Snapshot of California’s Effort to Transform Primary Care in the Safety Net

California’s ambitious Equity and Practice Transformation (EPT) program, which supports 198 primary care practices across 58 counties, is working to reduce disparities, enhance data capabilities, and prepare practices for value-based payments. During a Sept. 22 webinar, leaders of the program reported on some of the milestones practices have achieved so far. 

Palav Babaria, M.D., M.H.S., chief quality officer and deputy director of quality and population health management at the California Department of Health Care Services (DHCS), said the department sees this program as a critical part of its strategy to improve quality and equity for all Medi-Cal members. 

She explained that the state launched the $140 million EPT program, which is slated to run from 2024 through 2027 with the goal of supporting primary care practices, to advance equity, reduce gaps in care and worsening quality measures that developed as a result of the COVID-19 public health emergency, to invest in upstream care models and to help practices get ready for value-based payment methodologies. 

The 198 primary care practices participating are working with 19 managed care plan sponsors.

Babaria added that the State Office of Health Care Affordability (OCHA) has set a primary care spending benchmark of 15% by 2034 at the health plan level, and it requires that the payers — if they are not already at that 15% target — to make a 0.5 to 1% year-over-year improvement. “Starting in 2024 we have also built language into our public purchaser contracts through MediCal, Covered California and CalPERS with reporting requirements around primary care spend in these value-based contracts, and are currently working with OCHA to implement and align these requirements across all of the public purchasers,” she explained. 

“Value-based contracts allow us to tie more of our spending to actual quality and equity outcomes,” Babaria said. “OCHA has set targets for different lines of business for what percentage of all contracts need to be in some sort of value-based payment arrangement instead of fee for service. In partnership with our other public purchasers, we have started holding back money for quality targets. So Medi-Cal as of 2025 has a 1% withhold where hundreds of millions of dollars of capitated payments are withheld from our plans unless they achieve specific targets on high-priority quality measures, which we have aligned with Covered California and CalPERS.”

She added that they also know that so much of what drives poor quality and equity outcomes is lack of appropriate data and data sharing. “A lot of these initiatives require the California Data Exchange Framework to take off, so most healthcare entities and plans have signed the data exchange framework agreement and are participating in or onboarding to local health information exchanges,” she said. 

“On the DHCS side, we required our plans to have data sharing with multiple different types of local entities, including county behavioral health, public health departments, et cetera. And we also required plans to start using ADT feeds. In 2025 through our population health management platform, Medi-Cal Connect, all of the plans will have access to member-level records, dashboards and risk stratification.”

DHCS has partnered with the nonprofit PopHealth Learning Center to provide program oversight and technical assistance. “There is a lot of labor and redesign and workflow assistance and technology that needs to go into supporting our practices to provide the highest care possible,” Babaria said. “We have set this program up as a directed payment structure, so we have milestones, and as practices reach specific interventions and milestones that are all evidence-based and on a roadmap to getting to a high-functioning, advanced primary care practice, they get paid for achieving those through their managed care plan partners.”

Moving the needle with practices

Jennifer Sayles, M.D., M.P.H., is CEO of the PopHealth Learning Center. Previously, she led the Department of Health Care Services/Kaiser Permanente/Community Health Center Population Health Management Initiative (PHMI), a  program to develop and implement evidence-based models of care in population heath management among community health centers. She also has served as chief medical officer at Inland Empire Health Plan, chief population health officer at LA County Department of Health Services, and medical director roles at LA Care and LA County Department of Public Health.

“Moving the needle requires focusing work across the providers, payers and purchasers, with really aligning incentives, data and operations to make things happen,” Sayles said. “From our perspective, it also requires stepping back and taking a relentlessly practice-centered approach. So if our goal is to change the care that patients and family receive, then we need to really step back into this practice-centered approach. The rest of the system needs to organize around what is needed on the ground, to support practices to change primary care and try to step away from making practices focus on what everybody else wants.”

Sayles explained that they started in the EPT program with building practice capabilities to capture the data needed to understand and define disparities. “That is one of our major milestones in the first year of the program,” she said. “I will say that coming in, most practices did not enter the program able to stratify by socio-demographic data. We worked with them to capture the components needed to do this and to put it into action. After six months of working on capturing socio-demographic data and learning to stratify HEDIS-like measures, we had 75% of practices successfully stratifying their measures and identifying disparities that existed specifically in their practice population.”

She said they have made a concerted effort to include small practices that are often left out of larger scale efforts like this. “We are looking at small practices and what they need to be successful on their population health journey,” Sayles said. “I think that the myth that small practices can't keep pace really isn't playing out in this program. So 61% of small practices in the program have achieved eight or more of the 10 total milestones to date, and that's compared to only 55% of other practices.”

Summarizing, she said that one year into the program and its technical assistance model they are seeing significant ability of practices to meet program milestones, statistically significant improvements and self-reported practice population health management capabilities as well as meaningful improvement in operational measures such as access and continuity. “Also, we are seeing these improvements across all practice types, with notable improvements in small practices.”

Moving on to quality measures, Sayles noted that currently in California, there really is no structure or consistent methodology that is used for practice-level performance measurement that uses payer data, “and we know that NCQA actually doesn't have practice-level benchmarks or specifications yet either. The result is we see a lot of variation across payers. On the upside, the Medi-Cal program has just published specifications for practice-level measurement, and we at the EPT program, are going to be the first to implement them in partnership with DHCS and the managed care plans.”

She added that their first round of managed care plan data collection on practice baseline performance in 2024 was challenging, “predominantly due to the variation across plans that made aggregated results completely unreliable. So we really got a situation of apples to oranges to bananas that we need to reconcile and improve as we go forward.”