How direct primary care reduces primary care costs

In an age of family physicians literally not being able to give away their practices, Brian Forrest has built a successful model that is similar to the age of Marcus Welby where there was a direct relationship between a patient and their doctor. Practices such as Forrest’s Access Healthcare in North Carolina run unencumbered by insurance hassles.

As word of Dr. Forrest’s direct pay practice has spread, he has had a constant stream of physicians visiting his practice so others could learn how he has a successful financial model, happy patients and a sane lifestyle – something increasingly less common in the hamster-wheel model of primary care that is prevalent in current fee-for-service based primary care practices. Dr. Forrest runs a cash-only practice sees 16 patients a day at a maximum, works a 40 hour week and takes home more than the average family physician a year with a highly satisfied patient base that pays less than those in fee-for-service, insurance models.

Dr. Forrest embodies a rapidly expanding cohort of what could be called Do-it-Yourself Health Reformers. That is, they aren’t waiting around for politicians to fix what is widely understood to be the broken facets of healthcare. Rather, through their own trial and error, they are refining care and payment models that are demonstrating impressive results.

Dr. Rushika Fernandopulle commented on the Do it Yourself Health Reform movement. “I do think that what we need to fix heath care is not more regulation, but innovation. I think many companies in healthcare simply look for market imperfections and try to take advantage of them- e.g., if there is high reimbursement for doing something, they just provide lots of it. I think the interesting companies are ones that truly can provide better quality (experience and outcomes) while lowering the total cost of care. Another way to state it is that they increase value for the customer- it’s what drives the rest of the economy.“

The need for true innovation is being recognized by the investment community. For example, venture capitalist Mark Suster has been on record as saying that healthcare is one of the truly big problems that entrepreneurs and venture capitalists should pursue rather than more trivial problems like another social media tool. Historically, much of the healthcare venture capital investment has gone into biotech and medical devices. However, increasingly there’s recognition that health outcomes and cost reductions can be achieved more effectively with new care and payment models and their underlying technology.

Not only is his monthly fee very affordable compared to insurance-based primary, he is also saving his patients significant money for ancillary services. By removing the insurance bureaucracy from his practice, dramatic savings ensue. The following table illustrates the savings:

Local alternatives Dr. Forrest’s practice
Metabolic Panel $169 $29
Cryosurgery to remove plantars warts $329 $49
EKGs, cholesterol panels, diabetes tests like HgBA1C, TSH (thyroid test) etc EKG: $225 

TSH: $150

Included in annual physical or access card

Dr. Forrest answers my questions below on how his innovations are working and their background.

Dave Chase: How do you make the lives of patients palpably better?

Brian Forrest: We create an access point to quality health care that did not exist for patients before.  People who had no insurance can now afford primary care for less than the cost of a carton of cigarettes per month.  For insured patients we provide longer visits with more streamlined service since none of their visit has anything to do with what insurance they have.

DC: How are you lowering overall costs?

BF: We lower costs for primary care by around 85%.  Getting rid of the overhead associated with billing and filing claims is a big part of that.  Also, getting buy in from specialists and ancillary service providers to give patients “cash up front” discounts for paying directly can reduce many of these costs by a similar margin.

DC: How do you engage and activate the patient in their care?

BF: First of all, we spend more time with patients- on average 3-4 times longer than a traditional practice.  We utilize that time to do teaching about goals, medications, and to coordinate referrals and resources for lower costs medication.

DC: How do you provide rapid access to care?

BF: We have had an open access schedule ever since we opened the practice where half of the visits each day are scheduled and we leave the other half as empty slots.  That way they can be filled by patients who need to be seen that day due to scheduling or acute needs.

DC: How are you contributing to improved patient outcomes for maintaining the health or helping with their chronic disease your patients have?

BF: We have participated in a PDSA (Plan-do-Study-Act) cycle of Quality Improvement continuously and have an independent auditor assess our outcomes data every three months.  The data shows that for blood pressure control, diabetes control, and cholesterol goals we are in the top tier percentile in the US.  It also shows that every quarter we continue to get better.  Essentially, you look at where you are, identify where you could improve your patient care based on an independent auditor, come up with a plan to specifically implement best practices and evidence to improve outcomes, then measure your outcomes and repeat the process.  Sort of like a sharp knife- it may already be sharp enough to get the job done- but you can always give it a slightly sharper and finer edge.  Just to give you some tantalizing data- the national average for the percentage of patients controlled to their goal blood pressure is less than 50%.  In quarter 2 of this year our practice had 85% of our patients Systolic Blood Pressure at goal.

