Changes in Physician Practice Models

VII. Key Issues: Regulation & Reform >> C. Health Reform >> Affordable Care Act (ACA) >> ACA and the Health Sector >> ACA and Physicians >> Changes in Physician Practice Models (last updated 1.8.23)

Lead Editor – Dana Beezley-Smith, Ph.D.

Overview

Less than five months after passage of the ACA, the Obama administration’s top health care advisor Nancy-Ann DeParle wrote in the August issue of the Annals of Internal Medicine that the Affordable Care Act is “likely to lead to the vertical organization of providers and accelerate physician employment by hospitals.”
Federal mandates for expensive electronic health record (EHR) systems and reporting on treatment processes and outcomes had already been passed by the 2009 Congress in the form of the HITECH Act. Taken together, the two laws were expected to be such a financial and administrative burden that physicians would be compelled to close their independent practices and become employees of hospital systems and Accountable Care Organizations (ACOs). Some physicians, however, are rejecting the Big Medicine model and are transitioning to third-party free medicine.

2013 Health Reform Prophecy

ObamaCare 2016: Happy Yet? “Even before the ACA’s launch in 2013, many physicians—seeing the changes in their profession that lay ahead—had begun talking their children out of going to medical school… More important, the predicted shortage of 42,000 primary-care physicians and that of specialists (such as heart surgeons) was vastly underestimated. It didn’t take into account the ACA’s effect on doctors retiring early, refusing new patients or going into concierge medicine.” (Wall Street Journal, 10.22.13)

Third-Party Free Practice

Physician How-to Guides

How to Test the Waters of a Cash-Only Practice. “Take it in stages: It’s most prudent to ease into a cash practice as you would a hot bath: gradually. First, make yourself hard-to-get by patients with the worst paying discounted contracts to see if there is enough demand from patients covered by better contracts. When it works, signal your intent to resign the poor-paying contract. Then offer to see all of your existing and future patients who have that coverage on a cash-at-contact basis, providing everything they need to submit their claims (a copy of the super bill) and coaching them on how to do it if they need it. Then, one at a time, resign your remaining insurance contracts on the same basis, allowing time for the practice to stabilize after each cut. This strategy allows the practice to reverse course if sufficient patients don’t stay with the physician.” (UnCommon Sense, September 2012)
Cash-Only Practices: Eight Issues to Consider. “What’s the difference between concierge medicine and direct primary care? Is retainer medicine only or mainly for doctors who shun insurance? What does 24/7 access really mean? Can any competent doctor do this and succeed? What are the downsides? For answers, Medscape turned to 3 experts who can offer a national perspective.” (Medscape Medical News, 5.15.14)
What is Concierge Care? See How the Retainer-Based Care Model is Filling Care Gaps and Driving New Revenue. “Concierge care, once viewed as a luxury care model reserved for wealthy patients who could afford to pay out of pocket for on-demand care, has diversified to serve a wider group of patients and has the potential to play a role in expanding care access… The Concierge Medicine Research Collective estimates that 5,000 physicians are now involved in concierge care, and in a 2012 Merritt Hawkins survey, 10% of medical practice owners predicted they would convert to a concierge practice within three years.” (The Advisory Board Company, 7.8.14)
Understanding Direct Care. “The current business model of rapid-fire visits and reams of paperwork to get paid for their care and expertise isn’t working, not for doctors, and not for the patients they’re trying with helping. Born of the fatigue with the current state of healthcare there has been an upsurge in innovative healthcare models. The goals of these models are two-fold: 1. Provide patients with high-quality, patient-centric healthcare, and 2. Enable doctors to run financially sustainable businesses while offering their patients more personalized care.” (HintHealth 2.16.15)
Third-Party-Free Surgical Practice. “We have no regrets about our decision to become a TPFP. We have been successful in preserving our autonomy, preserving and improving the patient-physician relationship, maintaining medical privacy, keeping costs down, eliminating bureaucratic intrusion, and making the practice of medicine fun. Although making the transition to a TPFP can be challenging and scary at times, it is ultimately very rewarding. It is our opinion that a private TPFP is the best way to preserve the integrity of the medical profession and the sacred patient-physician relationship.” Gianoli, Gerard J., Soileau, James S., Soileau, Beth. (Journal of American Physicians and Surgeons, Summer, 2015)
Alternatives to the Health Insurance Paradigm. “With the onslaught of government and insurance intrusion into medical practices and declining reimbursement, physicians have turned to alternative forms of medical practice. This movement started slowly 10-12 years ago, but has accelerated in the past six years due to the Affordable Care Act (ACA). In this article we relay our story of converting a surgical specialty practice, Neuro-otology, into a third party free practice (TPFP). A TPFP is a practice with no insurance contracts, has opted out of Medicare and Medicaid, and accepts payment only from patients.” Gianoli, Gerard J. (Arizona Medical Association, Fall, 2015).
Achieving PCMH Status May Not Be Meaningful for Small Practices. “[I]t appears to us that a return to transparency and a free market model (for all medical care) such as direct primary care (DPC) is a better solution for small practices than joining larger groups or participating in externally driven quality programs. In DPC, the consumer judges quality and cost directly and will reward or punish the provider of care in a timely manner.” (Annals of Family Medicine, January/February, 2016)
Choosing a Business Model: Direct Primary Care. “DPC is type of comprehensive primary care model where the burdens of third-party medicine no longer stand between the physician and the patient. Ongoing care and ease of communication are critical to the success of the model. Physicians do not bill the patient’s insurance, and the associated overhead savings result in the chance to offer affordable prices for patients. Patients often have their physician’s email, cell phone number, and so on, and periodic (usually monthly) fees take the place of fee-for-service billing. A DPC practice is one that (1) charges a periodic fee and (2) does not bill third parties on a fee-for-service basis (at least for its DPC patients), and for which (3) any per-visit fee is less than the monthly equivalent of the periodic fee. This definition is designed to protect practices from being defined as unlawful ‘insurance’ companies. It also distinguishes DPC from concierge medicine models that typically charge higher monthly fees and continue to bill the patient’s insurance in addition to the monthly fee.” (Medscape Med Students, 5.31.16)
Physicians Offer Hands-on Advice on Launching a DPC Practice. “Vance Lassey, M.D., knew starting a direct primary care (DPC) practice could be expensive, so he decided to do most of the heavy lifting himself… ‘It’s not hard,’ he told physicians who attended the 2017 DPC Summit held here earlier this month. ‘It was easier than med school.’ Lassey, who opened Holton Direct Care in Holton, Kan., in 2015, participated in a panel of physicians who shared their DPC startup experiences during the June 15-17 summit. The event offered guidance for physicians who might be considering the innovative practice model but are unsure how to proceed.” (AAFP, 6.26.17)
Is Concierge Medicine Right for You? “It’s not for everybody. If you like to leave your work at work when you go home, it might not be the best solution for you. If you have some tolerance for ambiguity, I think it can actually be a much more rewarding style of medicine. The way that we get to know each other is through multiple modalities. When the person is sitting in front of you in the office, that is just one aspect of them presenting themselves to you. When they feel like they can text you, email you, call you, it helps you to develop a long, rewarding relationship with the patient. For me, that is rewarding in and of itself. The average doctor sees anywhere from 2000 to 2500 patients per year on their panel; they are responsible for 2500 lives. When that number gets cut down by a factor of five or 10, you now have the time and attention to really get to know people, and that is extraordinarily rewarding for me. I think the patients really appreciate it as well. It means that they are more forthcoming with you when they are in the office with you. There are things that I have been able to help patients with that I never would have thought would have fallen under the purview of being a physician. The core idea is having a relationship and being able to solve problems with people through conversations.” (Medscape, 9.29.17)

