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About 100 years ago, patients paid a physician modest fees out-of-pocket and that physician took care of all of their needs as best they could under primitive circumstances. (5) Today, a new model of care that harkens back to those days of old is gaining traction. The direct primary care model takes a step back in time, without giving up the gains of advanced technology and 21st-century medical discoveries. So what is direct primary care and is it worth it for both patients and physicians? Keep reading to find out.
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Presently in the United States, there is no nationwide system of health insurance. Health insurance is purchased privately or provided by the government for certain groups. (7) In Canada, there is a government-run public health system that covers the entire population, which is known as universal or national health insurance. () The direct primary care model replaces the traditional system of third-party insurance coverage for primary care services.
The direct primary care model is when the patient pays the physician directly for a defined set of primary care services via a flat monthly or annual fee. (2) A direct primary care practice does not accept health insurance, Medicare, or Medicaid, and they are becoming more popular. In 2018, there were around 800 direct primary care practices in the United States, and that number continues to increase. (4)
Benefits of direct primary care for healthcare providers
As with any new way of doing business, there are pros and cons of the direct primary care model, with some organizations and physicians feeling the pros outweigh the cons. The American Academy of Family Physicians (AAFP) promotes and supports direct primary care “as an innovative advanced practice model.” AAFP believes this model emphasizes and prioritizes the relationship between the patient and the physician, which will then lower overall costs and improve outcomes. (2)
From the physician’s standpoint, there are many benefits of direct primary care, including the elimination of insurance coding and billing. But does this make sense financially for the physician?
The direct primary care model is sometimes compared to concierge medicine; however, the fees with direct primary care are typically lower. For example, in 2015, the average monthly fee for a direct primary care clinic was just over $77, while the average for concierge medicine was more than $182. (3) The direct primary care amount equals $924 per year per patient, so if a practice has 500 total patients, that’s $462,000 a year. Primary care physicians typically earn about one-half of the total gross revenue, so that means the direct primary care provider will make $231,000. (4) This is more than the average primary care physician according to salary.com. (8)
Other advantages for the physician are that there is lower overhead, they have fewer patients, and they spend more time on average with each patient. (4) Because physicians and clinics are not encumbered by insurance, they are also more apt to use text, email, phone, and/or virtual technology to connect with patients. (3) This is a time-saver for physicians, and patients appreciate the more personalized approach.
Benefits of direct primary care for patients
One benefit to the patient is cost savings. Surveys show that direct primary care reduces costs to the patient compared to traditional insurance plans because the monthly fee typically covers many primary care services. (3) Many patients using the direct primary care model still have some insurance to cover services that aren’t provided by primary care such as hospitalization (catastrophic care), which provides an additional financial safety net. (2)
Both physicians and patients in the direct primary care model also appreciate the increased attention and level of care for patients. According to a 2017 physician survey, 79% of the direct primary care model practitioners responded that they had all the time they needed with patients to deliver a high standard of care compared to only 11% of traditional primary care physicians. (3)
In general, patients of the direct primary care model are getting better care. According to one study, direct primary care patients experience 82% fewer surgeries, 66% fewer specialist visits, 65% fewer emergency room visits, 35% fewer hospitalizations, and 91 to 97% lower readmission rates for acute conditions such as congestive heart failure and pneumonia. (6)(9)
Access to care and lack of socioeconomic diversity is also addressed with the direct primary care model as patients can include the uninsured, underinsured, and other vulnerable populations. (9)
The downside of direct primary care
Much of the motivation to move toward the direct primary care model is physician burnout and physician dissatisfaction. (3) Some argue that this is not healthy for an already stressed healthcare system because those physicians are leaving and not getting replaced.
In addition, an average family physician practice sees about 2,300 patients, whereas a direct primary care practice sees less than half that. That means that there are hundreds of patients who become displaced as they enter back into the traditional healthcare system. (1) The number of direct primary care clinics must be increased dramatically to take care of this issue.
The bottom line
The direct primary care model takes cues from the past to forge a future that may benefit both physician and patient by dramatically shifting how we view and pay for medical services. The appeal for the physician is a solid income, less overhead, fewer patients with higher-quality visits, and overall better job satisfaction. For the patient, there are lower costs, increased medical attention, and potentially better outcomes. So far, it appears that the direct primary care model is a win-win for the patient and provider.
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The information in this article is intended for healthcare practitioners for educational purposes only, and is not a substitute for informed medical, legal, or financial advice. Practitioners should rely on their own professional training and judgement, and consult appropriate legal, financial, or clinical experts when necessary.
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