The president’s signature legislation aims to provide every American with affordable health insurance options, but there’s been an increase in doctors becoming direct pay or cash-only practices recently.
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“There’s no doubt that one of the driving forces behind direct-pay practices is frustration and anger with health care among physicians,” says Michael Smith, medical director and chief medical editor at WebMD. “More and more doctors feel they are ready to quit the system and start practicing off the grid.”
With this payment model, patients pay a monthly membership fee similar to joining a gym for access to unlimited doctor visits, discounted medicine and lab work, and appointments that last at least a half an hour.
According to a 2012 compensation report by medical resource company Medscape, 6% of family doctors, 4% of internists and 2% of pediatricians said they were in concierge or cash-only practices. In its 2013 compensation report, all the numbers increased: now, 7% of family doctors, 7% of internists and 4% of pediatricians are cash-only practices.
For Ryan Neuhofel, a family doctor in Lawrence, Kan., launched his direct-pay practice, NeuCare Family Medicine, in December 2011. He says his payment decision was based on his dissatisfaction with the health-care system and the interactions he witnessed between patient and doctors.
Individual patients pay $30 to $40 a month while families pay $100 a month. That fee gets them unlimited visits without a co-pay, free routine lab work and testing. He also saves patients money on medications by offering them at wholesale prices. “Medicine at wholesale is 70% to 90% cheaper than at a pharmacy. “A lot of patients save $100, $200 or $300 a month on medication alone.”
Wait times are rate at NeuCare, and patients can get same-day appointments that are normally 30 minutes to an hour long. The practice has 700 patients, which Neuhofel says is significantly less than the standard patient load of 2,500-4,000 most practices have, which makes lengthy appointments hard.
Neuhofel doesn’t take any insurance and keeps overhead low by employing just one nurse.
While doctors offering direct-pay care don’t accept insurance, many of the patients that are opting for this type of health care do have coverage. Those without insurance are betting it’s cheaper to use a direct-pay doctor and pay the fine under the Affordable Care Act.
However, Smith at WebMD, advises doing the math carefully. “Even though the ACA fine is $95 for an adult (or 1% of your salary) in 2014, that jumps quickly over the next two years to $695 (or 2.5% of your family income),” says Smith. “By the time you pay the fine and the direct-pay membership fee, you’re likely better off financially just buying insurance.”
With a direct-pay model, doctors are able to see fewer patients and still make the same-- if not more money, according to experts.
Doug Nunamaker, chief medical officer at AtlasMD Concierge Family Practice in Wichtia, Kan., can see less than 10 patients in a week, but says the payment model allows him to provide better care and greater accessibility without worrying about losing money.
“At a certain point, the quality starts to be affected by the number of patients you have,” says Nunamaker. AtlasMD charges $10 a month for children up to age 19, $50 a month for people 20 to 44, $75 a month for those ages 45 to 65 and $100 a month for anyone 66 and older.
Older patients are charged more because they typically have more illnesses or issues that require additional time, he says. “The dirty secret with insurance-based medicine is it doesn’t pay for prevention. If you are on the border of having high blood pressure we don’t get paid by insurance to talk about preventing it--only to treat it. In a membership model, you can do everything and there’s an incentive to keep the patient healthy.”
According to Smith of WebMD, the direct-pay model make the most sense for people with multiple medical problems and need more than 15 minutes with their doctor per visit. It’s also attractive to those who like the unfettered access to their doctor since many of the physicians in these types of practices are available 24-7 either via phone, email or text.
It may not make sense for young and healthy patients with access to health insurance through an employer. “If you have multiple medical issues, that 15-minute appointment is going to leave both you and your doctor dissatisfied with your level of care,” says Smith. “More time with your doctor, and more personalized care, will help keep you healthy and out of the hospital.”