JOHN DWYER. “Health Care Homes”, set up to fail and doing so spectacularly.

Jun 6, 2018

Touted by Minister Hunt as the biggest health care reform initiative since the introduction of Medicare, the “Health Care Home” model for the better management of patients with two or more chronic diseases is floundering, beset with predictable organisational and resource inadequacies. As is so often (too often) the case with health policy initiatives, a laudable concept collapses at the implementation phase (e.g. Primary Health Networks). The boldness of the plan is not matched by the necessary resource boldness.  

The concept here is certainly “bold” for Australia. Doctors caring for patients with chronic diseases will receive a “block payment” (capitation fee) for their annual care rather than billing Medicare at each visit. The standard payment will pay for the doctor’s care but not that of the team of health professionals needed to manage all of the patients needs. GP practices can request Health Care Home status and eligible patients can volunteer to participate in the program. A review of their medical records by an officer of one of the ten Primary Health Networks (PHN) assigned to the scheme (cumbersome) will assign that patient to one of three severity “tiers”. Practices that sign up to the program get a one off $10,000 payment to cover the startup costs associated with the scheme.

In the ‘Patient enrolment factsheet’ published on the Department of Health’s website, we are told that statisticians have calculated that the average GP is likely to care for about 55 patients who would qualify for the scheme, that, on average, being 8 percent of their patient base.Which means the full cohort of patients for a GP is considered to be about 700 patients. Many GPs dispute that figure with a cohort of 1000 patients cared for being a more accurate figure.However using the department’s figures, of the 55 patients enrolled and cared for by a single GP, it is anticipated that about 5 would be tier 3 ( most in need), 25 will be tier 2, and 25 will be tier 1. The payment information factsheet specifies the yearly ‘payment value’ for each tier at:

Tier 3  $1,795 thus for   5 patients  $ 8,975
Tier 2  $1,267 thus for 25 patients  $ 31,675
Tier 1  $ 591    thus for 25 patients  $ 14,775

Writing in “Australian Doctor” in May, GP Dr Glenn Rosendahl calculated the adequacy of the capitation fee available.

“For those 55 patients a doctor would receive $ 55,475. On average, for each patient: $1,008.00. In comparison, if you total up the funding for a Health Care Plan with allied health referrals; a Mental Health Care Plan, their respective reviews; and 12 Item 23 consults, the fees generated for the year per patient is $1,298.20. Why take a cut in income? Particularly when implicit in the Medical Home concept is a clinical team. All the members will expect to be paid for the time they spend in the clinical team – over and above the payments they receive for the ‘one on one’ services they will still provide to individual patients, as they provide them at present through GP and Mental Health Care Plans.The GPs will be very lucky to make 50% of the capitation payment”.

By now the government anticipated that 65,000 patients would be enrolled in more than 200 practices. In reality there are fewer than 2000 patients enrolled and many practices that initially expressed interest have withdrawn from the scheme. Speaking at last months meeting of the AMA Minister Hunt described the initiative as an “interim step”. Health department officials fronting Senate estimates in Canberra last week confirmed the number and admitted that uptake was “slower than expected”.The department did not realise how much support GP clinics would need to move from traditional fee-for-service to the new model of capitation payments for managing patients with multiple chronic diseases, they said!The reform also came under attack from senators during the hearing when they were told the department was not tracking clinical outcomes as part of its evaluation.

Officials said the evaluation was about “understanding the patients’ journey”.

The predictable and fatal flaws in the scheme are all too obvious. Moving away from fee-for-service payments to capitated fees is an essential reform but one that will never be accepted if GPs are financially disadvantaged in the transformation. Providing integrated teams to care for patients with complex needs is crucial.But that additional care by other than doctors needs to be adequately funded and the care needs to be “in-house” not somewhere “out there” organised by a Primary Care Network (PHN) geographically remote for the local scene. There are but 31 PHNs for the whole of Australia. There is only one in Tasmania and to think that a PHN based in Hobart can arrange for a patient to see a physiotherapist on Thursday in Launceston is ridiculous. In a recent survey 71% of GPs asked said that they had never interacted with a PHN! I won’t discuss the complexities of the documentation and evaluation required of participating practices but report that they are a major impediment to participation in the scheme.

