Posts from 2018-02

President’s Report - February

Warren Buffett of Berkshire Hathaway, Jeff Bezos of Amazon and J. P. Morgan the nation’s biggest bank just announced plans to bypass the American health insurance system and independently organize healthcare for 3 million employees and their families.

Anything that bypasses the health insurance industry and creates direct relationships between doctors and patients deserves our applause.

Throughout its history the health insurance industry has paid lip service to controlling costs while actually driving them higher. It profits from higher costs because it can charge higher premiums getting it’s ten percent profit regardless. This will continue as long as payers put up with it. Perhaps our tolerance has reached its limit.

Primary care practice disruptive innovations have been around for two decades in response to insurance industry failings. These innovations can help business leaders drain the insurance industry swamp, control cost and improve quality.

What Americans really need are a few hundred thousand independent, personal, private primary care physicians that work ONLY for their patients, not for the insurance industry. Berkshire Hathaway, Amazon and J.P.M. need only 6,000 such physicians to manage their three million patients and family member’s primary care. It would be a good start and a beacon for the rest of the nation.

Thirteen years ago I launched one of the early direct practices at a time when only a few hundred existed nationally. There are now tens of thousands of doctors, caring for millions of patients, who have made conscious decisions to get out from under the insurance system’s control and work directly for patients. The terms Direct Primary Care (DPC) and Concierge Medicine are both parts of this movement. Let me explain why private primary care physicians should be part of the package that these business leaders create.

First, we limit our practices to hundreds rather than thousands of patients, thus allowing us to spend much more time with each patient and still be fresh and rested when delivering care. Primary care doctors in conventional insurance-dependent practices are often failing to take good care of patient panels that number 2,000 to 3,000 patients per doctor. These huge panel sizes have been forced on them by the insurance industry’s relentless withdrawal of support for primary care over many decades. Great primary care is the backbone of any effective, affordable health care system, and the health insurance industry has all but destroyed it. Direct practice is recreating it.

Second, to allow our small patient panels, we finance our practices with membership fees directly from our patients. These fees vary with the practice and are usually age adjusted. Most practices charge fees between $50 and $300 per month, an affordable price for many, but a barrier for others.

Third, because we work directly for and are paid directly by our patients, we give incredible service. If we didn’t do so we would lose their loyalty, and they would move on. My partner Dr. Nicole Lawrence and I see and manage our patient’s care the same day they call, during and outside office hours. All our patients have our home and cell phone numbers and are encouraged to call for even minor issues. Our patients can reach us immediately 24/7/365 with one five second dial or text. We do home visits and manage their hospital care personally. In other words, we do what most doctors used to do before the health insurance industry took over and changed the rules.

We eliminate between 50 and 80% of costly emergency room visits and urgent hospitalizations. There are several published studies proving that. One of the best was published in 2012 in the American Journal of Managed Care: to-significant-reductions-in-hospital-utilization

Since ER and hospital care is such a huge part of the excess cost, we know placing employees in this kind of direct private primary care practice is key to solving the cost problems. However, direct practice saves money and improves care in dozens of other ways. Those who have carefully studied these practices understand why they work so well and why the insurance industry version of primary care works so badly.

Direct Primary Care and Concierge Medicine have not yet expanded to the general population, though attempts have been made, such as Qliance in Seattle. So far they have largely failed. Funding is the issue. It is hard to convince financially stressed employees to invest their own limited funds in a novel healthcare design they don’t fully understand while continuing to pay sky high insurance premiums. Enlightened employers could be part of the solution to that problem.

Like the cell phone and other disruptive innovations direct practice innovations are first adopted by astute consumers with disposable income. When it becomes clear that the benefits are huge for everyone, eventually such innovation are adopted by wider groups of people. Assistance can come from employers. Perhaps that will happen with Direct Private Primary Care. Employers could help to fund it with HSAs and vouchers for an aggregated list of vetted DPC/Concierge practices which would not handcuff the participating physicians as the insurance industry does. Physicians running such practices must remain in control of their practices, fees and decision making. The opposite path has already been tried and failed. Let’s try something that will work this time, since we’ve tried about everything else.

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