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Medical Home Model: Reducing Cost, Increasing Care, and Improving Outcomes for Uninsured, Chronically Ill Patients.

Uninsured, chronically ill patients often utilize emergency departments (EDs) as their source for primary care. Frequently caught in a continuous cycle of repeated hospital admissions, they are high users of healthcare dollars. Low quality of life plagues them as they have difficulty with employment due to chronic illnesses. These chronically ill, uninsured patients access the ED in lieu of ongoing primary care services, as many are aware a medical screening exam, and subsequent care, must be provided to them under the Emergency Medical Treatment and Labor Act (EMTLA) regulations (Centers for Medicare & Medicaid Services [CMS], 2002). Often, these patients have gone without medications due to economic reasons and are admitted to the hospital with an exacerbation of their disease process. Readmission to the hospital, as well as an increase in healthcare costs, can follow. Cost of these services many times are written off, either as bad debt or as charity care, increasing costs to the system.


The number of uninsured Americans in 2013 was reported at 42 million. Uninsured users between the ages of 19 and 34 compose the largest population group, tapering down to age 64, followed by a significant drop at age 65 (Smith & Medalia, 2014). Studies reported below confirm many uninsured individuals suffer from chronic illnesses, and those numbers are trending upward. In historical data, Davidoff and Kenney (2005) reported more than one chronic illness for almost half (45%) of nonelderly, uninsured American adults. In 2008, there were an estimated 11.4 million Americans between the ages of 19 and 65 with chronic illnesses who were uninsured (Wilper et al., 2008). By 2011 the number of working-age adults who reported a chronic health issue and no health insurance at some point during the year rose to approximately 19 million (Gulley, Rasch, & Chan, 2011). Nationally, the average uninsured rate is 13.4% (Smith & Medalia, 2014).

Prior Research

The burden of overcrowding in EDs, coupled with cost to facilities of unnecessary admissions and readmissions, is an issue with a large impact for healthcare (Black, 2014). Much effort has been focused on the reduction of this impact with implementation of new models of care for the chronically ill, high healthcare utilizing population.

Readmissions within 30 days of discharge have become expensive for healthcare organizations with CMS applying penalties under the Hospital Readmissions Reduction Program (Gu et al., 2014). Utilizing a medical home approach has surfaced as a possible solution to reducing high use of the ED and subsequent admissions and readmissions. Gilfillan and colleagues (2010) reported reduced hospital readmissions of 38% using the intervention of a medical home.

The medical home concept dates back to 1967 with roots in the pediatric realm. At first the term referred to a single service but the concept has grown. Services provided are much more than simply a provider visit. According to Janamian, Jackson, Glasson, and Nicholson (2014), services include "access to a personal physician; physician directed medical practice, whole person orientation; care coordination and/or integration; quality and safety benchmarking through evidence-based medicine and clinical decision support tools; enhanced care availability after hours and via e-health; and practice payment reform" (p. 569).

From a payment perspective, a Patient-Centered Medical Home (PCMH) is considered by the U.S. Department of Health and Human Services (HHS) to be an alternative payment model. In early 2015, HHS announced a goal to move 30% of Medicare fee-for-service payments to alternative payment models by the end of 2016, and to reach the 50% mark by 2018 (HHS, 2015). This makes the move to PCMHs not only attractive for the uninsured, but also for patients covered by Medicare as well as commercial payers.

There are challenges to implementing a PCMH; transformation to a new system of practice is a paradigm shift for providers (Janamian et al., 2014). However, establishment of patient-centered care for uninsured and chronically ill patients is one of the focal points of the Patient Protection and Affordable Care Act (ACA) (National Conference of State Legislatures, 2012).

Multiple researchers have compared the connection between medical homes with reduced hospitalizations, reduced ED visits, and lowered costs of care, with differing results. Silow-Carroll, Edwards, and Lashbrook (2011) reported investment in quality care, case management, comprehensive education, and communication links for patients after discharge, as well as a provision of the continuum of care which a medical home provides, would assist in reducing readmissions and frequent use of EDs. Reid and co-authors (2013) found declines over time in visits to EDs after implementation of a medical home. A decrease of 13.7% was noted in the first year, and an 18.5% decline was seen in the second year. A study conducted within the Veterans Administration regarding the reduction of ED visits for patients utilizing the medical home model found patients who experienced visits in the medical home had a lower number of ED visits when compared to those who did not (Chaiyachati et al., 2014). David, Gunnarsson, Saynisch, Chawla, and Nigam (2015) found a 5%-8% reduction in ED visits for chronically ill patients. They did not find the same correlation for those patients not suffering from chronic illnesses.

