New practice model evolves: ‘direct care’

Proponents of direct-pay practice models argue that such alternatives are a badly needed intervention for both doctors and patients frustrated by the limited care that can be provided in 15-minute intervals or less. Other physicians are concerned that such models could shut out lower-income patients, creating a 2-tiered health system and further straining an already overstretched primary care workforce.


When Brian Forrest, MD, opened his primary care practice in Apex, N.C., in 2002, soon after completing his residency, he had no shortage of people telling him he was crazy.

He refused to accept insurance, instead charging a monthly fee or a set of reduced, transparent fees to his patients. His goal initially was to provide a lower-cost option for uninsured residents in his suburban Raleigh community, given that they were paying full price any time they needed to see a doctor rather than an insurance-negotiated fee. These days his practice is roughly split between uninsured and insured patients, driven by word of mouth, Dr. Forrest said: “The uninsured people were telling their insured neighbors about this great place they could go, and spend an hour with the doctor.”

Elimination of the insurance middle man is the main difference between direct primary care and concierge practices according to Reid Blackwelder MD the latter typically charge a retainer but also m
Elimination of the insurance middle man is the main difference between direct primary care and concierge practices, according to Reid Blackwelder, MD; the latter typically charge a retainer but also might file through the patient's insurance.

Today, Dr. Forrest, who was a plenary speaker on direct primary care at the American Academy of Family Physicians' (AAFP) annual leadership forum in 2014, finds himself on the leading edge of one of the latest practice models to catch the interest of doctors who long to loosen or entirely shed their ties to insurance companies and fee-for-service reimbursement. Dubbed “direct primary care,” the model is one of several evolving practice types that can overlap in style and approach, including concierge and retainer practices.

Proponents argue that these alternatives are a badly needed intervention for both doctors and patients frustrated by the limited care that can be provided in 15-minute intervals or less. With the proliferation of high-deductible plans, patients already paying out of pocket anyway might be more receptive to a cash-driven practice in exchange for better access, they said.

According to Dr. Forrest, the panel sizes in direct primary care are not necessarily drastically reduced and may be considered optimal. He also suggested that this model might appeal to medical students, who could start choosing careers in primary care in much greater numbers.

Other physicians, meanwhile, sound a more cautionary note, concerned that such models could shut out lower-income patients, creating a 2-tiered health system and further straining an already overstretched primary care workforce.

“I do wonder and worry about what were to happen if this model really took hold in a big way, what the workforce implications would be,” said Yul Ejnes, MD, MACP, an internist in Cranston, R.I.

Evolving and overlapping

Regardless of the precise moniker involved, these retainer/direct pay models are gaining some traction, according to a 2014 survey conducted by the recruiting firm Merritt Hawkins for the nonprofit Physicians Foundation. The survey of more than 20,000 U.S. physicians found that 7% already practice under some form of concierge or direct pay system, while an additional 13% plan to transition in that direction.

In 2013, the AAFP issued a policy statement in support of direct primary care and is launching a series of related workshops (one of which Dr. Forrest will be teaching, he said). In 2014, ACP started working on its own policy paper, which will look at direct primary care and other related models, including a review of the literature, said Robert Centor, MD, MACP, chair of ACP's Board of Regents. “It's controversial,” he said. “I can tell you that it's not going to be an easy policy paper to write.”

One of the challenges is the shifting terminology and semantics, with people sometimes using the same words to refer to very different practice structures, Dr. Centor said. For example, he said, “When you say ‘direct primary care,’ it's almost like a Rorschach test. Everybody sees what they want to see.”

In its recent policy statement, AAFP officials defined direct primary care as a form of a retainer practice, in which the patient pays a monthly or annual fee tied to some form of expanded service, including longer appointments and after-hours care if needed. One key distinction that AAFP makes is that the fee is in lieu of insurance, so the practice doesn't bill a third-party payer.

That elimination of the insurance middle man is the main difference between direct primary care and concierge practices, which typically charge a retainer but also might file through the patient's insurance, said Reid Blackwelder, MD, AAFP board chair and a family physician in Kingsport, Tenn. In direct primary care, while patients are encouraged to get some type of catastrophic policy, eliminating insurance claims for primary care treatment can significantly reduce documentation and overhead expenses for the practice, he said.

Along with the overlap in practice styles, there also has been some convergence between the fees charged by concierge and other models. When they first emerged, concierge practices were associated with the über-wealthy because of very high annual fees. But some practices these days charge more modest fees, noted Dr. Centor, who in 2011 published an opinion piece in Annals of Internal Medicine describing retainer medicine as an ethically legitimate form of practice.

Dr. Ejnes said that some of his discomfort with these alternative models has eased with the emergence of direct primary care practices that charge lower per-month or annual fees. As one example, he pointed to HealthAccessRI, a Rhode Island company that is building a network of doctors working in what it describes as subscription-based primary care. The fee is $35 per month, plus an $80 enrollment fee. After that, each doctor's visit costs $10. Per its website, the company is targeting several groups, including those without insurance, immigrants without documents, or people with high-deductible insurance plans.

Dr. Forrest started out charging $25 per month and $5 to see the doctor. Now his basic plan is $40 monthly, plus $20 per visit, which he said is enough to cover office overhead. His practice, Access Healthcare, has options as low as $25 per month. The clinic, with 3 doctors now including Dr. Forrest, provides Saturday hours. Dr. Forrest also describes making house visits to patients recovering from surgery or those for whom a trip to the doctor would be difficult.

