NCPA - National Center for Policy Analysis

"Medical Home" Concept Saving Illinois Millions on Health Care

August 12, 2010

The "medical home" concept under a state initiative started about four years ago appears to be saving Illinois taxpayers hundreds of millions of dollars from the state Medicaid health insurance program for the poor, according to a new study by Washington-based Robert Graham Center.

The idea behind a medical home is that patients get higher-quality medical care, including specialized services up front in a doctor's office, where costs are much lower than at a hospital.  The patient also is encouraged to maintain a closer relationship with the medical home.

According to the study:

  • In 2006, Illinois health officials began to link people enrolled in the state's Medicaid program to a medical home, where treatment and patient referrals are coordinated centrally as a way to keep costs down.
  • From 2006 to 2007, Illinois Medicaid assigned nearly 2 million people to primary care doctors who agreed to coordinate these patients' health care for an extra monthly payment under the program.
  • Illinois Health Connect saved the state $140 million in the fiscal year ended June 30, 2009, and an additional $80 million in fiscal 2008 (figures were unavailable for fiscal 2007 because the program was not fully implemented).

The study also showed that a disease-management program launched by Hamos' department has saved more than $300 million during the last three years by helping Medicaid patients adhere to taking their prescriptions for chronic conditions. The program, Your Healthcare Plus, is administered by McKesson Corp. and also helps physicians coordinate care.

In addition, Your Healthcare Plus reported increases in the number of patients getting vaccinations, which officials say typically result in fewer hospital admissions.

Source: Bruce Japsen, "'Medical home' concept saving Illinois millions on health care," Chicago Tribune, August 11, 2010.

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