Impact on Patients

Doctors Who Don’t Take Insurance: What Does It Mean for Patients? “More and more doctors are fed up with private insurers. It’s not just a question of how stingy they are, but how difficult it is to get reimbursed. Paperwork, phone calls, insurers who play games by deliberately making reimbursement forms difficult to interpret. Some physicians have just said ‘no’ to insurers. What does this mean for patients? Business models vary.” (The Health Care Blog, 7.9.08)
Concierge Medicine, Obamacare and the End of Empathy. “In response to government overhaul, primary care physicians are having difficulty surviving without joining some much larger entity, or by transforming into a concierge model… Don’t get me wrong, for nearly 40 years I practiced as a primary-care internist and geriatrician, so I understand both sides of this issue. Primary-care doctors have been undervalued and under-reimbursed by Medicare since the inception of the program. There has not been a real increase in fees in the past decade, during which time costs have soared… Medicare now looks the other way as the concierge-medicine movement grows. In times past, had physicians attempted to charge Medicare patients additional fees while still billing this agency for services rendered, all manner of fines and sanctions would have been imposed. No more. With the nation short 40,000 primary-care doctors—and that’s before 30 million more patients come on board in 2014 due to the Affordable Care Act—the policy gurus have looked around and concluded that they can’t afford to alienate the worker bees that still remain.” (Winakur, Jerald, The Wall Street Journal, 10.29.12)
Primary Care Should be Paid for Directly by the Patient. “It is time to stop tinkering around the edges of the current payment system. It needs to change conceptually and completely to a new paradigm where that the PCP is paid directly by the patient. Direct primary care (membership, retainer, and concierge) is one such new paradigm. The cost is reasonable, the care is better, doctor frustrations come down, patient satisfaction goes up and total health care costs come down. It is time for a change.” (KevinMD, 8.8.14)
Everyone Should Have A Concierge Doctor. “Heritage Foundation scholar Daniel McCorry has produced an excellent summary of what researchers know about concierge medicine…‘For states in which sufficient patient information was available (New York, Florida, Virginia, Arizona, and Nevada), decreases in preventable hospital use resulted in $119.4 million in savings in 2010 alone. Almost all of those savings ($109.2 million) came from Medicare patients. On a per-capita basis, these savings ($2,551 per patient) were greater than the payment for membership in the medical practices (generally $1,500–$1,800 per patient per year).’ As for quality measures, concierge medicine scores high on conventional measures as well: ‘The five-state study also showed positive health outcomes for these patients.’” (Forbes, 8.28.14)
Why Are Doctors So Unhappy? “Why should you care? ‘Unhappy doctors make for unhappy patients,’ writes Jauhar…I suspect that most doctors – certainly older doctors – would like to practice the way Marcus Welby (of 1970s TV) practiced. They have ended up with something akin to Lucille Ball’s predicament in the chocolate factory. Some are finding a way out with what is sometimes called ‘concierge medicine’ or ‘direct care.’ This is practiced by doctors who step outside the traditional health insurance system… In most cases, they give their patients same day or next day service. They talk to their patients by phone and email. If their patients have to go to the emergency room, they are likely to meet them there. They serve as agents for their patients in dealing with the rest of the system: ordering tests, getting appointments with specialists, etc. I think concierge medicine is not for the elite few. We all could have a concierge doctor if we freed doctors and patients to relate the way other professionals and their clients relate.” (Forbes, 9.11.14)
Fueled by Obamacare, Concierge Medicine May Be the Future of Healthcare. “Concierge medicine is growing because Faske adds that promises made under Obamacare have not come to fruition – that everyone would have coverage and that competition would lead to better care. ‘And it was never great for everyone before, but it’s not great for everybody now,’ said Faske. ‘I think we just traded it for a different hassle.’ And rather than have doctors leave medicine all together from burnout – Faske says this offers everyone an alternative. And patients like Whitney Perkins agree. ‘I keep saying it’s priceless, as far as I’m concerned,’ Perkins said. ‘There is a price to it, but for me it’s worth it.’” (CBS12, 7.9.16)
What Happens When Doctors Only Take Cash. “To Villa, the model seemed refreshingly subversive. The Surgery Center would charge $19,000 for his whole-knee replacement, a discount of nearly 50% on what Villa expected to be charged at his local hospital. And that price would include everything from airfare to the organization’s only facility, in Oklahoma City, to medications and physical therapy. If unforeseen complications arose during or after the procedure, the Surgery Center would cover those costs. Villa wouldn’t see another bill. Sometimes called direct pay, and closely related to concierge care, this sort of business model was once seen as the perquisite of rich folks and medical tourists from foreign lands. But nowadays many of the people seeking cash-based care are middle-class Americans with high-deductible insurance plans… ‘I’ve really never experienced this quality of care,’ Villa says.” (TIME, 1.26.17)
Expand Health Care Options in States. “Direct primary care clinics across five states achieved savings of $2,551 per patient in 2010, according to a study in the American Journal of Managed Care. And because their doctors had the time needed to detect and treat conditions before they grew severe, members of the clinic were 62 percent less likely to be hospitalized, compared with nonmembers.” (Virginia Pilot, 6.25.17)

