Obamacare’s third annual enrollment period for health insurance is officially almost over. Americans who do not have access to employer-sponsored health insurance, are self-employed, or have been dumped into the individual marketplace by their employers have the opportunity to sign up or renew their government-knows-best health insurance plan. While low-income North Carolinians benefit from plans paid for by other taxpayers, middle-income residents are getting pummeled with some of the highest double-digit percentage premium increases in the U.S.
An article in The News & Observer tells the story of Janet Joyner, a Raleigh resident who is struggling to make ends meet when it comes to paying for health insurance.
Joyner said she’s healthy and used only about $500 in health care services last year, but paid Blue Cross nearly $6,700 in monthly premiums. Her current plan would cost nearly $9,500 in premiums for the full year, plus a $3,500 deductible that Joyner would have to pay before coverage kicked in.
‘It’s like 2 1/2 car payments for me,’ she said. ‘I’d be paying $9,500 a year for my annual physical and lower prescriptions.’
Health insurance may now be more expensive, but basic health care doesn’t have to be. Medical providers will tell you that over 75 percent of health care can be provided in a primary care setting. As a means to improve the value of patients’ health care expenses, an increasing number of primary care physicians are breaking away from the status quo. By cutting the cord with insurance companies, doctors can spend more time with their patients in exchange for upfront cash payments.
This simple and effective strategy is known as direct primary care (DPC). It brings back personalized medicine, and it’s a win not just for doctors and patients, but also for the state.
Imagine not having to spend 40 percent of practice revenue on personnel responsible for submitting claims to insurance companies. Opting out of insurance contracts allows solo direct care practices to break even on just four patients per day rather than 32 in today’s typical practice setting. DPC heightens providers’ professional satisfaction because they can escape the corporate environment of the ever-consolidating health care industry and instead hold fast to their autonomy. Calling their own shots under this business model allows for them to actually practice the art of medicine by scheduling longer appointment times with patients if necessary and even committing to house calls.
Because primary care is relatively inexpensive to administer, DPC is an affordable option for the masses. Just ask Dr. Brian Forrest, whose practice is located in Apex, North Carolina. He continues to emphasize this concept after seeing a Medicaid patient and a CEO sitting next to each other in his waiting room. For a monthly payment equivalent to a gym membership (not multiple car payments), patients are entitled to around-the-clock care. Despite limited data on direct care, existing literature concludes that patients enjoy an improvement in health outcomes while saving on overall health expenditures when compared to those navigating the traditional health insurance system. A study conducted by the University of North Carolina medical school and North Carolina State University MBA students found that patients seeking treatment at Dr. Forrest’s practice, Access Health Care, spent 85 percent less and enjoyed an average of 35 minutes per visit compared to 8 minutes in a non-direct care practice setting.
But since Obamacare requires everyone to purchase health insurance, many question why anybody would be willing to pay twice for health care (monthly insurance premiums and monthly DPC membership fees).
The simple answer is that people with health insurance are already “paying twice” for health care. In addition to monthly insurance premiums, patients are responsible for other out of pocket cost sharing such as co-pays and co-insurance. Direct care can help health care consumers save on the cost-sharing part. And, because most Americans do not even meet their deductible, they could potentially save more on health care costs by switching from a comprehensive health plan (think gold-plated) to a major medical plan while direct care would cover preventative health services and better manage chronic conditions. Dr. Patrick Rohal, a direct care provider practicing in Pennsylvania, offers an excellent explanation below:
A friend of mine was jogging one day recently, and he cut his leg while trying to hop over a guardrail to avoid a deep puddle. He went to the ER. The ER doc did a skillful job stitching up the wound, and the insurance company, a few weeks later, did a skillful job of handing him a bill for $1800! (Alas, he had a high deductible.) My friend had no way to predict, nor to control, the costs adding up as his leg was being mended in the ER. In CovenantMD, the total bill for the procedure would have been $70 paid at the time of service, a price he would know before hand, as he would have already known that it costs $50 for me to come in after hours, and another $20 to do stitches.
Health policy wonks like to throw around the “value-based health care” buzzword a lot. What this essentially means is that commercial and public payers like Medicare and Medicaid are shifting more towards reimbursing providers based on patient health outcomes rather than the volume of services they render. In fact, the Centers for Medicare and Medicaid Services (CMS) plan to link 85 percent of Medicare payments to quality by 2016. North Carolina’s recently passed Medicaid reform also focuses on value-based health care in which managed care insurers and hospital networks will contract with the state to be responsible for improving Medicaid patients’ overall health within a defined budget.
DPC is the epitome of value-based medicine, and it has the potential to help North Carolina slow the growth of wasteful health care spending. The model is similar to managed care contracts in the fact that these practices are held accountable for continuously monitoring and treating their patients with their operating revenue — a majority of it derived from capitated membership payments. A key difference between managed care contracts and DPC, however, is that DPC isn’t bogged down with ungodly amounts of third party paperwork.
For the DPC model to remain unchanged yet still cater to Medicaid patients, it would be ideal for the state to administer health savings accounts (HSAs) or debit cards to eligible Medicaid patients with a lump sum contribution. With no middleman intervention, physicians and patients can bypass the bureaucratic mess our health care system has morphed into.
Read full article: www.forbes.com