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Explore direct primary care, concierge medicine, and other successful direct care models.
Even though the Direct Primary Care (DPC) practice model is structured in a straight-forward manner that harkens back to the day of the traditional family doctor, many patients still struggle with the concept. Insurance has been a major factor in primary care since the middle of the 20th century, so most people today do not remember a time when they paid the physician directly rather than going through an insurance company for healthcare coverage.
Educating your community about the DPC concept and about your practice involves a number of activities, many of which can be done at no or little cost.
Educational efforts can pay off, with little to no cost to you and your practice. Patients will actually be more likely to trust the information they receive that has been disseminated through non-paid methods, particularly if they are learning something new and can see the benefits of that information.
Julia Burgess March 13, 2020Read
Direct primary care (DPC) is a growing practice model, as more physicians are realizing the benefits and more patients are understanding how a DPC can work for their healthcare. There are some challenges for DPC physicians and their patients, however, many of which are the subject of federal and state legislation efforts in 2020. Other areas for DPC physicians to watch in 2020 include a more intense focus on prescription and healthcare costs.
Growth of DPC practices
The DPC concept first launched around the turn of the 21st century. Data regarding the number of practices and patients dates back to 2014, when 125 practices and 5,988 patients were recorded. In the past five years, the number has climbed to over 1,000 practices in 49 states caring for approximately 500,000 patients and will undoubtedly continue to increase in 2020.
DPC patients currently are not able to use their Health Savings Accounts (HSAs) to pay their DPC membership fees, as the Internal Revenue Service (IRS) considers the DPC model of care to be a type of health insurance. The Primary Care Enhancement Act of 2019 is designed to change that. Also known as HR 3708, the act’s intent is to “amend the Internal Revenue Code of 1986 to allow individuals with direct primary care service arrangements to remain eligible individuals for purposes of health savings accounts, and for other purposes.”
Many states are introducing their own legislation to have DPC recognized as “not insurance,” including Maryland, South Carolina, and Minnesota. While Colorado has already passed such a law, the state’s Medicaid patients are still prohibited from privately contracting for any “covered services.” CO HB1140, introduced in January with a hearing expected in February 2020, “prohibits the department of health care policy and financing (department) from denying a Medicaid recipient the right to purchase direct primary care services or enter into a direct primary care agreement.”
Tennessee’s TN HB 894/SB 696 requires the state’s Finance and Administration Department to “study the feasibility of adding direct primary care as a covered benefit under one or more of the basic health plans approved by the state insurance committee for eligible state employees.” The legislation was introduced in 2019 and is expected to be carried over to 2020.
Employer healthcare costs
Healthcare costs continue to rise for employers who provide coverage to their employees as a benefit. A survey conducted by the nonprofit National Business Group on Health (NBGH) found that larger companies estimate that their health care costs will increase a median of 6 percent in 2020. Premiums and out-of-pockets costs will increase from $14,642 to $15,375 per employee in 2020.
DPCs have the opportunity in 2020 to promote their healthcare services as a less expensive and more effective benefit to these employers, particularly as approximately 41 percent of those surveyed said they would be using cost-management tactics to reduce their projected health plan cost increases.
Julia Burgess March 5, 2020Read
Salad, salmon, and electronic health records (EHRs) were the menu highlights at the recent Direct Care Dinner hosted by Elation Health and facilitated by Dr. Darin Charles. Held at the Winewood Grill in Grapevine, Texas, the dinner event focused on the operation and the benefits of direct care and EHRs in the Dallas-Forth Worth area.
Dr. Charles launched his direct care practice, Hometown Health with the goal of offering the same level of care to his patients as he does for friends and family. He says that “by eliminating the complications of insurance, and implementing the latest technology,” he is able to provide high quality, personalized care with “immediate access, superior communication and expanded appointment times, with complete transparency, at a reasonable cost.”
The Direct Care DFW Dinner Event, held on February 5, 2020, also featured remarks from Elation’s Direct Care Growth Manager, Gabby Marquez, and Direct Care Growth Specialist, Julia Burgess. Throughout the evening’s presentation, Dr. Charles focused on several key topics, including the importance of:
Operating a successful direct care practice requires planning, financially as well as in terms of patient panel size. The attraction of direct care to the patient is the simplicity of the model and the affordability of the membership fee, but the provider is running a business and needs to be sure it can be sustained.
Hometown Health provides direct care services to small businesses as well as individuals. Many direct care practices work with businesses to provide healthcare to their employees, particularly as healthcare costs continue to rise. Using the right EHR solution can also make a significant difference in the quality of care provided to those businesses.
Dr. Charles emphasized the need for quality technology as a communication tool and as an effective tool for providing value-based care to all of his patients. He did an amazing job during the dinner event, facilitating conversations and giving a very informative and content rich presentation about his direct care practice and his route to success as an independent physician.