Trends

Giving Up on Red Tape, Doctors Turn to Cash-Based Model. “At both the state and federal level, efforts are underway to decrease Texas’ sky-high rate of residents without health coverage. But Villarreal is among a rising number of primary care practitioners who have given up on the red tape of filing insurance claims, switching to a cash-based model that is growing in popularity among Texas’ insured and uninsured patients. Doctors who use this model, which they call ‘direct primary care,’ say they can keep their costs competitive by avoiding the bureaucracy of the health insurance system and the high processing costs — including additional staff — associated with accepting coverage.” (Texas Tribune, 4.11.14)
Healthcare Startups Bringing On-demand, Concierge-like Services to the Middle Class. “Concierge services can offer a type of ‘safety valve’ that keeps both employers and employees happy, said Bob Kocher, a former special assistant to President Barack Obama for healthcare on the National Economic Council and a partner at venture capital firm Venrock, which invested in Grand Rounds. For doctors and hospitals, the companies can offer additional revenue and the chance to more productively use physicians’ time and expertise. With web-based companies to broker online consultations with patients, doctors can keep their traditional brick-and-mortar practices and build ‘e-practices’ in their spare time.” (Kaiser Health News, 5.7.14)
According to a September, 2014, Physicians Foundation survey, “7% of physicians now practice some form of direct pay/concierge medicine, while 13% indicate they are planning to transition in whole or in part to this type of practice. 17% of physicians 45 or younger indicate they will transition to direct pay/concierge practice.” (Physicians Foundation, September 2014)
Concierge Practice Appears to be Gaining Momentum. “Though only 1% of Merritt Hawkins’ search assignments were for concierge practice last year, two to three years ago Merritt Hawkins received virtually no requests to recruit into concierge settings.” (Merritt Hawkins, 2014)
Are Physicians Better Off Now than Six Years Ago? “Despite considerable enthusiasm, cash-only and concierge practices are still not significant payment models. In fact, as Medscape compensation surveys have revealed, concierge practices have stayed at around 3% for the past 3 years. The proportion of cash-only practices went up slightly this year (6%) compared with last year (5%). Travis Singleton commented, ‘In lieu of changing to concierge medicine, many physicians have opted out of traditional private practice to become employees. That is their escape hatch from the pressures of private practice.’ However, as reimbursement systems become more arcane and more value-driven, we anticipate that a growing number of physicians will embrace the concierge model. We have seen a continual increase, albeit a small percentage, of physicians migrating toward a direct-pay model. Whether truly concierge or just removing a third-party payer from the equation, the driving forces tend to be the same. Urgent care delivery systems have also given a safe haven for those providers who might otherwise have chosen concierge or direct-pay practices.” (Medscape Business of Medicine, 4.1.16)
Fueled by Health Law, ‘Concierge Medicine’ Reaches New Markets. “A growing number of primary care doctors, spurred by frustration with insurance requirements, are bringing ‘health care for billionaires’ to the masses, including people on Medicare and Medicaid, and state employees…The health law’s language was ‘sort of [an] ‘open-for-business’ sign,’ said Jay Keese, a lobbyist who heads the Direct Primary Care Coalition. Before 2010, between six and 20 direct primary care practices existed across the country. Now, there are more than 400 group practices, and more on the way. The total number of participating doctors may exceed 1,300. The American Academy of Family Physicians estimates that 2 percent of its 68,000 members offer direct care. ‘This is a movement — I would say it’s in its early phase,’ said AAFP President Wanda Filer, a doctor in Pennsylvania. ‘But when I go out to chapter meetings, I hear a lot more interest.’… Doctors already offering direct care say they see patients across all incomes. Dr. Stanford Owen of Gulfport, Miss., says he treats ‘waitresses and shrimpers, as well as doctors and lawyers.’” (National Public Radio, 1.15.16)
A Different Kind of Doctor’s Visit: Patients Pay Directly, Keep Insurance Out of It. “Moss isn’t the only physician who likes the concept. Since Congress passed the Affordable Care Act in 2010, the number of practices like hers has jumped from about 20 to more than 400 nationwide, according to the Direct Primary Care Coalition… ‘This is a cost-efficient way for physicians to deliver care, and it’s affordable for patients,’ said Tim Stapleton of the statewide doctors association, which supports the bill… ‘It just seems like this is the right thing to do,’ she said on a recent afternoon, while scrolling through text messages from a patient. ‘You can help everyone from waitresses making minimum wage to executives, and be more accessible to them all.’” (Tampa Bay, 1.22.16)
‘Concierge’ Docs Offer 24/7 Access, Spa Treatments and More — for a Price. “At a time when in-and-out appointments are a financial necessity for most physicians, Wilson and a growing number of direct care or ‘concierge doctors’ are using their practices to focus on wellness, not illness… ‘Doctors want more time with their patients, but with all of the paperwork and regulation they’re dealing with, they get less time and less eye contact. It’s hard to talk about wellness under those circumstances,’ says Tim Norbeck, chief executive of the nonprofit research and policy group the Physicians Foundation. Of the doctors surveyed in 2016 by the Physicians Foundation, 23% already offer concierge care or plan to transition to this direct pay model either fully or in part. And though it used to be for the very wealthy, with fees that ran more than $10,000 a year, many annual fees now are $1,800 or even less, according to statistics from the American Academy of Private Physicians, making it available to a much larger range of upper middle class patients. “ (Los Angeles Times, 1.14.17)
Here’s Why Membership Medicine is Gaining Physician Attention. “Physician practices described as ‘membership medicine’ have been springing up across the country during the past decade. These practices, in which patients pay a monthly or annual retainer to their doctor or medical office for a contracted bundle of services, offer an alternative model for physicians who hope to spend less time on paperwork and more time with patients… In addition to benefitting from improved income stream, more time with patients and less paperwork, those who have gone the membership medicine route say they’re happy they don’t need to participate in the Quality Payment Program established under the Medicare Access and Chip Reauthorization Act of 2015 (MACRA).” (Doximity, 2.10.17)
With Direct Primary Care, It’s Just Doctor and Patient. “There’s no office staff because Dr. Meyer doesn’t charge for visits or file insurance claims. Patients pay her a monthly fee—$25 to $125, depending on age—which covers all the primary care they need. ‘Getting that third-party payer out of the room frees me up to focus on patient care,’ says Dr. Meyer, who hopes to expand her year-old practice to 200 patients and is relying on savings until then. ‘This kind of practice is why I went into medicine, and that feels so good.’ Dr. Meyer is part of a small but growing cadre of doctors practicing ‘direct primary care,’ which bypasses insurance and charges patients a monthly membership fee that covers everything from office visits to basic lab tests… Although less than 2% of the nation’s 900,000 licensed physicians are involved in direct primary care to date, proponents say the model could grow as Republicans encourage more free-market alternatives to insurance-based, fee-for-service medicine… ‘People ask me how I can do this for $60 a month,’ says David Cunningham, who left a large medical group to open a two-doctor direct-care practice in Mansfield, Mass., last year. They think it should cost more, he adds, but ‘that’s only because we have this bloated way of paying for it.’ In his old practice, he says, more than 60 cents of every dollar went to administrative costs.” (Wall Street Journal, 2.27.17)
A Growing Movement of Surgery Centers and Specialists That List Their Prices and Don’t Take Insurance. “In August 2016, Millican drove the three hours to the Surgery Center of Oklahoma in Oklahoma City to get the procedure for $30,000 less than she might have paid… And it’s not just happening in primary care. A number of specialists — oncologists, physical therapists, and even some hospitals — are jumping on board as well. It works a little different from primary care, where there’s a monthly fee. Instead, these practices are based solely off services they provide with transparent pricing. For example, if you needed a knee replacement, you could go on the provider’s website and find out just how much you’d be expected to pay.” (Business Insider, 4.8.17)
Goodbye, Billing Codes and Co-pays: Las Vegas Doctor Thinks He Has Solution for Primary Care. “He felt pressure to see new patients every 10 or 15 minutes, leaving little time to establish a rapport with those seeking his care. It didn’t mesh with his altruistic vision of family medicine — physicians knowing their patients on a personal level and providing basic care with an eye toward keeping them healthy in the long run. ‘Medicine is a business in this country,” said Qamar, who now lives in Las Vegas. ‘And that was only part of the problem.’ The other challenge: Insurance companies become the middlemen between patients and physicians, forcing doctors to spend significant time doing paperwork and entering billing codes just so they can receive payment.” (Nevada Independent, 5.7.17)
Is Private Practice Making a Comeback? “Last year, the percentage of physicians who own a stake in their practices fell below the halfway mark for the first time, according to an American Medical Association survey. In 2016, only 47.1% of physicians held equity in their practices. That’s down from 2000, when 57% of all doctors had an equity stake in their practices. The drivers behind the trend are myriad and all too familiar: consolidation and hospital acquisitions, increased administrative and regulatory burdens, a desire for greater work-life balance, and more predictable hours. Pervasive as those trends may be, they haven’t snuffed out private practice, says Randy Bauman, president of Delta Health Care and coauthor of Choosing Autonomy: The Physician’s Guide to Returning to Private Practice. In fact, experts say, while private practice may never again dominate the healthcare landscape, it’s likely to remain a small but permanent fixture, thanks to emerging new business models, cost-saving technological advancements, and the tenacity of physicians determined to practice medicine on their own terms.” (Medscape, 11.1.17)
Private Practice is the Best Defense for Burnout. “If you choose a private practice that aligns with your values and goals and is the right fit, you are less likely to become stagnant, depleted, and burned out. You are less likely to feel trapped in a place and with people you don’t enjoy and who don’t have the same goals and aspirations as you. If you suffer from or want to avoid burnout, you have a different choice in private practice. You will not burn out if you love your work and your life. Instead, you will be fired up to enjoy and grow and be better fueled to heal your patients. As it should be.” Levine, Brett, MD. (KevinMD, 6.22.22)

