A kinder, gentler health care model?
Direct Primary Care is NOT insurance, but with physician burnout on the rise and patients yearning for more time and attention, it could be a viable option.
From the pages of In Business magazine.
January marked a career milestone for Nicole Hemkes, M.D. The board-certified family practice doctor opened her new direct primary care clinic, Advocate MD LLC in the Middleton Hills area, as an independent physician. She is one of hundreds of direct primary care doctors around the country who’ve bucked the large health system model in favor of small independent practices not beholden to corporate rules and regulations.
Some consider direct primary care “health care the way it used to be,” and it’s gaining traction, according to Consumer Reports, which included the DPC model in a November article titled “5 Smart Money Moves for 2019.” Around the U.S., CR reports there are about 900 practices serving an estimated 500,000 patients.
It’s critical to understand that direct primary care is health care, NOT health insurance. Patients are strongly advised to carry a separate health insurance plan.
DPC is not a panacea either. Patients electing this model must be prepared to pay out of pocket for any services or tests their DPC physician cannot routinely perform in their office. On the flip side, physicians are in full control of their daily schedule, and patients experience vastly improved access to their doctors.
There are no on-site cost barriers, such as insurance co-pays or co-insurance at check in because office visits are covered by a flat-rate monthly membership agreement. Appointments are scheduled directly with the physician via phone, text, or an email to the doctor.
Routine physicals and office visits are included at no extra charge, and members are not limited to how many times they can see their doctor, whether it’s 300 times a year, or two. Sound too good to be true? We’ll let you decide.
In most cases, direct primary care is a transparent model of health care whereby patients agree to pay a flat monthly fee for 24/7 access to their primary care physicians. Fees increase with age and cover the most common treatments at no extra cost.
Hemkes, for example, has been soliciting new patients online since October. Her monthly fees range between $44 and $111 per month based on age, including physicals or basic services commonly covered by a family doctor. Additional fees may apply for after-hours or house calls, so it’s always best to check first.
Her 2,000–square-foot practice includes a waiting room, two exam rooms, a lab/medication area, kitchen/storage area, and personal office. Hemkes administers care to patients of all ages, including preventive care, treatment of chronic illnesses (e.g. hypertension and diabetes), and also at no extra charge mole-removal, orthopedics/joint injections, and common aches and pains and miseries such as colds and sore throats. “Because of my background in emergency/urgent care, I’m comfortable handling issues of a more urgent nature, too,” she says.
As an independent physician not tied to any clinic or health insurance group, it behooves her to negotiate prices with clinics and laboratories in advance. She also can dispense a variety of common medications from her office at a pre-negotiated rate that she says can be “pennies on the dollar.”
The DPC community argues that by removing barriers like co-pays or co-insurance, they’re offering better health care because patients will be more likely to visit the doctor more regularly if it’s already included in their membership fee. “The DPC model tries to triage things over the phone, too,” she adds. “So if we can comfortably handle a patient concern, great! If I need to see you, we can agree to meet that same night or schedule something the next morning.”
The idea is to lessen referrals to specialists by treating issues before they develop into larger problems. Direct primary care offices may have just one or two employees, including the doctor. Patients needing to schedule an appointment or get a quick callback usually speak directly with the doctor, and if they can’t at that moment, they’ll hear back from the doctor very promptly. “That’s unheard of in today’s world!” Hemkes states.
She believes strongly that patients should have a choice in their health care based both on quality and cost, and there are no pre-existing condition clauses.
“Let’s say we have a nonaffiliated radiology office in town that charges $850 for an MRI, but I know that in Milwaukee that exact test would cost $500. Why shouldn’t I give that information to my patient — in a non-urgent scenario, of course?”
DPC physicians also keep their own patient records and share them as needed. If a patient requires more extensive tests — such as x-rays, cat scans/MRIs, hospitalization, or chemotherapy — Hemkes would refer them to a clinic or hospital as directed by the patient’s own insurance plan.
In light of the nation’s opioid crisis, Hemkes likely won’t be administering chronic pain medication. “Patients should probably see pain clinics for that,” she advises.
After 10 years as a physician, emergency/urgent care doctor, and hospitalist in Chicago, her home state of Florida, and now Madison, she decided it was time for a change. “I think what’s happening around the country is that both physicians and patients are frustrated,” Hemkes states. “Physicians are disillusioned because we’re spending the majority of our time in front of a computer and we’re being told how many patients we need to see and how much time we can devote to each.”
Job satisfaction usually comes down to two things, she explains, including “a feeling of purpose in what you do and autonomy. Autonomy is mostly gone, yet that’s where this profession came from.”
Suzanne Gehl, M.D., 59, is a board-certified physician with an office in Delafield, Wisconsin. She is also board certified in hospice and palliative care. Gehl served on the faculty at the Medical College of Wisconsin prior to joining Paladina Health in 2012, a national direct primary care employer with several locations in and around Milwaukee.
She left Paladina in October 2017 to become an independent DPC provider. Her flat, monthly rates range from $50 for someone aged 20-44, to $100 for a patient over 65. “People are paying a lot more for their cable bills!” she says.