Study results on the topic vary with inconclusive results regarding costs, hospital admissions, and ED visits, as one year may show strong savings that may be reduced by higher utilization the next (Peikes, Zutshi, Genevra, Parchman, & Meyers, 2012). A study in New Jersey used a nurse practitioner (NP) working with a select, high-utilizing patient group from three hospitals with the goal to ascertain whether focusing on patient-centered care "can both improve care and stabilize healthcare costs" (Jacobi, 2012, p. 41). The project showed limited signs of success and Jacobi concluded the medical home concept would be ideal for the problem of medical access for the uninsured with chronic health problems, but that issues of reimbursement have prevented it from being a viable solution. In a systematic review of 19 studies, Jackson and associates (2013) found that, while there were small improvements to patient care delivery, staff satisfaction, and a reduction in ED visits through the implementation of a PCMH, there were no findings of any improvements in hospital admissions, nor any indication of overall cost savings.

However, a study involving the Geisinger medical home model found savings increased over time (Maeng et al., 2012). Using a 4-year study timeframe, a savings of 7.1% was noted. In Michigan, a medical home demonstration project, specializing in oncology, indicated a savings of $550 per patient due to reduced utilization of ED visits (Kuntz, Tozer, Snegosky, Fox, & Neumann, 2014). A study reviewing Medicare beneficiaries showed total payments, as well as ED visits, declined after the institution of a medical home (Van Hasselt, McCall, Keyes, Wensky, & Smith, 2015).

Study Aim/Scope

The aim of this study was to determine outcomes following implementation of a medical home clinic for a select group of chronically ill, uninsured patients, who previously had repeated use of the ED leading to frequent hospital admissions and readmissions. These services ultimately were paid by the hospital following its charity care policy due to the patient's inability to pay, with a total cost to the hospital in 2011 of $8,077,384. While ACA has expanded Medicaid in many states, some state legislatures did not embrace expansion. This has caused many health systems to be caught in the middle of reduced payments from CMS sources and the healthcare edict from EMTLA, which stipulates no patient requiring emergency care be turned away, regardless of the ability to pay (CMS, 2002). Preventive care forms the basis for the medical home model, moving patient care from a reactive state of accessing care when symptoms present, to a proactive state of healthcare screening, compliance with medications, and health counseling. The model also aligns well with tenets of the ACA, which focuses on keeping people healthy and out of hospital settings (HHS, 2017). This is a paradigm shift for providers and will require innovative thinking and education for providers and patients.

Implementation of this medical home clinic intervention affects many elements of healthcare practice. Reduction of ED visits, and assisting with overcrowding issues and extended wait times of other emergent patients, will improve overall patient satisfaction. For these patients, improving their ability to stay on track with their medical regimen may reduce unnecessary hospital admissions and ensuing readmissions. For the healthcare organization, cost savings will be realized from reduced ED visits and subsequent hospitalizations and readmissions, which are frequently written off completely due to patients' inability to pay. The intent of this care shift is to improve access to high-value preventive healthcare for a chronically ill, uninsured population, and to stop the downward spiral of healthcare, which appears fueled by a lack of care, education, and medications. Success saves healthcare dollars, hospital resources, and can improve quality of life for this population.

This study sought to answer the following questions: (a) Is there a difference in number of ED visits, hospitalizations, and subsequent readmissions to an acute care facility for a select population of chronically ill patients after implementation of a medical home clinic? (b) Is there a difference in total cost for a select population of chronically ill patients by using the medical home model?


This analysis was a retrospective, pre-experimental study with a one group pre-test/post-test design. Study sample consisted of 93 patients who met all inclusion criteria. Data for the study are located in the organization's data repository, a database that serves as the platform for the long-term archive of all electronic medical record data. The facility's institutional review board (IRB) recognized the project as an exempt study and issued a non-IRB study letter on May 26, 2015.

Sample and setting. The study site is a 255-bed community hospital system with a staff of approximately 2,300 employees and 230 licensed healthcare providers. The hospital has approximately 11,000 admissions and 62,000 ED visits annually. This acute care hospital serves a primary population of 150,000 with an expanded service area population of 250,000 covering 2,520 square miles, which is larger than the states of Rhode Island or Delaware.

Study cohort consisted of patients who voluntarily transferred their care to a medical home clinic; first visit dates ranged from March 2012 through July 2014. These patients were invited to transfer care due to their overutilization of the ED (four or more visits in 6 months) or frequent hospitalizations (three or more inpatient stays in 6 months), coupled with an inability to pay. Other inclusionary criteria included a chronic disease diagnosis of diabetes, congestive heart failure, or chronic obstructive pulmonary disease; no primary care physician of record; and a history of noncompliance with treatment. Both men and women over age 18 were included in the study. No patients under the age of 18 were included in the study as no pediatric services are available at the medical home clinic.

