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Is the Direct Primary Care Model Dead?

A recent Medical Economics article asked “Is the DPC model at risk of failing?”

The piece focuses on two large DPC-like organizations, Qliance Medical Management of Seattle, Washington and Turntable Health of Las Vegas, NV, working in partnership with Iora Health, which recently closed their doors. Qliance and Turntable were not actually DPC practices by strict definition; they were innovative large business operations providing healthcare services to patients and excluding third party payers. Their idea was commendable, but their closure indicates little cause for concern in regard to the growing Direct Primary Care movement.

Robert Berenson, MD, who admits to not being a fan of the DPC model, said “Qliance has been the poster child for DPC… If that one can’t make it… it suggests the business model (of DPC) is flawed.”  He is correct about one thing; the “business” model of medicine is certainly flawed.

What Dr Berenson fails to realize is that DPC is not a “business” model; it is a “care” model. Whether accepting insurance or DPC in structure, we already know solo and two-physician practices deliver the best care and have been doing so for the past 100 years. These intimate clinics know their customers better than anyone else in the industry, and can devote the time necessary to their clientele; these micro-practices should be known as the small giants of healthcare.

Strictly defined, Direct Primary Care is a practice model centered on an arrangement wherein a patient and physician enter into a contract to provide unlimited primary care services for an affordable monthly fee (less than $100/month.) 80% of healthcare needs can be met in a DPC practice. The typical DPC practice has 1 or 2 physicians, 600 patients maximum per physician, and on average each physician sees 10 patients per day. Employees are minimal, usually including a receptionist and/or medical assistant. Only minimal office space is required to run such a lean operation, so overhead remains low. Supplies, medication, and equipment are purchased on an as needed basis and used only when necessary.

Qliance, founded in 2007 by Dr. Garrison Bliss and Dr. Erika Bliss, charged $64/month for adult members and $44/month for children. They had 13,000 patients in total including primary care and emergency care services, more than 20 times the number of patients compared to a traditional DPC clinic. They were trying to use a model embraced by direct primary care practices yet scale it into something entirely different. After 10 years, the experiment failed.

Iora Health, vying to become the “Starbucks” of healthcare, was in partnership with Turntable Health utilizing a “team based” concept. Each “team” included a physician, nurse, and a health coach. This model contracted with individuals, but also employers and unions already paying for healthcare by offering improved access to primary care services and pocketing a portion of the savings that materialized. In this model, physicians usually had 1000 patients and each health coach with a few hundred. Turntable charged $80/month for adults and $60/month for children to have access to their vision of a “wellness ecosystem”, which included yoga, meditation, and cooking classes.

An article in the New York Times quoted Duncan Reece, the VP of Business at Iora Health, “We wanted to do something radically different and show this isn’t your grandfathers’ doctor’s office.”

I get it. This is the kind of things that VP of Business say.

Let’s walk it back. Can someone please tell me what was wrong with that model? It was a quintessential small giant of the business world. My grandfather was an outstanding general practice physician with a small office and one nurse on staff. He made house calls. He did appendectomies, tonsillectomies, C-sections, vasectomies, and met most of his patients’ basic primary health care needs for 40 years. Why do we need something radically different?

The bottom line is healthcare requires two participants.

One physician and one patient. While it is a nice idea, we do not need yoga, massage, or smoothie bars in our clinics to improve patient outcomes. Adequate medical knowledge and time for meaningful conversations is essential; something the small giants of healthcare are experienced in providing. The vision of a “wellness ecosystem” should probably go the way of the “patient-centered medical home,” as there is little cost savings or difference in outcomes compared to the traditional fee-for-service system.

So what qualities make the best practices? According to a study conducted by The Peterson Center on Healthcare at Stanford, the very best primary care practices have either one location or a small handful of them. Stanford compiled a list of 10 distinguishing features of these top practices and many are commensurate with being a “small giant” of the business world. My favorite characteristic on the list is to invest in people, not space or equipment. By lowering overhead, physicians are not relying on patient volume to generate adequate income. These practices are consciously choosing to stay small by renting minimal space and investing in added services only when believing them to be more cost-effective.

The government and insurance companies cannot fix healthcare. It is up to physicians and patients– one micro-practice or DPC clinic at a time. Dr. Kimberly Legg Corba, owner of Green Hills Direct Family Care, said “The DPC model is growing and practices are converting all the time. Some are opening by transitioning an established practice, some are physicians starting clinics fresh out of residency from scratch, and others are leaving employed positions to return to practicing medicine in a way they love.”

