Patient 'membership fees' let doctors cut out insurance companies
For most medical practices, income comes in the form of reimbursements from health insurance companies -- the doctor sees a patient, and the insurer pays a predetermined amount for the visit. But some medical practices have decided to cease dealing with insurance company altogether. Instead, these physicians and physician groups are using a method called direct-pay health care.
So how does the direct-pay model work? Medical groups charge patients monthly membership fees. These fees usually cover certain preventative procedures and office visits, and patients pay for outside lab work out-of-pocket, according to Kaiser Health News.
Direct-pay health care is not health insurance. Physicians at direct-pay clinics do not bill health insurance companies. According to Kaiser, some patients combine this type of care with a high-deductible (catastrophic) health insurance plan.
For people who lack money to pay the subscription fee, the arrangement might not work. But direct-pay primary care practices claim they provide better physician access and a more direct connection between doctors and patients. Why? Because, they say, doctors no longer have an incentive -- in the form of health insurance reimbursements -- to squeeze in as many appointments as possible, according to Kaiser.
Qliance, a Seattle-based direct-pay practice, charges patients $49 to $129 a month, depending on age, according to its website. Although the fee increases with a patient's age, it will not go up if a patient becomes ill and needs more care. The fee does not include prescription drugs or hospital visits, but includes unlimited visits with a Qliance clinician and routine preventive care. Qliance also offers email and phone access to its clinicians as well as extended hours, including evenings and weekends.
The president of Qliance, Norm Wu, told Kaiser Health News that its membership fees bring in more revenue than insurance company reimbursements do -- even though its clinics have fewer patients than traditional facilities have.
The direct-pay model also encompasses concierge care, which caters to well-to-do patients. But, while concierge practices charge hundreds of dollars or more a month for perks like having a doctor on call, the most growth is in practices offering more basic care for more affordable fees, according to a 2010 report from Washington State's Office of the Insurance Commissioner. In 2010, in fact, the biggest growth was seen in direct-pay practices charging fees between $85 and $135 a month, according to the report. As of 2010, nearly 9,000 patients in Washington (2 percent of the state's population) were enrolled in a direct-pay medical practice.
The direct-pay approach stems from experimental policies developed in 1996 in Seattle. Since then, major institutions like the American Medical Association, the American Academy of Family Physicians and the U.S. Department of Health and Human Services have investigated and debated the merits of this unique approach to care.The Society of Innovative Medical Practice Design represents direct-pay physicians, according to the Washington insurance commissioner's report. The organization advocates for this alternative method of care and provides resources for patients and doctors looking to explore applications of the model.