Advanced Primary Care: the better way to deliver healthcare and the focal point of Aligned Marketplace

Aligned Marketplace Founding Team
October 27, 2023
Regardless of who or where the patient is, or how it’s delivered, Advanced Primary Care (APC) has proven to produce better outcomes for patients while driving down the total cost of care. By offering a broader range of services under a value-based care1 payment model, APC groups give patients better access, experience and outcomes. 

Commercial healthcare costs are out of control

It’s fair to say that the current trajectory of commercial healthcare costs is unsustainable. 

The average employer-sponsored health insurance premium in 2023 is $8,435 for individuals and $23,968 for families—both representing a 7% increase from 20224—of which employees and their families are responsible for $1,401 and $6,575, respectively. These increases outpace both wage growth and inflation, which puts financial strain on families while increasing employer costs.

The Medicare exception

In contrast, Medicare has seen its costs stay surprisingly flat since the passage of the Affordable Care Act in 2010. This is one of the greatest, least-shared success stories in modern American healthcare: not only is annual spending per Medicare beneficiary essentially unchanged since 2010, it’s about $10,000 lower than the spending trajectory of the previous 40 years would’ve predicted. The difference amounts to a $3.9 trillion gap, making it the best news the US federal budget has gotten in over a decade.6

There are several potential reasons for this. The most likely is Medicare’s early embrace of value-based payments, driven by ACA-implemented programs like the Medicare Shared Savings Program, which saved more than $1.8 billion for traditional Medicare beneficiaries in 2022 alone8. The Centers for Medicare and Medicaid Innovation also implemented programs targeting hospital readmission rates, improving outcomes and reducing waste in the healthcare system7.

Primary care makes all the difference

The biggest contributor to cost containment for Medicare, though, appears to be that patients simply don’t need as much treatment19. Older recipients are having fewer heart attacks, strokes, and other major health problems, largely because of better preventative medicine: keeping cholesterol and blood pressure in check, catching problems early, getting on preventative medication, and so on.

That kind of prevention falls almost entirely under the purview of primary care, and this is another area where Medicare has made big investments. Several programs from the Centers for Medicare & Medicaid Services (CMS) have focused specifically on improving the quality, scope and availability of primary care since 2010, culminating in the Primary Care First and newly announced ACO Primary Care Flex models. With nearly 15 years of results, it’s become clear that there’s a strong link between primary care investment at Medicare and Medicaid, and better outcomes for both patients and the bottom line 21.

Primary care, then, turns out to be one of the most effective strategies for keeping rising costs in check, and this is true across populations. When patients see their PCPs, total cost of care goes down: in one Veterans Health Administration study5, a single visit with a primary care provider correlated with an average $3,976 decrease in total costs per patient.

The impact is even greater when providers are independent. Among commercially- insured patients, those who saw PCPs employed by a health system generated more than 6% greater costs than those who saw independent PCPs.

Forward-thinking large employers are leading the way.

Large employers have taken notice of the “Medicare exception”, and some of the most forward-thinking have taken recent steps to emulate that success.

The first place they’ve focused, not surprisingly, is primary care. Many employer-purchased health plans have made great strides to improve the primary care experience of their employees, notably through Direct Primary Care (DPC) and telehealth urgent care solutions (especially since COVID).

The second is an embrace of value-based models, which incentivize PCPs to focus on holistic patient outcomes over billing codes. This compensation approach—also known as “quality-focused care” or “patient-first care”—consistently results in better access, patient experience and outcomes, at a lower total cost of care than traditional fee-for-service models2. Here are four examples:

  • “99% of employees reporting being ‘satisfied’ or ‘very satisfied’” – CHG Healthcare and Marathon Health
  • “Employees with diabetes, for example, saw a 24% reduction on average in HbA1c levels.” and “patients saw an 11% reduction in total cost of care” – Walmart and Included Health 13
  • “Preliminary data over a nine-month period indicates that per-member-per-month spending for participants has decreased by 14%, ER utilization has decreased by 11%” – Boeing
  • “Employers save an average of 25% on their employees’ total cost of care” – Milliman and Premise Health 20

When you combine these two approaches—more comprehensive primary care, implemented under a value-based model—you get Advanced Primary Care, or APC. It incorporates many of the advantages of DPC and telehealth, but goes beyond them in some important ways.

Different approaches, same goal

You may already be familiar with some examples of APC:

  • Employer-focused, historically brick-and-mortar clinics such as Marathon or Everside
  • Value-based care (or “VBC”) enablers such as Aledade or Wellvana
  • Retail-like clinics such as Carbon Health or One Medical
  • Virtual-only or virtual-first groups, such as Galileo and Included Health
  • Medicare or Medicaid-focused groups, such as Oak Street Health and Cityblock

Each of these is providing Advanced Primary Care, but approaching it slightly differently, and that’s good for both patients and purchasers. Everyone has different financial, logistical and health needs, so having more than one solution helps people find the one that fits theirs. 

Value-Based Care Enablers like Aledade or Wellvana often partner with independent physicians who have long-standing community ties, allowing them to deliver comprehensive care at scale faster and more efficiently. Employer-focused groups, on the other hand, have the advantage of being purpose-built to provide the white-glove service that employees expect from an on-site or near-site clinic.

