What licenses do you need to open a direct care practice?

When launching a new practice, the independent physician has a lot of factors to consider. Location, staffing, equipment needs, and office technology are all considerations to take into account with a new practice. When launching a direct care practice, there may also be questions about whether specific licenses are required. The answers to those questions for the direct primary care physician actually vary by state.

Most of the license or permit requirements depend on whether the direct primary care physician will dispense medication in-house. This is a service commonly provided by the direct care practice, in an effort to further help patients save money. According to a recent article published by AAFP, “Twenty-seven states allow physicians to dispense medication without a fee or license. Among states that require a license, the fee ranges between $10 and $300. Montana, Texas, New York and Utah do not allow physicians to dispense medication.”

The direct primary care physician who conducts any types of tests on patients must adhere to Clinical Laboratory Improvement Act (CLIA) requirements, including applying for a waiver for conducting basic tests. As outlined by the DPC Frontier, direct care physicians will “need to pay a fee (file for a waiver), … are subject to audits (to make sure you only do waived tests), and … must maintain extensive documentation (regularly updated) to prove compliance.”

There are also, of course, licenses and regulatory requirements typically applicable to the independent physician regardless of the practice model, including the basic medical license and malpractice insurance. The good news is, because DPC doctors have fewer claims than regular physicians, they can receive a nearly 50% discount on the cost of their malpractice insurance. With significantly lower malpractice premiums, DPC physicians can more easily obtain such insurance to protect their practices against potentially damaging lawsuits.

There are currently a number of policies at the state and federal level that that could impact direct care physicians. When launching a new practice, the direct primary care physician should review the legal considerations and understand all of the requirements, including those that may vary depending on the location of the practice.

Krystle Thornton
December 3, 2018


Direct care is popular with patients and physicians

Physicians attending the Direct Primary Care Summit in July 2018 were enthusiastic about the direct care model of healthcare. As the president of the Association of American Physicians and Surgeons (AAPS), Albert Fisher, MD, noted, “Palpable energy filled the lecture hall.”

Summit attendees learned about starting, promoting, and running a successful direct care practice from experts in the field. Most indicated that the model of working directly with patients, bypassing insurance and reimbursement-based regulations and paperwork, was attractive to them and their patients. As Dr. Fisher noted, “There is renewed interest in independence and autonomy. At the end of the meeting, I felt optimistic about the future of the practice of private medicine.”

Physicians were advised to plan carefully before launching a direct care practice. They were also shown how a direct care practice can benefit physicians and patients, particularly those patients who are “working people.” Many direct care physicians at the Summit were excited about working with employers to provide healthcare as part of their company benefit, noting that “DPC can offer convenience and is a good employee benefit. It may help reduce absenteeism for small employers. For the DPC practice, working with employers brings in new patients.”

Direct care patients enjoy the benefits they receive from personalized healthcare and from the cost savings involved in their membership. Many direct care physicians who spoke at the Summit dispensed medications in-house, in particular cost-saving generics, and believed that “In-house drug dispensing is a great financial benefit to patients.”

Marketing advice for the direct care physician included using review pages such as Yelp to reach new patients. These review pages include testimonials from satisfied current patients, which do more to promote the direct care practice than paid advertising. As Dr. Fisher noted, “Patients have a much more positive experience in DPC” and will be likely to provide good reviews for their direct care physician.

Krystle Thornton
November 29, 2018


Direct to employer care gaining steam

In an effort to combat rising healthcare costs and to address health issues faced by their employees, a growing number of employers are contracting directly with physicians to provide care for their companies. Direct care practices typically provide healthcare to individual patients, contracting with them for a monthly membership fee. The expansion of direct care as an employer healthcare plan is also gaining steam with many organizations.

The direct to employer care model has been shown to benefit the provider as well as the employer. Providers build their practice by contracting directly with employers and those employers are able to offer their employees healthcare coverage that is effective and typically less expensive.

A recent article in Healthcare Dive outlines three common types of direct relationships between employers and providers:

  • Accountable care organizations (ACOs) for an entire employee population
  • A bundled payment, carve-out or Centers of Excellence (COE) for a defined condition
  • An advocacy role, such as meeting with hospital leaders to advocate for quality initiatives or payment reforms

The 2017 22nd Annual Willis Towers Watson Best Practices in Health Care Employer Survey found that 22% of employers anticipated directly contracting with providers to secure improved pricing of medical services by 2019. That number is a significant increase from the current 6% of employers who contract directly with healthcare providers for their employees’ care.

