By William A. Sturrock, MD
MAY 6, 2014 – While scholars may argue whether this purported Chinese proverb is a blessing or a curse, no one could dispute that the American medical marketplace today is seeing great and interesting changes in how care is delivered. All across the landscape, providers, patients and insurers are wrestling with a new world of increasing numbers of older (and sicker) individuals needing care, combined with fewer healthcare dollars to accomplish the task. Indeed, we cannot continue on the same path medicine has been on since the 1950′s with a patchwork system of 3rd party insurers, Federal, State, employer-based organizations, and patients’ own pocketbooks trying to foot an ever increasing bill for medical care that is not meeting society’s healthcare needs. Almost all stakeholders are in agreement that the venerable ‘Fee-for-Service’ model needs to change because it has left us in the unenviable position of being first in the world in per capita healthcare spending while being embarrassingly 2nd rate when it comes to accepted definitions of good health outcomes such as longevity and infant mortality. Most public health experts advocate that it is time to evolve from the ‘high-production/dubious quality’ model to one focused on delivering better population health outcomes.
Now exactly what that new system will look like is still an open question. The Affordable Care Act, (aka Obamacare) is really just a stepping stone in the evolution of the American medical marketplace. Regardless of whether individual patients are ready, most major injurers and large employers are already implementing new care systems that are rewarding providers not for how many services they provide but whether they are providing measurable good outcomes for the large number of individuals and families in their care. Indeed the ACA allows for and encourages the development of alternative payment models to reward providers who have better immunizations rates, chronic disease outcome, lower complication rates, and a variety of other measures designed to improve the overall population health. EMMC is currently partnered with Medicare and other payers to form an ACO (Accountable Care Organization) for eligible patients in northern and eastern Maine, in which medical care dollars will be spent on activity that will improve the health of this population rather than simply reward the providers that see the most patients or do the most procedures.
Although most hospitals and hospital-based providers are involved in this process, there is a significant number of out-patient providers, particularly in small independent practices, that are not sure how they fit in to some of these changes. Faced with decreasing reimbursement by the major insurance companies, including Medicare and Medicaid, many are having real financial problems keeping their practices open. In addition they may have difficulty complying with the new expectation that all providers will use electronic medical records and run statistics on their patient outcomes. One new practice model that has developed for these physicians is something called ‘Direct Primary Care’. The primary feature of these clinics is that they do not take any insurance payments at all, but instead operate with a business plan more similar to a private gym, charging a modest monthly membership fee (usually less than half of your cell phone bill) and then a $10-20 charge for each visit which typically is about the same as what many would pay with their current insurance deductibles. Because it is not a ‘fee-for-service’ system, the providers have incentive to provide many services over the phone or using email, and not require all patients to sit in their waiting rooms before they receive care. Although the overall collections are much smaller, they work financially because the offices do not need to hire extra personnel to do the coding and billing necessary for 3rd party payment. Many patients like these arrangements, particularly if they have a ‘high-deductible’ plan that only covers catastrophic care.
Nationally it is estimated that there are over 5,000 offices that are using this model, and several have started in Maine. One doc in Hampden, Jack Forbush DO, recently announced his conversion to this model. In addition, there are already ‘chains’ of these practices such as Qliance, IORA Health and others in the more populous states, with 23 in Rhode Island alone. The American Academy of Family Physicians as well as the local Maine chapter has been providing information to interested physicians. So far patient care satisfaction and quality has been high at some of the more established sites where this has been measured. And docs like it because they are not pushed to see 25+ pts a day just to break even, but feel they can spend more time with patients when they do see them. Terry Ann Scriven, a family doc in Cape Elizabeth using this model, says she will often cover 8-10 different problems in a visit that may last for over an hour to meet all that patient’s needs.
- How are these practices different from the ’boutique’ or ‘concierge’ practices available in some cities?
ANSWER: Unlike these practices which are designed for wealthy clients and may cost thousands for a retainer fee, ‘ direct primary care’ practices are much more affordable, usually less than half a person’s entire cell-phone bill for all primary care needs for a year. Whereas a concierge practice will serve only one or just a handful of clients, most DPC docs will serve just under the 1200-1500 patients that make up the panel of a standard fee-for-service practice. As a result, they are more recognizable as office practices, but with shorter wait times because the doctor can see fewer per day. In addition, usually there are no additional charges for routine labwork that can be done in an office. This addresses a public health concerned often voiced about concierge practices because they would not meet the needs of many in society.
- What is the largest concern if all primary care docs adopted this model?
ANSWER: Even though these practices will see Medicare/Medicaid patients, there is still a concern that the neediest who cannot afford the membership or the low visit fee would have no option other than the ED’s. Interestingly, there are some ongoing demonstration projects in areas where the state Medicaid payers are looking at paying for the membership fees for their clients, as the estimated cost per patient per year to these tax-supported programs would still average less per year than if they were seen in a fee-for-service environment. Stay tuned, as usually the brightest minds will figure out the greatest savings!
- What about care that I might need to get outside of the PCP office such as x-rays, or visits with specialists? How would these occur if I was getting my primary care from a doc that was not operating within the standard insurance system?
ANSWER: These outside services could still be ordered by the DPC doc, and any charges that these might incur would be paid by any insurance policy (or go toward the deductible) just as they do now.
- Do these practices meet the legal requirements of the ACA , and would they allow a person to state that he or she ‘has insurance’ if this is where he or she is receiving primary care to avoid any penalty for being uninsured in 2015?
ANSWER: There is a specific section of the ACA (1301 A3) that allows the use of these primary care practices, when combined with an inexpensive ACA approved High-Deductible plan, as long as the doc and the plan provides your preventive services. This is why you do not want your chiropractor or your nutritionist to be proffering themselves as your PCP. They cannot provide basic preventive services such as immunizations or order mammograms and colonoscopies, all proven to save lives.