The Virginia Task Force on Primary Care is an initiative of the Virginia Center for Health Innovation and is funded by the Virginia Department of Health. The Research Consortium at VCHI developed the following report on behalf of the Task Force and is intended to support data-informed strategies to strengthen and sustain primary care in the Commonwealth.

Executive Summary

Primary care is foundational to a high-performing, cost-effective healthcare system— yet most states lack a consistent way to measure investment in the primary care ecosystem. To address this barrier, the Virginia Task Force on Primary Care publishes an annual Primary Care Investment Report to inform state policy and Task Force initiatives. Now in its fourth year, this report provides a longitudinal view of claims-based primary care investment in Virginia, using the Virginia All-Payer Claims Database (APCD) (see Appendix A for methodology). The findings in this report represent inflation-adjusted spending trends across commercial, Medicaid, and Medicare markets, offering policymakers, payers, and provider leaders with actionable insight into the health of the primary care ecosystem and trends in expenditures.

  • Virginia ranks #14 on overall healthcare system performance, but continues to perform worse than national averages on avoidable emergency department use and medical debt, issues that primary care has been shown to improve. In fact, fewer children in Virginia have a medical home in 2023 than they did in 2019.
  • Virginia primary care investment remains stagnant as a share of total health spending.
  • In 2023, Virginia invested $1.1 – $2.0 billion in primary care, reflecting $0.02 – $0.04 of every healthcare dollar (2.1% – 3.9% of total spend).
  • The percentage of total healthcare spend dedicated to physician-led preventive care decreased by 19.2% since 2019.
  • Even utilizing the Task Force’s broadest definition of primary care, after an initial bump in 2020, primary care as a percentage of total healthcare spend has remained stagnant – with less than a percentage point increase since 2019. In fact, aside from Medicare Advantage, primary care decreased as a share of total healthcare spend across all payers from 2022 to 2023.
  • Nearly all new primary care investment in real dollars is going towards outpatient facilities and advanced practice practitioners (APPs). Investment in physician-led preventive services has remained essentially stagnant, with a 3.3% increase in total dollars from 2022 to 2023, while total healthcare spend increased by 14.3% over the same time period.
  • For narrowly defined primary care, all payers aside from commercial payers decreased their spend per person per month since 2019. For broadly defined primary care, per member per month spend has fluctuated greatly and varies by payer.
  • Locality investment in primary care differs significantly as well, with the Southwest region spending more on primary care than other parts of the Commonwealth, both in terms of spend as a percentage of total healthcare dollars and spend per person per month. While spend in the Southwest is especially reliant on APPs and rural health clinics, spend on physician-led preventive care services is still greater than is seen in most regions of the Commonwealth.

Overview

Investing in primary care is essential for maintaining and improving the health of Virginians and ensuring a cost-effective healthcare system. Virginia has taken key steps in prioritizing primary care through establishing the Virginia Task Force on Primary Care and becoming the second state in the country to report annually on primary care investment and associated health outcomes, workforce, and utilization trends (see Virginia Primary Care Scorecard).

This 2025 report, published on behalf of the Virginia Task Force on Primary Care, presents an inflation-adjusted, claims-based analysis of primary care investment across major payer types from 2019 to 2023 with estimates derived from the Virginia All-Payer Claims Database (APCD).1  Together with the Virginia Primary Care Scorecard, these reports offer a comprehensive view of the health of Virginia’s primary care system. This report is intended to inform state policy and guide future recommendations of the Task Force.  For the purposes of this report, the Task Force established a 4-quadrant approach to defining primary care based on a narrow and broad set of services and provider types. Only the broadest and most narrow definitions are reported here to provide the full range of estimates. The narrowest definition is based on physician-led preventive services. The broadest definition includes all outpatient and professional services performed by primary care physicians, advanced practice practitioners (APPs), OBGYNs, School Health Clinics, Rural Health Centers and Federally-Qualified Health Centers (FQHCs) (see Appendix A for methodology).