While my practice is not DPC, it is a small, old-fashioned clinic serving families for as long as three generations. Our records are still on paper, a real human being answers the phone when it rings, and for occasional emergencies, patients stop by my house for a “reverse house call.” My belief in the DPC model is steadfast because any “care” model placing control directly into the hands of physicians and their patients is worth fighting to preserve and protect. The more small giants able to thrive in the constantly evolving healthcare landscape, the greater chance physicians have of inciting a large scale revolution to benefit patients everywhere.

Since the Affordable Care Act legislation went into effect, mergers and consolidations have increased by 70%, at the expense of care becoming less personalized and increasingly fragmented.   These large institutions are profit centers for CEO’s and business executives who have very little knowledge of what goes on between a physician and a patient. They need the independent practice model to fail so patient choice is no longer an option.

The small giants, micro-practices and DPC clinics, will continue to prosper and grow because a “care” model devoted to preservation of the physician-patient relationship cannot be defeated. Physicians must stop being afraid to take that leap of faith, leave employment, and go back to doing what we love most, caring for our patients and improving their lives. Physicians should be standing at the bedside, not in front of computer workstations. Direct Primary Care is a model for which we should all be rooting; it is transforming the physician-patient relationship and restoring the practice of medicine to its noble roots, allowing for the art, the science, and the wholly fulfilled physician.

My advice for patients everywhere: Whenever possible, find an independent practice, whether a solo doctor or direct primary care clinic, and patronize that physician. Your care will be more personalized, cost less in the long run, and your health will be better for the investment you made in yourself.

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John IrvineHorses22PerryAllanlanierbrian Recent comment authors
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Allan
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Allan

“I invite you to spend a day, a week in one of our DPC offices and see the level of complexity, chronic disease issues we are treating” Horses, for decades I treated one of the sickest populations in my area. All too many of my patients had multiple major diseases and were on a laundry list of medications necessary for survival. Originally I didn’t have the advantage of all the imagery you utilize today so I had to spend even more time on history and physical exam. Therefore, I don’t think you have to invite me to your practice to… Read more »

Barry Carol
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Barry Carol

Allan, thanks for the informative summary. I’m interested in your estimate of the percentage of the population that would qualify as “complex” patients, both for the under 65 population and the Medicare eligible population. For example, would an otherwise healthy diabetic whose condition is well managed with medication qualify as complex? How about a patient with heart disease that’s doing well with medical management (prescription drugs)? How about someone with asthma but no other medical issues? I certainly agree with your suggestion that patients should be able to choose the type of care that best suits them. Healthy patients may… Read more »

Allan
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Allan

Barry, thank you for your positive comment. Sorry, but I can’t answer the question you ask “ that would qualify as “complex” patients” as that is based upon the definition of the world “complex” along with the experience of the individual managing the problem. One could say that almost every action a physician takes is of high complexity since every action is a result of an incredible amount of training and knowledge. Some might find a response by a physician to seem simple, but that person probably doesn’t realize how much knowledge is quickly entertained before the response is provided.… Read more »

Allan
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Allan

Barry provided a satisfactory approximation of costs (below), but the conclusion that leaves is a need for catastrophic insurance that in an unencumbered government financed world is generally quite inexpensive. That is because the individual is paying directly for ***risk*** and doesn’t have all these other expenses loaded onto the premium. Unfortunately, too many advocating for catastrophic insurance want to load the risk up with unassociated costs and do not wish the patient or provider to have to deal with any significant risk. My first concern regarding DPC is that the selection process can easily rear its head if the… Read more »

Perry
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Perry

Allan,
There seems to be controversy right now whether there is or is not an immediate or looming physician shortage. My guess is that there will be limited numbers of physicians taking the DPC route due to a number of factors. As we can see above, the mass business model doesn’t seem to work so well, big surprise.
If in fact there is a looming shortage (which I believe there is) then we need to address that, and particularly in terms of Primary Care. More government regulations and mandates aren’t going to make PC more appealing.

