5 Warnings for Virtual Primary Care from an Insurance Company
December 29, 2021
Dr. Eric Bricker
Virtual primary care is an innovative new solution for employer-sponsored health plans.
For employers who believe that primary care is a central strategy for keeping plan members healthy and reducing the frequency and severity of high-cost claims, virtual primary care now offers convenience, speed and doctor expertise to plan members no matter where they are.
However, virtual primary care specifically from a health insurance company has problems.
Here are 5 problems with virtual primary care from a Health Insurance Company:
Low Trust with Patients – A survey from the American Board of Internal Medicine and the University of Chicago found that only 33% of patients trust health insurance companies. For virtual primary care to be effective, patients need to use the service and follow the directions of the primary care provider. If most patients do not trust health insurance companies, patients will neither seek out a virtual primary care visit from a health insurance company nor follow the advice of that even if they did.
PBM Conflict-of-Interest – All the major health insurance companies have their own Pharmacy Benefits Manager (PBM). These PBMs make money on every prescription by either collecting a commission from the pharmaceutical manufacturer for brand-name medications (i.e., Rebates) or by up-charging for generic medications (i.e., Spread-Pricing). Therefore, health insurance companies are financially incentivized to have as many prescriptions written as possible.
However, when a patient has a virtual primary care visit, they may not need a prescription. Counseling on lifestyle changes regarding diet and exercise may be much more effective than medication. Accordingly, a virtual primary care physician from a health insurance company has a conflict of interest between what is best for their employer (i.e., writing a prescription) and what is best for their patients (i.e., not writing a prescription).
Prior Authorization Conflict-of-Interest – Certain tests and medications require prior authorization from a health insurance company to be covered. Prior authorization involves a doctor asking a health insurance company for permission to order a test or medication. If a prior authorization is denied, a doctor can appeal that decision to advocate for the patient.
A conflict of interest occurs if a virtual primary care physician who works for a health insurance company is denied prior authorization. A virtual primary care doctor from a health insurance company would be forced to counter their own employer. Would the health insurance company reprimand that doctor? Would it fire them? Would these actions be transparent for the health insurance company’s employer customers and the public?
PPO Contract Restrictions – Frequently PPO contracts between health insurance companies and hospital systems that employ large groups of doctors prevent the health insurance company from directing members to a specific hospital or doctor. The term for directing patients is “steerage” and PPO contracts forbid it. This “no steerage” term is negotiated by the hospital system in exchange for the discount it gives the health insurance company.
A virtual primary care physician who works for a health insurance company will need to refer some patients for specialist care. That virtual primary care doctor will not be able to refer the patient to a specific specialist that has the best expertise for the patient because of the health insurance company’s “no steerage” contract restriction.
Employees Lose Their Doctor with an Insurance Change – Employers often change health insurance companies to lower costs and receive better service. However, if an employer has virtual primary care through their health insurance company, then the employees would lose their virtual primary care doctor with that change.
This disruption to employees gives the health insurance company greater leverage with employers to charge higher prices and skimp on service.
These 5 problems with virtual primary care from a health insurance company are why obtaining virtual primary care from a different source is the best approach for employers.