State Legislative Support

“Direct primary care (DPC) is gaining legal momentum at the state level as a viable means for physicians to provide primary care to patients at a lower cost than traditional practice models. For years, physicians who wanted to adopt DPC had to battle with insurers and state regulators, but now 18 states have enacted laws that recognize the practice model and make it easier for physicians to implement it. Just this year, Kentucky passed new legislation, and West Virginia and Arkansas revised their statutes regarding DPC. Eight other states have pending legislation, and in three of them — Indiana, Colorado and Alabama — the legislation is awaiting only the governor’s signature… ‘In my opinion, DPC is already legal in every state and always has been,’ Eskew said. ‘Even without legislation, it is possible to do it anywhere, but it requires an understanding of insurance law, which physicians don’t have. That’s why we are pursuing [federal] legislation to clear everything up.’ Indeed, the practice model has spread to every state except North Dakota, South Dakota and Iowa.” (American Academy of Family Physicians, 4.21.17)

Arkansas

“Rep Justin Gonzales introduced HB 2240 on 03/06/17 to exempt DPC agreements from insurance regulation. This legislation corrects some aspects of a bill passed in an earlier session (covered on the Arkansas state page). HB 2240 has been passed out of the House and Senate and was signed by the governor on 04/07/2017!” (DPC Frontier, 5.30.17)

Colorado

“HB17-1115 ‘Direct Primary Health Care Services’ was introduced on 01/20/17 and the governor signed the bill on 04/24/17 making Colorado the 20th state to pass DPC legislation. The bill no longer contains a new prohibition regarding Medicaid private contracting, and instead merely references the old problem already in place in CSR 25.5 (discussed and linked here).” (DPC Frontier, 5.30.17)

Florida

“Lawmakers are considering a proposal (HB 37/SB 132) that would ensure direct primary-care providers don’t run afoul of state insurance laws, paving the way for more doctors to contract directly with patients. ‘This is a cost-efficient way for physicians to deliver care, and it’s affordable for patients,’ said Tim Stapleton of the statewide doctors association, which supports the bill… In recent months, direct primary care has caught the attention of state lawmakers, who see it as a way to improve access to health care and drive down costs. The Legislature is currently considering a bill seeking to clarify that a direct primary-care agreement does not constitute insurance — and thus is not subject to state insurance regulations.” (Tampa Bay, 1.22.16)

Indiana

“SB 303 Direct Primary Care Agreements has passed the senate by a wide majority. It was assigned to the House committee on insurance where it was passed and received additional cosponsors. The governor signed the measure on 04/21/17 making Indiana the 19th state to pass DPC legislation.” (DPC Frontier, 5.30.17)

Kansas

Kansas Health Institute: Direct Primary Care Not Subject To State Insurance Regulation Under New Law. “Starting July 1, primary care physicians in Kansas may see patients who pay them a flat monthly fee without fearing that such agreements are subject to state insurance laws. Josh Umbehr, a doctor who runs a Wichita practice that has gained notoriety for practicing under the no-insurance ‘direct primary care’ model, pushed the Legislature to pass a bill that specifies such plans are not health insurance. Gov. Sam Brownback announced last week he had signed the bill.” (Kansas Health Institute, 5.14.15)
Medicine By Monthly Fee Expanding In Kansas: Is KanCare Next? “Heybrock is part of a growing group of Kansas doctors who accept no insurance. Instead, they charge a monthly membership fee — in Heybrock’s case $60 for an adult — for unlimited office visits, phone calls and some lab tests. They call it direct primary care, or DPC. Heybrock said he chose it because he didn’t want to spend time worrying about insurer coding and billing or become part of a hospital group in which doctors largely oversee the work of lower-level providers. ‘I didn’t get into medicine to manage,’ Heybrock said. ‘I got into medicine to see patients.’ As DPC practices grow, patient advocacy groups warn that they’re no substitute for comprehensive medical insurance and patients who treat it that way risk large out-of-pocket bills. But the doctors say they’re filling a customer service niche that patients aren’t finding in practices that depend on insurance reimbursement. They are collaborating and clearing regulatory hurdles and, if President Donald Trump fulfills one of his campaign pledges, they could soon move into a new arena: Kansas Medicaid.” (KCUR, 2.2.17)