Why Investment Matters

According to the 2025 Scorecard on State Health System Performance from Commonwealth Fund, while Virginia ranks #14 for overall healthcare system performance, Virginia performs worse than the national average on avoidable emergency department use and residents with medical debt, both issues that access to high-quality primary care has been shown to improve.2

Yet, as this report shows, primary care investment remains largely stagnant as a share of total health spending. In fact, fewer children in Virginia today have a comprehensive medical home than they did in 2019 (down to 45% compared to 53%), setting the Commonwealth up for further health declines and affordability concerns in the future.3 Areas that have seen increases are largely related to services performed by APPs and outpatient services. Investments may be made through public policy initiatives or through other industry-led investments, including traditional fee-for-services rates, increases in utilization of services, or through shifting towards alternative payment arrangements, such as value-based purchasing models, performance-based payments, or infrastructure investments. This report does not include investments in alternative payment arrangements as this information is not reported to the All-Payer Claims Database.

Trends in Primary Care Spend in Virginia

Primary Care as Share of Total Healthcare Spend

Greater investment in primary care is associated with fewer emergency department visits and hospitalizations and reductions in overall healthcare costs.4, 3 Yet, investment in Virginia’s primary care has remained low even as investments have increased in healthcare overall.

As of 2023, primary care received $1.1 – $2.0 billion through service-based billing, with the range reflecting a narrow definition focused on physician-led preventive services up to a broader definition which includes outpatient facility fees and advance practice practitioners (APPs) such as nurse practitioners and physician assistants (see Appendix A for methodology). Overall, primary care accounts for $0.02 – $0.04 of every healthcare dollar (2.1% – 3.9% of total spend) (Figure 1). While in 2023, Virginia spent 2.1-3.9% of healthcare dollars on primary care, surveys found that the public believes primary care receives 51.8% and addresses 59% of healthcare needs. While public estimates of care are aligned with actual utilization data, spend was vastly over-estimated. This discrepancy suggests that the public values primary care at a significantly higher amount than our current healthcare system.5

Figure 1. Primary Care as a Percentage of Total Healthcare Spend

The percentage spend on physician-led preventive care (narrow definition) has decreased by 19.2% since 2019. This decrease is seen across all payers.

Since an initial bump in 2020, primary care as a percentage of total healthcare spend has remained stagnant – with less than a percentage point increase since 2019. This is largely due to growth in other healthcare sectors outpacing growth in primary care (see Total Healthcare Spend). In fact, the percentage spend on physician-led preventive care (narrow definition) has decreased by 19.2% since 2019, from 2.6% to 2.1%. This decrease is seen across all payers, with the largest decrease in Medicare Fee-for-service (-29.2), followed by Medicaid (-23.1) (Table 1A).

More broadly defined primary care, inclusive of APPs, has increased as a percent of total healthcare spend since 2019, but the variation across payers in significant – ranging from an increase of 22.7% in commercial payers to -3.1% in Medicare FFS (Table 1B). Additionally, the majority of the increase occurred in 2020, with the percentage of spend remaining essentially stagnant following that initial bump – led by commercial payers. In fact, for all payers except Medicare Advantage, which remained stable, primary care decreased slightly as a percentage of total healthcare spend for all payers between 2022 and 2023.

Table 1A. Primary Care as a Percentage of Total Healthcare Spend (Narrow)

Table 1B. Primary Care as a Percentage of Total Healthcare Spend (Broad)

Trends in Real Dollar Investment in Primary Care

Primary care as a share of total healthcare spend is dependent both on investments in primary care and growth in other healthcare sectors. This section describes the growth in real dollars for primary care and informs how primary care spend may vary as a share of total healthcare costs by describing change in total healthcare dollars as well.  All reported dollars are adjusted for inflation to 2023 dollars using the Bureau of Labor Statistics (BLS) Medical Consumer Price Index (CPI).

