Pioneering Study Links Higher Primary Care Spending Percentage Among Medi-Cal Managed Care Plans to Better Quality of Care and Plan Rating

Findings Point to Opportunities to Improve Health Equity Through Greater Investment in Primary Care

Study released after the newly enacted state budget establishes the Office of Health Care Affordability to measure and promote a sustained systemwide investment in primary care, and Medi-Cal managed care will start to report primary care expenditures in 2024

A new, first-of-its-kind study encompassing 5.4 million Californians enrolled in Medi-Cal managed care, or nearly half of all Medi-Cal members in 2019, finds that greater investment in primary care is associated with better quality of care, patient experience, and plan rating. Plans that spend a higher percentage on primary care were statistically more likely to get a better rating from the National Committee for Quality Assurance. NCQA evaluates health plans on the quality of care patients receive, how patients experience their care, and health plans’ efforts to keep improving. The research is based on an analysis prepared by Edrington Health Consulting, a Health Management Associates Company, for the California Health Care Foundation.

“Increasing emphasis on primary care in Medi-Cal is essential to improving health and well-being and reducing health disparities,” said Kathryn E. Phillips, CHCF senior program officer. “This study provides an important baseline for understanding how greater investment in primary care can improve performance.”

Primary care providers administer critical first-line care for physical and behavioral health needs. Supported by teams that include community health workers, nurses, behavioral health staff, and others, they help patients diagnose symptoms, prevent disease, manage chronic illness, and overcome social stressors that impact health, such as violence or food insecurity. They also help coordinate care, such as testing and specialist care.

Medi-Cal is the state’s health insurance program for Californians with low incomes, including over 40% of all children, half of those with disabilities, over a million seniors, and one in five workers. About 80% of all Medi-Cal enrollees get their care through a Medi-Cal managed care plan, which are contracted with the state.

The study, which evaluated primary care spending data from 13 Medi-Cal managed care plans, found wide variation in the level of primary care investment by plan and population. Spending on primary care across plans ranged from $8.85 to $61.24 per member per month. This translates to roughly 11% of total health care dollars being spent on primary care, ranging from 5% to 19%.

A significant statistical relationship was observed between plans with higher primary care spending percentages and those that scored higher on a composite measure of overall care quality, which included the percentage of plan members who complete well-child visits, receive immunizations, have control of their diabetes, and receive recommended cancer screenings, among other quality measures. When individual measures of quality were studied, plans with a higher percentage of spending on primary care performed better on 9 of 11 measures. Three of these measures met criteria for statistical significance and align with state priorities: receipt of recommended cancer screenings and two measures of management of medications for depression.

Medi-Cal covers a third of all Californians and nearly half of all children. It serves those facing health challenges shaped by poverty, housing and food insecurity, pollution, and racial discrimination. Due to these systemic injustices, Californians enrolled in Medi-Cal are twice as likely to have poor health overall. About two-thirds of all Medi-Cal enrollees are people of color. Medi-Cal care quality remained stagnant at best in the decade leading up to 2019. A focus on primary care is an opportunity to move these measures in the right direction.

Medi-Cal serves 34% of California’s Latinos/x, 28% of Black Californians, and 15% of the Asian American community. Given that, the study points to an important opportunity to improve health equity for all Californians through greater emphasis on primary care.

The study comes as California and several other states are making a push toward requiring primary care teams, including physicians, nurse practitioners, physician assistants, community health workers, behavioral health staff, and others, to play a greater role in the health care delivery system.

As part of efforts to transform Medi-Cal, beginning in 2024, the California Department of Health Care Services (DHCS) will require all Medi-Cal managed care plans to report on primary care expenditures. This heightened focus on strengthening primary care will impact the more than 10.8 million Medi-Cal enrollees served by Medi-Cal managed care plans and align California with other states seeking to strengthen primary care as a lever to improve quality, improve value, and advance equity.

“DHCS is committed to reducing the stark racial and ethnic disparities in access to primary care. These include maternity outcomes and children’s preventive services, as well as improving maternal and adolescent depression screenings. This study will serve as a benchmark among Medi-Cal managed care plans as we seek to achieve these and other bold goals,” said Dr. Palav Babaria, chief quality officer and deputy director of Quality and Population Health Management at DHCS.

California established a new Office of Health Care Affordability to measure and promote a sustained systemwide investment in primary care in the state budget enacted just weeks ago.

A previous study’s report, Investing in Primary Care: Why It Matters for Californians with Commercial Coverage, showed that primary care spending, as a percentage of overall spending, varied widely among commercial health plan products, from a low of 4.9% to a high of 11.4%.

Also, a recent California Health Care Foundation / NORC Health Policy Survey found Californians who report having a primary care provider have fewer language, distance, and affordability barriers to appropriate care and are less likely to delay care. Californians with a primary care provider are also less likely to report negative experiences with health care providers.

Contact Information:
Anne Sunderland
Senior Communications Officer, Improving Access

About the California Health Care Foundation

The California Health Care Foundation is dedicated to advancing meaningful, measurable improvements in the way the health care delivery system provides care to the people of California, particularly those with low incomes and those whose needs are not well served by the status quo. We work to ensure that people have access to the care they need, when they need it, at a price they can afford.