An interesting new trend in the healthcare industry is primary care that patients buy directly from physicians, thereby removing insurance companies from the process and lowering costs for both the doctor and the patient.
Built upon the idea of concierge medical practices, doctors using this innovative model provide day-to-day care to patients who pay a monthly fee for the service. For $49-$130 a month patients receive preventive care, basic tests, treatment for chronic conditions, and non-life-threatening emergency services like X-rays and stitches. Patients are also able to get advice from doctors via e-mail, phone or video messaging, thereby saving both parties time and reducing the number of unnecessary office visits.
What sets practices like the Seattle-area Qliance Medical Group or Silicon Valley-based MedLion, two of the leaders in this emerging care strategy, apart from traditional concierge practices is their fees. Direct healthcare was once the sole domain of the rich, given the thousands of dollars a month in fees charged by doctors who saw relatively few patients. For as low as $49 a month, however, the aforementioned organizations provide the standard care patients need at an affordable price. How, you might ask, are they able to offer such low-cost comprehensive everyday care?
It really is all about time and money. According to Qliance, insurance billing and overhead consumes about 40% of health care costs. Simply cutting out the insurance middle man therefore dramatically reduces fees. The ability to treat some patients remotely instead of adhering to the insurance company mandate that every consult be face-to-face in order to be reimbursable, also allows doctors to see more patients and waste less time.
The increased individual attention also saves patients 22% on health care annually, according to Qliance, because it reduces hospital visits and the need for appointments with specialists.
While subscribers to the services provided by Qliance and MedLion must retain a high-decudtible health insurance plan for specialists, certain emergency situations and serious ailments, if you think about it, paying out-of-pocket for primary care and using insurance only for emergencies is quite logical.
You don’t file a claim with your home insurance provider for chipping paint or with your auto insurance company for an oil change. So why would you go through a health insurance provider for a runny nose, sprained ankle or routine blood work? Doing so starves the free market of the necessary competitive force of millions of consumers shopping around for the best deals on routine procedures.
In a traditional insurance-centric system, there’s no incentive for consumers (which is really what all patients really are) to shop around and find the lowest-priced health services possible. The majority of their costs will be billed to their insurance companies anyway and they’ll owe the same co-pay no matter which doctor they go to, so why waste the time and effort? In the same vein, doctors aren’t incented to lower their prices as long as they participate in major healthcare plans because they compete with other physicians based on reputation and qualification, not price.
As a result, the distinction between everyday and emergency coverage that the direct general-care provider model promotes is a way to reduce the far-reaching detrimental effect of healthcare hyperinflation. Less money spent on insurance means more spent on things that we truly need. Now, I’m not saying that the model being employed by practices like Qliance and MedLion is perfect, but it at least seems like something that should be more widely considered, especially given the obvious need this country has for healthcare alternatives.