Nearly $21 million allocated to 'medical neighborhood' project


A collaboration of vendors TransforMED, VHA Inc. and Phytel will help up to 15 health systems and provider groups in 15 states, including Nebraska, Mississippi and Connecticut, use health IT to transform their practices, coordinate care, improve clinical performance and drive savings, according to an announcement from TransforMED on Jan. 4.

The effort is part of a patient-centered "medical neighborhood" pilot funded by the Center for Medicare and Medicaid Innovation scheduled to begin this month. Vendors will help primary care providers redesign their practices to align with healthcare systems in their communities in a test to improve outcomes and lower costs.

The vendors will support up to six primary care practice transformation efforts within each participating community to develop patient-centered medical homes into patient-center medical neighborhoods, which are designed to strengthen relationships among primary care practices, hospitals, specialists and other services.

The Innovation Center is funding the medical neighborhood pilot over three years at $20.75 million. It is part of the Centers for Medicare & Medicaid Services’ Health Care Innovation Awards program, which field-tests new methods to improve healthcare and lower program costs for recipients of Medicare, Medicaid and the Children’s Health Insurance Program.

The medical neighborhood demonstration will involve about 157,000 Medicare and Medicaid beneficiaries.

“The concept of the patient-centered medical neighborhood has enormous potential to provide a template for effective care delivery that healthcare providers nationwide can replicate in their communities,” said Peggy Naas, MD, VHA vice president for physician services.

The patient-centered medical neighborhood project plans to accomplish the following over the three years of the demonstration:

  • Decrease healthcare costs by $49.5 million within the 15 communities.
  • Improve the eligible patient population health by a 15 percent average in selected quality measures.
  • Achieve patient experience improvement by 25 percent.

When CMS awarded the project in June, the agency described the initiative as using “a sophisticated analytics engine to identify high-risk patients and coordinate care across the medical neighborhood while driving patient-centered medical home transformation in a number of primary care practices in each community.”

Primary care practices that have transformed to a patient-centered medical home “would not by themselves be able to transform the broader healthcare system,” said Terry McGeeney, TransforMED CEO, in describing a medical neighborhood on the company website. “The ultimate goal is highly effective, efficient primary care practices that are managing and coordinating care in an integrated fashion. This integration needs to involve specialists, hospitals and all other stakeholders in the patient's medical journey and experience.”

TransforMED, a subsidiary of the American Academy of Family Physicians, provides consultations to help practices redesign themselves to patient-centered medical home models. Phytel offers population health management technology and registries to identify and automate care gaps, patient outreach and performance evaluation. VHA will provide analytics, clinical quality improvement and knowledge transfer.

Among the 15 healthcare providers participating are:

  • Charleston Area Medical Center, Charleston, W.Va.
  • Huntsville Hospital, Huntsville, Ala.
  • Marquette General Health, Marquette, Mich.
  • North Shore Physicians Group, Salem, Mass.
  • Orlando Health, Orlando, Fla.