The described initiative is a million miles away from the “Medical Home” model I and others have described herein ( Dwyer P&I April 5, 2016). In fact I am concerned that the Health Care home initiative will sully the enthusiasm that is appropriate for the far better “Medical Home” model summarised below. Inherent in this initiative is the imperative that we better use the clinical skills (as opposed to the clerical skills) of our GPs.

GP Glenn Rosendahl, referred to above, provided in his comments on the Health Care home initiative, an important critique of concern to all looking at ways to improve Primary Care in Australia. He noted as have many GPs I have talked to:

The primary focus of the clinical reform of general practice should be the re-skilling of general practice. Re-establishing the skill set, the work and the resourcing of general practice. Only by advancing the skill base of general practice – re-identifying the necessary and appropriate skills of generalist medicine, re-establishing the ability and motivation to acquire those skills in general practice, by providing the resource of time and funding that enables their acquisition and continuing use – will there be a reversal of the de-skilling that has been the lot of general practice for the last three decades. There is now a practical lack of clinical expertise – tasks that should be undertaken are not being done, relevant skills are not used, and are being – indeed have been – forgotten. Because the resource of time and funding necessary to do these things well is no longer provided”. His comment represents a generalisation of the problem and there are many exceptions but looking at the big picture, the comment is accurate. However we do need major structural reforms to Primary Care that facilitate the use of the full range of GP’s clinical skills.

I replied:

I agree with Dr Rosendahl’s description of the unattractiveness of the Health Care Home business model and his lament re the underutilisation of our General Practitioner’s clinical skills. In so doing patients are disadvantaged as this current reality is a major cause of health care fragmentation, but so are our doctors when their anticipated role in “hands on” clinical care is so diminished. However the Health Care Home initiative as a model for improved health care delivery is fatally flawed. It focuses on better care for patients with chronic co-morbidities but fails to provide the caring doctor with the resources needed to do just that.

In any case it is clear in our sickness focused health system that not one dollar more should be spent on caring for established disease without spending more on prevention. A lack of emphasis on prevention is the “Achille’s heel” our system. The level of Health literacy in Australia is at the bottom of the OECD table for this indicator. Frustratingly, the Health Care Home model is a million miles away from the “Medical Home” model now being pursued by 11 OECD countries. That model, now strongly supported by an evidence base for effectiveness, features the enrolment of patients in a “Home” wherein they have available to them doctor led teams of health professionals. Some are devoted to improving health literacy and tackling healthy lifestyle issues, others, with an emphasis on continuity of care, focus on early detection and management of developments that could lead to the woes and costs of Chronic and Complex disease, while others focus on those with established problems, extending care into the community, a strategy shown to markedly reduce hospital admissions. The lack of the latter sees many of our hospital trying to extend their care into the community, a second rate solution.

Medicare must fund “team medicine”. Already universities have established inter-professional learning modules to prepare graduates for”team medicine”. Many nursing schools. anticipating this development, are training nurses for a major role in improving integrated care. However many complain that there are no jobs available where they could use these skills! Doctors thrive professionally in team based care models ( the norm in good hospital care), wherein professional skills are used appropriately.

We currently spend about 7 billion dollars a year paying for our GP’s services. We could introduce team medicine by doubling that amount. If in phasing in this new system we phased out government support for private health insurance the evolution could be cost neutral. But even though the changes described are of proven value where oh where are we to find the political leadership to facilitate real structural reforms so obviously needed to improve the health of Australians while simultaneously tackling inequity and cost ineffectiveness? As advocates for our patients and our profession we doctors must not accept the status quo but rather maintain pressure on our politicians to provide the informed policy boldness that provides real progress.

Professor John Dwyer, Emeritus Professor of Medicine at UNSW, has long been an advocate for major structural reforms of our health system. He founded the Australian Health Care Reform Alliance.

Share and Enjoy !

Subscribe to John Menadue's Newsletter
Subscribe to John Menadue's Newsletter


Thank you for subscribing!