Kentucky

“SB 79 Defining “Direct Primary Care Membership Agreements” was introduced on 01/03/17 and signed by Governor Bevin on 03/17/17. Kentucky is the first state in the 2017 session and the 18th state overall to pass DPC ‘not insurance’ legislation!” (DPC Frontier, 5.30.17)

Maine

Direct Primary Care Takes Shape in Maine. “Gov. Paul LePage signed into law last week a bill that stamps Maine’s Direct Primary Care (DPC) health care model into state law. The bill, LD 1385, created by the Maine Heritage Policy Center and sponsored by Sen. Rod Whittemore, R-Somerset, removes insurance companies and other barriers from the health care equation… For instance, Megunticook Family Medicine in Rockport charges a $40 monthly fee for someone between the ages of 22 and 64 to receive DPC services. This monthly fee covers a physical and a flu shot, and following visits cost only $20. Similar systems are developing across the country and will continue taking shape in Maine. There are only nine direct primary care providers currently practicing in Maine, but the passage of DPC legislation will likely spur additional activity in the industry now that the model is protected by state law.” (The Maine Wire, 6.7.17)

Michigan

A Plan for Cheaper Health Care under ‘Obamacare’ Passes Michigan Senate. “The state Senate Thursday took a stab at legislation its sponsor says could lower health care costs for individuals while still complying with the Affordable Care Act. What SB 1033 technically does is specify that a medical retainer agreement wouldn’t be regulated in the same way as insurance. Sponsor Patrick Colbeck, R-Canton, says what it actually gets at is separating catastrophic care insurance coverage from primary care insurance coverage. So a person could in theory buy catastrophic insurance coverage and a have separate ‘medical retainer’ agreement. That would be a contract between a health care provider and a patient where the patient pays between $10 and $75 per month and the provider agrees to provide health care services to the patient. When a patient went to the doctor’s office, they would pay out of pocket for services they used.” (M Live, 11.7.14)

Virginia

“Senate Bill 800 has been passed by both the House and Senate… In a surprise move Governor McAuliffe later signed the bill into law on 04/26/17.” (DPC Frontier, 5.30.17)

Washington

“Washington state’s Medicaid program — Apple Health — has already started paying for some Medicaid beneficiaries to use the DPC model.” (AAFP, 1.3.17)

DPC (Direct Primary Care) Frontier

2022 DPC Legislative Update, January 26, 2021.

Federal Legislative Support

AAFP Backs Senate Bill Supporting Direct Primary Care. “As some primary care physicians make the shift from private insurance to the direct primary care (DPC) practice model, limitations on patient eligibility are slowing the model’s growth. Now the AAFP is supporting the efforts of a federal legislator who is throwing his weight behind the new care model. Sen. Bill Cassidy, M.D., R-La., has introduced the Primary Care Enhancement Act of 2015, which would make it easier for patients to select DPC as an option for their medical care. The AAFP wrote a letter to Cassidy expressing support for the legislation because it enables patients to participate in DPC using their health savings accounts (HSAs). Patients cannot use HSAs to pay for premiums under existing tax law, which has precluded many from choosing the DPC model.” (American Academy of Family Physicians, 9.23.15)
AAFP Applauds Bill to Ease Direct Primary Care Payment. “Some family physicians might be intrigued by the idea of direct primary care (DPC) but hesitate to adopt this emerging model because of regulatory limitations. Federal lawmakers who are aware of the growing interest in DPC have again this month introduced legislation that aims to make it easier for physicians and patients to choose this model. Two legislators, Reps. Erik Paulsen, R-Minn., and Earl Blumenauer, D-Ore., recently introduced the Primary Care Enhancement Act of 2017, which would change tax laws that are hindering the growth of DPC.” (American Academy of Family Physicians, 1.24.17)
States Prove Why Direct Primary Care Should Be A Key Component To Any Health Care Reform Plan. “Direct primary care (DPC) will end up playing a more prominent role on the national stage of conservative health reform. The Wall Street Journal considers this patient-centered delivery model the “fourth leg” to any plan that would replace Obamacare. Lawmakers in Congress and others in the consumer-driven health care scene strongly endorse DPC because it drives patients to pull more price transparency out of the very opaque U.S. health care system. And price transparency frequently comes with falling prices… lawmakers can further optimize DPC by enforcing the following ‘supply side’ health reforms: deregulating health insurance carriers to offer plans that fit consumer preferences, having the federal government supply funds for states to administer high-risk pools to assist those with pre-existing health conditions, and refundable tax-credits to ensure access to basic coverage.” (Forbes, 2.6.17)
DPC Legislation in Play. “Sen. Bill Cassidy, M.D., R-La., recently introduced legislation that would facilitate the expansion of direct primary care (DPC) by allowing patients to use their health savings accounts (HSAs) to pay for DPC services. The IRS currently prohibits use of HSA funds to pay for these services. The bill was referred to the Senate Finance Committee. The House companion bill was sponsored by Rep. Erik Paulsen, R-Minn.” (AAFP, 6.26.17)

Resources

Restoring Free Markets to Medicine — Association of American Physicians and Surgeons
Third Party Free Practices — Association of American Physicians and Surgeons
Cash and Direct Payment Friendly Practices — Association of American Physicians and Surgeons
DPC Frontier’s DPC Mapper. The map contains a listing of public addresses and website links to 1930 direct primary care (DPC) practices across 48 states plus Washington, DC.
DPC Frontier State Legislative Update.