The great turnout at the dinner event included experienced physicians as well as those just launching their practice. One attendee noted with excitement, “As a new practice I would highly suggest using Elation. It is by far the best EMR!” At Elation Health, we look forward to working with this provider and many others who will soon be making the switch.
Julia Burgess February 22, 2020Read
The practical aspects of setting up your practice administration involve considerations regarding finances, staffing, banking, and other areas of your practice that are more directly related to the business operations than to actually seeing patients. To accomplish many of the steps, you may need to work with a professional such as a lawyer or accountant.
The logistics of setting up your practice administration include:
Julia Burgess February 18, 2020Read
Starting or expanding a direct primary care (DPC) practice involves many considerations. You will have to think about staffing and marketing your practice. If you’re converting to a DPC from a traditional practice, you’ll need to communicate with your patients as to the details of the transition. If you’re opening a new practice, there will be a lot of work to do to educate people in the community about the DPC model. One of the most important things to plan is where your DPC practice will be physically located.
Some things to consider in finding a practice location include:
Once you’ve found a great location for your DPC practice, you’ll also need to consider how to set up and decorate the interior as well as any parts of the outside you can control, such as signage and landscaping. Maintaining a physical appearance that is in line with the branding message you are sending your target patients is important.
Timing is a consideration as well. Typically, the process of securing office space and filing paperwork takes approximately 6 months. It’s important that aspiring direct care doctors are prepared to devote that amount of time to starting their new practice.
Julia Burgess February 6, 2020Read
An independent practice is a business. A direct care practice, in particular, needs a solid business plan that addresses the details of operating productively. A business plan includes financial projections as well as plans and goals for patient panel size, practice location, and other logistics necessary to run a successful practice. Drafting a business plan for your new practice requires research, forecasts, and realistic objectives.
Given the financial structure of the direct care practice, careful planning can help ensure the practice’s success. Elements of a business include:
Be sure to include a plan for optimizing technology, especially electronic health records (EHRs) in your new practice.
As you draft a business plan for a new direct care practice you will need to determine where you want your practice to be located. Is there an area in your community that has a need for your services? What is convenient for your target patient population?
Setting your membership pricing structure will require financial planning and projections. Some factors to consider are time, variable costs, and overhead (including the cost of growing the practice). Will you offer reduced fees for children and the elderly? You will also need to determine whether you will accept any type of insurance, including whether to accept Medicare patients. Pricing and financial projections will also need to include your ideal patient panel size, both now and when growing your practice.
The marketing section of your business plan will include a section on how to educate patients about the direct care model. Include how you will create a website, how often you will post on social media, and if you need to contract with a professional to help you with outreach and promotional efforts.
The key to drafting a business plan is to be realistic and to treat the plan as a living, usable document. Be realistic about the potential patient base in the location you’ve chosen for your practice as well as in your financial projections and planning. There will be a ramp-up period for a new practice, so include realistic start-up costs, promotional costs, and staffing costs. Then project your growth based on comparisons with other independent practices in your area and on the population you will serve.
Use the business plan to track and manage your business on an ongoing basis. It is not a document to be completed and put on a shelf. Your business plan will be your guide to managing a successful practice and to planning your growth as a direct care practice.
Julia Burgess January 28, 2020Read
Communicating with patients is critical for ensuring they understand their diagnosis and follow-up care thoroughly. Often, patients will have questions or will not remember the details of their conversation once they leave the physician’s office. At other times, it may be necessary for the direct care physician to provide the same information to multiple patients. Engaging those patients with video may be the best solution, to ensure the information is properly disseminated and retained.
In the direct care physician’s office, patients may indicate they understand instructions or explanations. However, once they return home they may realize that they didn’t quite get everything that was conveyed verbally or on a piece of paper. Access to a video will help those patients review the information multiple times, until they are comfortable with their understanding of the content.
Videos can also be recorded in multiple languages. For a direct care patient whose first language is not English, a video recorded in their native language could be critical for the physician to engage with them. Likewise, for patients who may be challenged with hearing or comprehension difficulties, a video could be the solution for the direct care physician to engage with them in a more meaningful way.
As the trend toward remote healthcare, including telehealth, grows, videos will also become an important tool for engaging patients who cannot or prefer not to visit the direct care physician’s office. Engaging telehealth patients through video will become a critical aspect of their care as the direct care physician reaches out to provide healthcare through emerging virtual services.
Preventive care is particularly suited to videos. The direct care physician can record videos of various aspects of preventive care and make those videos available to patients on a website, through patient portals, and in the practice’s waiting area. Preventive care videos would emphasize those activities that contribute to the patient’s overall health, engaging patients in their journey toward positive healthcare outcomes.
