Has community-oriented primary care's time come?

Proponents say new public system could lower costs

Community-oriented primary care (COPC) is a new public health care delivery concept that could provide better medical care -- particularly to underserved populations -- while drastically lowering costs, according to a number of Los Angeles-area health care attorneys.

The COPC concept, which has been tried in several cities and is under study in many others, involves decentralizing public health care delivery into the smallest practical localities, such as neighborhoods. Primary care physicians at those neighborhood care facilities would then act as gatekeepers. They would screen, diagnose and refer patients to hospitals, labs and specialists, as needed.

Under COPC, the neighborhood public health care facility can coordinate ambulatory and hospital services from other nearby care facilities, as well as mental health services, substance abuse treatment, case management and public health nursing services.

"Community-based care allows you to identify health problems before they start, and includes such things as immunizations and pre-natal care," said Tom McCarthy, vice president and health care chief at the L.A. office of National Economic Research Associates, an international economic consulting firm.

McCarthy said he believes COPC's applicability to Los Angeles would depend on funding. "Our county hospital system is under great strain already," he said. "If you deal with problems early and locally, you may be able to avoid more-expensive treatments in the future and free-up crowded emergency rooms -- while improving the health status of the population."

Who's the gatekeeper?

COPCs are part of a massive movement in public health care to get the primary care services organized in a gatekeeper function. Many health care delivery systems -- public and private -- are changing to the HMO model, where patients are seen by a primary care provider before they are allowed to be treated by specialists, hospitals or mental health facilities.

"You like to have a lot of these centers, geographically dispersed, because you use them as entry points to your health care system," explained Steve Valentine, executive vice president of The Camden Group in Torrance, a firm which manages physician practices and provides health care consulting.

Valentine said he believes COPCs are effectively used by many states and counties, through federally qualified rural health clinics, which have been established to cope with physician shortages.

In urban areas, COPC public health clinics tend to be set up where there are high concentrations of indigents and/or Medicaid patients. Ventura County's health department is setting up some clinics. And community-based primary care is being studied by health officials in Orange County, San Diego and San Francisco.

L.A. County has been "focused on trying to replace County/USC Hospital and may not have given a lot of thought to COPCs," Valentine said. "From the county's perspective, it makes an awful lot of sense, because it creates incentives to keep people healthy before they become expensive admissions."

Physician groups as gatekeepers

Not all community primary care networks are set up to serve Medi-Cal patients. In fact, some of them are not even in the public sector at all. Some are groups of private-sector primary care physicians who sell their services to specialty group practices and/or hospitals as gatekeepers.

This enables specialists and hospitals that lack a base of primary care physicians to contract with the large payor groups. For example, Cedars-Sinai Medical Center has acquired a primary care group called the Beverly Hills Medical Group so that it can get better contracts with payors.

"These primary care networks can sell (their services) at a higher rate than they could in the past or than they can independently because they have more clout as a group," observed Ronald D. Spoltore, partner and national director for health care services in the L.A. office of national consulting and accounting firm Kenneth Leventhal & Co. This increased clout is making primary care groups more attractive acquisition targets for insurance plans, multi-service group practices and hospitals, such as Cedars-Sinai.

Los Angeles is too large an area to allow an entity to enroll the majority of physicians in community-based solutions, he said. "The only way it will work here is if hospitals collaborate and bring primary care physicians together," Spoltore explained.

"However, the hospitals compete furiously in L.A., so the infighting taking place for hospital survival is preventing a lot of this community-based networking from beginning. We're still at the phase of figuring out who will survive; the survivors can link up later."

Divvying up the market

One way Los Angeles care providers can try community solutions is by geographically segmenting the market. UniHealth America, a non-profit hospital chain based in the San Fernando Valley, for example, is looking to try instituting community solutions in areas where it has concentrations of hospitals and physician groups.

While interest in community-oriented programs is growing, such programs in the public sector may have difficulty luring primary care physicians because of ferocious competition from large private-sector managed health care networks.

"As the primary care physicians get drawn into these systems, we'll see control of the entire primary care sector settling into relatively few hands," predicted Robert Rosenfield, a partner in the Century City office of national law firm McDermott, Will & Emery.

He warned that tying most primary care physicians into large health networks as gatekeepers for managed care could be a benefit or a detriment to health care. "They may provide wonderful service at a good price, or they could end up responding to pressure to see more patients per hour than they can effectively (treat)," Rosenfield said.

According to an American Association of Medical Colleges report, only 14 percent of 1993 medical school graduates chose primary care. "Primary care doctors have the worst working conditions, the least challenging work, and they are paid the least; otherwise, it's hard to know why the field is so unpopular," Rosenfield quipped.

Demand grows

Today, however, primary care doctors are suddenly in demand by hospitals, specialist medical groups and insurance companies.

Hartford, Conn.-based insurer Aetna Life & Casualty has budgeted more than $5 billion to acquire primary care practices. Medical groups such as Long Beach-based Mullikin Medical Centers are becoming enormous through mergers and acquisitions.

Brigham and Women's Hospital in Boston announced in October that it plans to spend $180 million to acquire primary care practices. And Wall Street has identified the primary care physician sector as one of the most lucrative unconsolidated chunks remaining in health care.

"No other industry this size has undergone such a huge transformation, and the speed with which this is happening is breathtaking," Rosenfield said. In his view, the fierce competition for primary care physicians could destroy a large number of academic medical centers which have produced some crucially important research, technology, research and drugs.

"This (transformation of health care delivery) is going on without much debate," he concluded. "Congress and the IRS are concerned with issues that seem to be yesterday's news. Everyone has been so focused on health care reform that they have paid no attention to how health care is organized and delivered."

As a result, the promising new community-oriented primary care systems may be hard-pressed to lure enough physicians away from the new gigantic health mega-networks to function successfully in the communities where they are most greatly needed.