The medical home clinic consisted of an interprofessional care team: physician, NP, dietitian, pharmacist, social worker, and registered nurse case manager. Patients received care at no cost as an inducement to switch care locations, so the organization could determine if proactive, high-quality care was more cost effective than reactive emergency care.

Measures. An ED visit was defined as a visit which included a medical screening examination by a provider, treatment, and either discharge from the ED or admission to the acute care hospital. An inpatient admission was defined as a hospital stay past two midnights. A hospital readmission was defined as an additional inpatient stay within 30 days of discharge from original inpatient admission. Costs were calculated by obtaining actual cost of hospital charges incurred during each ED visit, and any subsequent hospitalization, both pre and post intervention, as well as costs of providing care. For this study, patient costs were defined as cost to the organization of providing services, as opposed to charges. Costs included staffing and supplies provided to patients during the ED visit or hospital stay. There were no staff increases to deliver this care, merely a shifting of workplace so costs did not include an increase in staffing.

Data analysis. Preliminary analysis included calculation of descriptive statistics to include mean, standard deviation, median, mode, and range, as well as percentages, as appropriate. Examination of within-group differences, to answer the research questions, captured volume of ED visits and admission data, as well as any charge/cost differences for these services for 180 days before and after movement to the medical home. These differences were analyzed using paired sample t-test, which was chosen due to the pretest/post-test, one group structure of the study. A significance level of 0.05 was used for all tests.


ED visits. Mean number of ED visits pre-enrollment in the medical home clinic was 1.62 (SD=2.09), compared with mean number of ED visits post enrollment (1.13 [SD=1.31]). Using paired sample t-test, the difference (M=0.333, SD=1.873) was not statistically significant (t=1.716, p=0.089). These results indicate enrollment in the medical home did not reduce ED visits significantly. While the difference was not statistically significant, there was an overall 31% reduction in visits within the group, dropping from 99 to 68 during the measurement period.

Hospital admissions. There was a statistically significant difference (p<0.001) between the number of hospital admissions pre-enrollment in the medical home clinic (M=1.09; SD=0.43), and the number of post-enrollment hospital admissions (M=0.32; SD=0.57). These results indicate enrollment in the medical home significantly reduced hospitalizations. Actual number of admissions decreased 70%, from 85 pre-enrollment to 24 post enrollment.

Hospital readmissions. Hospital readmissions were reduced by 66%, with a pre-enrollment total of 24, decreasing to eight post enrollment. The number of hospital readmissions pre-enrollment in the medical home clinic was 1.50 (SD=0.73), and number of hospital readmissions post enrollment was 0.50 (SD=0.89). Using paired sample t-test, the difference (M=0.172; SD=0.636) was statistically significant (t=2.608; (p=0.011). These results confirm enrollment in the medical home significantly reduced hospital readmissions. The decrease in readmissions would be expected since overall hospital admission rate was reduced.

Total patient costs. Mean of total patient costs per patient pre-enrollment in the medical home clinic was $9,076.32 (SD= $9,354.48), and mean of total patient costs per patient post enrollment was $5,067.02 (SD=8,407.39). The difference (M=4,009.299; SD=12,994.628) is statistically significant (t=2.975; p=0.004), suggesting enrollment in the medical home clinic significantly reduced overall patient costs. The high standard deviation reflects the large range within the pre cost (R=$49,437.68) and post cost (R=$51,143.56). Total costs incurred by the sample group pre enrollment were $844,097.69 compared to $471,232.86 post enrollment, a decrease of 59%. This final result supports the premise that quality outcomes, as well as quality of life, can be improved with implementation of a medical home model while reducing costs (see Table 1).


Results for the first research question that examined differences between ED visits, hospitalizations, and subsequent readmissions were mixed. While the decrease in number of hospital admissions and readmissions were statistically significant, number of ED visits, while decreased, were not reduced significantly. Hospital admissions may have decreased because patients, when seen in the ED, had a medical provider for followup in the medical home clinic. It must be considered, however, that introduction of proactive, comprehensive healthcare assisted in reducing not only the number, but severity of chronic disease exacerbations and subsequent hospitalizations for this cohort of patients.

Results for the second research question that examined differences in cost spent by the hospital to cover this care showed a significant decrease. This finding suggests the cost of utilizing outpatient clinic care, even with the expanded interprofessional team approach and medications at no cost, was lower compared to the cost of hospital ED and inpatient services.