Large organizations such as WalMart are among those who have chosen to move toward the direct to employer care model. WalMart is the biggest private US employer. The company offers a COE network focused on reducing unnecessary spinal surgeries for its employees through a value-based payment program, incentivizing specialist to provide quality treatment through bundled payments.

The Willis Towers Watson survey found that employers recognize the employee experience with health and well-being is becoming increasingly important. Providing innovative, quality healthcare options to employees is a key strategy for employee recruitment and retention as well as for reducing costs for the employer.

Gabby Marquez
November 14, 2018


Elation Health attends Direct Primary Care Conference 2018

Earlier this month, Elation joined hundreds of physicians and physician leaders dedicated to the direct care movement at the Direct Primary Care Conference, previously known as DPC Nuts & Bolts.

During the event, several direct care physicians shared their journey toward direct care and how they have managed to grow their businesses while focusing on providing intimate, comprehensive, high-quality patient care. Many of these physicians included Elation users who rely on Elation’s Direct Care EHR to seamlessly provide care.

Elation’s team also had the chance to demo our platform for attendees thinking about starting an direct care practice or finding out more about a tailor-made EHR system. Among the features that were highlighted included:

-Access to the largest network of DPC providers to enable you to provide more collaborative care

-Integrated practice management tools that will allow you to run your practice more efficiently

-Patient engagement features to help you provide more innovative care

-The partners and integrations we support to give you a more robust DPC solution

-Elation’s dedicated 24/7 support and hassle-free onboarding process

-Our robust access to resources to help your practice flourish

We’re excited about the direction direct care is headed in and we want to continue the momentum that was ignited at the Direct Primary Care Conference so that more and more patients have access to phenomenal care.

Interested in learning more about Elation for Direct Care? Click here.

Krystle Thornton
November 12, 2018


How direct-to-employer care is driving comprehensive, affordable care

The rising cost of healthcare is a challenge for patients, providers, and employers. One effective way to help curb those costs is to focus on coordinated preventative care that reduces or eliminates unnecessary expenses. Duplicative tests, multiple provider visits, and unchecked health conditions can add to the costs as well as reduce the quality of care provided to the patient.

Direct-to-employer care enables primary care physicians to provide comprehensive, affordable care that improves the quality of value-based care while reducing costs. Revcycle Intelligence reports on one such direct-to-employer care relationship that is benefiting all involved. Vera Whole Health and Blue Cross Blue Shield of Kansas City (Blue KC) have partnered on three new primary care clinics “that blur the line between provider and payer and incentivize both sides to deliver high-quality, low-cost care to patients.”

In addition to primary care services, Spira Care Centers also provide behavioral health services, x-rays, and pharmacy services. All the services provided by the primary care clinics, except the prescriptions, are covered by the insurance component. To ensure that the primary care and the insurance model work together to provide quality healthcare at reduced costs, “Vera and Blue KC had to align their financial incentives through a value-based contract.”

The key is a capitated payment model tied to quality performance, by which Vera is reimbursed for primary care services delivered to patients at the Spira Care Centers. As Blue KC’s VP of Business Development David Olson explained, “It is a per member, per month payment contingent on them meeting quality metrics. A portion of their capitated payment is withheld pending them meeting HEDIS quality metrics, including patient satisfaction. There is a lot we have in the contract that they have to meet to ensure that they are continuing to deliver high-quality care.”

Aligned financial incentives ensure that providers “no longer have to depend on service volumes to ensure they can continue delivering high-quality care to patients.” Rather, primary care providers and patients are able to work together toward their “shared goal of improving preventative care to decrease costs.”

Gabby Marquez
November 5, 2018


How HSA reform could benefit direct care physicians

Many people choose a high-deductible health insurance plan to reduce their monthly premium cost. Those who do so are eligible to participate in a Health Savings Account (HSA) that may help offset some of the added expenses of the high-deductible plan, including deductibles, copayments, coinsurance, and certain other expenses. HSAs are also attractive because the money is set aside on a pre-tax basis.

