Direct primary care is yet another in a long line of ideas to help reinvigorate primary care for both doctors and patients. Some view it as a panacea, others as snake oil. I’m not sure what it is, but I know it’s not a transformative innovation for making primary care more relevant, responsive, and affordable on a large scale.
In a nutshell, direct primary care is a model for delivering primary care, and only primary care. The doctor charges each patient a monthly fee, generally ranging from $50 to $200, in return for timely, convenient access to him or her and a buffet-like menu of mostly basic primary care services. The amount of the monthly fee is presumably set in relation to the scope of services covered, though every practice may do it differently.
For services that aren’t covered under the fee, like more extensive management of a chronic disease, the patient’s insurance — if he or she has it — must be billed to pay for the service or, in some cases, the physician or practice will charge the patient extra fees to cover those services.
Direct primary care appeals to a growing number of doctors. Many are burned out and dissatisfied working in traditional primary care practices, where the administrative hassles are high and they do not get to spend enough time with their patients. Many want to return to a time when the doctor-patient relationship was more central to the delivery of primary care. Many want greater predictability and control in their work lives.
Direct primary care might be a better model for some of them — if they can still earn enough while not taking on too many patients. It also sounds appealing for patients, at least at first glance when you go online and see some of the inviting websites of direct primary care physicians.
As someone who studies doctors and how they work, I see problems with direct primary care for providers, patients, and the U.S. health care system. Here are several of them.
Lack of scalability. From a numbers standpoint, direct primary care is self-limiting in how many patients it can serve. According to the fine print from places like the American Academy of Family Physicians, which supports direct primary care, a doctor working under a retainer-based arrangement cannot treat as many patients as physicians working in traditional primary care practices.
This makes sense. To sell yourself — not others like a nurse practitioner, nurse, or another doctor you might not know — as being available in a timely manner and to guarantee a highly personalized relationship implies that the number of patients a direct primary care physician can reasonably care for goes way down, in some estimates to only one-third or one-quarter the number a traditional primary care doctor can care for. That does not define a transformative innovation in a country that has serious primary care access problems.
Having more patients on retainer means less time available for each one and less ability to react quickly to those who contact the doctor. That can make a direct primary care physician’s life miserable pretty quickly. Contracting with too many sicker or needier patients can also be problematic for direct primary care doctors, as these patients require more contact and care management.
It would be useful to see data from existing direct primary care physicians and larger direct primary care practices on the case mix of their retainer-based patients. They likely include a disproportionately high percentage of healthier, “worried well” individuals.
Incentives to limit care. Another problem in the direct primary care model is the built-in incentive to limit care. The direct primary care physician or practice functions as an insurer by using the fees from their patients to pay for the services they provide. The pushback from direct primary care advocates here is, “Traditional primary care practice also has an incentive to limit care due to the ways they are paid by contracts with outside insurers.” That’s true. But replacing one conflict of interest with another isn’t necessarily an improvement, and the direct primary care potential conflict of interest here is significant.
Direct primary care doctors or practices assume 100 percent of the financial risk for services included under the retainer for each patient, often including lab work and various screenings. While insurance companies spread their financial risk across large numbers of patients and many different doctors and practices, the direct primary care doctor or practice can spread it only over a limited number of patients. That imposes significant pressure to keep service utilization, care management activity, and direct contact per patient lower to maximize the profit margin.
Patient expense. The direct primary care model can get expensive for patients, making it a model that caters to the affluent and potentially worsens inequities in the primary care delivery system in terms of the care that different individuals receive.
When I examined a retainer-based direct primary care practice near where I live in the Boston area, I found that the monthly retainer covered only a limited menu of basic primary care services and number of contacts with the doctor. Anything else required me to get services paid for through other health insurance I might have, and in the process be subject to paying copays and deductibles to get those services reimbursed.
Most people opting for direct primary care will want — and need — to have additional insurance for things the direct primary care practice does not cover. That means it is quite possible that participating in direct primary care could make some patients pay more out of pocket for their care due to the added costs of the monthly retainer fee on top of normal insurance costs. In addition, a direct primary care physician or practice, by choosing to participate in fewer insurance plans, can end up as a more expensive out-of-network provider for patients to use.
There is also the possibility that patients’ paying $1,500 a year in retainer fees for better access to their doctor will feel the need to access him or her more, which may produce unnecessary service utilization and increase out-of-pocket costs.
More work for patients. The direct primary care model places greater responsibility on patients to know their medical insurance inside and out. They must also become the liaison between their direct primary care physician or practice and their insurance plans.
A big part of the allure for direct primary care doctors or practices is that they can dispense with the hassles of dealing with insurance companies on their patients’ behalf, thus not having to spend their own dollars employing personnel for billing or claims processing. This can considerably reduce their fixed overhead. The flip side is that direct primary care shifts a lot of the insurance paperwork and administrative burden onto the patient. I understand why direct primary care doctors and practices like that. I don’t understand why patients paying $1,500 a year out of pocket for retainer fees would want to take that on.
In the very best case, direct primary care could make some doctors and patients feel more connected to each other, and might even help produce a better care experience. But given significant problems with the model, I don’t expect to see direct primary care taking on a significant number of patients across the country any time soon.
This boutique form of primary care, likely to be found in affluent suburban and urban areas or where employers are looking for practices to more aggressively oversee their employees’ health care, is a model that in many ways seeks to carve itself out from the larger health care delivery system.
There’s a bit of smoke and mirrors here, as direct primary care tries to convince patients that the rest of the health care system, like hospitals and specialty physicians, doesn’t really exist. But it does. And as long as many patients have to deal with the rest of that system on a consistent basis as they acquire more serious conditions and have constant needs throughout their lives for complex diagnostic and treatment care, direct primary care will be of limited help.
Timothy J. Hoff, Ph.D., is professor of management, health care systems, and health policy at Northeastern University in Boston; a visiting associate fellow and visiting scholar at the University of Oxford; and the author of “Next in Line: Lowered Care Expectations in the Age of Retail- and Value-Based Health” (Oxford University Press, September 2017).