The purpose of this study was to ascertain if the number of ED visits, hospitalizations, and hospital readmissions of patients who are uninsured and suffering from specific chronic diseases could be reduced, while at the same time lowering overall cost of care for this population through implementation of a medical home clinic. Results indicated ED visits, hospitalizations, and subsequent readmissions, as well as overall costs for these services, were reduced for the 93 chronically ill and uninsured participants in this study.

While the hospital system funded the first model, continuing that framework would not be sustainable. To expand this model to other locations, alternative funding is needed. Possible funding sources may be available through grants, as well as other funding opportunities at both the federal and state levels.

Further research to determine why ED visits were not reduced significantly should explore whether visits were clustered around the start of the 6-month post-enrollment period, or spread across the entire 6 months. It may be that habit modification of accessing the ED for care takes time. Getting comfortable with accessing care in a clinic setting as opposed to the immediate answers of an ED may take longer. As relationships with caregivers are developed, patients may be more likely to stop heavy ED utilization. Reid and coauthors (2013) confirmed this timeline for reducing ED visits with greater second year declines in ED utilization compared with the first year.


This study demonstrates patient utilization of high-cost healthcare resources were improved through enrollment of chronically ill patients in a medical home clinic, which incorporated focused medical care and health screenings in the provision of preventive medical care for a group of patients with a track record of frequent hospital use for the exacerbation of their disease process. While this study model utilized physician providers with NPs, in future models, these clinics could be completely led by NPs. Chism (2016) states NPs possess the additional proficiency required to manage complex medical care through interprofessional relationships. In states where a collaborative agreement is required, physician oversight of advanced practice nurses in multiple clinics would extend, significantly, lives touched through this model.

Nurse practitioners tend to be more collaborative in their practice model, from either practice style or legislative requirements (Kutzleb et al., 2015). However, physicians may not embrace a model which utilizes such an interprofessional approach, with equal input from NPs, pharmacists, dieticians, case managers, and social workers, in addition to their medical model viewpoint. To successfully promulgate the vision for the expansion of this model, which incorporates evidence-based research, projects such as this must be reviewed with potential team members to demonstrate the strong patient outcomes resulting from a practice based on interprofessional collaboration. These types of data should appeal to the scientist within most physicians.

Future Research

Further research should include a review of data with a longer timeframe (over 1-2 years) to ensure this model sustains the reduced frequent use of high-cost healthcare as well as the cost savings, which the original study demonstrated. The first 6 months of enrollment in the medical home may be the most resource heavy, and a comparison of costs post enrollment at longer intervals may provide further answers to the viability of this model. Further tracking of this metric for a longer time period may reveal additional insights into healthcare behaviors.

One area of healthcare not addressed in the model is the underlying need this population may have for behavioral health services. The addition of mental healthcare counseling could continue to improve outcomes and decrease costs. A focus study on mental health services requirements in the uninsured, chronically ill population would be advisable.


While the ACA had the promise of a reduction in the number of uninsured among working-age adults, lack of Medicaid expansion, and thus insurance, in some states may be a contributor to the continued rise in the number of chronically ill, uninsured working-age adults in the United States who struggle with the high cost of medical care. Solving the healthcare conundrum, which the chronically ill, uninsured population experience, is a significant national problem. Healthcare organizations spend millions of dollars each year on both charity care and bad debt, some of which is caused by needless hospitalizations and medical treatments due to a lack of preventive, proactive care. These expenditures continue the trend of rising healthcare costs, which threaten to break the back of American economics. Moving uninsured patients who access the ED after an exacerbation of a chronic illness to a more proactive, interprofessional medical home clinic model, may assist that population achieve a healthier, happier lifestyle, with an overall reduction in healthcare cost.


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ELIZABETH CLINE, DNP, MBA, RN, is Chief Operating Officer, Augusta Health, Fishersville, VA.

NANCY L. SWEENEY, PhD, APRN, BC, is Nurse Executive DNP Program Director, Professor of Practice, Old Dominion University, School of Nursing, Norfolk, VA.

PENNY B. COOPER, DHSc, is Data Scientist, Augusta Health, Fishersville, VA.
Table 1.
Cost Results

                  Pre-Enrollment  Post-Enrollment
                      Costs           Costs        Savings

Total costs          $844,098       $471,233       $372,865
Per patient cost     $9,076         $5,067         $4,009
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Author:Cline, Elizabeth; Sweeney, Nancy L.; Cooper, Penny B.
Publication:Nursing Economics
Article Type:Report
Date:Jan 1, 2018
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