All posts by Dino William Ramzi, MD, MPH

Is it Tax Deductible?

DPC fees are not tax deductible or applicable to health savings accounts (HSA’s) due to an IRS regulation that views DPC as insurance, although it is clearly not. Several state legislatures ahve passed enabling legislation that specifically states DPC is not insurance, nor is to be treated as such. Currently, Senate Bill 1989 at the Capitol will make this the law of the land and open the possibility of allowing Medicare money to be directed by patients to primary care physicians who are willing to accept such payments.

 

 

Objections to DPC

The taint of concierge care for the elite sticks to DPC, although it is an inherently advantageous way to provide primary care and is ideal for people who cannot afford going to the doctor or taking care of themselves.

There is so much more to the stubborn misunderstanding of the role of DPC in the health system, but this is why we have blogs and record brief videos.

Addressing Primary Care Gaps

I recently met Diane Lund-Muzikant, publisher, editor, organizer and all ’round charm for The Lund Report.

Every state should have such a publication focused on the local health system. And a fireplug to match Diane’s energy. She said I could write an editorial whenever I would like to highlight primary care issues.

Here is my first effort published September 22, 2015.

The greatest success of Obamacare, is the reduction in the number of uninsured. Most of this improvement has come in lower income groups, who disproportionately suffer the burden of illness and the most difficult social circumstances, including poor employment prospects. So it is unsurprising that Medicaid expansion accounts for over 2/3 of the newly insured, according to the Heritage Foundation. The political partisans use this as a weapon arguing that Obamacare resulted in little more than the expansion of the Medicaid entitlement. The other side feels that more has to be done to cover the remaining 10 million uninsured.

What about the social value of medical coverage to vulnerable populations, the economic benefits of health care to this group and a questioning of the cost relative to the benefits? Sometimes it is OK to spend tax money if there is value and accountability. If our nation is to spend public money on healthcare, it is incumbent on policy-makers to ensure the greatest value for the effort.

The greatest public value derived from modern medicine is derived from immunizations, maternal-child health and primary care. When the newly insured report that they do not have access, they mean primary care docs who understand their situation and listen to their concerns. Unfortunately, the healthcare system as it stands commoditizes primary care and works against the functions of primary care, especially continuity. Each time someone looks for new primary care provider, the system has failed.

Because healthcare in the US is purchased through employers, their entire family would change provider when jobs turn over. As health plans move to narrow networks, odds are increasing that their doctor will not be in the network offered by the next employer. This interferes with continuity of care over time and erodes outcomes.

The situation is worse for low income individuals and the Medicaid population. Some in this population suffer from mental health problems and are easily overwhelmed by the normal demands of life. They find it difficult to hold onto jobs for a long periods of time. Unstable insurance source from a Medicaid provider to a narrow network and back, repeatedly forcing them into new primary care relationships.

Long term relationships between doctors and their patients build trust. It is the trust built on years of knowing the person embedded within the context of family and community which improves outcomes and reduces costs. The lower the income level, the greater the vulnerability, the greater the risk of bouncing on and off Medicaid, with lapses and fluctuating access determined by deductibles and coinsurance.

Erika Bliss, the CEO of QLiance, a Direct Primary Care company in Seattle, suggested to me a few months ago an idea that could help bolster how primary care improves health system performance. Perhaps it is time to consider a primary care benefit that is portable from employer to employer and continuous with Medicaid. It is easy to carve primary care out of traditional insurance, where it should always represent the top dollar of healthcare spending. This is the idea behind the growing Direct Primary Care movement where high impact primary care is paid for on a monthly subscription basis. First, this helps maintain continuity between a doctor and their patient, a foundation stone of primary care. Second, it serves to create a sustainable business model for medical students to do what they idealistically entered medicine to accomplish and attract more smart people to primary care specialties. Third, primary care increases the efficiency of healthcare systems around the world, which seems to be the fundamental motivation behind the notion of value-based purchasing. If you want to buy value, invest in primary care not MRIs and pay as much as you reasonably can.

Reflections on Health Care Past, and Future

The Portland Business Journal recently sponsored a forum entitled Health Care of the Future, providing a glimpse into what Portland companies are doing to disrupt the healthcare system. Panelists discussed new models for healthcare, new technologies that extend the reach of physicians and financing methods. It was a hugely attended event, with a great buzz, fantastic networking opportunities and a lot of great information. But close to the end of the conference, a couple of comments were made by panelists that I found incredibly frustrating reflections of an old, broken, sick health care system that were oddly out of place.