Since 2019, real dollar investment has increased for both narrowly and broadly defined primary care; however, that increase differs substantially between the two definitions. For narrowly defined primary care, investment has increased from $998.4 million in 20219 to $1,077.7 million in 2023 (7.9% increase). Most of the increase was in 2021 when spend rebounded following a -6.7% drop in 2020 with the COVID-19 pandemic (Figure 2). Since that time, investment has risen slowly with a 3.3% increase in spend between 2022 and 2023. Comparatively, primary care utilizing the broad definition grew 10.2% and total healthcare spend grew 14.3% between 2022 and 2023.

Figure 2. Year-to-Year Change in Real Dollars, 2019-2023

Similar to narrowly defined primary care, more broadly defined primary care also experienced a decrease in spend in 2020; however, the decrease was only 1.0%, while the rebound was 15.5%.  Markets across the healthcare system corrected with smaller increases in 2021, but broadly defined primary care has retained relatively stable year-to-year increases in spend – ultimately increasing by 35.7% since 2019 while healthcare spend overall increased by 19.3%. The relative growth in broadly defined primary care compared to narrowly defined primary care is driven by increases in spend for outpatient facilities and APPs (see Drivers of Primary Care Spend).

Primary Care Investment by Payer

The limited growth in real dollars invested in physician-led preventive service primary care is driven by a sharp decline in Medicare FFS investments (-47.9%) (Table 2A). Medicare Advantage (MA) investments have increased substantially during this period (88.6%) – potentially suggesting a shift from Medicare FFS to Medicare Advantage. However, the total new dollars invested by the MA program are insufficient to fully substitute for spending loss from Medicare FFS.  While Medicare FFS spend has decreased by $203.7 – $236.7 million (narrow to broad) over 5 years, MA spend has only increased by $71.1 – $76.5 million (narrow to broad) – resulting in a real dollar loss of $132.0 million for Medicare-covered primary care. Meanwhile, commercial payers have nearly doubled primary care spend over the same period.

Table 2A. Real Dollar Investment in Primary Care (Narrow) (millions)

Table 2B. Real Dollar Investment in Primary Care (Broad) (millions)

Importantly, overall increases in investment for primary care, especially physician-led preventive services, are largely due to an increase in volume of insured individuals rather than increased primary care spend per person. In fact, for narrowly defined primary care, all payers aside from commercial payers decreased their spend per person per month since 2019. Commercial payers increased per member per month spend by 51.5% for narrowly defined primary care and doubled spend for broadly defined primary care. However, it should be noted that commercial insurers had significantly lower per member per month spend in 2019 compared to all other payers. The range of primary care spend per member per month is most similar between Medicare FFS and Medicaid, although Medicare FFS had a sharp decline in spend in 2023 that is not seen in Medicaid. Medicare Advantage has significantly higher PMPM for all primary care definitions than other payers, with even their PMPM for the most narrowly defined primary care $5.00 more than the broadest definition for any other payer (see Figure 3).

Figure 3. Per Member Per Month Spend (Narrow to Broad)

For physician-led preventive services, all payers aside from commercial payers decreased their spend per person per month since 2019.

Total Healthcare Spend

Healthcare expenditures are rising in Virginia. Between 2019 and 2023, total healthcare expenditures reported to the APCD increased by 19.3%, from $42.9 billion to $51.2 billion (adjusted for inflation) (see Figure 4).

 

Figure 4. Total Healthcare Spend

Expenditures increased across all payer types, with the exception of Medicare FFS, which has decreased due to decreases in enrollment, with a greater proportion of Medicare-eligible Virginians shifting to Medicare Advantage. While Medicaid growth between 2020 and the end of 2023 slightly outpaced that of other payers, the growth in spend was due to disproportionate growth in enrollment, not higher costs per member. In fact, while commercial spend per member increased by 63% between 2019 and 2023, Medicaid’s growth was flat, with a per member per month cost of $463.69 in 2019 and $463.73 in 2023. This was, however, a rebound from a negative trend of less spend per member per month between 2019 and 2023 (see Figure 5). 

