Press Release

North Carolina should take steps to encourage direct primary care

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Click here to view Katherine Restrepo discussing this Spotlight report.

RALEIGH — North Carolina policymakers should take steps to make the state even friendlier to direct primary care. It’s an “innovative” business model that already generates benefits for patients, doctors, employers, and the state, according to a new John Locke Foundation Spotlight report.

“DPC restores the incredible value of personalized medicine,” said report author Katherine Restrepo, JLF Health and Human Services Policy Analyst. “North Carolina already ranks as one of the top DPC-friendly states. Unlike other state legislatures, ours does not subject these practices to government price controls, capped patient numbers, limited treatments, or a defined menu of services.”

In exchange for a monthly fee that covers a defined package of services, direct primary care guarantees patients unlimited access to their physicians, Restrepo said. “It’s similar to concierge medicine, but the key difference is that these practices deliver basic health care at an affordable price with no insurance billing whatsoever.”

North Carolina has more than 20 DPC practices in locations from Asheville to Williamston, Restrepo said. Nationally, the model has grown from 146 doctors in 2005 to more than 4,400 in 2014.

Restrepo recommends steps to boost growth of direct primary care in the state. “While DPC faces minimal regulatory hurdles at the state level, it would be wise for policymakers to pass legislation that simply states that direct care providers do not act as a ‘risk-bearing entity,'” she said. “This would ensure that patients’ monthly membership fees are not classified as insurance premiums.”

This legislation would clarify that DPC is not subject to N.C. Department of Insurance regulations, Restrepo said. Thirteen other states have passed similar laws.

Patients benefit from direct primary care in multiple ways, Restrepo said. “Because it’s relatively inexpensive to administer, average monthly memberships range from $25 to $85,” she said. “In return, patients get access to around-the-clock care that may include comprehensive annual physicals, EKG testing, joint injections, laceration repairs, and skin biopsies. North Carolina practices can even dispense prescription drugs in-house at wholesale cost.”

Existing research suggests DPC patients see improved health outcomes while saving on overall health expenditures, Restrepo said. “One study showed that patients seeking treatment from an Apex-based direct care physician spent 85 percent less money while enjoying an average of 35 minutes per doctor visit, compared to just eight minutes in a nondirect-care setting.”

Doctors also benefit, Restrepo said. “Direct primary care restores the traditional doctor-patient relationship,” she said. “Opting out of insurance contracts allows smaller practices to break even by seeing as few as four patients per day, rather than an average of 32 in today’s typical practice setting. Calling their own shots allows doctors to practice the art of medicine and hold fast to their autonomy.”

Direct primary care can co-exist with the federal Affordable Care Act, Restrepo said. “One section of the federal health law endorses DPC as long as it is accompanied by catastrophic health coverage that includes benefits outside of primary care.”

A majority of direct care takes place in small practices, but some DPC establishments contract with large employers. Clients who hired Seattle-based Qliance saw substantial health care cost savings, Restrepo said. “A review of two years of claims data revealed that workers who opted to be treated by Qliance saved their employers 20 percent on health care expenses,” she said. “Direct care visits led to a greater than 50 percent reduction in specialist referrals, emergency room visits, and surgery.”

Even state government can see benefits from direct primary care, Restrepo said. “Commercial and public payers like Medicare and Medicaid are shifting more toward reimbursing providers based on patient health outcomes rather than the volume of services they render,” she said. “DPC is the epitome of value-based medicine. It has the potential to help North Carolina improve the value of total health care spending.”

North Carolina could take steps that would help the existing DPC model cater to Medicaid patients, Restrepo said. “The N.C. Department of Health and Human Services could work within a federal waiver to administer and monitor health savings accounts or debit cards with a lump-sum contribution to eligible enrollees,” she said. “That way, there would be no middleman intervention between the physician and patient.”

It makes sense for policymakers to open the door to more direct primary care, Restrepo said. “Passing clarifying legislation would likely lead to a stronger direct primary care presence in North Carolina,” she said. “It would also assist in rekindling the appeal of the primary care profession, which in turn would help mitigate a projected shortage of primary care physicians.”

Katherine Restrepo’s Spotlight report, “Direct Primary Care: Restoring the Doctor-Patient Relationship,” is available at the JLF website. For more information, please contact Restrepo at (919) 828-3876 or [email protected]. To arrange an interview, contact Mitch Kokai at (919) 306-8736 or [email protected].

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We are North Carolina’s Most Trusted and Influential Source of Common Sense. The John Locke Foundation was created in 1990 as an independent, nonprofit think tank that would work “for truth, for freedom, and for the future of North Carolina.” The Foundation is named for John Locke (1632-1704), an English philosopher whose writings inspired Thomas Jefferson and the other Founders.

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