Skip to main content

What is the difference between direct primary care (DPC) and an independent physician association (IPA)?

iStock 946299296

Independent physicians searching for alternatives to the traditional care model or who feel the need for assistance in keeping up with compliance regulations, administrative contracts, and other overhead issues may be investigating several options. Two possibilities for independent physicians include transitioning to the direct primary care (DPC) model and joining an independent physician association (IPA).

Direct care is a medical practice model where providers contract directly with patients. For almost all of America’s history, Americans paid their provider directly for care. It was only in the 20th century that health insurance outpaced out-of-pocket pay as the primary revenue source for medical practices. But since the turn of the 21st century, direct care has made a resurgence.

Patients enjoy the direct care model as it enables them to plan for their medical expenses and to enjoy cost savings as well as quality healthcare. Direct care physicians see fewer patients, with typical patient panels of between 350 and 500. The provider is able to spend more time with each patient and has less overhead and administrative burden, when the practice does not have to deal with insurance companies and wait for financial reimbursements.

The IPA is designed for independent physicians who want the advantages of a larger group but who also want to retain their independence. As the AAFP defines it, “An independent physician association (IPA) is a business entity organized and owned by a network of independent physician practices for the purpose of reducing overhead or pursuing business ventures such as contracts with employers, accountable care organizations (ACO) and/or managed care organizations (MCOs).”

Further, AAFP lists the advantages for the independent physician participating in an IPA:

  • Appropriate alignment of physicians’ financial incentives
  • Efficiencies in practice administration and management
  • Political influence within the medical and wider provider community
  • Peer support
  • Optimized facilities
  • Enhanced ability to negotiate favorable contracts with other entities such as MCOs, ACOs, radiology, laboratory, and hospital systems
  • Autonomy and local financial and care management control in managed care
  • Improved services, including, expanded hours, urgent care, outreach services for prevention, telephone triage, and follow-up expertise

The independent physician has options for improving the practice, providing more personalized healthcare, and optimizing the practice’s efficiencies. The direct primary care model and an independent physician association are two potentially positive alternatives.