Editor’s Note: There is widespread agreement that the nation’s primary care infrastructure is woefully inadequate. For example, at the Senate hearing on his nomination to be Secretary of Health and Human Services, Sen. Tom Daschle spoke of health care as a pyramid, with primary care at the bottom and specialized care at the top. He stated: “Every country starts at the base of the pyramid with primary care, and they work their way up until the money runs out. We start at the top of the pyramid, and we work our way down until the money runs out. And the money runs out. And so few people get good primary care and wellness. And so we have to change the pyramid. We have to start at the base.”

Below, in the second part of a two-part blog post, Kevin Grumbach, one the nation’s leading experts on primary care and the health care workforce, sets forth a plan to revitalize primary care in the United States. In part one of the post last week, Grumbach discussed some of the reasons for the deficient state of primary care, as well some of the consequences of this situtation and its impact on efforts to expand coverage.

At the federal level, a bold initiative is urgently needed to revitalize primary care. This initiative needs to be comprehensive, not piecemeal, and simultaneously address physician payment reform, the practice infrastructure, the training pipeline, and research needs. Although Congress and the new administration face the daunting challenge of a large federal deficit and economic recession, many elements of a primary care renewal initiative could be implemented in a budget-neutral fashion, and other elements require only small amounts of new investment relative to the overall size of the federal health care budget.

Physician Payment Reform

Medicare not only is the nation’s largest health plan in its own right, but also sets the trends for physician payment policies used by private health plans. Medicare should revalue its payment policies to reverse the widening gap between primary care and specialist compensation. As recommended by the Medicare Payment Advisory Commission (MedPAC) in its June 2008 report, Congress should significantly increase Medicare fees for primary care services.

MedPAC also recommended that Medicare implement more demonstration projects for enhanced primary care payments, such as care coordination fees, for practices that adopt medical home innovations. Given the existing evidence on the value of primary care and the urgency of the primary care crisis, Medicare should not limit this initiative to small demonstration projects and wait years for more evidence to be accumulated, but should immediately scale up the medical-home payment policy for nationwide implementation and provide much greater emphasis on new forms of primary care payment that shift from a pure fee-for-service, visit-based model to one compensating practices for comprehensive, whole-person care, including care provided outside of a traditional face-to-face visit.

The Centers for Medicare and Medicaid Services (CMS) should work with organizations such as the National Committee for Quality Assurance and primary care professional societies on certification standards to assure that practices are held accountable for the standards that merit enhanced payment. Additionally, Congress should require that private health plans participating in the Federal Employees Health Benefit (FEHB) program adopt similar enhanced payment models for primary care, and should also insist that state Medicaid programs include some type of medical-home payment program as a condition for receiving federal matching funds.

Finally, Congress needs to modify the rules of the Medicare Sustainable Growth Rate (SGR) so that primary care physicians are not financially penalized for inflation in physician payments that are caused by excessive growth in expenditures on imaging, diagnostic procedures, and other non–primary care services. Under the current SGR policy, Congress sets a target for the rate of growth in overall Medicare physician expenditures, with fee levels being reduced if the target is exceeded. Between 1997 and 2006, growth in expenditures for primary care–oriented “evaluation and management” services accounted for only 14% of the overage in expenditures, with non–evaluation and management services accounting for the remaining 86%. Because the SGR feedback loop formula is based on total physician expenditures, the SGR triggers across-the-board fee reductions for all services, irrespective of the degree to which a category of service contributes to the overage.

A fairer approach to the SGR would create separate categories for evaluation and management payments and other physician payments to calculate annual fee updates. Adjustment to the SGR could be prospectively implemented in a relatively budget-neutral fashion, addressing future rates of payment growth rather than a redistribution of existing payments. Payment enhancements for primary care medical homes would require new dollars, but the North Carolina Medicaid program experience indicates that these new costs are likely to be offset by savings in expenditures for emergency department and hospital services, providing better value for the money spent.

The Practice Infrastructure

The federal government has a key role to play in catalyzing nationwide adoption of interoperable electronic health records (EHRs) in the ambulatory care sector — an information-age infrastructure investment akin to previous federal investments to build interstate highways and hydroelectric power. Health systems in much of the developed world are already far ahead of the U.S. in widespread deployment of information technology (IT) in primary care offices, largely due to direct government funding and support for this capital improvement. In the pluralistic U.S. health system, a single, government-purchased IT system for all primary care offices is probably less viable than government financing of diverse EHR systems with government-regulated standards for interoperability across practices and different sectors of the health system. President-elect Obama has pledged a $50 billion investment in new health IT, and this investment should pay particular attention to the needs in ambulatory care.

The second major infrastructure initiative should draw from another successful government model: the Cooperative Extension Service administered by the U.S. Department of Agriculture. The Co-op program, enacted in 1914 as collaboration between the federal and state governments, agricultural experts at land-grant universities, and farmers, created a network of agricultural field educators in every county in the nation to provide technical assistance to local farmers, contributing to the increase in agricultural productivity in the U.S. The Co-op program is still active.

Congress should launch a Primary Care Cooperative Extension Service, with family doctors rather than family farmers as the target audience. This program would link local practitioners with regional centers of excellence in primary care, perhaps based at land-grant universities, with the collaboration of other organizations with expertise in primary care delivery such as the Institute for Healthcare Improvement, TransforMED, and professional societies, to provide the hands-on technical assistance needed for widespread adoption of innovative practice models to modernize the primary care medical home.

