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Medical Practices Looking to switch to Direct Primary Care (DPC) Model

October 10, 2017

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Direct primary care (DPC) is a hot topic among practitioners these days. With the insurance and many health-delivery systems in their current states of flux as well as increasingly bogged down in regulations and paperwork, many practices are making a decision to bypass third-party payers altogether and simply charge direct fees for services rendered. As a result, more of today’s physicians – 63 percent of respondents to a recent survey – expressed interest in switching to DCP with the goal of offering better care spread among a smaller patient workload. 

Direct Primary Care (DPC) defined

  • Under DPC, patients pay a set fee per month for a menu of services – usually costing less than $99 for all primary care services offered. Additional services may be available for additional charges.
  • Note that DPC is not the same as ‘concierge’ medicine, where a patient’s insurance is billed in addition to collecting an often-hefty monthly subscription for access to services.

The case for switching to a DPC model

  • There are no insurance companies to worry about, so providers are able to provide care based on the patient’s actual needs, not limited by what an insurance company will allow.
  • DPC is expected to sharply reduce time-consuming insurance paperwork while allowing providers more time with fewer patients, averaging 800 – 1,000 patients compared to the 2,500-4,000 in many insurance dependent practices.

The potential pitfalls of DPC

  • Developing a DPC practice takes time and plenty of money: lacking plan referrals, most cash-only physicians must often find patients through word-of-mouth.
  • Providers can also expect to pay $150,000 – $250,000 to keep the practice afloat before there are enough regular patients to make it viable.
  • Physicians who fully opt out of Medicare for three or more years, as is true of most cash-only practices, may have difficulty re-entering Medicare in the future, and can have trouble meeting loco tenens Medicare-eligible qualifications.
  • Practices must beware of “behaving” like insurance companies and violating state insurance regulations, meaning that charging flat fees for “unlimited care” may set off regulatory alarms. One way to avoid this is to specifically describe services offered for monthly fees and identify when any additional charges apply. Doing so will reduce the chances of violating state consumer protection laws by “acting as” insurance companies.

Integrated plans: a middle ground

There are two routes that practices usually take when charging a monthly fee for primary care:

  • Opt out of Medicare and other third-party plans completely; however even if “opting out”, practices must still adhere to federal and state privacy laws and other regulations such as federal laws prohibiting providers from charging Medicare-eligible patients additional fees exceeding Medicare’s reimbursement for covered services.
  • Offer services as being not covered by Medicare, such non-medically necessary routine exams.

A better practice model would be to simply assume that all patients are at some point Medicare-eligible and design practice programs that are fully compliant with Medicare assignment guidelines.

Related Article: Medical Coding Mistakes That Providers Must Know

Of course, providers who practice direct-care medicine without opting out of Medicare will still deliver Medicare-covered care, collecting co-pays and deductibles

Can a medical billing company, smooth the transition to DPC?

As an experienced medical billing service since 2002, M-Scribe can help practices ensure continued compliance with state and federal billing requirements, including privacy laws, regardless of who pays. For practices retaining relationships with third party payers, M-Scribe’s experienced claims processors can offer freedom from having to train and keep coders and billers on staff while providing a higher rate of claims reimbursement.

If your practice is considering making the switch, contact M-Scribe  or email for a complimentary consultation with one of our experienced counselors, who can show you how to save time and money while increasing your practices’ revenues. 



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