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Wednesday, April 25, 2018

A small but growing movement of doctors that don't accept insurance and charge a monthly fee could be a model for big employers like Amazon and JPMorgan

  • Direct primary care is a small but fast-growing movement of doctors who don't accept insurance and instead charge a monthly membership fee.
  • At a time when many are feeling pressure from high healthcare costs, direct primary-care models can be a cheaper alternative that offers perks like quick access to doctors and sometimes wholesale prices on medications or lab tests.
  • And it could be a model employer — including JPMorgan, Amazon, and Berkshire Hathaway through their nonprofit healthcare venture — could tap into as a way of lowering costs.
A new kind of doctor's office that charges a monthly fee and doesn't take insurance has been spreading around the US. 
The practices are part of a movement known as direct primary care. Instead of accepting insurance for routine visits and drugs, these practices charge a monthly membership fee — often between $50 and $150 a month — that covers most of what the average patient needs, including visits and drugs at much lower prices. The movement's been gaining momentum at a time when high-deductible health plans are on the rise.
In most cases, the practices recruit patients on an individual or on a family-by-family basis. But often, employers who cover their employee's healthcare have turned to practices as well. 
For many large companies, they're the ones ultimately paying out their employees' claims. Insurance companies are there in the middle to handle the logistics of getting the claim from one place to another, which means you might not realize your employer's footing the entire bill on the other end. 
"I tell people, JPMorgan Chase already buys a $1.5 billion of medical, and we self-insure," JPMorgan CEO Jamie Dimon told Business Insider. It's why his company, along with Amazon and Berkshire Hathaway, two other massive self-insured employers, are looking for new options through a nonprofit healthcare venture. "Think of this, we're already the insurance company, we're already making these decisions, and we simply want do a better job," Dimon said.
Finding ways to "do a better job" could mean a number of things, from leveraging the number of people they cover to negotiate lower rates, to digging in and upending the way healthcare's done entirely.
And it's possible direct primary care could be a consideration.

The potential for employers to tap into direct primary care

Here's how that might look: An employer could cover the monthly direct primary care fee — either directly to the practice or as a reimbursement to the employer — or cover a certain amount. The direct primary care practice could be heavily involved in that process or relatively hands-off. 
For the majority of the practices Business Insider spoke with, employers make up a small portion of their business. Often, a relationship with an employer was sparked by someone who first came to the practice for their family's healthcare and decided they want their part-time or full-time employees to have the service as well. 
The direct primary care practices could be located within the community or housed on-site at the company's offices.  For example, Dr. Kim Corba, who runs Green Hills Direct Family Care in Allentown, Pennsylvania said she's been asked to set up a clinic situated between two employers to cover their needs.
Carolyn Long Engelhard, a public-health expert and professor at the University of Virginia School of Medicine — who has her concerns about direct primary care and its lack of connectivity to the larger healthcare system — said that this is one area where she could see direct primary care thrive because it'd be attached to employer-funded plans. A small but growing movement of doctors that don't accept insurance and charge a monthly fee could be a model for big employers like Amazon and JPMorgan
The bottom line for Direct Primary Care is simplicity.  The patient pays for the visit at the POS. Introducing an employer may create the kind of bureaucracy that DPC attempts to remove.
The minute a third party payor enters the equation, costs and bureaucracy escalate.

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