Advancing the Development of a Framework to Capture Non–Fee-For-Service Health Care Spending for Primary Care

Primary Care Transformation Primary Care Investment

As the country struggles with its response to COVID-19, the health and future of primary care is a growing concern. In its research and convening, the Milbank Memorial Fund has encouraged the use of primary care spending measures to monitor the “primary care orientation” of states, payers, and health systems, compare payer performance, and establish accountability.

Many payers investing in primary care innovation are using alternative payment models (APMs), such as capitation payments, which are not captured through health provider claims. Previous research showed that payers did not routinely collect or analyze these data. To fill this gap, the Milbank Memorial Fund and the California Health Care Foundation commissioned RAND to review how leading states and payers are collecting APM data on primary care and make recommendations to standardize the information gathering and reporting process.

The RAND report, Advancing the Development of a Framework to Capture Non–Fee-For-Service Health Care Spending for Primary Care, identifies four key policy decisions that need to be addressed in order to standardize reporting:

  • Is there a standard way to define the APM categories or do states want to create their own?
  • How do we identify primary care as a specific component of APMs?
  • Should this information focus on state residents or insurer contracts (which may cross state lines)?
  • How much detail is needed at the payer level? Is it sufficient to have aggregated information for all of the payer APM contracts or is more detail about specific payment arrangements needed?

“Primary care is among the highest value care in our delivery system, and it’s crucial that policymakers understand how much we’re spending on it,” says Kristof Stremikis, director of market analysis and insight at the California Health Care Foundation, which also supported the research. “This paper helps ensure we’re all measuring primary care spending in the same way.”

Additional work will be needed to finalize the standards. “We hope these recommendations will spur further national policy discussion and help guide how states and payers operationalize information about these non–fee-for-service payments,” says Rachel Block, program officer at the Milbank Memorial Fund. “The Fund will continue to encourage this work at the state level, and we will also promote further refinement of specifications and standardized reporting on the various types of APMs.”

Read the report