Movement to Large Health Systems

Also see Accountable Care Organizations

Physician Employment

Physicians Say White House Should Not Write Off Small Practices. “In a newly published article, the White House is advising physicians to accept a life in Big Medicine — as a hospital employee or member of a large group practice — in the wake of healthcare reform. Some leaders of organized medicine, however, are objecting to the government message. ‘We’re not ready to write off the small practices,’ J. Fred Ralston Jr, MD, president of the American College of Physicians, told Medscape Medical News. ‘We think there needs to be more than one delivery model.’ ‘America is not a one-size-fits-all country,’ added M. Todd Williamson, MD, a neurologist from Lawrenceville, Georgia, and spokesperson for a coalition of medical societies opposed to the new healthcare reform law, now called the Affordable Care Act.” (Medscape Medical News, 8.24.10)
How Healthcare Reform Is Changing the Way Your Doctor Does Business. “You may see fewer private practices in the future. According to a 2013 survey of nearly 3,500 doctors, 40% are either employed by a hospital or work in a practice owned by a health system or hospital. This is an increase from 2012. Only 22% work in a practice where they have an ownership stake and just 15% have a solo practice. Both of these decreased from 2012. This trend could have consequences for the healthcare system by limiting choice and decreasing competition. In the same survey, half of doctors reported they would take steps to reduce services over the next one to three years. Working part-time, seeing fewer patients, retiring, and switching to concierge or cash services are all potential strategies.” (CNN.com, 8.20.13)
Burnt Out Primary Care Docs Are Voting With Their Feet. “Anecdotal reports and studies suggest a significant increase in the level of discontent – especially among primary care doctors who serve at the frontlines of medicine and play a critical role in coordinating patient care. Just as millions of Americans are obtaining insurance coverage through the federal health law, doctors like Finer, Gassner and Devitt are voting with their feet. Tired of working longer and harder because of discounted insurance payments and frustrated by stagnating pay and increasing oversight, many are going to work for large groups or hospitals, curtailing their practices and in some cases, abandoning primary care or retiring early. The timing couldn’t be worse.” (Kaiser Health News, 4.1.14)
2015 Review of Physician and Advanced Practitioner Recruitment Incentives.“Hospital-employed positions comprised 51% of Merritt Hawkins search assignments in the 12-month period covered by this Review…while physician-owned medical group employed positions comprised 20% of search assignments… Community health center and academic settings also accounted for a greater percent of Merritt Hawkins’ search assignments year-over-year.” (Merritt Hawkins, 2015)
Texas Doctors Finding it Tough to Remain Independent.“A 2014 study in the Journal of American Medical Association found that spending per patient was 10.3 percent higher for hospital-owned physician offices compared with doctor-owned organizations. The costs were nearly 20 percent higher when hospital networks employed physicians rather than independent physician offices. ‘On the face, it’s a good idea. We’re better together than we are individually,’ said Travis Singleton, senior vice president for Merritt Hawkins. ‘The problem is I have not seen it happening. Maybe bigger is not better.’ Most agree it is too soon to know who is doing it right. But there seems to be consensus that a solo doctor or small practice will be increasingly hard-pressed to do it entirely alone in the future, said Paul Keckley, managing director of the Navigant Center for Healthcare, Research and Policy Analysis.” (Houston Chronicle, 8.5.15)
Hospital Job May Hold Rude Shocks for Physicians. “Physicians who sell their practice to a hospital and become employees can experience what two hospital executives call ‘postintegration trauma syndrome.’… The underlying cause of postintegration trauma syndrome is loss of autonomy, especially for physicians who have been the boss for 15 or 20 years, Godfrey and Sykes explained… And forget about the kind of long-term guaranteed salaries that were common 20 years ago until hospitals recognized that they sapped physician hustle, said Sykes. LifePoint Health will guarantee a salary for 3 months, 6 months, maybe a year, and then switch physicians to a combination of base salary and productivity, measured as relative value units (RVUs). ‘A big lesson for us is to make sure the physician understands that this is not retirement,’ he said. ‘We are looking for productivity.’” (Medscape Medical News, 10.15.15)
Solo and Small Practices: A Vital, Diverse Part of Primary Care. “Solo and small practices are facing growing pressure to consolidate. Our objectives were to determine (1) the percentage of family physicians in solo and small practices, and (2) the characteristics of and services provided by these practices… Family physicians working in solo and small practices still outnumber those working in medium-sized and large practices. Contrary to preconceived notions, solo practitioners are diverse and less likely than those in small practices to work in rural areas. As policy makers and national initiatives such as Family Medicine for America’s Health revisit the future composition of the primary care workforce, they will need to consider the unique needs of family physicians in these settings.” (Annals of Family Medicine, January/February, 2016)
Hospital Employment of Doctors Rising Rapidly. “The number of physician practices owned by hospitals and health systems jumped 86% from 2012 to 2015, according to a survey conducted by Avalere Health for the Physicians Advocacy Institute (PAI). The number of physicians employed by hospitals increased by nearly 50% during the same period, from 95,000 doctors in 2012 to more than 140,000 physicians in 2015, the survey shows. Hospitals acquired 31,000 practices during the study period, and 1 in 4 medical practices were hospital owned in 2015. Moreover, 38% of physicians worked for hospitals in that year, the report said. In comparison, a 2014 survey conducted by physician recruiting firm Merritt Hawkins for the Physicians Foundation showed that only 35% of physicians identified themselves as independent; among family physicians, the percentage dropped to 31%… The report also observed that when physicians go to work for hospitals, the health systems can charge Medicare more for ambulatory care services than the doctors could charge when they were in private practice. That is because of a feature of Medicare reimbursement policy that defines the practice site of hospital-employed doctors as the hospital outpatient department (HOPD), where care is reimbursed at a higher rate than it is in an independent physician office. An earlier PAI analysis developed by Avelere found that Medicare payments for three common services are up to three times higher when performed in an HOPD rather than in a physician-owned practice. (Medscape Medical News, 9.14.16)
Is Private Practice Making a Comeback? “Last year, the percentage of physicians who own a stake in their practices fell below the halfway mark for the first time, according to an American Medical Association survey. In 2016, only 47.1% of physicians held equity in their practices. That’s down from 2000, when 57% of all doctors had an equity stake in their practices. The drivers behind the trend are myriad and all too familiar: consolidation and hospital acquisitions, increased administrative and regulatory burdens, a desire for greater work-life balance, and more predictable hours. Pervasive as those trends may be, they haven’t snuffed out private practice, says Randy Bauman, president of Delta Health Care and coauthor of Choosing Autonomy: The Physician’s Guide to Returning to Private Practice. In fact, experts say, while private practice may never again dominate the healthcare landscape, it’s likely to remain a small but permanent fixture, thanks to emerging new business models, cost-saving technological advancements, and the tenacity of physicians determined to practice medicine on their own terms.” (Medscape, 11.1.17)

Affiliation with Accountable Care Organizations (ACOs)