To keep her expenses in check, Gehl works in a rented office furnished with used furniture. “It’s very nice,” she says, “but more importantly, my patients have told me they no longer feel like they’re part of a cog in a gigantic wheel.”
Gehl works with individuals and businesses owners, as any direct primary care physician can. Once, when negotiating with a small business owner who had always provided standard health insurance for his employees, it became evident that some employees had been delaying their own health care for a variety of reasons — mostly cost.
“Suddenly I was diagnosing diabetes, skin cancer, hypertension, thyroid problems, all because those barriers were removed,” Gehl says.
Under that type of scenario, Gehl suggests an employer’s health care costs may increase as employees get evaluated and properly treated. Long term, she believes direct primary care has the potential to save employers “a lot of money” because employees will be healthier overall.
“The current health care system focuses on the biggest issue you have today, not all the concerns a patient might prepare on a list,” Gehl states. “If an employed physician is limited to 15 or 30 minutes per patient, they often don’t have time to delve deeper, or they’ll pass the patient along to a specialist, and that costs more money.”
Gehl recently met a woman who received a $240 bill after seeing a traditional doctor for a sore throat. “Had she come to me I could have done that strep test for free and given her an antibiotic that would have cost her $1.59!
“That $240 would have paid for four months of membership in my practice, a complete comprehensive physical exam, and lower-cost medication. A thyroid test that I do in my office costs $1.75.”
At the same time, she confirmed that other health care organizations charged between $40 and $400 for the exact same blood test. “We don’t mark things up,” she says.
Gehl believes direct primary care participation will only continue to expand, especially for businesses. “I wasn’t motivated to go into medicine for the income. I wanted to take care of people! This model gives me a path to do exactly what I want and provide quality health care.”
Gehl says the DPC model has been criticized for not caring for enough patients at a time when there’s a severe shortage of primary care physicians, but she disagrees. “I see this as a solution that’s keeping many physicians in the workforce longer because they love it. It’s what they went to medical school for and they don’t have to sit in front of computers punching boxes all day long!”
It may not be the right model for a new med student with $200,000 to repay in student loan debt, she cautions, “but I’m married and my kids are out of the house, so it’s easier for me to take a risk.
I’m so much happier now.”
A winning decision
Mark Niedfeldt, M.D. splits his Mequon-based practice between direct primary care practice and sports medicine.
“The DPC model has been evolving for the past 10 years,” Niedfeldt says. He opened his practice in October 2008 with no patients, no income, and one employee. “2008 was not a good time to start a business,” he reflects.
Prior to that, had spent 12 years on the faculty at the Medical College of Wisconsin and was sensing a change toward a volume-based health care model.
One day, while meeting with a health care administrator who was evaluating Niedfeldt’s RVUs (relative value-units, how doctors get paid), an administrator noticed that one of Niedfeldt’s long-term patients had diabetes.
“‘You know,’ the administrator said to me, ‘you could get a nice bonus but this guy’s bringing you down,’ he told me. Then he actually suggested I kick that patient out of my practice!”
In another instance, Niedfeldt observed an interaction between a colleague-physician and a medical student. The medical student had just seen a patient and listed off a number of concerns that patient had mentioned. “My colleague’s response to her was, ‘Okay, go back in there and tell her that she only gets one complaint today, so which does she want me to address? She’ll have to make another appointment for the other issues.’”
Niedfeldt was stunned. “This woman probably scheduled her appointment months ago, took a half-day off work, waited in a waiting room for a long time, and then she’s told to choose her biggest of several issues? This is what we’re teaching our medical students?
“I went home that night and told my wife, ‘I’m out.’”
She wasn’t the least bit surprised.
He’s never regretted becoming an independent physician, although it took over a year for his practice to become sustainable and about two years before he took a paycheck.
“You won’t get rich under this model,” he admits, “but we do it because we want to do the right things for our patients, we want to control our practice, regain our love of medicine, and reclaim our home life again.”
Niedfeldt decided early to limit his DPC patient panel to 500, and he also provides fee-for-service sports medicine consults.
Most patient issues are handled in his office, but if a specialist is needed, he’ll work within the framework of the patient’s insurance plan, and he’ll recommend other physicians, as well, if he believes they’re the best option. “I’ve suggested physicians in Chicago or the Mayo Clinic and let the patient decide because I believe people value the independence.”
Niedfeldt says the direct primary care model benefits two types of patients: someone with a number of health issues who “just needs a quarterback,” and the person who wants to live a healthier lifestyle and establish a long relationship with their doctor so they can identify potential risk factors now that could lead to health problems down the road. “That’s true preventive care,” he says.
Niedfeldt warns physicians interested in direct primary care arrangements to price their services appropriately. “I raised my prices a few years back and actually gained more patients.”
DPC is like an all-you-can-eat buffet, he compares. “You don’t have to eat it all, but you know it’s there if you need it. People spend $85 or more for a massage, so isn’t having a physician on retainer worth it?”
Do the math
Cheryl DeMars, president/CEO of The Alliance in Madison, cautions anyone interested in direct primary care to “do the math.” Because it is not insurance, people need to assess their health and how much they might need to utilize out-of-office services. “You need a plan for care that isn’t covered by that primary care physician. You can’t ignore that.”