Allan
Member
Allan

Perry, I wasn’t calling of additional government regulations and mandates. I call for less, much less. I look towards a freer marketplace where the physician and patient can contract together in any fashion they choose while independently the patient can contract with his choice of insurer if he so desires. Physician shortage: Who knows and what constitutes a physician shortage? Is there a physician shortage because there isn’t enough clinical time for the physician patient relationship or is it because the physician is too busy doing other things such as dealing with insuranc and the EHR? Is there not enough… Read more »

Perry
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Perry

Allan,
Sorry for the misunderstanding. I have seen your posts here enough to know that you are not for more regulations. I was just pointing out that whatever schemes the “powers that be” have for recruiting new doctors, they should not only include decent pay, but freedom from excessive paperwork burdens.

Allan
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Allan

I agree, but more important is that the patient doctor relationship be maintained where both are free to chose each other and that both parties are free to contract with other agents to help them in their tasks.

Michael Chen MD
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Michael Chen MD

I second Perry’s comment about the looming shortage; it’s inevitable and will be clear if and when DPC becomes more mainstream. Being that DPC works outside of the insurance, fee-for-service model and even if there was a single-payer, public-option situation where all patients are covered for catastrophic medical costs, DPC theoretically will continue to show cost reductions to the entire cost pool which encourage further adoption DPC model which will also increase the numbers of medical students interested in primary care, which is a reverse of the negative cycle of decline over the past 20 years due to FFS and… Read more »

Allan
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Allan

Micahel Chen, if a free market (that including a DPC choice) would require less physicians than DPC alone, then economically the country would be better off.

A physician ,especially when young ,that is only treating 10 patients a day is not getting enough exposure to different diseases and might have problems honing his skills. Time with the patient is important, but practice makes perfect.

Horses22
Member
Horses22

Seeing a patient every 7 minutes is only honing the skill of a learning to take a shortened history and treat only one condition. Allen, I invite you to spend a day, a week in one of our DPC offices and see the level of complexity, chronic disease issues we are treating, diagnosing, managing in our offices. You imply that all we are seeing is the “walking healthy,” when in fact, a lot of the patients that are joining DPC offices have been lost in the system, are extremely complex and require a level of time and coordination of care… Read more »

Barry Carol
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Barry Carol

So how many patients out of your panel of 600 (on average) fit the complex criteria as opposed to basically healthy patients who may only come in once or twice a year? DPC appears to be a good choice for the complex patient who needs more time with the doctor than he can get in a traditional primary care practice and he will perceive that he’s getting his money’s worth from his subscription fee as well. The issues are, what percentage of patients, especially among the non-Medicare population, fit the definition of complex and what percentage of those can afford… Read more »

Michael Chen MD
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Michael Chen MD

Barry, just so you know what it’s like to be a DPC physician, I can say about 50% of my panel fits the complex criteria. This will differ based on locales and especially DPCs that do large contracts with an employer, and depending on the employer type – you’ll see a difference in patient populations (workplace or chronic pain/injury for manual labor but also chronic diseases from sedentary, desk jobs, long-term computer screen use, etc). But the key here is that a DPC physician is much more flexible and adept at spending more time with a patient that fits this… Read more »

Michael Chen MD
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Michael Chen MD

“It looks like a niche market to me” – I can say in my experience, patients who experience DPC care within a short period of time realize the value (not just the health cost value but the relationship, access, face-to-face time, knowing their doctor is human, etc) that for them they don’t want to lose it. For most patients who have experienced DPC care, it’s a no-brainer. Once enough patients see the difference and know it exisits, it’s hard for patients to see it any other way. I had a micropractice before and the experience was the same even though… Read more »

Perry
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Perry

This is the benefit of DPC. The patients can judge for themselves the “value” of the arrangement and care they are receiving. It’s not determined by some nebulous governmental quality measures.

pjnelson
Member
pjnelson

Niran, . Well-done, one more time! . I would offer the following as a basis for the reduced cost of total healthcare associated with dedicated Primary Healthcare. It should offer the character of a Caring Relationship as follows: a variably asymmetric interaction occurring between two persons who share a ‘beneficent’ intent over time to enhance each other’s ‘autonomy’ by communicating with ‘warmth, non-critical acceptance, honesty and empathy.’ When a caring relationship is mutually sustained between each citizen and their physician-based team, as an attribute of Primary Healthcare, the resultant efficiency becomes increasingly self-sustaining. . Another conceptual basis for augmented Primary… Read more »

Res Morgan M.D.
Member
Res Morgan M.D.

Physicians working for for-profit companies underwritten by venture capitalists is grotesquely unethical and rife with conflicts of interest. No loss that these two organizations went belly-up.

