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Fixing the broken economics of primary care


Even before the onset of the COVID-19 pandemic, healthcare costs were rising and many independent physicians were facing financial challenges. Fixing the broken economics of primary care will require more investment in these practices, including increased reimbursements, as well as an increased focus on the importance of the independent primary care provider in the healthcare system, according to experts.

Primary care visits are reimbursed at a lower rate than specialist visits so primary care providers must schedule a greater number of shorter visits to recoup their basic costs. The result is a heavier administrative burden and, more importantly, less time to spend with each patient. This combination is detrimental to the overall health of the providers, often resulting in burnout.

In speaking with the Medical Economics Journal, Emily Godfrey, MD, MPH, a family physician and OB-GYN specialist in Seattle, expressed that one of the ways to fix the broken economics of primary care is a greater investment. Additional funds would enable providers to hire more staff and that, in turn, would allow the physician to spend more quality time with patients. As a result, patient outcomes would likely improve as well.

When the physician is restricted in the amount of time spent with the patient, because of a need to see more patients, it can be difficult if not impossible to address all the concerns of that patient. Dr. Godfrey describes the differences in the time a specialist is able to see a patient as compared to a primary care physician, saying, “Because 15 minutes of our time is worth less than 15 minutes of a specialist’s time, we have to see more patients to earn the same amount of revenue as a specialty clinic.”

In fact, financial assistance may be on the horizon. The Centers for Medicare & Medicaid Services (CMS) announced in November 2021 that the 2022 Medicare Physician Fee Schedule will include an update to clinical labor pricing rates for the first time in twenty years. The additional funds for nurses and medical assistants will help ease the financial strain on the practice and result in improved patient care overall.

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Asaf Bitton, M.D., M.P.H., executive director of Ariadne Labs, a collaborative health systems innovation center at Brigham and Women’s Hospital and the Harvard T.H. Chan School of Public Health in Boston, says that the root cause of the broken economics of primary care is a “misalignment of payment” between the fee-for-service based funding and the provider’s ability to offer proactive, population-based care in their communities.

The National Academies of Sciences, Engineering, and Medicine committee, of which Bitton is a member, published a study in May 2021 that outlined the recent history of primary care as well as suggestions for ways to bolster it. One of the most significant recommendations is to pay primary care providers for the services they provide in a manner that is on par with specialists.

The committee notes that primary care accounts for 35% of healthcare visits but only receives 5% of the expenditures. Healthcare spending in the US is expected to grow at an average annual rate of 5.4% from 2019 to 2028, reaching $6.2 trillion by 2028.

There is also a push to encourage more medical school students to pursue primary care rather than specialty care. The AAFP, for example, has called for additional federal spending on federal programs that target primary care, such as the National Health Service Corps. Launched in 1972, the program offers scholarships and loan repayment for providers who work in underserved areas.

Dr. Bitton explains that most analysts as well as physicians recognize that regular investments in primary care produce more equity and lower mortality. Fixing the broken economics of primary care will involve physicians as part of the solution set, beginning with the articulation of their specific needs to policy makers and third-party payers.