New models for primary care will revolutionize healthcare in America

November 15, 2012

Joe McWilliams

Imagine if we all depended on auto insurance for "primary care" for our vehicles. For example, every time you needed regular maintenance (for example, new wiper blades, a tire rotation, or an oil change), there would be a broad network of middlemen to manage billing issues, paperwork, claims, and other administrative issues commonly associated with insurance reimbursement.

Consider the hassles and time that would be required for each of these relatively minor situations! The expected implication would be that the overall cost of your auto maintenance would increase, simply to cover the business overhead. Soon, millions fewer Americans would be able to afford auto insurance, liability costs would skyrocket, and we would have a massive national crisis on our hands.

This seems like a bad idea. Yet this is the way that healthcare works in the U.S. today.

Fortunately, there are new business models that seek to address this problem by decoupling primary care healthcare provision from insurance companies, resulting in lower costs, increased access, and much greater personalization.

Direct primary care (DPC) practices offer a membership-based approach to routine and preventive care. Similar to a health club membership, this fee gives patients unrestricted access for visits and care, so patients can use the services as much or as little as they want.

Many direct primary care practices are open seven days per week and offer same-day or next-day appointments. At many clinics, physicians are on call 24/7. Furthermore, business overhead is greatly reduced, since there are no procedural billing codes, co-payments, or deductibles required today by insurance reimbursement.

Doctors are also no longer forced to see an unmanageable number of patients and can instead take the time necessary with each patient to deliver high quality, personalized care. The typical patient in a DPC practice keeps an insurance plan to cover emergencies and serious illnesses, but can choose a less comprehensive plan with a higher deductible and lower premium, since routine care need not be covered.

Today, many economists believe that healthcare hyperinflation is a primary driver of our jobless economic recovery. Soon, experts predict that $1 out of every $5 in the U.S. economy will be spent on healthcare despite the U.S. ranking 31st in the world in terms of health outcomes.

It is time for a revolutionary new model for delivering primary care in America that enables patients, employers, and the government (i.e., DPC practices may be able to significantly help Medicaid patients while also saving money for cash-strapped states) to dramatically reduce the cost of day-to-day healthcare while increasing access and quality.

Companies such as MedLion and WhiteGlove Health, retail clinics such as MinuteClinic (CVS) and Take Care Clinics (Walgreens) that are increasingly providing primary care services, and numerous other innovators with supporting technologies and services believe that scaling new models for direct primary care across America is critical to improving the health of the population, strengthening the economy, and empowering doctors and other care providers to practice truly patient-centric medicine.

Here's my prediction: By disintermediating insurance companies from their current position in day-to-day healthcare and equipping doctors and patients with increasingly sophisticated technologies, we'll all be part of a new and improved model for primary care within 5 years.

Joe McWilliams is a healthcare strategy consultant and committed supporter of a smarter, more efficient healthcare system. He currently works in strategy and marketing at Philips Healthcare, where he is focused on the identification and development of new business models for next-generation healthcare applications. Prior to Philips, Joe worked at Scientia Advisors, a healthcare strategy consulting firm in Cambridge, Mass. He has also worked as a consultant at Accenture and in business development and licensing at Partners Healthcare Research Ventures and Licensing, the technology transfer arm of Partners Healthcare responsible for investing in novel technologies from Massachusetts General Hospital.

Originally published Nov 15, 2012 10:00:08 AM.