How can Direct Primary Care (DPC) save patients money?
Direct Primary Care (DPC) is a health care model that allows physicians and patients to directly contract for health care services, eliminating third party payers such as insurance companies.
Some of the benefits to the patient include more time with their own physician, as DPC doctors tend to have much lower patient volume, more convenient and flexible office hours, and the availability of telephone and video conferencing which are often not an option in conventional office practices. However, probably the biggest benefit to the DPC patient is cost.
Most DPC practices charge a membership rate of $50-100 per month for comprehensive primary care care, including office visits, minor procedures, blood draws, and other in-office services. Unlike with a typical insurance model, there are no copays or deductibles to meet in order to see your doctor.
Patients with high deductible health plans (HDHP) can probably financially benefit the most from a DPC practice. Since standard health insurance can be quite expensive, many small business owners and individuals without coverage through their work participate in a high deductible health plan, which is often referred to as a "catastrophic" health plan.
These plans have much lower monthly premiums than standard insurance plans, but are intended to cover emergency care such as hospitalizations, and they don't start to pay until a certain amount of money, or deductible, has been met. For 2016, the IRS defines a high deductible health plan as any plan with a deductible of at least $1,300 for an individual or $2,600 for a family. High deductible plans can go even higher, up to the maximum out-of-pocket limit, which for any 2016 Marketplace (HealthCare.gov) plan is $6,850 for an individual plan and $13,700 for a family plan.
So, let's assume that a family of 4 buys the least expensive high deductible plan. Their insurance won't begin to pay anything until they have spent $13,700 on health care, after which point, the insurance will pay for covered medical expenses at 100%. If a member of the family needs to see a doctor for a minor issue, they can expect to pay the standard rate for each visit (anywhere from $100-300 per visit) until they reach that out-of-pocket maximum.
Rather than paying for doctor visits separately, another option for this family would be to enroll in a DPC practice. For an average cost of $150-200 per month, the entire family would have unlimited access to a primary care physician, while maintaining a lower cost high deductible insurance plan for unexpected serious health crises.
Here's an example. Today' s healthcare.gov price for a married couple in Florida is $10,000 per year for the highest deductible plan. The best plan available, which does have a $1,000 deductible and copay requirement, costs $20,000 per year. If this couple chooses the high deductible plan, and enrolls in a DPC at $1,800/ year, they will save approximately $8,200 per year, assuming no emergencies occur.
For someone with a current high deductible plan, a DPC is a no-brainer. For everyone else, it may make sense to crunch the numbers as open enrollment for health insurance approaches, and see if a change to a lower cost HDHP along with with DPC membership makes sense.
One additional consideration: HDHPs can be used with Health Savings Accounts (HSAs). HSAs are special tax-favored retirement accounts that can be funded to cover health expenses, and can be rolled to future years if not used. Talk to your financial adviser or insurance representative about these options.