases in the delivery of annual wellness visits (AWVs) and flu shots, but not other high-value services such as advance care planning, counseling to prevent tobacco use, or depression screening. This suggests that while the program may have encouraged some preventive services, it did not lead to a comprehensive improvement in the delivery of high-value care.

Another notable finding was that CPC+ did not improve spending or quality for privately insured patients. This highlights the challenge of improving primary care in a fragmented healthcare system, where initiatives targeted at one payer may not translate to improvements for patients covered by other payers.

There were also some concerning findings related to equity and access. Practices with higher proportions of Black or Latinx fee-for-service beneficiaries were less likely to participate in CPC+, suggesting that the program may not have been reaching the populations that could benefit most from improved primary care delivery. Additionally, there was no evidence that CPC+ increased continuity or decreased fragmentation of care, which are key goals of primary care redesign efforts.

Perhaps most concerning from the perspective of primary care physicians, the CPC did not affect primary care physician experience in terms of burnout, control over work, job satisfaction, or likelihood of leaving current practice. This suggests that even multi-payer initiatives aimed at improving primary care may not be sufficient to address the underlying factors contributing to primary care physician burnout and dissatisfaction.

Despite these challenges, there were some positive findings from the CPC+ program. Medicare beneficiaries with more comprehensive primary care physicians reported better overall care, suggesting that investments in primary care can lead to improved patient experiences.The mixed results of the CPC+ program underscore the complexity of improving primary care in a fragmented healthcare system. While multipayer initiatives like CPC+ are a step in the right direction, they may not be sufficient to address the underlying structural and financial barriers to delivering high-quality, comprehensive primary care.

While complex initiatives like the Comprehensive Primary Care Plus program have shown mixed results in improving primary care delivery and outcomes, Rhode Island has taken a simpler, yet effective approach to strengthening its primary care system. Through a combination of increasing insurer investment in primary care offset by capping hospital price increases, Rhode Island has made significant strides in enhancing the quality and accessibility of primary care for its residents.

One of the key components of Rhode Island’s approach is the establishment of primary care expenditure targets for health insurers. Over a decade ago, Rhode Island became the first state in the nation to explicitly prioritize primary care spending within the health insurance sector. As part of the state’s Affordability Standards, insurers were required to invest more in primary care providers and services, with the goal of shifting the focus towards preventive care and effective management of chronic conditions. By setting clear targets for primary care spending, Rhode Island created a framework for ensuring that primary care remains a priority within the healthcare system.

In addition to setting expenditure targets, Rhode Island has also taken steps to increase insurer investment in primary care. The Office of the Health Insurance Commissioner (OHIC) has been instrumental in advocating for increased reimbursements for evaluation and management and other medical services when provided by primary care providers. This initiative aims to make primary care payment more competitive with other medical specialties and neighboring states, thereby supporting a robust care team of clinicians, medical assistants, and front office staff. The Affordability Standards have also encouraged the transformation of primary care practices into Patient-Centered Medical Homes (PCMHs), which are primary care practices designed to improve care coordination and outcomes for patients, especially those with chronic conditions, by emphasizing continuity of coordinated care efforts at a single practice with multiple staff members to help with care (such as nutritionists and pharmacists to help patients between doctor visits).

Recognizing the importance of a diverse healthcare workforce in meeting the needs of its population, Rhode Island has also invested in supporting workforce diversity and training. The Fund for a Healthy Rhode Island (FHRI) grants, managed by the Rhode Island Foundation, support projects focused on retaining a racially, culturally, ethnically, and linguistically diverse health workforce. These grants aim to improve primary care access, utilization, and quality by supporting place-based collaborations and addressing health determinants outside the clinical setting. Additionally, recent legislative proposals have sought to provide $2.7 million to primary care practices for enhanced interdisciplinary clinical training sites, further supporting the development of a skilled and diverse primary care workforce.

Rhode Island funded primary care expenditure by capping hospital price increases to rates even more generous than inflation. Rhode Island prevented the consolidation and mergers of hospitals from resulting in monopolies with unchecked pricing power. The savings generated from these price controls were then distributed to primary care, making it more attractive and sustainable through increased supply and funding for multidisciplinary teams.

The impact of Rhode Island’s primary care initiatives has been significant. My colleague Aaron Baum’s analysis found that after the implementation of the Affordability Standards, quarterly spending among adults in Rhode Island decreased by $76 per enrollee, or a decline of 8.1 percent from 2009 spending. Simultaneously, quarterly primary care coordination spending increased by $21 per enrollee. The study also found that total spending growth decreased, driven by lower prices concordant with the adoption of price controls, while quality measures improved. Notably, while a primary focus of Rhode Island’s initiatives was on the commercially insured population (the majority of the state population), the program also benefited Medicaid recipients. The Rhode Island model demonstrates that a simpler, targeted approach to improving primary care can be effective in enhancing the quality, accessibility, and affordability of healthcare. By setting clear priorities, such as primary care expenditure targets, and investing in key areas, such as workforce diversity and training, states can create a more robust and sustainable primary care system without the complexity and potential unintended consequences of hugely complex initiatives like CPC+.

The Rhode Island experience highlights the importance of addressing the underlying structural issues that contribute to the fragmentation and misalignment of incentives in the healthcare system. By imposing price controls on hospital contracts and redirecting the savings towards primary care, Rhode Island has taken steps to create amore balanced and equitable healthcare system that prioritizes prevention, care coordination, and population health.