Killing Marcus Welby. “The ACO… became the intellectual foundation for ObamaCare’s vision of ‘bending the cost curve’ — that you can improve medical outcomes by cutting Medicare spending. The ACOs have become Washington’s most fashionable vehicle for pursuing that prophecy. Even if the Obama team dresses up the same concepts in a new acronym, their regulatory impulse to tightly manage how these organizations operate tilts the ACOs into the hands of hospitals. It forces doctors to sell their medical practices to these networks if the physicians want to maintain what they’re paid by Medicare.” Gottlieb, Scott. (New York Post, 10.18.10)
Consolidation of Providers. “ACOs help realize a critical goal of health care planners: ‘to get more leverage over providers. The geographic dispersion of doctors into small practices has made them hard for a central agency like Medicare to regulate… Once doctors are consolidated into ACOs, it will be easier for Medicare to gain more direct leverage over their clinical decisions.’ The Obama team aims to use ACOs more widely, well beyond Medicare. ‘Health care policymakers inside the White House and Centers for Medicare and Medicaid Services (CMS) may also be crafting new rules that would provide ACOs favorable treatment in the health insurance exchanges,’ Gottlieb writes… As former Obama administration official Nancy DeParle put it in a recent article, ‘the economic forces put in motion by [the Obama health care plan] are likely to lead to vertical organization of providers and accelerate physician employment by hospitals and aggregation into larger physician groups.’” Schulz, Nick. (American Enterprise Institute, 3.1.11)
Why ACOs Are Struggling: What Does It Mean for the Physician? “The future of the ACO model is not secured, and the bottom lines of the hospitals and participating physicians need to be financially secure, so unless the ACO is a fully integrated system, the parties typically come to the table to continue to try to maximize their own income. This involves negotiation between the ACO participants related to delivery system change and shared-savings distribution, so it is important for physicians to identify the leverage they will have before they wholeheartedly jump into an ACO model… It is important for physicians to understand the magnitude of shared-savings opportunities before they agree to reduce service volume in a material way.” (Medscape Business of Medicine, 9.5.13)
Alternatives to ACOs Emerge. “Physicians are hearing a lot of talk about accountable care organizations as the wave of the future, with many being recruited to join and others trying to make themselves appealing with extensive metrics detailing their quality and efficiency. But what if an ACO is not right for you? Well, you’re not alone. About 60% of physicians are not committing to an ACO, according to recent research in the journal Health Services Research. There are alternatives to ACOs that can be a better choice for some physician practices.” (Health Leaders Media, 6.12.14)
Are Physicians Better Off Now than Six Years Ago? “According to the Medscape survey, current and future participation in ACOs is indeed still increasing, at 39% this year compared with 37% in last year’s report. Thirty-seven percent of specialists participate or plan to participate this year in ACOs, which is much lower than PCP participation (45%). More PCPs (39%) also reported being in ACOs this year than in last year’s report (35%). According to some experts, as of late 2015, the results on ACOs still leave questions as to whether meeting quality metrics translates into meaningful improvement in patient care. In addition, they don’t seem to have reduced costs at all.^”(Medscape Business of Medicine, 4.1.16)

Large Medical Groups

Large Independent Primary Care Medical Groups. “Increasingly, physicians are choosing to become employed by large organizations. Some join large multispecialty or single-specialty medical groups. This opportunity is often not available, however, and many physicians are becoming employed by hospitals. For primary care physicians, an additional option is available: the large, physician-owned, primary care medical group… Our findings suggest that large physician-owned primary care groups can present an attractive option. They make it possible to work in the small practice setting that some physicians prefer while gaining substantial help with the business side of medicine plus economies of scale to develop health information technology, ancillary services, and care management processes. Nevertheless, the groups’ physicians report only moderate satisfaction with their clinical workload and their work-life balance, suggesting that these groups have not fully resolved the difficulties of practicing primary care medicine.” (Annals of Family Medicine, January/February, 2016)

Hospital Buyouts

Selling Your Practice: Will the Offer Disappoint You? “Some doctors — particularly those in small or solo primary care practices, who preferred independence way back when but who are now having second thoughts — may be disappointed at what their practices are worth and what sort of deals are on offer at this late stage in the buying game, experts contend.” (Medscape Medical News, 4.10.14)
Obamacare’s Threat to Private Practice: The Payment System is Forcing Doctors to Sell Out to Hospitals. “Here’s a dirty little secret about recent attempts to fix Obamacare. The ‘reforms,’ approved by Senate and House leaders this summer and set to advance in the next Congress, adopt many of the Medicare payment reforms already in the Affordable Care Act. Both favor the consolidation of previously independent doctors into salaried roles inside larger institutions, usually tied to a central hospital, in effect ending independent medical practices… A recent Physicians Foundation survey of some 20,000 U.S. doctors found that 35% described themselves as independent, down from 49% in 2012 and 62% in 2008.” Gottlieb, Scott. (Wall Street Journal, 12.7.14)
Physicians Are Talking: Can Small Practices Survive? “Primary Care Medical Associates (PCMA), a six-physician practice in Chicago, Illinois, said no to consolidating their medical group or selling to a large health system. Their strategy is gutsy and entailed some trial and error, but it has been working out for them and could possibly work for you, too. A recent Medscape article detailed how.” Article quotes physician responses to the article. (Medscape Business of Medicine, 12.23.14)

Impact on Care

The Personal Political Nature Of Medical Care. “By the sheer magnitude of their size, giant systems can handle government rules and regulations, but at the expense of the personalized care found in the offices of private practices. Just as overzealous government regulations are forcing community banking out of business by creating even more ‘too big to fail’ banking systems, private practice is being forced out of business, thus creating even larger, cost-ineffective health care giants.” The Physicians Foundation. (Forbes, 5.4.15)

