Primary Care Payment Innovation Can Mean Leaving Insurers Behind

June 20, 2014 04:18 pm Michael Laff Washington –

Patients might be a long away from a world without health insurance companies, but a growing number of primary care practices are bypassing the middleman patients often loathe.

During a recent forum in Washington, family physician Brian Forrest, M.D., right, explains how he made the transition to direct primary care.

Rather than paying monthly premiums and sweating high deductibles, patients who opt for direct primary care can pay a monthly subscription fee that covers basic primary care. Other practices offer more interaction with a physician by leveraging technology.

At a June 19 forum titled "Disruptive Innovations in Primary Care" that was hosted by the Robert Graham Center for Policy Studies in Family Medicine and Primary Care, three physicians discussed their decision to transition to a new payment model whereby patients either pay a monthly fee for services or are linked to a primary care practice through their employer.

Like some other health care terms, "direct primary care" (DPC) has become a buzz phrase without a precise shared understanding of the concept it represents. "It's hard to define direct primary care," said panelist and family physician Brian Forrest, M.D., CEO of Access Healthcare, a DPC practice in Apex, N.C. "If you've seen one, you've seen one."

Story highlights
  • Physicians are opting for new practice payment models that cut back on or eliminate health insurance from the picture.
  • By spending less time on administrative tasks, physicians and staff can spend more time with patients.
  • In direct primary care, patients pay a monthly fee that covers most primary care services.

In the late 1990s, Forrest explained, he saw uninsured patients who often could not afford basic care. On top of that, he was frustrated that uninsured patients were paying substantially higher fees for care than insured patients.

"They were paying the rack rate that you see on the back of a hotel door that nobody pays," Forrest said.

Growing weary of treating 32 patients every day and never having enough time to devote to each one's needs, Forrest said that's when he thought about changing his practice's payment model to maximize his time with patients.

Today, his practice is either paid a monthly fee by individual patients or by an employer who often pays for a full year of care. Although about 50 percent of his patients have insurance, Forrest said he has not been paid by an insurance company for 13 years.

It's a decision he wouldn't take back. "I could slow down, do patient care and still have a profitable business," Forrest said.

In his practice, the care coordinator shares responsibility for handling patient care with the physician. Health services go beyond treating illness to advising patients how to improve their lifestyle and health habits. For example, a dietitian who works in his practice may go shopping with a patient, review what food is kept in the home pantry and discuss food diaries. A massage therapist and a podiatrist are also available for sessions.

New blog focuses on AAFP advocacy Efforts, practice enhancement

The AAFP works tirelessly in Washington, D.C., in state capitals and in boardrooms across the country to advance family medicine. Now, a new AAFP blog, In the Trenches, chronicles some of those public and private sector advocacy and practice enhancement efforts. Penned by Shawn Martin, the AAFP's vice president of advocacy and practice advancement, and published every other week, the new blog aims to give Academy members an informative insider's perspective on issues that affect family medicine practices and patients.

Forrest likened the payment model at his practice to a gym membership. Patients pay a monthly fee that covers all services that can be handled in a family medicine practice, including lab tests. Applying a fee-for-service model in the gym environment, on the other hand, would require a practice employee to follow the patient around and charge a fee for each machine the patient used and every time he or she jumped on a treadmill.

"That's the insanity of primary care" as commonly practiced today, he said.

When asked to contrast DPC with concierge care, Forrest pointed to the fact that patients in lower income brackets can afford DPC. In most cases, he said, patients pay between $25 and $60 per month, less than a carton of cigarettes and often half the price of a monthly cell phone bill.

Forrest's success in lowering costs and keeping patients healthy has drawn high praise from an unlikely source: his malpractice insurance company. That praise has taken the form of a 65 percent drop in his premiums.

"We're not getting more out of the system," Forrest observed. "We're getting rid of the waste associated with getting paid."

Of course, improving patients' health outcomes requires more than simply extending their time with the practice's physician. Rather than focusing primarily on squeezing more time out of the physician's schedule, some practices are building entire teams of professionals who are jointly responsible for maintaining the health of the practice's entire patient population.

One panelist at the forum said his practice refashioned primary care by rethinking the hierarchy of the medical team. Although the physician remains a pivotal member of the team, a nurse innovator leads a group of medical coaches who deal directly with patients.

According to Andrew Schutzbank, M.D., M.P.H., assistant medical director for Cambridge, Mass.-based Iora Health, the coaches build relationships with patients on a personal level, and because they are local, they become familiar with the life choices patients make. Coaches are recruited from a variety of professions including nurses, medical assistants, yoga instructors -- his practice even has a former Target employee working as a coach.

Schutzbank said patients often tell him what they think he wants to hear instead of what's really true. His most experienced coaches, however, can persuade patients to be honest about adverse experiences such as physical abuse or poor choices such as drug abuse or failure to take medicine.

What it comes down to, said Schutzbank: "Patients come for the doctor and stay for the coaches," he observed.

Iora Health contracts with employers and large unions that pay subscription fees to cover the cost of primary care for their employees. Patient rosters include employees of Dartmouth College and hotel/restaurant workers covered by the Culinary Health Fund in Las Vegas. Another union group Iora works with consists of carpenters in the New England area.

"We wanted to change the way we get paid," said Schutzbank. And it has worked.

According to another panelist, still other practices are realizing greater efficiencies by expanding their use of technology. At One Medical in Washington, D.C., patients schedule same-day appointments and follow up with a physician by email. Phone support is available around the clock.

Patients with insurance are responsible for a copayment and/or a deductible depending on their plan. Members pay an annual fee of $199 that offsets costs not covered by insurance.

Among other pluses, the practice now boasts longer appointments that start on time.

Tom Lee, M.D., One Medical's CEO and one of the developers of Epocrates, specializes in using technology to preserve physicians' time.

"There's enough money in health care," said Lee. "We can at least do a better job of managing our overhead."