Currently, the HSA is only available to people who have a high-deductible health plan, either employer-sponsored or obtained through the Marketplace, with a deductible of at least $1350 for an individual or $2700 for a family. Those who opt to participate in a Direct Care program are not eligible for the HSA program.

HSA reform could be on the horizon, however. A proposed bill, HR 6199, passed the House of Representatives in July 2018 and is now in the hands of the Senate. The bill would allow Direct Care patients to participate in an HSA and use those funds to pay their membership fees.

The Direct Care physician bills patients for a membership on a monthly basis, rather than billing for each visit or service provided. Patients are able to take advantage of basic primary care services as well as some treatment for illness or injury as part of their membership. Direct Care patients sometimes do secure high-deductible insurance plans for catastrophic coverage but are still not eligible for the HSA program since they participate in the Direct Care program.

The number of Direct Care practices is increasing as more patients realize the benefits and cost savings involved. To date, though, the inability to participate in an HSA or use HSA funds for DPC membership fees has been a challenge for both Direct Care patients and providers. If HR 6199 is passed, the amendments specified in Sec. 3. Treatment of Direct Primary Care Service Arrangements, will apply “to months beginning after December 31, 2018, in taxable years ending after such date.”

Krystle Thornton
October 29, 2018


Concierge medicine comes in all flavors and sizes

The image of a concierge medical practice is often that of an expensive form of personalized medical care, in which the physician is available for the patient 24/7. The traditional concierge practice does charge a membership fee that can range from $150 a month to $25,000 a year and offers the patient access outside the regular office visit. However, concierge medicine actually takes many forms, some much more affordable than many patients may realize.

A recent article in MedPage Today describes a range of successful concierge practices, including many hybrid models. Many practices are part of larger companies. One of the oldest concierge companies is MDVIP, launched in the year 2000 in Boca Raton, Florida. The practice has expanded to include 950 physicians in 43 states. Physicians in the practice “agree to reduce the size of their patient panel substantially, usually to anywhere from 300 to 600 patients.” The annual fee for the patient can range from $1650 to $1800. MDVIP boasts a 95% reduction in hospital readmission rates, as a direct result of its practice model.

Larger companies like MDVIP and Concierge Choice see their physicians as clients, for which they provide services such as marketing and accounting. Concierge Choice has concierge physicians in 24 states, serving “under 1,000 practices nationally.” In their model, “follow-up patient visits are covered either by private insurance, public programs like Medicare, or out of pocket if the patient doesn’t have other insurance.”

Independent physicians in concierge practices may also offer patients the option of enrolling under a membership fee or seeing the physician as a traditional patient, in a hybrid model. Physicians offer certain hours for each type of patient, usually spending more time during each visit with their concierge patients. For example, the independent physician may schedule two concierge patients during an hour slot but four traditional patients per hour. The traditional patients are able to continue to see their primary care physician while the concierge patients enjoy the benefits of their membership.

Gabby Marquez
October 10, 2018


The first things you need to do to start a direct care practice

The number of direct care practices is growing, as more independent physicians decide to return to the concept of patients paying their physicians directly for their care, with no insurance involved. The direct care model has helped strengthen the relationship between patients and physicians, allowing physicians more control over their patient panel sizes, practice staffing, and care delivery.

For physicians, adopting a direct care model can improve work-life balance, reduce practice overhead, bring higher per patient revenues, and maintain physician autonomy. Starting a direct care practice involves research and preparation, to ensure that the independent physician is providing the quality of care patients expect in a manner that optimizes the practice for success.

The first step for the independent physician is to learn as much as possible about the structure and management of a direct care practice. Resources such as DPC Frontier and Elation Health’s Direct Care Resources abound for the independent physician who wants to learn more. The independent physician should also:

  • Make sure the direct care practice is viable. Budgeting for a practice that runs on patient membership fees instead of relying on insurance reimbursements can be a challenge.
  • Plan the practice structure, including pricing for membership fees, office location, and a name for the practice. Basic business items such as determining the legal formation of the practice and writing a detailed business plan will help the independent physician prepare for success.
  • Research and adhere to the legalities of running a direct care practice. There are a number of legal considerations involved, including deciding whether to opt out of Medicare for older patients, complying with applicable regulations, hiring a lawyer, and securing malpractice insurance.
  • Market the practice to existing and potential clients. For the independent physician currently operating in a traditional practice, transitioning to a direct care practice will require educating patients on the change and reaching out to a new client base to build the practice.
  • Implement technology, including electronic health records (EHRs). A direct care practice has to operate efficiently. Technology that enables secure patient communication, ease of patient data input and review, and coordination with specialty physicians is key to starting a direct care practice designed for success.