Figure 5. Total Healthcare Spend by Payer ($ Billions and PMPM)

Using claims-based data from the APCD, pharmaceutical spend makes up the greatest proportion of total healthcare costs (27.6%). Pharmaceutical costs also had the greatest growth from 2022 to 2023 (25.4%). However, growth across sectors has varied tremendously since 2019, with sectors seemingly rebounding from the COVID-19 pandemic lows at different times (see Figure 6).

Figure 6. Total Healthcare Costs by Sector

Drivers of Spend in Primary Care

In 2023, 31.1% of spend in primary care was for services rendered by an advanced practice practitioner (APP) (e.g. nurse practitioner or physician assistant). The growth in nurse practitioners especially has been a significant contributor to the increase in primary care spend – with a $134 million increase in spend from 2022 to 2023 (27.3% increase).  Since 2019, APPs have accounted for a growing percentage of primary care spend (see Figure 7).  

Figure 7. APPs as a Percent of Primary Care Spend

However, it should be noted that while the Virginia Task Force on Primary Care includes all professional and outpatient services performed by an APP as primary care, national data suggests that only 26.7% of nurse practitioners practice in a primary care setting. This trend is similar to the percentage of physicians practicing in primary care settings. Therefore, the inclusion of all APP costs may overstate that actual investment in primary care, if less than 1 in 3 APPs is practicing in primary care. The Task Force included all APP expenditures in the broad definition of primary care due to limited information about setting of care in APCD data. Unlike physicians, APPs do have specialties assigned to their provider identifiers.

Use of APPs varies greatly by payer and is evolving quickly. In Medicaid, 30.6% of primary care expenditures were for services provided by an APP. While this proportion of spend is higher than among commercial payers (24.4%), it is significantly lower than the proportion provided by APPs in Medicare FFS and Medicare Advantage (38.1% and 38.5% respectively). It should also be noted that use of APPs grew significantly between 2022 and 2023, with a 42.7% increase in spend for APPs in Medicaid, second only to the growth in Medicare Advantage (46.5% increase).

Outpatient Services

Primary care may be provided in a clinic or office-based setting, or it may be provided in an outpatient facility, such as an ambulatory care center associated with a health system. Primary care services provided in an outpatient facility can be reimbursed both for the professional services offered as well as a facility-based fee to support the cost of maintaining the facility. Outpatient expenditures in Virginia have been increasing as a percent of total expenditures, now accounting for 19.8% of total healthcare costs. This trend is similarly evident in primary care spend, where outpatient expenditures account for a growing proportion of primary care. 

Figure 8. Outpatient Facility Spend as a Percent of Total Spend

However, the percentage is still exceedingly small in primary care, with only 2.3% of primary care expenditures going toward outpatient facility services, even using the broadest definition of primary care. Overall, outpatient services accounted for $45.3 million of primary care spend in 2023.

Geographic Variation

Broadly Defined Primary Care

The Southwest region of the Commonwealth has the greatest investment in primary care, broadly defined, in terms of the percentage of healthcare dollars spent on primary care – followed closely by Northern Virginia. In fact, 4 of the top 5 localities for primary care spend as a share of total healthcare spend are in the Southwest. This investment in primary care in the southwest is not just a result of lower total healthcare spend and limited access to expensive specialists. The total monthly spend on primary care services per person is also higher in the Southwest, with $347.57 per insured person per month in the City of Norton compared to $117.09 in Highland County (Northwest) – the lowest spend in the Commonwealth (see Figure 9).

Figure 9. Broad Percent Spend and PMPM

Narrowly Defined Primary Care

Compared to broadly-defined primary care, spend on narrowly-defined primary care is less regional and more local. The localities with the highest percent spend on physician-led preventive services tend to be in areas with large medical centers, such as the Northern Virginia cities and the Charlottesville area. The locality with the highest percent spend on physician-led preventive services is the city of Manassas (3.5%), followed by Loudon County (3.1%), Manassas Park (2.9%), and Albemarle County (2.9%). The lowest percentage of spend is in the city of Galax (0.9%) and Valley counties of Page (1.0%) and Highland (1.0%).

