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Cost-Sharing and DPC: Two Very Different Family Medicine Models

The changing healthcare environment over the last decade or so has led to a new way of looking at family medicine and primary care. Direct primary care (DPC) is just one manifestation of this new view. DPC takes the place of traditional cost-sharing plans for people who either cannot afford insurance or do not want it.

Although DPC has been around for a few years, only now are we asking whether or not it is a better model than cost-sharing. Common sense dictates that neither model is superior in every situation. And yet, DPC offers some very definite advantages to a core group of patients.

The remainder of this post will be dedicated to examining the two models. You can decide whether or not you think one is better than the other. Bear in mind that DPC represents a growing trend in American family medicine.

The Cost-Sharing Model

What we know as modern health insurance is the epitome of the cost-sharing model. It shares the costs of medical care between patient and insurance provider. Think HMOs and PPOs, here. The cost-sharing model is the more prevalent of the two.

A traditional cost-sharing plan has the patient purchasing health insurance through his or her employer. The patient pays a certain portion of the premium while the employer picks up the remainder. When healthcare services are actually rendered, the patient covers the co-pay and the insurance company pays the balance. It is all pretty simple.

The model works well most of the time. Yet it still has significant drawbacks. For example, patients have to go to their primary care physicians to get a referral to a specialist. Physicians have to follow a prescribed protocol, established by health insurance providers, for treating patients. Worst of all, health insurance doesn’t cover everything.

It’s no secret that family physicians aren’t entirely in love with the cost-sharing model. It limits the time they can spend with patients and the kinds of treatments they can recommend. It even limits their reimbursements.

The DPC Model

Direct primary care is another way of offering family medicine and primary care services without having to interact with insurance companies. DPC gets its name from the fact that patients pay their doctors directly. DPC is essentially a cash on the barrel model that aims to give control of healthcare back to physicians and their patients.

The upside of this model is that patients have unlimited access to their doctors without having expensive monthly premiums to pay. The downside is that DPC doesn’t cover anything more than primary care. If a patient faces a serious emergency or illness, he or she either pays out-of-pocket or relies on a major medical plan.

Another concern is that DPC is not always locum friendly. Unless a locum tenens provider agrees to provide services for a DPC practice owner, he or she will have to go through the normal cost-sharing channels to get paid. That’s the way the system works.

Proponents of each model make very good points in support. Yet there isn’t a convincing case to say that either model is superior to the other. Why? Because more often than not, it comes down to cost. The unfortunate reality in modern healthcare is that cost affects everybody. Whether you are a family practice doctor, a patient, or a hospital administrator, you’re always looking at the bottom line.

DPC is an excellent choice for some patients and their physicians. Cost-sharing is a better option for others. In the end, it matters not as long as doctors and patients are free to make their own decisions.