Direct Primary Care. Direct primary care (DPC) is a style of clinical practice in which a healthcare provider (usually a physician or a physician group) offers primary care services to patients who pay a monthly membership fee for the provision of primary care services at no additional charge to the patient/member. For its most ardent enthusiasts, DPC may best be described as it is on the Direct Primary Care Coalition’s home page:
Direct Primary Care (DPC) is an innovative alternative payment model improving access to high functioning healthcare with a simple, flat, affordable membership fee. No fee-for-service payments. No third party billing. The defining element of DPC is an enduring and trusting relationship between a patient and his or her primary care provider. Patients have extraordinary access to a physician of their choice, often for as little as $70 per month, and physicians are accountable first and foremost to their patients. DPC is embraced by health policymakers on the left and right and creates happy patients and happy doctors all over the country!
As evidenced by the following federal and state legislative activities, interest in the DPC model as an alternative to traditional insurance-based medical practice models has grown over time.
- On January 6, 2017, Republican Congressman Erik Paulsen [R-MN-3] introduced the Primary Care Enhancement Act of 2017 (H.R. 365) to the U.S. House of Representatives where it was immediately referred to (and remains with) the House Ways and Means Committee.
- Many states – including Florida (see below) – have adopted DPC-related laws and regulations to establish standards for legally compliant DPC arrangements.
- State laws and regulations have been adopted to exempt DPC arrangements from the definition of “insurance” and, in turn, the myriad of insurance-related statutory and regulatory requirements and obligations that the DPC model was designed to avoid.
Prior to such legislative actions, DPC providers often found themselves at odds with health insurers – and their proponents in state government – that argued that DPC was a form of insurance and that DPC providers would be unfairly advantaged if they were allowed to operate without the burdens of state insurance law compliance. Notwithstanding these complaints, the number of states with laws that specifically exempt DPC providers from being treated as insurance has grown at a steady pace.
The latest example of state legislative action in this area occurred on Friday, March 23, 2018, when Florida Governor Rick Scott signed the “Direct Primary Care Agreements” bill (HB 37) to amend the Florida Insurance Code and, in turn, made it clear that DPC agreements between physicians and patients do not constitute the making of insurance and therefore do not have to comply with the terms of the Florida Insurance Code.[1] Prior to HB 37, Florida lacked statutory and regulatory guidance on whether DPC was subject to insurance regulation. Although the Florida Office of Insurance Regulation had never asserted regulatory authority over DPC arrangements, without HB 37, it could have done so.
HB 37 allows significant flexibility for structuring DPC arrangements, so long as such arrangements meet certain basic requirements. For example, a compliant DPC program must ensure that primary care services provided to DPC patients/members are within the competency and training of the DPC provider who is rendering the service. Moreover, a DPC agreement must (i) be in writing; (ii) be signed by the parties, (iii) include specified term and termination provisions, (iv) include a description of the scope of primary care services covered by the monthly fee to be paid by the patient under the DPC agreement, and (v) include explicit language stating that the DPC agreement does not constitute a policy of insurance. If the passage of HB 37 portends anything, it is that 2018 will likely be another active year for the expansion of DPC as an alternative source of primary care services outside of the traditional patient/insurer/provider model. Certainly, if the Primary Care Enhancement Act of 2017 (H.R. 365) starts to move forward in Congress, increased interest in the DPC model may result in the growth of existing DPC practices, and attract investment into new DPC practices.
[1] News Service of Florida, Direct ‘Primary Care Bill’ Gets Scott’s Approval, WLRN, (March 26, 2018)