Paul Grundy, M.D., president of the Patient-Centered Primary Care Collaborative and IBM's global director of health care transformation, examines progress and challenges remaining on the patient-centered medical home model. He's optimistic both political parties will support this effort to lower prices and boost quality.

Interviewed by Bob Kehoe

Where are we in the evolution of the patient-centered primary care delivery model?

GRUNDY: It has gained a lot of traction and I'm very optimistic. The patient-centered medical home moves delivery away from an episode of care and toward managing a population, with the medical home or primary care practice being the system integrator. The federal government as a health care buyer is moving in this direction. The Office of Personnel Management is moving in this direction. WellPoint and UnitedHealth Group are moving in this direction. It's become the standard of care in the Department of Defense and the Department of Veterans Affairs.

H&HN Web Exclusive

How quickly can hospitals and doctors embrace the ongoing shift from episodic care to population health management? Paul Grundy, Global Director of Health Care Transformation for IBM and an early proponent of medical homes, explores the pace of change in health care in a conversation with H&HN Contributing Editor Bob Kehoe. Running Time: 4:37.

How is this affecting provider-purchaser relationships?

GRUNDY: The great thing is that primary care doctors gave us the principles upon which this foundation is built. They wanted to change the covenant around the care we buy as much as we did. It's turning out to be a win-win and there's broad consensus for this.

It's not easy to make the transformation. It's tough to do the three things that we need done at once, i.e., put skin in the game for patients by transforming how benefits are designed, transform how physicians work toward managing a population and paying for outcomes. The other thing we see is that specialists love this model. In North Dakota, for example, specialists talk about how the patients they see are much more likely to need the procedures they offer and that their care is managed more efficiently and effectively.

What still needs to change in the care delivery model?

GRUNDY: The most difficult thing that we're asking folks to do is make a cultural transformation — thinking of themselves in the way that every other business except health care does in terms of continuous improvement in efficiency, Six Sigma and Lean. It's also difficult to move from a master builder model of care, where the information is in the doctor's head, to having a plan, a team and care coordinated. That's a huge transition. Organizations will wake up one day and realize that they will never be a medical home; they will always be driving toward how to improve what they're doing today to be better tomorrow. This just isn't in the DNA of medicine.

How are companies like IBM responding to patient-centered care delivery?

GRUNDY: Large corporations in this country are the buyers of care principally for the 65 and younger population. We play a unique role. And, frankly, most of us have been fed up with the value proposition of the care that we buy. We get it when we see a sign on the freeway that says: "We do the best heart surgery." That sign says to us, "That's where the money is and we're going after it." We don't want to buy that anymore.

There are places in this country right now that already have one-third less necessity to do heart surgery because someone has the discipline to manage a population, to do blood pressure monitoring, aspirin therapy and cholesterol control. It's just not in the interest of the hospital given the current value proposition of how we pay them.

How are physicians responding to the population management approach?

GRUNDY: We have early adopters and systems that are definitely embracing it. I was talking with one of the Pioneer ACO facilities in Appleton, Wis., and the CEO said, "We really want to start being part of the solution and not part of the problem."

Those providers who see themselves as wanting to be part of the solution are on board with this. They're embracing it, driving it and are excited about it. Those that are happy with being part of the problem — i.e., doing as many high-end procedures as they possibly can and doing as little primary care as they can get away with because that's where they make their money — are conflicted.

They're going to have to come to grips with that. Every system is going to have to ask: Do I want to be part of the solution or do I want to continue to be part of the problem?

How will cost and quality change in this new model?

GRUNDY: We're seeing significant improvements in some of the early pilot programs. A report from Geisinger Health System in the The American Journal of Managed Care in April shows a significant decrease in cost. In some of the early pilots by WellPoint and BlueCross BlueShield of South Carolina, for example, we see a 9.6 percent decrease in costs. We see a decrease in the neighborhood of 32 percent in number of deaths. In CareMore, one of the BlueCross BlueShield–WellPoint practices in California, we've seen a 60 percent reduction in the complication rates of diabetics. That's 60 percent fewer amputations, 60 percent fewer people going blind.

What will it take to deliver a more coordinated approach to care?

GRUNDY: Let's start at the absolute simplest element — a spreadsheet of data about a population that you need to help. My cat, for instance, has a registry. My cat gets notified when it needs immunizations. It gets notified when it needs preventive procedures. But until recently, most people haven't experienced that in health care because that is not what's reimbursed.

The simplest element would be a registry by which a doctor could gather information about who they see and how they follow up. The next element would be patient engagement. About 60 percent of my employees who saw their doctor when we did this test with Care Partners using a solution kiosk didn't understand what the doctor told them. We need to understand how much of the information we provide is understood and what requires follow-up.

The next step is to understand how to engage a patient differently, measuring that and paying for that. The next step would be coordinated care — seeing your doctor and having a care coordinator follow you with a plan to make sure you're complying. A diabetic doesn't need an episode of care. A diabetic needs a manager, a plan, coordinated care and a reminder to take meds and exercise. We need to engage patients in a very different way.