Direct primary care and office management

The direct primary care (DPC) model is, on the surface, relatively simple. Patients pay a monthly membership fee for basic primary care services. The DPC physician does not accept nor bill insurance for any of the services provided. Patients are encouraged to secure “catastrophic” insurance for hospitalizations or emergencies that may not be covered by their basic DPC membership fee, but that insurance is not managed or billed by the primary care physician.

Many primary care physicians who have transitioned to a DPC model say that the administrative burden of practice overhead is significantly reduced in their new practice. Office management is slightly easier, as there is no insurance billing, no forms to complete for reimbursement, and no phone calls to make to establish approval for services.

Risheet Patel, MD, as reported by Revcycle Intelligence, transitioned his family practice to a DPC model out of frustration over having to focus on the burden of fee-for-service billing, among other things. He says that the fee-for-service model was actually increasing his costs because of the office management requirements. He had to hire billers and coders and worry about insurance reimbursement, instead of focusing on his patients’ needs.

Though the office management structure of a DPC practice is simpler, given the membership fee model, the practice is still a small business. Patel adds that “You have to handle all of the day-to-day business processes that any small business owner has to worry about. So, accounting, payroll, marketing, insurance and those types of things.”

The DPC model generally allows for “Less administrative burden, generally allowing for longer interactions,” as described in a recent research article published by MGMA. The article also points out that an advantage of the DPC practice is that it can result in “Better health outcomes through better access to physicians.”

Dr. Patel found this to be the case as well, which is one of the major reasons he transitioned to the DPC model. He is able to spend more time with each patient but realizes that office management is still necessary. “That’s probably the biggest thing to think about as you transition away from an employed position to a DPC position. You, the physician, are now also the business owner, and you have to start making business decisions.”