InnovaMedDoc
Member

Passion for medicine, adequate medical knowledge and time for meaningful conversations are some of the things Direct Primary Care docs bring to the table in our relationship with the patient (and not with the insurance company). Expanding the differential diagnosis by incorporating possibilities not thought of in a 5 minutes encounter with the patient, treating conditions in our offices -when feasible, therefore reducing specialist care (without hurting our patients), saving patients from unnecessary ER visits by being accessible after hours, among many others (I am pretty sure some of my DPC colleagues will comment on statistics, studies, percentages) are part… Read more »

Niran Al-Agba
Member

Could not agree with you more Dr. Aviles. Thank you for commenting!

Barry Carol
Member
Barry Carol

I don’t have any argument with the potential for direct primary care to provide excellent patient-centered care. There are two issues that I think need clarification and discussion, however. First, assume a monthly DPC subscription fee of between $50-$75 for each adult and perhaps $20 per month less than that for each child. That implies that the cost would be in the range of $2,000-$3,000 per year for a family of four. I wonder what percentage of the population could afford to pay that. Second, suppose it were possible to buy a health insurance policy that did not cover primary… Read more »

Michael Chen MD
Member
Michael Chen MD

“If employers were to pick up the cost of DPC subscription fees, their healthcare spending would likely rise as the majority of employees are healthy and generate little or no healthcare expenses in any given year” – where is the evidence that the majority of employees are healthy and generate little to no healthcare expenses in any given year? This is where our DPC model is trying to show and is showing improvements in out-of-pocket expenses by the employer and patient. In the current trend of high-deductible health insurance (which is the preferred insurance type that is coupled with an… Read more »

NeuCare
Member

You have a lot of presumptions about the rest of the system staying exactly as-is. DPC is attempting to solve the problems in primary care, but we all recognize that other systemic changes need to occur to scale DPC to become a widely adopted and “affordable” model of primary care. 1) Total costs. We (collectively, all sources) spend $10,000 per year per year on healthcare in America. There is no doubt that there is enough money to fund quality primary care. The problem is we spend too little on PCP– currently 5-7%. No other country spends less than 10-15% on… Read more »

InnovaMedDoc
Member

“Many of my patients, including those with insurance, save more money on these ancillary services (versus traditional prices) than they pay for their membership each month. And they get unlimited visits with their personal physician without copays.” Indeed Dr. Neu. Today I had a patient who went for blood tests through his insurance and paid more than double of what he would have paid by utilizing my pricing list! And the list goes on.

Niran Al-Agba
Member

I couldn’t add more than you already did except to say, I sewed up a dad recently and he paid cash as his deductible (with a company I am not in contract with) is over $20,000. The normal “ER” charge would have been all told about $2000 per stitch =$8k. My supplies were about $75-100 and it took me 15 minutes to sew the 4cm gash. Took the stitches out today and he was thrilled with a cash charge total of $250. Compared to 8K he might have paid out of pocket… care at a private office is a steal.

Barry Carol
Member
Barry Carol

“We (collectively, all sources) spend $10,000 per year per year on healthcare in America.” This number probably comes from the National Health Expenditure Data. Unfortunately, it has very little to do with the cost of medical claims, health insurance premiums, or per capita spending by Medicare and Medicaid. This is because the NHE data includes lots of costs that are not included in most medical claims such as public health initiatives, healthcare R&D, hospital construction, long term custodial care in a skilled nursing facility, assisted living facility or home care, dental care, routine vision care, insurer administrative costs, etc. Custodial… Read more »

NeuCare
Member

1) Yes, defining “health care” can be tricky for total cost calculations. But how can you NOT count “hospital construction”, “insurance administration” or “healthcare R&D” (not sure what that means actually) as part of that!? If that isn’t part of the healthcare economy, what category does it belong? Besides, I’m not really sure of the point of debating this. We spend WAY more than every other country. 2) Yes, super-utilizers are HUGE portion of costs. Do you know what helps keep those people out of the ER and hospital unnecessarily? . . . . great primary care. 3) Status quo… Read more »

Barry Carol
Member
Barry Carol

Neucare, First, to clarify my background, I am not a doctor and have never worked in the medical field. My career was in finance, specifically, the money management business. Second, I’m retired now and have been on Medicare for the last five plus years. Regarding healthcare expenses, I think total spending per the NHE data is quite different from medical claims paid by insurers. Medical claims account for 80%-90% of premium revenue for most insurers with administrative costs and profit accounting for the rest. To the extent that DPC can reduce healthcare costs, it’s medical claims that matter to individuals,… Read more »