However, DeMars sees promise with the DPC model, in general, especially for self-funded employers who offer a pay-as-you-go model and don’t work with insurance companies. Individual consumers of health care who are self employed could also benefit.
The local health care market is dominated by provider-owned HMOs, DeMars explains, meaning many of the primary care physicians here are employed by the very delivery systems that own their insurance product. That, in her opinion, may be one reason why DPC is less known in this area versus other parts of the state.
Overall, DeMars views DPC as an alternative to part of what Quartz and Dean do. “It also has the potential to direct high-margin care to good value specialists, instead of the current model where primary care providers — generally speaking — refer to specialists within their own delivery system without regard to information about the cost or quality of their care as compared to their peers in the market.”
Count DeMars among those who believe it’s time to give the DPC model a seat at the health care roundtable and simply view it as another option for health care consumers to consider.
“Over the past decade, we’ve seen the challenges involved with trying to fix health care at the macro level through legislation either at the state or federal levels. While we continue to work on that, why not let a market-based initiative test the market?
“Direct primary care may not be the total solution, but who can defend the status quo?”
A patient’s perspective
Patrice Bottoni is a patient of Dr. Suzanne Gehl.
She pays $75 a month for 24/7 access to Gehl’s DPC practice, and is also enrolled in a high-deductible plan offered through one of her two employers. She chose the least expensive premium which has a deductible of $4,000.
“I get a very thorough, very complete physical every year that sometimes takes as long as two hours at no extra charge,” she reports. “She looks at me and talks to me!”
Access to her doctor is a huge peace of mind, she says, and outweighs any costs. Her doctor is a true advocate that has time to provide options and negotiate costs should she need care elsewhere.
When she needed two special blood tests done, Gehl sent them out to a clinic for processing. “I think one cost me $3 and one was $7!” Bottoni laughs. “When was the last time you saw a number like that on a medical bill?”
Under the dome: The legislative debate
Arguing FOR DPC
Twenty-three U.S. states have approved direct primary care bills similar to what was proposed by Wisconsin Sen. Chris Kapenga and Rep. Joe Sanfelippo last year. In Wisconsin, the measure passed the state assembly (AB 798), but the Senate did not take it up, so it effectively died.
The bill allows patients or employers to enter into a contract with a direct primary care provider for routine health care services for an agreed upon fee and time period.
Sanfelippo said they would reintroduce the bill this session “because we believe strongly in the model and the opportunity it provides for people throughout the state to get better health care at an affordable price.” A brief synopsis of our conversation follows.
Why isn’t DPC more popular?
Sanfelippo: Because it’s relatively unknown, in my opinion. There are currently no laws on the books to govern it, and that’s why we’re proposing this bill. Doctors need to know exactly what they can and cannot do.
Right now, any physician practicing direct primary care is in unchartered waters, so if an issue was to arise, there are no rules to guide what happens. If we can give DPC some structure, I believe you’ll see practices begin to flourish throughout the state.
Why is it so important to clarify that DPC is “not insurance?”
Sanfelippo: That’s where the affordability comes in. We’ve seen health insurance costs skyrocket 30-40 percent in some counties. Even with the exchanges, people cannot always afford to use insurance because the deductibles and co-payments are so high.
“If you take one of those types of plans and combine it with the DPC package, you can get unlimited access to a primary care physician. Studies show that 90 percent of a person’s health care issues can be handled in a primary care office.
Can this pass, in your opinion?
Sanfelippo: We’re very hopeful, but like anything else, there’s some resistance to changing a traditional model.”
Concerns about DPC
The Wisconsin Association of Health Plans serves as a voice of community-based health plans that provide health insurance coverage in every county of the state.
Tim Lundquist, director of government and public affairs, offered his responses via email [edited for space].
Does your organization support direct primary care?
Lundquist: Direct primary care may meet the needs of a subset of people, but Wisconsin’s community-based health plans are most interested in working on solutions that improve cost and access to care for everyone. Wisconsin’s community-based health plans believe appropriate consumer protections should be in place for those who choose to participate in direct primary care arrangements.
What are the sticking points here?
Lundquist: The association is concerned about the proposal because it is very broad, and the impact on Wisconsin’s health care and health insurance markets is unclear. The potential effect of direct primary care on individual market premiums is particularly concerning. If mostly healthy people leave the individual market for direct primary care arrangements, premiums could rise for people needing comprehensive and specialty care.
As proposed, the bill would have exempted “valid direct primary care arrangements” from insurance law and Office of the Commissioner of Insurance (OCI) oversight. These exemptions would create a significant loophole in Wisconsin consumer protection laws and increase the possibility of direct primary care arrangements becoming vehicles for unregulated insurance products.
The potential for consumer confusion and consumer harm increases as direct primary care functions more like insurance without the same regulations and consumer protections. Contractual arrangements that do not constitute the business of insurance do not need statutory exemption from laws that apply only to the business of insurance.
Direct primary care products already coexist with insurance coverage. The question is, how will direct primary care arrangements evolve and will the state’s approach to ensuring appropriate consumer protections evolve, as well?
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