Direct Primary Care Practice (DPC)

The number of independent physicians dropped from 57% in 2000 to 39% in 2012, and those that are left are looking to new practice models to hold their ground, according to the Accenture Physicians Alignment Survey.

Accenture estimates that one in three remaining independent physicians—their ranks decline by 5% each year—will look to adopt subscription-based practice models to achieve higher yields, and that trend will continue to increase by 100% annually over the next 3 years.

The survey also included some of the top reasons physicians give for leaving independent practices to be employed elsewhere. The cost and expense of running a business was cited as the main reason for leaving independent practice by 87% of physicians surveyed. Another 61% cited dealing with managed care, 53% cited electronic health record (EHR) problems, another 53% cite maintaining and managing staff, and 39% cite the volume of patients they have to see to break even on overhead.

Although there are many ideas on how to save primary care in the face of an onslaught of new patients created by the Affordable Care Act (ACA), burnout and declining reimbursements, there are no clear solutions. But direct primary care—a more affordable version of concierge medicine—is gaining traction.

Definition

DPC: An Alternative to Fee-for-Service

The Direct Primary Care Model 

The direct primary care (DPC) model gives family physicians a meaningful alternative to fee-for-service insurance billing, typically by charging patients a monthly, quarterly, or annual fee (i.e., a retainer) that covers all or most primary care services including clinical, laboratory, and consultative services, and care coordination and comprehensive care management. Because some services are not covered by a retainer, DPC practices often suggest that patients acquire a high-deductible wraparound policy to cover emergencies.

Direct primary care benefits patients by providing substantial savings and a greater degree of access to, and time with, physicians.

How It Works

Source: Medical Economics

Article by:  Rachael Zimlich, RN

At that time, concierge medicine was still relatively new, but gaining popularity. But Qamar couldn’t find any companies that would help a new graduate start a concierge practice—they only worked with existing practices. So he started his own, and incorporated his concierge practice during his third year of residency. Soon after, he and his wife—also a family physician—headed to Monterey, California. There were no concierge practices in the area, so they decided it would be a good place for Qamar to get his practice started while his wife elected to start her own, traditional model practice.

Qamar became the first concierge physician in central California and was soon named the house doctor for a series of resorts in Pebble Beach. He worked as a concierge physician for 7 years. Meanwhile, his wife had amassed a panel of more than 3,000 patients at her practice—one of the largest family practices in the area. When they started to compare the two practices, some big differences stood out.

“[We saw] all the things we read in the magazines about how frustrated primary care physicians are. She had to see 30 patients a day, and people were fighting about claims over and over,” Qamar says. “We also felt that our accounts receivable in the traditional medical office was always a bit high.”

Still, Qamar’s concierge fee of more than $1,000 per month wasn’t for everyone. There had to be care for those who couldn’t afford boutique care. Yet, Qamar says he was surprised when the economy took a nosedive in 2008 and it was his wife’s traditional practice, not his, that suffered.

“She had about a 25% decline in visits in the last quarter of 2008. We did internal checks and found that, because of the recession, people were losing their jobs and their insurance,” Qamar says. “That was sort of the waking up moment for my wife and I.”

Most patients wouldn’t afford the self-pay fee of $100, and his wife couldn’t maintain seeing 30 patients per day just to break even with overhead. Patients started to end up in the emergency room for simple medications because they refused to come in to the office and pay for a visit. When Qamar and his wife started calling those patients, they found out many were in foreclosure or financial ruin. “We wanted to help them,” he says.

So the Qamars took the existing traditional practice and decreased the fees to an economically sustainable level so that their patients could afford to come in for treatment. For a $49 per month membership fee, Qamar says he doesn’t think there was enough perceived value. When the fee was raised to $59 per month, the practice found its “sweet spot.”

They defined a list of services for patients and implemented a $10 fee for each physician visit, in addition to the membership fee. “It’s not cost-prohibitive for patients to do that, but it doesn’t lend toward overutilization of service,” Qamar says.

He then found discounted drug plans and ways to save his patients money on lab testing and other diagnostics like imaging. Soon, the practice started to grow and was saving 30% on business overhead just from eliminating insurance billing and started seeing patients coming from out-of-town.

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