NeuCare
Member

Barry, I probably won’t be able to convince you about the monumental difference in a PCP having 10-30 minute visits vs. 20-60 minutes, but let us think about your profession in “money management”. I am not sure your exact role in this, but my financial advisor helps clients make decisions about the finances (allocation of funds, savings, investments, taxes, etc.). How long did you “need” to provide good advice (asking questions, discussion, etc.). Do you think decisions and quality of advice would be the same spending 10 minutes vs. 30 vs. 60? What if the client’s books and financial house… Read more »

Barry Carol
Member
Barry Carol

Neucare, First, I was on the institutional side of money management which means I was part of a team that managed a large, multi-billion dollar corporate pension fund with over 60,000 plan participants. We didn’t deal with individual clients. With respect, to DPC, I think I understand what you’re trying to tell me, at least for the most part. It’s just that when I look back on my own experience as a patient, especially over the last 23 years when I had numerous surgical procedures and hospital stays and incurred probably $250-$300K of expenses at contract rates, I can’t identify… Read more »

NeuCare
Member

Barry,

Quite frankly, you do NOT understand what I am saying but I gave it my best shot. Thanks for the conversation.

Horses22
Member
Horses22

Hello Barry, regarding your reference to Allan’s comment and “not seeing enough patients to hone skills,” please see my response to Allan’s comment. Also I trained in my family practice residency from 1994-1997, well before any of this regulatory crap started and when health insurance did not dictate health care. Heck, it was even before the first regulatory burden was born, the ’97 E & M coding and billing guidelines. As an attending in the late 90’s, early 2000’s, I was not required to see a patient every 7 minutes. I will say it did not retard any of my… Read more »

lanierbrian
Member

Union County, NC called, and they said you could pry their DPC out of their cold dead hand: https://youtu.be/pqmNHvhaPm8

peter lehmann
Member

1. “The issue is affordability”. Well, my clinic for a family of four would be just under $1700 a year. That’s the upfront cost. Subtract from that the difference between the real price of a test or medication versus the “insurance-negotiated” price. Patients are saving money by the hundreds each year with those. Subtract the cost of a specialist visit’s “insurance-negotiated price” now not needed because the DPC doc had the time to research, diagnose and treat the problem independently or via online consulting with specialists around the country. This is a benefit provided to my patients in their membership… Read more »

Steve2
Member
Steve2

CMS does a nice annual break down on health care spending. More detailed than your insurer estimates.

https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf

VinceKuraitis
Member

You can’t create a successful care model in the absence of a successful business model.

Niran Al-Agba
Member

While I emphasized a model of “care”, there is always some business sense required. I am constantly refining mine. The more traditional small giants of the business world did not always follow the same yellow brick road and neither do we. It is neither naïve or impossible to create a successful care model if it is personal, which is my larger point. Business does not always have to grow or be big to be successful. And in fact, I believe this is the single most critical point that health economists of the older generation do not seem to grasp. They… Read more »

VinceKuraitis
Member

OK, thanks for your clarification. Suggest you revisit your original wording for next time — good business and good medicine can be synergistic, not a trade-off.

That said, I definitely prefer someone with your mindset as a personal physician. I think most patients would be more comforted knowing their doctor wakes up prioritizing the New England Journal over The Wall Street Journal.

Horses22
Member
Horses22

Lol, Mr. Kuraitis, it would be awesome if the WSJ stayed out of it entirely, but medicine has become big business for a lot of entities hasn’t it? It is BIG NEWS! I am sick of reading about my profession in business journals. We ARE the “business” churning out the “product” which is sickening (although this no longer applies to me thank God, I am DPC); without the doctors none of these big businesses would have anything to discuss. There is no other industry in the country where fees for services, never mind a service that requires the training and… Read more »

Michael Chen MD
Member
Michael Chen MD

I’d like to add a DPC group that is built around 1 physician-1 MA with the aim of a small footprint, low overhead location that has multiple locations nationwide. Paladina Health, while not as visible as Iora or Qlliance, has been around since 2010 and they have been targeting medium sized businesses or government entities where they cover the membership fees for their employees and dependents to show in an evidence based way that what we do in a DPC model provides short and long-term value to a patient’s well being as well as health care costs. Disclaimer: I’m a… Read more »