For an anecdote- Several years ago a woman came to our practice for the first time- her husband had left her and dropped her health insurance the same day (and her 16 year old son’s too).  She was diabetic and could not afford any insurance due to this preexisting condition. Her first year after he left, she told me she spend about $5000 on medical care.  This consisted of an annual exam and 4 follow-up visits for her diabetes including blood work, office visits, an EKG, and ancillaries.  She had worked about 60-80 hours per week at two retail jobs in that interim year and could still barely afford her care and medication.  Then she found us.  When she arrived her HGBA1C was 11.9- meaning very poorly controlled.  One year later- her A1C was 6.8 (well controlled) and she had only spent about $450 for an entire year of care with us- including the annual physical, all of her follow-up visits, all of her lab work and ancillaries. As she told NPR in an interview a few years ago “We were a God send for her.”

DC: How have you (or will you) demonstrate increased patient satisfaction and how do you measure this?

BF: We use patient satisfaction surveys – we keep these relatively short to get more people to fill them out but they have routinely demonstrated an average of 5 on a 5 scale.  We still listen to and respond to any suggestions or input that patients might make in the open-ended questions.  I have actually published some of these survey results in an abstract for the Journal of Clinical Hypertension for May of 2011.

DC: How do you demonstrate high tech and high touch?

BF: We are almost totally paperless, with e prescribing, electronic records, etc.  However, I personally do not normally even take the computer in the room with me- rather I sit across from the patient and listen- often for 30 minutes,  I take a few critical notes on scratch paper if needed and then put the electronic note in the computer as soon as I exit the room when I am doing their electronic prescription refills.  The patient might not even see my computer at my office, but I am leveraging the power of electronic data to ensure better care.

DC: How do you demonstrate teamwork with other clinicians?

BF: We typically have “team huddles” at the beginning of the day to plan out what the needs of each patient might be that day and how we can best coordinate their care.  We usually do this again either at the beginning or end of lunch- for follow-up on items form the morning and to plan for the afternoon.  Having a smaller staff generally means much more efficient communication.  We definitely function as a team. Everybody knows how to “play their position” and generally waits on me just to “take the snap.”

DC: How do you increase the overall value of the healthcare services delivered?

BF: We offer full scope primary care with advanced chronic disease management for about 85% less than what those service would typically cost- that’s value- especially when the clinical outcomes are superior.  We also bundle some services (like annual comprehensive physicals).  For many patients on an Access Card- the annual physical is totally free.  This means for prevention we are putting our money where are mouth is.  Imagine a patient who normally comes in only for high cholesterol finding out that they can get a comprehensive exam with lab work, EKG, Prostate cancer screening, or PAP smear for no additional fee.  It really encourages people doing their annual physical and we have discovered a lot of disease that patients had never known about these, because at other offices they had been unable to afford to get screened.

DC: How do you simplify rather than complicate the process of getting care?

BF: Our office is ONLY about providing health care.  Since we do not have to worry about coding, billing, various CPTs, ICDs, claims appeals, etc. We can focus on patient care.

DC: Have you done anything to scale this beyond a single site/clinician?

BF: I have done lots of consulting and speaking for other organizations and docs around the country, am in the process of launching franchises and affiliate practices across the country (Direct Pay Health), and have written numerous articles in Medical Economics, Physicians Practice, and Family Practice Management.

DC: What is the biggest obstacle to expanding what you have done more rapidly? If you could have any assistance, what would it be and where would it come from?

BF: The biggest obstacle is Physician Inertia.  It takes time for physicians to be willing to embrace change of any type, as many have in the past been happy with the status quo.  However, in this era of rapidly changing health care policies and budgets, the status quo is just no longer acceptable.  Once physicians fear of the new and unknown is less than their fear of what is getting ready to happen to the practice of medicine, then you will see a sweeping movement of physicians moving to new models like direct pay.  I think the assistance in moving this forward comes from getting the word out to docs that are afraid to “stick their toe in the pool” to “Come on in the waters fine.”

DC: Who else is innovating in the healthcare arena that is an inspiration to you?

BF: There are tons of people that I have taken cues from.  I remember reading about a physician in People magazine that was in Vermont that had left her traditional practice to start “Simply Medicine” about 10 years ago.  I also read a lot of articles from Dr. Gordon Moore at the time I was starting the practice. He was even braver than I opening an office with no staff at all to prove the “low overhead” point.  Others have been successful doing slightly different models like Robert Berry, MD in Tennessee at the PATMOS clinic where each fee for service is based on the presenting complaint.

Dave Chase is CEO of Avado.com, a Patient Relationship Management software company, previously founded Microsoft’s Health business and was a consultant with Accenture’s Healthcare Practice.  He can be found on Twitter @chasedave.

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