Julia Burgess January 21, 2020Read
Employer-sponsored healthcare plans are beneficial to employees who qualify, as the employer typically covers much, if not all, of the cost of those plans for employees entitled to benefits. However, a growing number of workers in the US economy do not qualify for benefits. They are part-time or contract employees who need healthcare but are not able to participate in their employers’ plans. Direct primary care (DPC) coverage may be the solution for those employees.
It’s been estimated that about half of construction workers and more than thirty percent of restaurant workers are uninsured. In addition, workers who do not qualify for benefits include drivers, nurses and retail workers. Essentially, anyone who works less than the amount necessary to qualify or who works on contract may be a non-benefited employee. DPC healthcare can be secured individually for a relatively low cost. In addition, groups of non-benefited employees may be able to participate in a DPC at a discount.
The DPC healthcare model is affordable for most, with monthly membership fees typically ranging from $50 to $100. There are generally no additional fees for office visits and often the membership covers basic laboratory services. Employees may also be able to save money on diagnostic tests and prescription medications through the DPC practice.
DPC practices are growing in popularity. They offer primary care services in addition to more personalized services, such as after-hours communication with the physician and longer visit times in the office. Non-benefited employees may want to supplement their DPC membership fee with a high-deductible catastrophic insurance plan, for hospitalizations and more expensive, non-covered procedures.
Given the rising costs of healthcare – and the costs and limitations of traditional insurance plans – participating in a DPC practice may be the best solution for non-benefited employees who are not eligible to participate in an employer-sponsored plan. Employers can also entice quality employees or contract workers by offering DPC memberships – or at least suggesting it as an option.
Krystle Thornton December 9, 2019Read
Direct primary care (DPC) is growing in popularity, particularly as healthcare costs for patients continue to increase. The DPC model is relatively simple – patients pay a monthly membership fee and receive basic primary care services from the DPC physician for that fee. There are no additional visit charges and some DPC practices offer discounted fees for laboratory services and prescription medications. However, DPC patients are not eligible for Health Savings Accounts (HSAs), according to current IRS regulations. That policy may be changing.
The Primary Care Enhancement Act (HR 3708), introduced in July 2019, would allow patients to participate in HSAs and to use those funds to pay their monthly DPC membership fees. Currently, DPC membership fees are considered to be health insurance premiums, so DPC patients are not allowed to use their HSAs to pay those fees without incurring a tax penalty. HR 3708, designed to amend the IRS Code of 1986, was approved by the House Ways and Means Committee in October 2019.
Although widely supported by a range of organizations, including AAFP and the HSA Council of the American Bankers Association (ABA), there is some language in the bill that has been met with concern, particularly by the Association of American Physicians and Surgeons (AAPS).
Indicating that HR 3708 “fails to expressly define DPC arrangements as a qualified medical expense under IRC 213(d),” “unclear language may impede patient access to prescription drugs at near-wholesale pricing,” and that the proposed aggregate cap of $150 “constrains any flexibility the bill might have for allowing agreements with non-primary care specialties,” the AAPS submitted a letter on October 22, 2019, outlining “a number of concerning areas of this bill that we believe improperly limit the design of DPC arrangements eligible for HSA use.”
Previously introduced in 2017, the bill was not acted upon and was cleared from the books. HR 3708 was forwarded to the full House for consideration and approval in October 2019.
Krystle Thornton November 1, 2019Read
The simplicity of the direct primary care (DPC) practice structure is such that overhead, including the need for staffing, is reduced significantly. DPC physicians do not bill insurance companies and patients do not pay a fee for each visit or service provided to them. Billing and accounts receivable are much less complicated than in a traditional independent physician’s office. The front office in a DPC, though, does have a major role for the patient and for the practice.
One of the main responsibilities of the front office is to communicate with patients and potential patients. The front desk gives the DPC patient the critical first impression of the practice. In some practices, the physician may actually come out to greet patients and escort them to the exam rooms; however, the first point of contact is the person in the front office.
Patient engagement is top priority for the DPC front office. Patients may have questions about the membership fee, what is included, how it is paid, and when it is due. The front office staff at a DPC practice should understand the concept of the DPC model to the point where it can be explained thoroughly to potential patients and clarified for current patients. Many DPCs also offer discounted fees on lab services or prescriptions and the front office will be responsible for handling those transactions.
Given the efficiency of the DPC practice, it is up to the front office to maintain an organized healthcare environment for both patients and the physician. Membership fees are the sole income for the practice, so a well-run office is critical for the financial success of the practice, which still must be run as a business. With fewer staff members, patients have only a few contact points in the office, so the front office becomes a critical piece of their visit as well.
The good news is that a DPC patient panel is typically much smaller than a traditional practice’s and the front office staff has a perfect opportunity to get to know each patient better, providing a higher quality healthcare experience for every patient.
Gabby Marquez September 20, 2019Read