Despite proposals from Biden to double-down on the current dysfunction, the Republicans have not coalesced around one plan, though many market-friendly reforms have been floated. Given the obvious fatal flaws of the Affordable Care Act and lack of political will to confront the real cost-drivers, many have lost faith in a government solution for a problem that government largely caused.
Fortunately, the private sector has brought forward new ideas for health care reforms, and these promise access to affordable and innovative care on our terms. Alternative market-driven options exist that improve access, reduce costs, and move patients into closer relationships with their doctors instead of with government bureaucracies.
Category: Consumer-Driven Health Care
Shelter In-Place Care: Another “Box Checked” for the Value of Direct Primary Care
HEADLINE:
FCC Unveils COVID-19 Telehealth Program, Updates Connected Care Pilot
The Federal Communications Commission is using $200 million in funding from the CARES Act to launch a new program to help providers access the broadband resources they need to support telehealth programs.
Wow, the government has discovered remote digital technology medical care! Although, maybe a little late. What would we do without those innovative minds in D.C. ?!?
But there’s a better solution that’s been up and running for more than a decade; private citizens being free to act and chose what services they value. It is a solution which occurred organically when an innovative supply side acted to solve other people’s problems within a cooperative marketplace driven by mutual benefit. It is called Direct Primary Care (DPC). And it is only possible because we still have some semblance of healthcare freedom within our society. No thanks to Washington, D.C.
But step aside, the FCC with money to burn is coming to the rescue after COVID is already in full crisis mode.
Never mind that Direct Primary Care physicians have routinely integrated remote care technology platforms into their practices for a more than a decade. And set aside the fact that revenue in a DPC business model doesn’t rely on office visits (the opposite of social distancing) to trigger a billable encounter, the claim against which is paid out of a grossly over-priced pre-paid 3rd party fund that we call health insurance. Instead, the Direct Primary Care physician is paid to be available to solve problems, answer questions, triage illness/injury, provide treatment and advice via the most appropriate venue for each patient.
And last, no disrespect meant to the media outlet below for featuring this story. They are just reporting the healthcare news, as is their mission.
Who Pays for Your Healthcare Matters
By Robert Nelson
Zero co-pays. No co-insurance. No surprise medical bills! Considering the inflated prices we pay for healthcare, who could pass up that deal, right?
Are the new generation of value-based employer-sponsored Direct Contracting Health Plans, which often include Direct Primary Care, a great deal and more efficient use of our healthcare dollars? Absolutely yes!
But we can’t lose sight of the economic reality that individuals always pay the cost of benefits, either directly or indirectly. And linking benefits to employment has been a colossal policy mistake and the genesis of job-lock and our 3rd-party payer system, which has been the source of runaway costs for 50 years. As the graph illustrates, insurance (3rd party payer) is now a near surrogate for total healthcare costs!
Don’t be fooled. Within the modern paradigm of healthcare financing, employers don’t pay for our healthcare. Our healthcare expense, no matter how it is structured, IS part of our compensation and a huge portion of of it.
FACT: Every dollar of tax-favored benefits paid by our employer reduces our take-home pay.
The beauty of Direct Primary Care is the portability (no job lock) and affordability which can exist independent of the size or benefit package of the employer. But the foundation which aligns the incentives is based on the identity of the customer. This is why we have to be careful to match the buyer with the recipient of care whenever possible. To insert another 3rd party, even the employer, undermines the sovereignty of the patient and the independence of the physician.
The supply side of healthcare has served the wrong customers for far too long. DPC should not make that same fatal error by exchanging its essence for a pipeline of patients.
This linkage highlights the importance of policy decisions regarding use of HSA funds; the importance of allowing HSA dollars to pay premiums AND DPC fees can’t be overstated.
For DPC, and Direct Contracting at-large, to dig us out from under the boot of the 3rd party apparatus it must remain accessible to the sole proprietor, independent contractor and very small businesses that don’t have “health plans.” And moving to defined contribution plans and away from defined benefit plans will help get us there.
Getting first dollar decisions in hands of consumers will also be deflationary and spur competition; and essential to the goal of eventual portability & ownership of benefits. To do otherwise, with too much focus on a new & improved generation of employer-sponsored healthcare plans, will lead us right back to where we started.
More Patients Turning to ‘Direct Primary Care’ | Medscape
Having quick access to a primary care doctor 24/7 is very appealing to Mick Lowderman, 56, who is married with two children, ages 10 and 8. He pays a monthly membership fee to AtlasMD, a direct primary care practice in Wichita, KS.
Primary care is built on the long-term relationship between clinicians and patients. A 10- to 15-minute patient visit doesn’t support that relationship, Sullivan says.
When Kevin Boyd, 64, fell on his stairs in Wichita and broke three ribs, he didn’t go the emergency room. Instead, he called Umbehr, who told him to come to his office. He referred Boyd nearby for an X-ray and dispensed pain medications at his office. The total cost was $70.
In contrast, the first time Boyd fell and broke his ribs, he had Blue Cross Blue Shield and drove himself to the ER, where he saw the ER doctor, a radiologist for an MRI, and got shots for his pain. The total bill was $14,000, and he paid $2,600.
“I don’t put off care the way I used to because of the money I save,” says Boyd, who joined AtlasMD in 2015.For his monthly membership fee of $75, Boyd gets several benefits, including unlimited 24/7 access to Umbehr by text, email, or phone, extended same- or next-day office visits, and free diagnostic tests and office procedures, such as EKGs, DEXA scans, and body fat analysis. If Boyd gets really sick and needs a house call, or if he needs a phone consult when traveling, those are also included in the fee.
Why Value-based Payment Methods Won’t Fix Healthcare
I’ve read several posts today on so called “Value-based payment” strategies and I couldn’t resist adding my 2-cents.
