Primary care accounts for a small percentage of total expenditures in Medicare, despite efforts to get patients to use more preventive services, according to a new RAND study published in JAMA Internal Medicine.
Primary care spending represents only between 2.12% and 4.88% of total medical and prescription spending for Medicare Parts A, B and D, depending on whether a narrow or broad definition of primary care is used.
Primary care spending percentages were lower for mover vulnerable beneficiaries, including those who are older, black, native American, dual eligible and have chronic medical conditions. The percentages also varied by state.
Health systems that emphasize primary care see stronger quality outcomes along with lowered costs, so Medicare's lack of spending in this area is cause for concern.
A dearth of primary care physicians (PCPs) starts a chain reaction leading to lessened care access, more emergency department visits and more spend for payers and providers overall. A recent Premier analysis found that primary care has a bottom line impact for hospitals. More PCPs could help patients better control chronic conditions, resulting in fewer ED visits (and billions in savings for cash-strapped hospitals).
The issue isn't solely limited to Medicare, however. The RAND study follows a Health Care Cost Institute report that found fewer people with employer-sponsored health insurance are visiting PCPs — an 18% decrease between 2012 and 2016.
On the plus side, HCCI found more patients are receiving care from nurse practitioners and physician assistants. Those healthcare professionals are expected to play significant roles in alleviating predicted primary care shortages. The Association of American Medical Colleges expects a primary care shortfall of between 14,800 and 49,000 by 2030.
That problem has already started to show. A UnitedHealth Group report found that 13% of Americans live in an area with a primary care shortage.
In the new JAMA Internal Medicine study, which received support from nonprofit Milbank Memorial Fund and government evidence group Agency for Healthcare Research & Quality, RAND looked at the medical care for 16 million fee-for-service Medicare beneficiaries in 2015.
Rachel Reid, the study's lead author and associate physician policy researcher at RAND, said there isn't a "consensus about the optimal share of medical spending" for primary care, and suggested current spending estimates could act as a reference point to guide policy debates about primary care investment.
Recent research has shown that use of PCPs leads to better mortality outcomes and the lack of those doctors can hurt population health programs. Though the number of PCPs increased between 2005 and 2015, doctors weren't always practicing in areas that most needed them.
Rural areas, for instance, had larger losses per population than other regions. Some states have taken steps to address the shortfall. Rhode Island and Oregon recently instituted minimum primary care spending percentages for insurance plans.
RAND found primary care spend varied by state. Under the narrow provider and service definitions, spend oscillated from just 1.59% in North Dakota to 3.18% in Hawaii. In the larger definition, spend spanned from 2.92% in the District of Columbia to 4.74% in Iowa.
RAND researchers analyzed outpatient care, hospital services and prescriptions. They defined primary care as providers in family practice, internal medicine, pediatrics or general practice. A more narrow definition of primary care was limited to doctors, while a less stringent definition roped in nurse practicioners and physician assistants.