While percent spend is somewhat aligned with localities that are home to large medical centers, this is not so when looking at per member per month spend. The Southwest region again tends to out-perform other regions of the state with the highest per member per month spend in Smyth County ($14.11), followed by Albemarle ($12.73), Bristol City ($12.68), and Scott County ($12.52).

Figure 10. Narrow Percent Spend and PMPM

Conclusion

In Virginia, primary care investment has largely been matched or outpaced by increased investment in other healthcare sectors. Investment in physician-led preventive services has been especially stagnant or even decreasing among some payers, while APPs make up an increasingly large portion of primary care spend. Regardless of payer, per member per month spend has been fairly stagnant, although total spend varies significantly by payer, with Medicare Advantage plans investing a far greater among per member than other payers. Furthermore, spend is not even across the Commonwealth, with areas such as the Southwest region investing more per person in primary care than other regions.

Virginia has invested in primary care, namely through the establishment and annual convening of the Virginia Task Force on Primary Care. However, as evidenced by continuance of low investment in primary care, the Commonwealth has made few direct financial investments in primary care, with the last major investment being to increase Medicaid rates for some primary care services to 80% of Medicare rates in 2022.6 States have increasingly taken additional actions to increase investment in primary care through a number of policy options, such as through Medicaid payments, primary care spend targets, education and workforce programs, or infrastructure investments.  The Task Force  continues to review potential policy options that may be most appropriate for Virginia, and has recommended increasing primary care rates in Medicaid to parity with Medicare and additional data collection and research on spend targets and alternative payment policies to incentivize continued investment in infrastructure and quality-based payments.  

Citations

1. Virginia Health Information. All-Payer Claims Database (APCD). https://www.vhi.org/apcd/

2. Bazemore, A., Petterson, S., Peterson, L. E., Bruno, R., Chung, Y., & Phillips Jr, R. L. (2018). Higher Primary Care Physician Continuity is Associated With Lower Costs and Hospitalizations. The Annals of Family Medicine, 16(6), 492–497.

3. Commonwealth Fund. 2025 Scorecard on State Health System Performance. https://interactives.commonwealthfund.org/2025/state-scorecard/Virginia.pdf

4. Investing in Primary Care: A State-level Analysis. (2019). Patient-Centered Primary Care Collaborative & Robert Graham Center. https://thepcc.org/wp-content/uploads/2019/07/Investing-In-Primary-Care-State-Level-Analysis-July-2019.pdf 

5. Ma, M., Etz, R., Bazemore, A., & Grumbach, K. (2025). The General Public Vastly Overestimates Primary Care Spending in the United States. The Annals of Family Medicine, 23(3), 240413–240413. https://www.annfammed.org/content/early/2025/02/05/afm.240413

6. Virginia Budget. Item 288 CCCC. https://budget.lis.virginia.gov/item/2025/1/HB1600/Chapter/1/288/

Appendices

Click Here to View the 2025 Virginia Primary Care Investment Report as a PDF

Acknowledgements

This report was prepared by:

Lauryn Walker

Chief Strategy Officer and Executive Director, Research Consortium at VCHI

Virginia Center for Health Innovation (VCHI)

 

Zelda Hinkle

Project and Communications Coordinator

Virginia Center for Health Innovation (VCHI)

We want to thank our colleagues at Virginia Health Information, Kyle Russell and Dawniece Trumbo for support with data analysis and technical assistance. We’d also like to express our appreciation for our partners at Milliman MedInsight, Melanie Craff, Michael Hadfield, Dale Skinner and Rose Hess for data preparation, expertise and technical assistance. Thank you to Allison Hammond, VCHI intern, for additional support and document review.