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March 2, 2017

With direct primary care, there is no middle man

Daily Briefing

More physicians are practicing "direct primary care," a method of care provision that lets patients pay a modest monthly fee for everything from office visits to basic lab tests—and which cuts down on costly overhead and enables physicians to focus on patient care, Melinda Beck reports for the Wall Street Journal.

Spotlight on direct primary care

According to the Direct Primary Care Journal, direct primary care memberships typically:

  • Cost between $25 and $85 per month;
  • Cover office visits, 24/7 support, basic lab tests, vaccinations, scans, and generic drugs; and
  • Serve patients ages 29 to 59 with incomes below $93,000.

It's a similar model to so-called concierge medicine practices, which typically charge a monthly fee between $101 and $225, according to Concierge Medicine Today. However, according to Beck, concierge practices frequently bill insurers or patients for individual office visits and offer other value-added services, such as wellness assessments.

Direct primary care practices run the gamut from smaller, independent practices to larger networks with locations in multiple states. For instance, Beck spotlights Linnea Meyer, a physician who recently started a direct primary care practice in Boston that charges patients a monthly fee between $25 and $125, based on age. The fee covers basic primary care services and gives patients access to Meyer via text, phone, and email, Beck writes. There are no insurance claims to file, and Meyer doesn't need any office staff to handle the administrative tasks.

"Getting that third-party payer out of the room frees me up to focus on patient care," Meyer says. "This kind of practice is why I went into medicine, and that feels so good."

Understanding the trend

While less than 2 percent of the country's licensed physicians are currently involved with direct primary care, some experts think the model "could grow as Republicans encourage more free-market alternatives to insurance-based, fee-for-service medicine," Beck writes.

For instance, there are bills in both the House and Senate that would allow individuals to spend money from health care savings accounts (HSA) on direct primary care fees. And some Republican proposals to replace the Affordable Care Act would give people tax credits to use toward HSAs.

The American Academy of Family Physicians also supports direct primary care because it lowers administrative burdens and doesn't incent doctors on volume of services. John Meigs, the group's president, said, "Patient satisfaction goes up. Physician satisfaction goes up. Quality goes up and costs go down because you don't have to prove it to Uncle Sam or an insurance company."

Direct primary care isn't a replacement for insurance, Beck writes—but it can pair well with high deductible health plans that help cover hospitalizations or serious medical problems. Jay Keese, executive director of the Direct Primary Care Coalition, said that in such cases, patients are "essentially buying insurance against using [their] insurance."

New research casts doubt on the benefits of high-deductible plans

According to experts, the model could be particularly beneficial for patients with complex medical conditions who require steady monitoring and need help organizing care from multiple specialists.

Making it work

Despite the positives, Beck writes that "there are few academic studies assessing whether direct primary care actually cuts costs and improves patient health." But individual practices have reported success.  

For instance, Qliance—a large direct primary care practice in Washington which has contracted with the state's Medicaid program—said its patients had 27 percent fewer ED visits, 60 percent fewer hospital days, and cost their employers 20 less on average, compared with similar, non-Qliance patients in the area. And Boston-based Iora Health—which works with Medicare Advantage plans in Colorado, Arizona, and Washington—said 83 percent of the patients in its practices with high blood pressure have it under control, about 20 percentage points higher than the national average.

But scaling up the direct primary care "model significantly could exacerbate the shortage of primary-care doctors," Beck writes. Traditional primary care doctors treat more than 2,000 patients, while direct primary care physicians treat fewer than 600. Robert Berenson, a fellow at the Urban Institute and former head of managed-care contracting for Medicare, said widely adopting direct primary care could require three times as many doctors.

Insurers may also refuse to pay direct primary care fees if services go unused, Beck writes. That's what happened to Qliance, after only about 25 percent of the Medicaid beneficiaries assigned to it for care showed up in the first year. The state subsequently negotiated for a lower rate.

Some also worry that without the oversight of an insurer, direct primary care practices might cherry pick healthy patients. But advocates say patients can be their own quality control—leaving practices if they don't feel they are getting high-quality care. And so far, according to Beck, patient "satisfaction rates run high." As Meyer put it, "Patients love it, and I love it" (Beck, Wall Street Journal, 2/27).

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