Health Insurance and Direct Primary Care

Yesterday, opened for “window shoppers,” those that would like to get a preview of health insurance rates prior to the Exchange opening for purchasing on November 1st.  Lancastrians can pick from a total of nine plans, offered by three payers:  Highmark, Capital Blue Cross, and Geisinger.  Yes, the number of plans and payers has substantially decreased over the last couple of years.  

I often get the question, “How does direct primary care (DPC) work with health insurance?”  Or rather, “What kind of health insurance should I purchase with DPC?”  This is my short answer:  DPC pairs particularly well with high deductible insurance plans.  When I make presentations about CovenantMD before prospective patients or groups, I always show a slide that illustrates this point.  The slide features a hypothetical family of five that purchases either a gold (high premium, low deductible) plan, a bronze (low premium, high deductible) plan, or a bronze plan paired with CovenantMD.  And the latter scenario comes out way ahead.  

Yesterday, I updated my slide to feature numbers from the 2017 exchange.  And so below, I’d like to show you the results of that analysis.  Before I do so, let me offer two disclaimers:

  • If this happens to be the first blog post of mine that you’re reading, then you’re probably saying to yourself, “What in the world is direct primary care?!”  For an explanation, see here, here, and here.
  • I am not an insurance broker, nor am I a financial advisor.  In fact, I'm a member of the group you should trust the LEAST:  doctors pontificating on the internet.  So please consult your financial advisor and/or your broker as you make decisions for your health insurance for 2017.  

Now back to our hypothetical family of five.  They live in Lancaster County, PA.  Let’s says the parents are in their 40’s, and they have three young children.  Their household income is $56,000/year, which is the median in the county.  (It’s important to note that this level of income qualifies them for subsidies adding up to a discount of $784/month off the price of their premium, reflected in the table below.  A higher income family will pay much for in premiums.)  This family has a number of things happen in the course of their hypothetical 2017, listed in the left column.  A somewhat busy year medically, but not catastrophic.  Then let's see what each of these occurrences "costs" out-of-pocket under each of the three scenarios, and then add up the total out-of-pocket expenses for 2017 in the last row.

Here are the numbers:

Notice that in the last column, the family paid their bronze plan premium ($1536 for the year) AND the monthly fee for CovenantMD ($130/month, or $1560 for the year).  Despite the extra expense of CovenantMD, they still came out way ahead compared to the gold and bronze plans.  This is because CovenantMD offers many types of out-of-pocket savings, including:  no visit copays, no additional fee for stitches, a $50 after hours fee, and substantial discounts on labwork, medications, and radiology.  These savings help to hedge against using that high deductible.  And we're not even talking about the other benefits of CovenantMD, like extended visits, same day availability, and housecalls.

Perhaps you're reading this, and you're thinking, "when have I ever needed an MRI?" Or, "I don't take a generic cholesterol medicine."  If you take some of the rows out, DPC still comes out way ahead.  Or make a row of your own, perhaps an asthma exacerbation, an ultrasound, or a mole removal.

Or perhaps you're reading this and, while sold on the benefits of DPC, you have little choice in choosing your health plan because it is determined by your employer.  Here's what you can do:  1) if you have a choice between plans, choose the one with the highest deductible, or 2) have your employer reach out to us.  There are businesses that have purchased CovenantMD as a health benefit for their employees, and employer benefits brokers that recognize DPC as a cost-saving innovation that they can offer their clients.

Substantial savings, quality, and accessible primary care.  And all for less than the price of cable.  

Patrick Rohal, MD, FAAFP is a family doctor and the founder of CovenantMD, a direct primary care practice in Lancaster, PA.  He lives in Landisville with his wife Lynn and three kids.