A medicaid alternative payment model program in oregon led to reduced volume of imaging services

The patient-centered medical home model aspires to fundamentally restructure care processes, but a volume-based payment system may hinder such transformations. In 2013 Oregon’s Medicaid program changed its reimbursement of traditional primary care services for selected community health centers (CHCs) from a per visit to a per patient rate. Using Oregon claims data, we analyzed the price-weighted volume of care for five service areas: traditional primary care services, including imaging, tests, and procedures; other services provided by CHCs that were carved out from the payment reform; emergency department visits; inpatient services; and other services of non-CHC providers. We further subdivided traditional primary care services using Berenson-Eggers Type of Service categories of care. We compared participating and nonparticipating CHCs in Oregon before and after the payment model was implemented. The payment reform was associated with a 42.4 percent relative reduction in price-weighted traditional primary care services, driven fully by decreased use of imaging services. Other outcomes remained unaffected. Oregon’s initiative could provide lessons for other states interested in using payment reform to advance the patient-centered medical home model for the Medicaid population.