Advantages of Small Practices

Value-based Contracting

Farewell to Fee for Service? A “Real World” Strategy For Health Care Payment Reform. (UnitedHealth Group, UnitedHealth Center for Health Reform and Modernization, Working Paper 8, December 2012)
Health Law’s Pay Policy Is Skewed, Panel Finds. “Medicare and private insurers are increasingly paying health care providers according to their performance as measured by the quality of the care they provide. But, the draft report by an expert panel says, the measures of quality are fundamentally flawed because they do not recognize that it is often harder to achieve success when treating people who do not have much income or education.” (New York Times, 4.28.14)
VBMs: Coming Soon to Either Increase or Lower Your Income. “The VBM will be applied in 2015 to groups of 100 or more eligible professionals (EPs). In 2016, the VBMs will be applied to groups of 10 or more EPs. By 2017, all 600,000 physicians who participate in Medicare will be subject to the VBM. Under the current program, the maximum VBM incentive is 2% of Medicare reimbursement, and the maximum penalty is 1% in 2015, rising to 2% in 2016… You can’t avoid the VBM simply by not reporting to PQRS. If you don’t report, a negative VBM will be ascribed to you. If a practice did not participate in PQRS in 2013, the VBM will cause its Medicare reimbursement rate to drop 1% in 2015. If it fails to report in 2014, its Medicare payment rate will fall 2% in 2016. In addition, physicians who don’t participate in PQRS by 2015 will have their Medicare reimbursement trimmed by 1.5%; the penalty increases to 2% in 2016… Some groups won’t be subject to the VBM. It won’t apply to groups in which any of the physicians belong to Accountable Care Organizations (ACOs) that participate in the Medicare shared savings program or the Pioneer ACO program. A group is also off the hook if its doctors participate in CMS’s Comprehensive Primary Care Initiative.” (Medscape Business of Medicine, 2.6.14)
Health Insurers Are Trying New Payment Models, Study Shows. “Health insurers are experimenting with new formulas for reimbursing doctors and hospitals, slowly moving away from the traditional approach of basing payments on the numbers of tests and procedures performed, according to a survey of Blue Cross insurers, among the most dominant plans in the country. The survey, released on Wednesday by the plans’ trade association, estimates that $1 out of every $5 in reimbursements is being paid under an arrangement in which providers are rewarded for improving care and lowering costs… Mr. Wilson, the Blue Cross of North Carolina executive, acknowledged that his company must expand its programs and move toward a payment model where health systems are at more financial risk in caring for patients.” (New York Times, 7.10.14)
Quality Still Accounts for Minor Slice of Physician Pay. “Judging by survey data released last week by the Medical Group Management Association (MGMA), the paradigm hasn’t shifted very much. Group practices on average based roughly 6% of total compensation on quality measures for both primary care physicians (5.96%) and specialists (5.7%) in 2013. Some common examples of quality measures are the percentage of patients with hypertension who have their blood pressure under control, and the percentage of diabetic patients who receive an annual eye exam. Patient satisfaction scores amounted to another 1.9% of compensation for primary care physicians and 2.3% for specialists last year…But is making quality of care a 6% slice of the dollar pie enough to change how physicians practice? No, said Uwe Reinhardt, PhD, a professor of healthcare economics at Princeton University. To get physicians’ attention, he said, the quality slice needs to be at least 20%.” (Medscape Medical News, 7.10.14)
Influence of Shared Medical Appointments on Patient Satisfaction: A Retrospective 3-Year Study. “Shared medical appointments (SMAs) are becoming popular, but little is known about their association with patient experience in primary care… Our study confirms and extends prior literature demonstrating that patient satisfaction outcomes are often mixed despite concerted efforts geared toward improving the patient experience.” (Annals of Family Medicine, July/August 2014 vol. 12 no. 4 324-330)
We’re Approaching the End of the Generalist PCP Model. “We see four emerging PCP identities. Super-PCP: Physicians who develop expertise in longitudinal specialties, and work to manage patients with the particular specialty condition; Complex care manager: Physicians who are primarily responsible for managing the highest risk, highest cost patients—those with multiple complex chronic illnesses; Care team director: Physicians who lead and oversee the diagnosis and treatment provided by advanced practitioners and nurses in the advanced medical home model; Concierge care provider: Physicians who manage smaller patient panels and receive a retainer fee per patient.” (The Advisory Board Company, 8.13.14)
HHS Prescribes $840 Million to Help Doctors Transform Their Practices. “The federal government will spend $840 million over the next four years to help doctors move their practices away from a volume-based business model to one that’s focused on rewarding them for good patient outcomes. That’s one of the goals of the Affordable Care Act, which provided the funding for the Department of Health and Human Services’ Transforming Clinical Practice Initiative.” (American City Business Journals, 10.23.14)
Physicians Are Talking: Why Punish Docs for Patient Actions? “As payers begin to shift to outcomes-based reimbursements, physicians with high percentages of nonadherent patients stand to potentially see payments fall. Patients who don’t take their medications or don’t adhere to treatment recommendations are at risk of getting sicker and requiring more services, and this added cost could come out of physicians’ reimbursement. A recent Medscape article explored the fairness of this situation, where physicians are penalized for poor outcomes which they are usually helpless to control, but patients aren’t penalized for poor adherence or nonadherence, as if doctors were to blame.” Article publishes physician responses to the article. (Medscape Business of Medicine, 12.15.14)
Also see Pay-for-Performance (P4P).

Guidance for Physicians

Frequently Asked Questions About Accountable Care Organizations. Guidance for physicians about ACOs and PCMHs. American Academy of Family Physicians, Payment and Reform.
12 Key Questions Providers Should Ask Before They Engage in Value Based Contracting. “As providers increase efforts to engage in value based contracting many are asking us what questions they should be asking. In the frenzy of accountable care hype it can be tempting to take a ‘ready, shoot, aim’ approach. In other words, it can be luring to follow the crowd—in essence to compete with the Jones family next door—and assume a value based contract without fully undertaking a cost/benefit analysis. Before engaging in value based contracts, providers should determine the desired degree of care coordination and financial risk they can or should assume.” (Leavitt Partners, 8.12.13)
12 Changes That Will Affect Doctors’ Income in 2015: Get Ready for Some Big Changes. “The new year will bring several developments, some of which may be troubling to physicians, and others that may bring welcome news. These changes can affect physicians’ incomes to varying degrees and are likely to have at least some effect on many or most practices. The following list highlights these upcoming challenges. See which ones may affect you, and what you should watch out for.” (Medscape Business of Medicine, 11.25.14)

Guidance for Specialists

What Does the Affordable Care Act Mean for Infectious Disease/HIV Specialists? “The question of whether an ID specialist should join an ACO doesn’t have an easy answer. There are a ton of factors that have to be considered. If you’re in Miami, Florida, you might have different options than if you’re in Utah or Des Moines, Iowa. It’s still fee-for-service. Everybody goes about their business billing Medicare, but they’re sort of cost-conscious now and are also trying to meet these quality indicators. ID physicians who are employed by hospitals may not have a say in whether they join an ACO. The hospital is going to make that determination. If hospitals see savings as an ACO, that won’t necessarily turn into bonus checks for physicians. It’s more likely that those payments will be ploughed back into reducing overhead costs for the hospital. Physicians in private practice have a different set of decisions to make, especially if they’re in an area where there are multiple ACOs. Under the law, physicians can only participate in one ACO for the purpose of shared savings, though they can still see patients who are enrolled in other ACOs.” (Medscape Infectious Diseases, 8.22.13)
Confused About Ophthalmologists’ Place in ACOs? “‘We’re going to have to see how this unfolds,’ Brock Bakewell says. ‘We just don’t know. ACOs aren’t even proven to really work. You certainly have to be a member of the ACO to get that money, but it may not be much at all. The concern about bonuses may be overblown.’ Another consideration: If you join a 1-sided ACO as a full participant, you share in the savings, if any, but not the risk. If the ACO is 2-sided, however, you share in both. But if ophthalmologists are practicing at the top of their game and other specialists in the ACO aren’t, it costs everyone, because risk is shared. ‘There’s no evidence that ACOs save money and improve quality, particularly when it comes to ophthalmology,’ says ASCRS’s Nancey McCann.” (Medscape Medical News, 4.10.14)
ACO, Health Insurance Exchange Pressures Mounting. “Dermatologists must remain engaged, informed, proactive in documenting value their services provide.” Offers information and advice for physicians in negotiating the new healthcare landscape. (Dermatology Times, 7.14.14)