 

First, Jared Short, the head of Cambia’s Insurance group (Regence BCBS) who recounted diagnostic failure in the primary care setting as one reason for high cost to the system. He brought up a personal experience with his son’s diagnosis of a chronic rheumatic condition that took over two years to diagnose, despite elaborate investigations. Of course we don’t know the clinical details, but that’s why it’s an unfair characterization of primary care.

 

As an intern, I was responsible for the diagnosis of a case of lupus in a man who had been searching for a cause over ten years. I was not smarter than my colleagues or professors, but rather, the unique evolution of his disease made it impossible to diagnose earlier. Doctors knew that waiting and watching was the best possible strategy and in this patient’s specific case, there was sufficient trust that the patient was content to wait rather than pursue useless investigations. This is always necessary in a market where distortions are introduced by the fact that advanced investigations are essentially subsidized by payers. If patients understood what little value they added at time, they would decline. It is frightening that the head of one of the largest and most powerful payers in the Northwest has such a distorted view of the diagnostic process and value within the system.

 

If primary care is inadequate, then we should invest in supporting primary care and attracting the smartest minds. You do not get to underinvest in a key health system function for decades and then complain that it doesn’t do its job.

 

The other inexplicable comment is one I used to hear frequently in healthcare business circles in the past. Martie Ross, a principal in a consulting firm out east, made the point that insurers needed to find mechanisms of transferring risk to health providers with new value-based payment methodologies.

 

My point is that healthcare providers are not risk bearing entities and should generally be discouraged from doing so. It is not clear which features of ACOs predict their success, but some of the most successful ones have been where the risk was transferred to the ACO, but not necessarily to the providers. Providers should be in the business of taking care of people and doing the right thing, irrespective of the cost. As far as insurers go, their business is the management of risk, not the transfer of risk. To a lifelong family physician, insurance companies transferring risk seems like cheating.

 

Moreover, the only entities large enough to absorb this kind of risk are large integrated health systems which is the birthplace of perverse incentives for high volume, excessive and sometimes unnecessary care. Small practices arguably do better at quality where large systems are better at collecting data and generating revenue.

 

The disdain for primary care and the industry’s tone-deaf dehumanization of health to “risk transfer” are part of the reason our old system is broken and we are experiencing this generational opportunity for disruption. This is the health care of the past, not the Health Care of the Future.

 

 

Fire Fighting for a Beleaguered Community

This is a story that appeared in The Camas Post-Record, our local weekly, about my EverMed DPC partner, Scott Jonason. It was written by Dawn Feldhaus.

 

 

 

Three people with ties to the Camas-Washougal area recently spent a few days in north-central Washington, to help individuals affected by the Okanogan complex fires.

Scott Jonason, a physician assistant, certified and owner of Lacamas Medical Group, in Camas and Vancouver; Jennifer Kaufmann, a Lacamas medical assistant for 12 years; and George Ryland, a former Camas resident, provided medical support to fire crews and residents of the Tunk Valley area — 20 miles north of Omak.

They were there from Aug. 30 to Sept. 3.

“We were equipped to provide advanced first aide, for wound care, insect bites, dehydration and respiratory illnesses like asthma or COPD flares,” Jonason said.

They also delivered supplies that had been donated from the Camas-Washougal community.

Supplies from this area included water and sport drinks, as well as snacks, such as protein and granola bars for firefighters.

School supplies were also donated.

“Immediate needs have been answered, but they will have ongoing needs,” Jonason said. “There are more humanitarian needs and livestock needs, for those who lost everything.

“The future needs include more sheltering and clothing, as well as food,” he added. “Most of the people are back in their houses and are self-sufficient.”

Additional undergarments, such a T-shirts, underwear and socks, are needed for firefighters, according to Jonason.

“Some of them have been in tents up there for a couple of weeks,” he said. “They could be there for another month.”

The Okanogan complex fires have grown into the largest wildfire in Washington history at more than 256,567 acres.

In addition to addressing medical needs, Jonason said he, Kaufmann and Ryland unloaded trucks of supplies and provided security checks in homes.

There had been some problems with looters, Jonason said.

“We stomped out a couple of hot spots,” he said. “We had shovels and picks in our trucks. We buried it or snuffed it out.”

Jonason grew up in Wenatchee, located approximately 120 miles from Tunk Valley.

His 22 years in the military included service in the Army, the Oregon Army National Guard and the Oregon Air National Guard.

“My feeling was, ‘if I can help, I should,” Jonason said, regarding his recent trip to the areas affected by fires.

Ryland has retired from the Oregon Army National Guard. He was an Army medic with Jonason 25 years ago.

The two friends have previously assisted victims of Hurricane Katrina, in New Orleans.

Kaufmann and Jonason have provided post-earthquake assistance, in Haiti.