Krystle Thornton
October 8, 2018


What are the consequences of rejecting insurance payment?

Direct care practices operate just as their name implies – they provide care directly to their patients, eliminating the insurance middleman. Direct care physicians focus on preventative care, with a goal of maintaining their patients’ health and well being to help prevent major illnesses and injuries. By reducing the need to secure prior approval and then insurance reimbursement, direct care physicians are better able to focus on the needs of their patients without the administrative overhead.

Rob Lamberts, MD, a board-certified internist and pediatrician with a direct primary care practice in Augusta, Georgia, writes in Medical Economics that one result of the direct care practice eliminating the insurance payments is an increased focus on reducing the cost of care. With healthcare costs rising, that can be a significant factor for independent physicians as well as for their patients.

Dr. Lamberts, who takes advantage of the benefits of Elation Health’s electronic health record (EHR) solution, notes that there are three key benefits to rejecting insurance payments:

There is an increased focus on customer service. Direct care patients enjoy more time with the physician during each visit. The wait to see the physician is often reduced significantly as well. When the direct care physician is more focused on patient care and less on insurance paperwork, the physician also becomes more accessible before and after the visit. Dr. Lamberts notes that some patient care can actually be “done via text message or phone, reducing the need for coming to the office at all.”

Patient records are freed from the coding nightmare. As Dr. Lamberts states, “Most health records hide important clinical information in an avalanche of insurance documentation compliance.” The direct care physician is able to “document for care” without the need to apply codes and secure insurance approval.

Patients trust their doctor more. Direct care physicians who reject insurance payments are winning back the confidence of their patients who “are increasingly suspicious of the motivations of their physicians, wondering if the care they get is focused on them or if it is done for increasing revenue or following insurance company rules.”

Krystle Thornton
October 3, 2018


On Base Percentage = All Cause Mortality

This week, Dr. Phillip Eskew, DO, JD, MBA shared a guest blog post for Elation Health’s direct care blog

Dr. Eskew founded DPC Frontier in Feb 2015. He is a direct primary care family physician and attorney. He joined ProactiveMD in Feb 2016 and is the company’s VP of Clinical Development and General Counsel.   Dr. Eskew has advised state and federal legislators about DPC legislation, and volunteers his time as the general counsel of the Direct Primary Care Coalition where he also serves as a member of the steering committee. He intends to use his diverse training to not only grow Proactive MD, but to support other DPC practices in the medical, legal, and policy arenas.

Baseball fans have always been obsessed with statistics.  For those that have not watched the film “Moneyball” the story focuses on how baseball analysts added up hits, runs, and RBIs for decades while ignoring (not even tracking) a more valuable statistic – on base percentage.  Deep down, health insurance companies already know that their current coding system is a garbage in, garbage out process. If you want proof, look no further than life insurance companies.  Life insurance applications commonly ask a variety of medical questions, but these are generally objective laboratory findings. These are not CPT code driven. They are simple, objective measurements related to lifestyle behaviors and chronic conditions that are easily trended over time.

As DPC physicians we can happily abandon 90% of the “data” tracked by the traditional system.  This data is not clinically useful. It doesn’t predict all cause mortality. Usage of this “fluff” data makes it easier for interlopers to argue their wasteful services are necessary.  We should track clinical information that is useful to us and our patients. Laboratory studies and vital signs related to chronic conditions are an obvious place to start. This kind of data is clinically actionable, allows for outlier identification, and can be presented in a trended view to motivate patients.

Whether they want to admit or not, life insurance companies are focused on one thing – when will someone die – or in medical speak does a number or lifestyle choice predict “all cause mortality.”  We will know that DPC has “made it” not when it is embraced by health insurance companies, but by when life insurance companies ask “are you a member of a DPC practice?” right after the question “are you a tobacco user?”

Dr. Phillip Eskew, DO, JD, MBA
October 1, 2018