Direct Primary Care Physician Business Model Healthcare Practice

Published: Oct 23, 2015
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It’s been called “concierge care for the common person.” Like the concierge medicine model, Direct Primary Care (DPC) is retainer-based. Patients pay a monthly fee in return for same-day appointments, longer visits and increased access via e-mail or telemedicine. Typically included are annual wellness evaluations, office visits and in-office labs such as urinalysis, strep screens and pregnancy tests.

Yet what makes DPC different is that practitioners are paid directly for their services. That means “no” to health plans and insurance companies and “yes” to monthly retainers. According to the American Academy of Family Physicians, those average between $50 and $150 per month. Some practices add a one-time enrollment fee, while others keep membership fees low by charging modest per-visit fees.

As with the concierge model, providers are able to keep their practice small – typically 600 to 800 patients. They don’t have to worry about credentialing and contracting with insurance companies. And they don’t have to bother with pre-certifications, co-pays and following up on denied claims.

Financially, all the overhead associated with claims, coding, write-offs and billing staff is eliminated. The biggest drawback? Patient payments are the sole source of revenue. Practices considering the DPC model must run the numbers and be diligent in their operations to ensure that patient fees are sufficient to support the practice.

Ultimately, practitioners tired of overwhelming patient loads and dealing with third-party payers might find DPC an attractive alternative. The DPC model is still emerging, and states are still working through how they will regulate DPC practices. In some cases, they are placing them under existing insurance regulations.

To follow the evolution of this new payment model, visit the Direct Primary Care Coalition and Access Healthcare Direct.

Healthcare Practice Strategies - Fall 2015