For example, these Primary Care Co-ops could facilitate training of practice staff in chronic care programs, application of IT to create patient registries for panel management to improve delivery of chronic and preventive care, and same-day “open access” appointment scheduling models. These Co-ops could work synergistically with regional Medicare Quality Improvement Organizations. Financing of these Primary Care Co-ops could come from a mix of federal and state government funds, along with a surcharge on private health plans that stand to benefit from having more effective and efficient primary care networks for their subscribers. A modest investment of $100 million annually would provide $10 million to operate 1-2 Primary Care Co-ops in each of the ten Health and Human Services regions.

The Training Pipeline

The one existing federal program specifically dedicated to supporting the training of primary care physicians and physician assistants is Section 747 of the Title VII program of the Public Health Service, administered by the Health Resources and Services Administration. This program provides grants to health professional schools and primary care residency programs to support the education of primary care physicians and physician assistants, with an emphasis on producing graduates who will care for underserved populations. Section 747 funding was reduced from $92.4 million in fiscal year 2003 to $48.0 million in 2008 — a reduction equivalent to about two hours’ worth of government spending on Medicare. Twenty-five years ago, in the heyday of medical school expansion, Congress appropriated $2.7 billion (in 2008 dollars) for all Title VII health professions programs.

Although the Office of Management and Budget has questioned the effectiveness of the Title VII program as a whole, several recent studies have demonstrated successful outcomes from the Section 747 grants program. Graduates of medical schools and residency programs that received Title VII grants at the time these students and residents were in training are more likely to enter primary care, practice in an underserved area, work at a community health center, and join the National Health Service Corps (NHSC) than their counterparts who did not attend Title VII–funded schools and programs. A Title VII Section 747 funding level of $200-$300 million per year would restore the integrity of this program and allow it to reach many more students and residents. A renewed Title VII program should challenge training institutions to prepare primary care clinicians to be leaders in implementing innovative new models of primary care and developing more patient-centered medical homes. The Title VII budget is also dwarfed by the $8.8 billion Medicare spends annually on graduate medical education payments — almost all of which flow to hospitals sponsoring residency programs, tying funds to hospital-based settings emphasizing specialty training and hospital service priorities rather than primary care training in community-based ambulatory settings such as community health centers. Congress should implement the recommendations issued in the Nineteenth Report of the Council of Graduate Medical Education in 2007. These recommendations call on Medicare to “broaden the definition of ‘training venue’ (beyond traditional training sites),” “remove regulatory barriers limiting flexible GME training programs and training venues,” and “make accountability for the public’s health the driving force for graduate medical education.”

The final key element of an educational pipeline strategy is to increase funding for the NHSC to provide debt relief to more medical graduates as an incentive for them to enter primary care careers. Although the NHSC should not lose sight of its principal charge, which is to use service obligation to place health professionals in communities with the greatest unmet need for these clinicians, an expansion of the number of NHSC positions should be coupled with greater flexibility in the administration of NHSC awards. One important modification that would work synergistically with more flexible Medicare GME policies in support of community-based primary care training would be to allow physicians teaching and supervising students and residents in underserved clinical settings to be eligible for loan repayment, even if the physician performs less than the 30 hours per week in direct patient care currently required of NHSC participants. Another consideration would be to allow primary care physicians to qualify for partial loan repayment if they could demonstrate that they had some minimum level of uninsured and Medicaid patients in their practice, even if the practice was not located in a federally designated shortage area. Creating a more robust NHSC is another area where some combination of financing from federal and state governments along with matching contributions from private health plans would be an appropriate mix. In 2006 there were over 4,200 vacant positions in underserved areas for NHSC physicians, yet only 1,200 NHSC physicians available to fill these slots. A tripling of the NHSC budget, from $155 million to $465 million annually, would fund about 3,400 additional health professionals annually for a three-year primary care service obligation.


Elias Zerhouni, until recently the director of the National Institutes of Health, explained prior to stepping down from his position in September 2008 that “our goal at NIH is to usher in an era where medicine will be predictive, personalized and preemptive.” Central to this vision is mapping individuals’ genomes and using this information to tailor clinical interventions, such as emphasizing aggressive cholesterol reduction for a patient with a high genetic predisposition to coronary heart disease or selecting a blood pressure medication based on a patient’s pharmacogenetic profile. However, when the public is asked about its view of personalized medicine, they indicate that they want a relationship with a health care professional who treats them as a whole and unique person and not merely as the sum of their personal genomic microarrays. One might question, then, why an agency pursuing a vision of research in the service of personalized health does not have an institute dedicated to research in the care of the person as a whole. The NIH comprises various institutes organized around individual organs and diseases, such as the National Institute of Diabetes and Digestive and Kidney Diseases and the National Heart, Lung, and Blood Institute. Congress should call on the NIH to establish a new NIH Institute of Primary Care Research, awarding research grants to advance the science of whole-person care and community-engaged, translational research conducted in primary care settings. This initiative should be closely linked with the NIH’s Clinical Translational Science Award Roadmap program, and coordinated with practice-based research and prevention programs at the Agency for Healthcare Research and Quality (AHRQ) and the Centers for Disease Control and Prevention (CDC).


Rebuilding the crumbling primary care infrastructure is a priority for health reform in the United States. The nation will not be able to meaningfully improve access to care and build a better-performing health system when its foundation of primary care is so fundamentally unsound. Finding the funds to invest in a primary care revitalization initiative is a matter of political priorities, not lack of potential available resources in a health system that spends $2 trillion annually. A recent study concluded that Medicare would save $21.9 billion annually simply by directly negotiating with pharmaceutical companies using the same type of Federal Supply Schedule pricing policies employed by the Department of Veterans Affairs and Department of Defense. A small portion of such a Medicare pharmaceutical savings dividend could fund much of the new cost of a primary care initiative. Responsibility for investing in a renewal of primary care is not solely the responsibility of the federal government, but renewal is unlikely to occur without strong leadership from the federal government.