As other states and policymakers seek to improve primary care delivery and outcomes, the Rhode Island model offers a compelling example of how a simpler, targeted approach can yield significant results. While the Rhode Island model has shown promising results, it alone may not be sufficient to truly transform primary care into the proactive, prevention-oriented system needed to maximally improve population health. A key missing piece is the transition from fee-for-service reimbursement, which incentivizes visits, to capitated payments that reward practices for keeping their patient populations healthy.

Under the current predominant fee-for-service model, practices lose revenue when they replace in-person physician visits with team-based care from nurses, health coaches, or remote monitoring. The costs of this non-visit-based care are not offset by new visit revenue, since practices are limited in how many additional patients they can see. This creates a major financial disincentive for practices to invest in the staff and infrastructure needed to provide proactive population health management.

In contrast, under capitated payments, practices receive a fixed amount per patient to cover the costs of their care. This frees them to innovate on how they deliver that care, without being constrained by only getting paid for in-person physician visits. Practices can use data and dashboards to identify patients at highest risk, and proactively reach out to them to prevent complications - even leveraging community health workers to engage patients outside the clinic walls. The focus shifts from just treating those patients who happen to schedule and show up for visits, to actively managing the health of the entire patient panel.

In a research study published in Health Affairs, my colleagues and I quantified the capitation levels needed to enable this transition to team- and non-visit based care. Using data from 969 primary care practices, they found that replacing a subset of in-person physician visits with team-based and remote care resulted in financial losses under fee-for-service. However, if more than 63% of practice revenue came from capitation, 95% of practices would come out ahead financially by making this shift. The gains were even larger if practices also received shared savings bonuses based on total cost of care (e.g., for keeping patients healthy enough to reduce emergency room visits and hospitalizations).

Of course, capitation alone is not a panacea. Practices need support to successfully take on the financial risk, with accurate risk adjustment, data/analytic tools, and resources to invest in new staffing models. There are also legitimate concerns about stinting on needed care. However, with thoughtful design and accountability for quality, capitation offers a powerful catalyst to reorient primary care around proactive population health management.

The Rhode Island model demonstrates that increasing primary care spending can improve quality and reduce overall healthcare costs. But achieving the full potential of primary care to maximally improve population health will likely require coupling those investments with a shift away from fee-for-service towards capitated payments. Only then will practices have the flexibility and incentives to creatively redesign their care models around the proactive, team-based, data-driven approaches needed to keep patients healthy and out of the hospital. While not a silver bullet, meaningful levels of capitation may be the key missing ingredient to truly transform primary care.

While the Rhode Island model has shown promising results, issues such as physician burnout, administrative burden, and the need for greater integration of behavioral health and social services into primary care delivery remain significant challenges that require ongoing attention and investment.

Recent advances in artificial intelligence, particularly large language models (LLMs), offer exciting potential to alleviate some of the most pressing threats to primary care. While many medical AI companies are focused on the complex challenge of diagnosing diseases, perhaps the greatest near-term impact could come from applying LLMs to the bureaucratic and administrative tasks that consume so much of clinicians’ time and mental energy.

Imagine an AI assistant that could automatically complete prior authorization forms based on the clinical documentation, saving hours of frustrating paperwork. Or a system that automatically generates clinical notes from a conversation directly in the EHR, capturing the key details while freeing the clinician to focus fully on the patient. LLMs could also assist with completing social service applications and referrals, helping to address patients’ social determinants of health more efficiently.

Even more powerfully, AI could enable proactive population health by integrating data across EHRs, pharmacy claims, and social service databases to predict and get ahead of potential issues. For example, the system might notice that a patient was prescribed an important medication on Thursday but their insurance denied the pharmacy claim on Friday due to a typo in their member ID. An alert could be automatically routed to a population health pharmacist to resolve the error, before the patient ends up in the emergency room over the weekend from lack of access to their medications.

Early results from health systems piloting ambient AI scribes, which listen to the visit and generate clinical notes, show promise in reducing documentation burden and improving patient interactions. In one study by Kaiser Permanente, the AI scribe was used in over 300,000 encounters across diverse specialties in just 10 weeks. Clinicians reported being able to listen and connect with patients better, while the AI-generated notes scored highly on quality measures. Statistical analyses also found links between AI scribe usage and reduced time spent in the EHR.

While not a silver bullet, AI assistants that automate administrative tasks could be a game changer in alleviating burnout and restoring the patient-clinician relationship as the heart of primary care. By giving time back to clinicians to do what they do best—connecting with patients, thinking critically, and delivering whole-person care—LLMs may prove to be the technological innovation that primary care has been waiting for. The path forward will require rigorous evaluation frameworks to ensure the quality, safety, and efficacy of these tools. But the potential upside is immense for revitalizing primary care and enabling it to deliver on the promise of accessible, equitable, relationship-based care for all.

Technology is not a panacea, but when leveraged properly in service of strengthening the primary care relationship, it could be an important part of the solution. Combined with payment models that adequately value and support primary care, a well-trained and empowered workforce, and integration with public health and social services, primary care in America could yet emerge from its current crisis into a new era of innovation and impact.

The challenges facing primary care in America are complex and multifaceted, with no easy solutions. The Rhode Island model of investing in primary care through payment reform and accountability for population health outcomes shows promise, but is not a cure-all. Deep-seated issues like physician burnout, administrative burden, care fragmentation, and the need to better integrate behavioral and social services remain major barriers to achieving the full potential of primary care.

Ultimately, the path forward will require a sustained, society-wide investment and commitment to revitalizing primary care as the foundation of an effective, equitable health system. The stakes could not be higher, as the strength of our primary care system has profound implications for the health of our population and the sustainability of our healthcare expenditures.

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Chapter 2: The Medicaid Landscape: Structure, Funding, and Eligibility

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