By Sally C. Pipes
Scores of doctors are taking a page from Netflix’s playbook and getting into the subscription business.
They’ve adopted a business model called “direct primary care,” whereby patients pay a periodic fee for access to primary care physicians. Since 2014, the number of direct primary care practices in America has grown more than six times over.
Doctors appreciate its simplicity; no longer do they have to fight with insurance companies over payment or getting a particular treatment approved. Patients, meanwhile, love its flexibility – they have essentially unlimited access to their doctors, sometimes for less than they’d spend with conventional insurance.
Direct primary care could inject some sanity into our health care system by relying on the same market forces that have resulted in higher-quality products at lower cost everywhere else in our economy.
The typical monthly fee for direct primary care runs between $50 and $150. Patients generally receive unlimited access to primary care. They can text, email or call their physicians to receive a quick response.
Patients can also get medications and lab tests at wholesale prices. Without insurers in the middle claiming their share, those prices tend to be much lower than under the status quo.
Consider the costs for Atlas MD, a direct primary care facility in Kansas. A lipid panel test for patients screening their cholesterol levels costs only $5.50 – 91 percent less than the $62.50 it costs conventional practices. Atlas sees savings like this for so many tests and services that they’re able to offer many – like EKGs, laceration repairs and blood sugar tests – for free.
Direct primary care doctors also spend more time with patients. A typical visit lasts two to three times longer than a visit to a standard family practice.
A conventional doctor has little leverage over a dominant insurer bent on paying as little as possible for an office visit to protect its profit margins. That doctor may need to compensate for low reimbursements by seeing as many patients in as little time as possible. Direct primary care, by contrast, empowers doctors to set their patient load. They can set their subscription fees at a level that attracts the number of patients they’d like to see – and that will cover their costs.
The federal government could bolster direct primary care by allowing patients to pay their subscription fees with tax-advantaged funds from a health savings account.
Direct primary care capitalizes on the power of markets to deliver better quality care at lower cost. And it puts patients and doctors, not insurers or the government, back in charge of the provision of health care.
Sally C. Pipes is president and CEO at the Pacific Research Institute.