BCBS of Michigan PCMH Program Saves an Estimated $155M in Three Years

Blue Cross Blue Shield of Michigan's patient-centered medical home program, the largest PCMH program in the U.S., saved an estimated $155 million from July 2008 to July 2011 based on calculations made from a recent analysis published in Health Services Research Journal.

These avoided costs represent the savings achieved relatively early in the program's history and factor in costs at all practices in the program, not just those that had been designated as PCMH-based practices. Cost savings achieved by highly developed PCMH-based practices are substantially greater, according to Blue Cross Blue Shield of Michigan. In fact, the Michigan Blues, who have operated the PCMH program for the last five years, also estimate they may have saved an additional $155 million in the program's fourth year.

Across the country, physicians and healthcare organizations have been testing medical home qualities and features to see if they lead to improvements in care and efficiency. Through its analysis, "Partial and Incremental PCMH Practice Transformation: Implications for Quality and Costs," Blue Cross Blue Shield of Michigan and University of Michigan researchers found that its PCMH model, when fully implemented, is associated with a 3.5 percent higher quality measure, a 5.1 percent higher preventive care measure and a $26.37 lower per member per month medical cost for adults.

Blue Cross Blue Shield of Michigan began collaborating with physicians across Michigan in 2005 to study and test what key features and capabilities should be included in a PCMH model with physician practices earning designation starting in 2009. Practices earning designation were found to have made the most progress in transforming their processes, staff and procedures into the PCMH care model.

"Blue Cross' Patient-Centered Medical Home is transforming healthcare delivery, saving millions of dollars and improving lives," Daniel J. Loepp, president and CEO of Blue Cross Blue Shield of Michigan, said in a statement.  "The partnerships established between the Blues, Michigan physicians and their practice groups have been instrumental in the success we are achieving together."

The Blues' Patient-Centered Medical Home program includes approximately one million Blue Cross members and two million Michigan residents.