DESCRIPTION (provided by applicant): The patient-centered medical home (PCMH) is one promising model for transforming the organization and delivery of primary care in order to achieve high-quality, accessible, and efficient health care. To date, much of the PCMH evaluation has focused on the success of improving quality outcomes in large integrated delivery systems. There is an urgent need to understand the costs associated with supporting, implementing, and maintaining systematic redesign of small and medium sized primary care practices that serve American's most vulnerable populations (i.e., the safety net). The safety net health care system in Greater New Orleans after Hurricane Katrina embarked on a system-wide effort to rebuild and transform primary care by using the PCMH model, which was supported by a $100-million federal grant called the Primary Care Access and Stabilization Grant (PCASG). The preliminary results have demonstrated an improved patient rating of care coordination among the PCASG clinics. Our long-term goal is to provide comprehensive evidence to support the implementation and sustainability of primary care practice change in the United States using the PCASG program as a "natural experiment" in years 2007-2011. There is a dearth of data to estimate the cost effects of PCMH transformation from the perspective of individual clinics to further improve efficient, effective, and sustainable PCMH models. Therefore, the primary aim of this cost evaluation will be to quantify the direct and indirect costs shouldered by New Orleans small and medium sized safety net practices in becoming PCMHs and external non-financial costs involved in PCMH redesign and implementation activities. We will use the PCASG program data including patient encounters, services delivery register, operating budget and revenues, and PCMH scores. We will separate total costs into direct and indirect costs of safety net practices according to the PCASG program cost categories (direct cost: clinical and specialty care; indirect cost: administrative). The cost measures (e.g., cost per patient per month and cost per full-time equivalent (FTE) physician) derived from PCMH clinics and non-PCMH clinics will be further summarized in terms of baseline practice expense, incremental cost of PCMH transformation, and maintenance of practice change. The external non-financial incentives will also be included in the cost evaluation. The secondary aim will be to examine the associations between clinic-level characteristics and cost measures in primary care practices over the period of the PCASG program. Using the PCASG data sources, we will employ difference-in-difference longitudinal models to analyze the influencing factors of the cost measures under the PCASG program. This cost evaluation project will provide key stakeholders (e.g., primary care practices, health care systems, health care payers, and health policy makers) with information about the costs of transformative primary care practice redesign and implementation and make recommendations on future initiatives for primary care change in the United States.

PUBLIC HEALTH RELEVANCE: This proposal is relevant to public health because the results may lead to improvements in supporting, implementing, and maintaining primary care redesign and transformation in the United States. Specifically, this project will estimate the costs of transforming New Orleans' safety net clinics into patient-centered medical homes, which was supported by a large federal grant after Hurricane Katrina. This project is also relevant to AHRQ's mission because the clinics that will be evaluated by this proposal are considered part of the safety net that serves low-income individuals, including Medicaid recipients and the uninsured.