In today's healthcare market, many patients are faced with high deductibles and recurring out-of-pocket expenses like copays. On the other side of the coin, physicians are under pressure to see as many patients as possible, and bill third-party payers for all allowable expenses. As a result, some people are turning to Direct Primary Care as an alternative to the traditional insurance-focused model.
The Direct Primary Care model is similar to Concierge Care, but is less expensive for the patient, and does not rely on third-party payers. In Concierge Care models, physicians charge a "retainer fee," but patients continue to use their insurance to pay for office visits, lab tests and prescriptions. Under the Direct Primary Care (DPC) model, patients pay a monthly fee to the practice, and generally do not use their health insurance. While Concierge Care fees can reach thousands of dollars a year, DPC's fees hover around $80 a month per individual.
Direct Primary Care vs. Insurance Model
Primary care physicians operating under the typical fee-for-service model may have as many as 2,300 patients. According to Business Insider, with DPC, the number of patients is reduced by half to three-fourths. Additionally, these physicians are able to spend an average of 30 to 60 minutes with each patient, instead of the more typical 13-15 minutes.
DPC practices do not bill for services, but instead rely on the monthly fees paid by patients who want a more personal level of care and a better relationship with their physician. The monthly fee usually includes routine laboratory tests, and prescriptions at the wholesale price plus 10 percent.
Where the DPC Model Falls Short
Patients who wish to receive care under the DPC model will need to keep some form of health insurance in case of catastrophic events. Also, individuals with health savings accounts are currently prohibited from using them to pay for DPC fees, since the IRS views those costs as insurance payments. Congress is reviewing legislation to change this rule, but until the regulations are altered, patients may see this limit as a downside to DPC care.
The American Academy of Family Physicians (AAFP) recommends that practice owners who are interested in turning to a DPC model consult an attorney or healthcare consultant. It's important to enlist someone who is familiar with state and local laws that might govern these type of "retainer-based" practices.
Deciding to Adopt the Direct Primary Care Model
Private practice gynecologists who are interested in moving toward a model of direct primary care should weigh the pros and cons of functioning under this model. Even if a practice is self-contained — offering in-house, cost-effective services such as ultrasound — if its physicians perform surgery at a larger facility, the third-party payer ramifications can be complicated. Some DPC practices use a hybrid system, thereby still accepting insurance, but from fewer, better payers. One of the major considerations in a Direct Primary Care model, however, is the cost savings associated with not having a billing department, but the decision to become an out-of-network provider is one that needs careful thought.
Private practices are financially challenging, but when managed effectively, are sustainable under a DPC model. A physician interviewed for the Business Insider article saw a reduction in his income overall, but found greater career satisfaction in being able to spend more time with his patients. Furthermore, according to Health Leaders, patients who have better access to their physicians through a DPC plan are healthier, less likely to visit the emergency room and more engaged in their own health.
While Direct Primary Care may not be for everyone, it does present an interesting option both doctors and patients can consider, especially given some of the issues that come up with an insurance-based system.
