Direct Primary Care Alternatives to Health Insurance

Is Direct Primary Care a Good Alternative to Health Insurance?

Female doctor with senior patient
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For many people, traditional health insurance leaves a lot to be desired. While it does help pay for medical care, billing can often be complicated, a network may limit your choice of doctors, and you may still have high out-of-pocket costs.

Patients looking for alternatives to traditional health care can consider a relatively new option: the direct primary care (DPC) model. With DPC, you pay a monthly fee to a health care provider's practice. In exchange, you have access to a doctor, typically including in-person and telehealth visits.

Learn more about the DPC model and how it works.

What Is Direct Primary Care?

DPC gives primary care physicians an alternative to third-party billing, which takes up a significant amount of time and requires doctors to see a high number of patients. Instead, doctors charge patients monthly, quarterly, or annual fees.

These fees cover primary care services such as consultations, laboratory tests, and clinical or other medical services. Patients can use health insurance—often a high-deductible insurance plan—to cover emergency expenses and other expenses not covered by the DPC plan.

The model aims to improve patient care. Patients typically have longer appointments in a DPC practice as there's a lower doctor-to-patient ratio.

Direct medical care also reduces overhead expenses and simplifies administrative work.

How Direct Primary Care Works

Paying an all-inclusive, flat-rate fee for unlimited access to a primary care physician is an attractive option for some patients. Fees are typically less than $100 per member per month depending on the provider and services offered.

You might think of this as paying for an exclusive membership at a doctor’s office where patients receive personalized care and spend quality time with their physician.

Many DPC centers allow access to your doctor through phone appointments, video chats, text, and email while still providing traditional office visits. Medications and lab tests often are available at a discount to the patient.

Note

In November 2019, there were approximately 1,200 DPC practices in the U.S.

Advantages and Disadvantages of DPC

The DPC model can be beneficial to patients and doctors alike. Patients enjoy the personalized attention and doctors like to practice medicine as it was before health insurance became prevalent.

Spending more time with patients gives doctors the ability to focus on the patient's overall health, including wellness and lifestyle improvements. It has the potential to simplify health care for patients and doctors alike.

Critics have raised concerns that DPC clinics may become over-burdened, causing neglect of patients. They argue that health care providers would be incentivized to provide less care since they're responsible for the total costs.

Other concerns focus on the separation of insurance from primary care when patients may ultimately end up needing insurance for services not covered under the DPC model.

Additionally, the DPC model may not be available to those who can't afford a monthly payment. This means that some patients who could most benefit from this kind of care can't access it, contributing to health care inequality.

Note

Twenty-eight states have enacted laws that classify direct primary care practices as “not insurance,” which prevents them from being regulated like insurance companies.

Another disadvantage is the inability to use funds from a health savings account (HSA) to pay for direct primary care. This is because the Internal Revenue Service sees your monthly fees as insurance payments, and you can't use HSA funds to pay health insurance premiums.

Legislation continues to be introduced to address this issue, including H.R. 3708—Primary Care Enhancement Act of 2019.

Examples of DPC

An example of one of the first successful direct primary care providers was Qliance. This DPC provider was started in 2007 in the state of Washington and was backed by Michael Dell, the founder of Dell Computers, and Jeff Bezos, the CEO of Amazon. Company leaders later bought the practice and ran it privately. However, in June 2017, Qliance ceased operations.

Another example is Direct Primary Care in Spokane, Washington. It has a fee for adults aged 39 or younger, a higher fee for adults aged 40 and older, and a low fee for children. Labs, medications, and imaging are available at a discount.

Note

Most direct primary care practices operate locally with doctors who have built their own practices.

Is DPC Worth It?

As with so many things in life, the answer to whether DPC is worth it is: It depends.

On the plus side, you have access to a physician through a monthly, quarterly, or yearly fee. A supplemental health insurance policy may still be a good idea for the services not covered by your DPC practice, though.

The DPC model also has disadvantages, which include not having assistance in navigating specialized care covered by health insurance, as well as the lack of accessibility to those with limited resources.

Whether it's right for you depends on your health, finances, and preferences for receiving care.