These solutions are learning and borrowing from each other as well, with many APC groups expanding their virtual offerings to accommodate more distributed workforces, and many enriching their offering with mental health and physical therapy services. 

Advanced Primary Care is also a remedy for provider burnout

It’s no secret that the last few years have been hard on the healthcare workforce, especially primary care physicians (PCPs), and especially since the COVID-19 pandemic. PCPs have experienced record levels of reported burnout14, prompting many independent physicians to sell their practices15

Add to this an expected physician shortage in the US16 and fewer residents deciding to go into primary care17, and you have the makings of a genuine primary care crisis. And this means a fundamental health crisis: reduced primary care engagement is associated not only with increased costs and worse outcomes, but with an increase in mortality18.

APC addresses burnout head-on, in several ways. APC providers tend to get paid better than in traditional models, for one thing. They also get to spend more time with their patients: an average of 20-30 minutes, versus the seven to 12 minutes that’s become industry standard. Since pay and time constraints are two of the most common complaints among PCPs, these differences alone can go a long way toward quenching the burnout.

There’s also the issue of meaning, and APC has much to contribute here as well. Primary care physicians are often motivated by a desire to help and connect with their patients, even if it means making less than they would in another specialty. An APC clinic is generally better resourced than a traditional one, able to build care teams—including care managers and navigators—that can manage a broad range of patient needs. Being able to actually solve more of their patient’s problems directly, while spending more time with them, means that APCs are more likely to feel fulfilled in their work—and less likely to leave clinical practice.

Advanced Primary Care for the American workforce

So hopefully by now you’ve come around to the idea, at least a little, that Advanced Primary Care is an important part of the solution for American healthcare today. But that raises a question: if APC works so well, why isn’t it more prevalent? 

Part of it is logistics. Since many APC providers are small and regional—sometimes just a single clinic—it’s hard for large employers with distributed workforces to engage with them, unless they contract directly with dozens of different providers. Effective APC also depends on sophisticated actuarial models to measure contract performance, to help match patients with the right providers, and to support those providers with the data they need to offer better care. Until recently, those models have been hard to come by for all but a handful of large players (including Medicare).

But perhaps a bigger reason is a lack of incentive. The current fee-for-service model is deeply entrenched in many healthcare systems, hospitals, and care networks, and organizations often have an interest in keeping it as is. That means that shifting to more comprehensive care will need to come from the outside…and that’s exactly what’s happened, as large employers like Walmart and Boeing have assembled their own APC solutions.

Our perspective is that it’s time for these solutions to become available to all self-insured employers across the US, and the 100 million employees and dependents they insure. It’s only in the last few years that APC providers have become common enough, data accessible enough, and actuarial models effective enough that a true nationwide solution is possible.

All that’s needed now is motivation. And that’s something we’ve got plenty of at Aligned Marketplace.

  1. The Commonwealth Fund. (2023). Value-Based Care: What It Is, and Why It’s Needed.
  1. United States of Care. (2023). Our Messaging Findings on Patient-First Care (a.k.a. Value-Based Care).  
  1. Wall Street Journal. (2023). These Startups Are a Bright Spot in Sluggish Healthtech Financing Market.  
  1. Kaiser Family Foundation (2023). 2023 Employer Health Benefits Survey.  
  1. Journal of Primary Care & Community Health. (2022). The Effect of Primary Care Visits on Total Patient Care Cost: Evidence  From the Veterans Health  Administration.  
  1. The New York Times. (2023). A Huge Threat to the U.S. Budget Has Receded. And No One Is Sure Why.  
  1. The New York Times. (2023). Does Obamacare Explain Medicare’s Spending Slowdown?  
  1. Newsroom. (2023). Medicare Shared Savings Program Saves Medicare More Than $1.8 Billion in 2022 and Continues to Deliver High-quality Care.  
  1. Kaiser Family Foundation. (2023). Medicare Advantage in 2023: Enrollment Update and Key Trends.  
  1. JAMA Health Forum. (2023). Medicaid Value-Based Payments and Health Care Use for Patients With Mental Illness.  
  1. Jama Network Open. (2020). Utilization and Cost of an Employer-Sponsored Comprehensive Primary Care Delivery Model.  
  1. Aledade. (2023). Value-Based Primary Care Network from Florida Blue and Aledade Shows Significant Health Care Quality Improvements.  
  1. Included Health. (2023). Included Health Unveils New Virtual Primary Care Results Alongside Walmart.  
  1. The Commonwealth Fund. (2023. Responding to Burnout and Moral Injury Among Clinicians.  
  1. Primary Care Collaborative. (2022). Report: Supermajority of U.S. physicians are employed by health systems or corporate entities.  
  1. American Medical Association. (2022). Doctor shortages are here—and they’ll get worse if we don’t act fast  
  1. JAMA Internal Medicine. (2023). Career Plans of Internal Medicine Residents From 2019 to 2021.  
  1. JAMA Internal Medicine. (2019). Association of Primary Care Physician Supply With Population Mortality in the United States, 2005-2015.
  2. Health Affairs. (2019). Explaining The Slowdown In Medical Spending Growth Among The Elderly, 1999–2012.
  3. Milliman. (2023). Premise Health: Independent review of ROI methodology.
  4. JAMA. (2016). Medicare’s Vision for Advanced Primary Care New Directions for Care Delivery and Payment.

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