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One of the Challenges for Direct Primary Care

July 22, 2015
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The AAFP’s Health is Primary document makes an unusually bold statement for a bunch of family physicians that payment reform is the key to all other reforms. This new-found courage to actually stand up for ourselves is refreshing, though I had some serious concerns with the document that were previously published, and I won’t repeat them here much. Briefly, I thought they should have named the AMA CPT codes and its partner CMS’s documentation, coding, and billing system as the underlying causes of our historically anemic existence and lack of medical student interest.

Also, my other major concern is that they put all of their payment reform eggs into the direct primary care basket. I think a fee-for-thinking system would be better. Imagine if your doctor bill looked like you shopped at a Target. A quick trip for one small item would generate a small bill. A longer trip where you want to talk about lots of stuff with your family physician would generate a larger bill.

A recent news report on the cost of Medicare Advantage plans supports one of my fears about the application of direct primary care. It states that an impending report from the National Bureau of Economic Research will conclude that the feds are overpaying these plans to the tune of $2 billion per year. Advantage plans are essentially Medicare HMO plans.

I have a physician friend who takes this insurance, and he told me that they get lots of pressure from the plans to record every piddly finding/diagnosis the can so the insurance companies can maximize the per-member-per-month fees the feds pay. Now this report confirms his anecdote on a national scale.

The fundamental problem for both Advantage plans and direct primary care plans is that no one has come up with a good risk-adjustment system based on diagnoses codes, and I predict ICD-10 won’t help much. There are no good codes for some of the real factors that drive utilization such as patient education, social status, income, family dysfunction, kindness, humility, and probably most important — the underlying expectations of patients of what the healthcare system is supposed to provide them in the first place.

Therefore, direct primary care (DPC) at some national fixed rate should be a boon to physician practices that establish themselves with large companies that have young healthy employees who only want to go to the doctor when they absolutely feel miserable. Direct primary care will not work nearly as well in vulnerable populations not tied to a company, such as Medicaid, Medicare, and dual-eligible populations. I could see doctors paid under DPC using the same tricks the HMOs did, for example, going to senior fitness centers to enroll patients and refusing to see patients in nursing homes or those with mental health diagnoses.

A fee-for-thinking system would remove the need to use mostly worthless risk-adjustment formulas, thus saving a significant chunk of insurance administrative overhead. AAFP leadership has led us down capitated rabbit holes before (i.e. the managed care era disaster). It’s a shame that they have not thrown a wider net of payment reform possibilities. We need more experimentation and disruption of the existing system, not limits

One Response to One of the Challenges for Direct Primary Care

  1. J. Timothy Ames, MD on August 7, 2015 at 8:01 am

    I am a firm proponent of direct primary care, so I welcome criticism of the model. It will only show its value if it can stand up to skepticism.
    That said, I have a proposal for treating most-needy members of the population: put their primary care up for bid. I, for one, would not mind if I was given the responsibility for taking care of 60 very ill and/or dysfunctional patients if I were paid $5000 a year for each of them. I would do it under the condition that I would take only very general directions defining the qualities of the care I should deliver, and no requirement to document my care with thousands of codes. If there were still not enough primary care physicians to take care of these patients, I would raise my price until more doctors were attracted into this field. Conversely, if I were underbid, I would accept less money or find a different population where I have a competitive advantage.

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