VBP can’t fix these fundamental problems because it is still based on a price-opaque shell game I like to call Fee-for-Coding, which results in:
1) Price insensitivity on the utilizer’s part.
2) Misaligned incentives on the provider’s part.
3) Lack of important price signals between buyers and sellers due to lack of advance pricing capabilities.
VBP utilizes the same fundamentally flawed economic system as our current billing model.
Moving to value-based care will require…
1) A system where prices are known in advance of care (not trauma or emergency care where extent of injuries or illness are unknown at onset – but even still a lot of those can be estimated ahead of time based on scenarios).
2) …that physicians be paid to be available to solve our problems, where payment is not tied to documenting work in a chart.
3) …that we move to a system that is based on defined contributions as opposed to defined benefits. As John C. Goodman is fond of saying, “money should follow people”, not programs and insurance policies.
Value will be elusive until we let the discipline of the market work in healthcare.
https://www.linkedin.com/pulse/why-value-based-payment-methods-wont-fix-healthcare-robert-nelson-md/
Hospitals pledge to fight Trump admin price transparency plan in court | Healthcare Dive
The old aphorism is true, leopards don’t change their spots!
For these three entities that oppose the new HHS price transparency rules, and for many others to be sure, there is no incentive to hold down healthcare care costs. In fact, the incentives of the current system of healthcare financing are such that it’s in their favor for prices to always go up.
In all cases, whether it be a percentage of claim cost, percentage of premium or percent of discount margin, these same price-hiding crony pals continue to benefit financially when the price of medical care rises.
FORBES | Employers Could Slash Their Health Costs Overnight. So, Why Don’t They?

“I am often asked if the free market can work in health care. My quick reply is: That is the only thing that works. At least, it is the only thing that works well.
Show me a health care market where there is no Blue Cross, no Medicare and no employer. I’ll bet it’s a market that works a lot like the markets for other goods and services.
In Overcharged: Why Americans Pay Too Much for Health Care (Cato: 2018), law professors Charles Silver and David Hyman make this same point in spades.
After several decades of trying everything from managed care to value-based purchasing, employers need to sit up and take note. The authors say the only thing that really holds down costs is giving money to the employees and letting them buy their own health care. “There is no health care cost crisis in the retail sector,” they write, and there “never has been.”
Atlas MD in Wichita, Kansas, for example, provides just about every service you can get at a primary care doctor’s office for $50 to $75 a month for adults (depending on age) and $10 for a child. Doctors are available by phone or email 24/7. Drugs cost less than what Medicaid pays. Medical tests are cheap. A cholesterol test is $3, a tiny fraction of the charge that the lab they deal with bills to insurers. An MRI scan costs $400 instead of the typical third party charge of $2,000.
What about expensive hospital care? That too can look like retail medicine if you know where to look. The Surgery Center of Oklahoma (SOC), founded by Drs. Keith Smith and Steve Lantier, posts prices for 112 common surgical procedures. They deal mostly in cash and they don’t take Medicare or Medicaid or negotiate prices with insurance companies. One of SOC’s competitors is Integris Baptist Medical Center in Oklahoma City. The contrast couldn’t be starker, as the authors note:
Integris charged $33,505 for a complex bilateral sinus procedure, which helps patients with chronic nasal infections. This bill covered only hospitalization; the fees for the surgeon and the anesthesiologist were extra. At SOC, the all-inclusive price for the same operation is $5,885. Not surprisingly, Integris’s bill was loaded with overcharges, including $360 for a steroid available at wholesale for just 75 cents, and $630 for three doses of a pain killer called fentanyl citrate, which altogether cost the hospital about $1.50.”
New developments in retail medicine are almost always the product of entrepreneurial thinking. Sometimes the entrepreneurs are medical doctors. Sometimes they are business types with a strong interest in eliminating the many inefficiencies in traditional health care.”
Source: Employers Could Slash Their Health Costs Overnight. So, Why Don’t They?
Trump’s new rule will give businesses and workers better health care options – CNN
A HUGE WIN FOR THE LABOR MARKET AND A STEP TOWARDS ENDING JOB-LOCK!
This is one of the most positive and substantive changes in healthcare policy to come out of Washington, D.C. in the past 40 years. It finally pierces the veil of separation between the Group Market & the Individual Market, helping to dissolve the perverse tax incentive which ties health insurance to employment. ~ Forum for Healthcare Freedom
“Starting on January 1, 2020, employers will be able to offer their workers HRAs to buy individual market coverage for themselves and their families. The administration’s new rule addresses a major inequity by, in effect, providing the same tax advantage that traditional employer-sponsored group plans receive — exclusion of premiums from federal income or payroll taxes — to coverage that workers in the individual market purchase from an HRA.
The rule will significantly expand worker options since 80% of firms that provide insurance currently offer only one type of plan. Now, workers will be able to use tax-advantaged money from their employers to buy coverage of their choosing. This new flexibility will allow people to maintain their coverage when they switch jobs.
In particular, this new rule should help small business workers by making it possible for employers to fund coverage with less hassle and cost than maintaining a traditional group health plan. Between 2010 and 2018, the proportion of workers at firms with three to 49 workers covered by an employer plan fell by more than 25%. This rule should help reverse that decline. The rule also makes it easier for small businesses to compete with larger businesses for talent.
It will take roughly five years for the full impact of the rule to hit — at which point, we expect 11 million workers and family members to use HRA funds to obtain individual coverage. The HRA rule may increase the size of the individual market by upwards of 50%, and should spur a more competitive market that drives insurers to deliver better options to consumers.”
Source: Trump’s new rule will give businesses and workers better health care options – CNN