What about those individuals who can't swing even $40 to $50 a month for a primary care fee? Dr. Centor said that he'd like to see direct pay practices, as they evolve, remain attuned to their responsibility to those less fortunate. One option is to carve out a portion of each panel for low-income scholarship or charity care patients who can't afford the fee, which Access Healthcare does, Dr. Forrest said.

High-contact care

Christopher Ley, MD, ACP Member, an internist and a former member of the large practice that also includes Dr. Ejnes, said he changed his practice model to avoid burnout. About 6 years ago, he found himself seeing more and more patients and working until 8 or 9 p.m. and still not getting caught up. Before Dr. Ley joined MDVIP, a Boca Raton, Fla.-based company with a national network of more than 750 affiliated concierge practices, he had never envisioned that his future would include that model. But, he said, “I also realized I could either do something different or could be carried out in a box eventually because it was really exhausting me.”

Dr. Ley, who made the mid-career switch in 2009, described his hours as a bit shorter these days. But his total time spent with patients is roughly similar, as he spends more time with each one on his panel of 400 to 500. The annual $1,650 fee that patients pay covers services not typically provided under insurance. He's able to visit his patients when they are hospitalized and assist with care coordination.

Before Dr. Ley left his prior practice, he made sure another doctor was covering for his patients, he said. About 250 patients came with him initially, and some additional ones came later. It was “very tough” to leave patients behind, he said, including older patients whose investments had been hard hit by the deep recession. “It was one of the reasons that I didn't want to do it,” he said. He was able to retain some lower-income patients on scholarship.

Richard Dupee, MD, FACP, who has been practicing internal medicine since the mid-1970s, could have opted for retirement when he closed his large Wellesley, Mass., practice in 2014. But the 69-year-old internist had already received what he describes as a dream offer to serve as dean of international affairs at Tufts University. In addition, he has been able to continue to see patients part-time at Pratt Diagnostic Center, the concierge practice that's part of Tufts.

The Center, located near Beacon Hill, Mass., charges a $2,000 annual retainer. In return, it helps to offset Tufts' costs of taking care of underinsured patients through the department of medicine, Dr. Dupee said.

High-contact care can pay off for patients, according to an analysis involving MDVIP patients published in 2012 in the American Journal of Managed Care. The study, which compared hospitalization rates between MDVIP and non-MDVIP members in 5 states, found that the likelihood of hospitalization was consistently lower for those in concierge care. Compared with non-members, MDVIP enrollees were 54%, 58%, and 62% less likely to be hospitalized in 2008, 2009, and 2010.

Dr. Dupee, who in his previous practice had cared for a panel of about 4,500 patients with the help of physician extenders and residents, was able to bring along slightly more than 100 of those patients to Pratt as of last fall. But he still regrets his lost patient connections, some forged through multiple decades. “I must say that the move for me was bittersweet,” he said. “I miss my patients.”

Direct pay logistics

Dr. Forrest, who also does consulting work with practices that want to develop direct primary care, said that sometimes larger practices prefer to adopt a hybrid approach. For example, some doctors within an existing practice can be designated as the direct pay practitioners, and that number can increase over time as other doctors join the practice, he said. Another option is for each doctor to designate a percentage of his or her patient panel for direct pay patients.

These days, Dr. Forrest said he's still only working with 1 full-time assistant per full-time clinician, as his practice model effectively eliminates much of the staff time and record-keeping related to working with insurers. By comparison, a typical primary care doctor can anticipate needing as many as 5 staffers, according to Medical Group Management Association data.

Working with local clinicians, Dr. Forrest has negotiated deep discounts for specialist referrals and routine imaging services, with an X-ray costing about $19, a mammogram costing roughly $80, and similar steep discounts for MRIs and other imaging tests. His notable gap: hospital care. To that end, the Affordable Care Act has been a boon for his uninsured patients, as they can pick up a bronze plan for negligible cost and peace of mind to cover the worst-case scenario. “I've actually gained patients with the passage of the ACA,” Dr. Forrest said.

The Affordable Care Act also has opened the door to direct primary care in another regard. The law enables the model to be offered on health exchanges as long as it's packaged with a wraparound policy to cover other medical costs, including catastrophic care.

Dr. Forrest maintains that there is a cultural difference between concierge and direct primary care. “Concierge almost turns your doctor into your butler,” he said. “Here's my litmus test. If you're in a concierge practice, it's very unlikely you are going to have many people that are uninsured in your waiting room, whereas this would be common in a direct primary care practice.”

Regardless of the precise design of the fee-for-service alternative, though, these practices reach fewer patients, Dr. Ejnes said. He worries about newly trained doctors launching one of these practices, or too many doctors switching mid-career and abruptly scaling back the number of patients they treat.

There are other ways for doctors to feel like they provide comprehensive care, such as through the medical-home model and incorporation of physician extenders, Dr. Ejnes said. But the pressure to see more patients and the related burnout factor are real, he acknowledged, and perhaps these alternatives will prevent a talented doctor from jettisoning clinical care entirely.

“If you keep a physician from retiring prematurely, I think there is a benefit to finding models for them to stick around,” he said.