Media Mentions for EverMed and DPC, Another Grant Request for PanZoe

We got a couple of media mentions a couple of weeks ago for EverMed’s DPC efforts. They were brief, one more or less accurate and the other word-for-word the way we would have like the issues framed.

From Elizabeth Hayes of The Portland Business Journal comes the following:

A Vancouver-area company is launching a new model of delivering primary care services in the Portland area, one designed to give patients direct access, regardless of their insurance plan.

EverMed Direct Primary Care of Camas isn’t itself insurance, but layers on top of a patient’s existing plan. A member pays a set monthly fee and receives comprehensive primary care services.

While most Director Primary Care companies employ doctors directly, EverMed is seeking established, independent primary care clinics. About 30 clinicians at eight clinics have signed up in Clark County and about half a dozen clinics are in various stages of the contracting process in Portland, said Seth Sjostrom, director of business development.

EverMed charges patients $45 to $85 a month for unlimited access to a primary care doctor for wellness exams, basic diagnostics and other non-emergency needs.

“The principle of DPC is that you don’t need insurance for day-to-day care. It’s for catastrophic illnesses,” said Dr. Dino Ramzi, EverMed’s chief medical officer and a physician with Lacamas Medical Group in Camas.

Members can enroll directly, though many have come through self-funded employer medical plans. Ultimately, EverMed would like to partner with an insurer who would devise a plan that doesn’t include primary care, Ramzi said.
So far, EverMed has signed up 75 members and five corporate clients. Sjostrom said the company is now promoting itself with insurance brokers in hopes of attracting more business during the 2015-16 enrollment season this fall.

More and more patients have gravitated to “bronze” plans, with high deductibles. Faced with copays or an unmet deductible, these patients may defer care, which ends up costing more in the long run when a patient ends up at an urgent care clinic or the ER. Highly effective primary care could save the health system a third of its costs, Ramzi said.

This upset Seth, as noted above, our Director of Business Development. It turns out I misrepresented our pricing structure, essentially because it has undergone several changes. My momoery is not what it used to be. In fact, as we prepare to enter the employer market more profoundly, there are signals we may have to make further changes. Pricing is an important component. We want to make sure providers get good value, but it is telling that employers are falling over themselves, given the price of assured primary care is remarkably low from tehir perspective.

The Direct Primary Care Journal did a perfect job representing our efforts. (Duh, it was a press release.)

Direct Primary Care clinics have been popping up all over the country, it was only a matter of time before the Portland marketplace became a part of the revolution in healthcare.

Born from the concierge clinic concept, Direct Primary Care (DPC) is the iteration for the masses. As one of EverMed DPC’s marketing tag lines states, DPC is “genuinely affordable health care”.

Direct Primary Care is a healthcare benefit option where members pay a set, low monthly fee to receive comprehensive primary care services. DPC is not itself insurance, it is an affordable option to access primary care needs for the member and their family.

EverMed DPC is a new spin on the growing Direct Primary Care marketplace. While most DPC offerings are staff model enterprises (the physicians work for the DPC business), EverMed DPC seeks out independent primary care clinics that are already established in the communities they serve.

“One of our key objectives as EverMed DPC is preserving the viability of the independent primary care practice. We see Direct Primary Care as a way for clinics to not only survive, but thrive,” says founder and clinician Scott Jonason, PA-C.

EverMed DPC makes accepting direct primary care patients a turn-key proposition for clinics. “We handle nearly everything for clinics – marketing, contracting, payroll and bank withdrawals, enrollments – all the clinics we serve really have to do, is see their patients,” Director of Business Development, Seth Sjostrom states.

With their network in southwest Washington established, growing northward into Seattle and across the river into Oregon were natural next steps. “If anything, we were overwhelmed by the positive response we received. We quickly realized growing slowly was not an option,” Sjostrom says.

EverMed DPC’s plan? Having enough clinics spread throughout the Portland metro in time to have homes for primary care patients opting for DPC membership during the 2015-2016 healthcare enrollment season.

“Our second objective is to truly remove finances as a barrier to primary care,” Jonason explains, “Working with the healthcare broker community and employers, we provide an affordable way to provide quality care while at the same time, driving down costs.”

EverMed DPC aims to add value to employers and individuals by minimizing the number of urgent care and emergency room visits, thereby reducing the overall total healthcare spend. “When patients are concerned about paying copays or worried about unknown costs of seeking care, they tend to avoid seeking treatment until it is too late and then they end up in the ER. With DPC, if they have a concern or even unsure if they need to come in, they can call, visit or even use secure email or text depending on the clinic,” Jonason adds.

“We believe when physicians have genuine relationships with their patients, quality of care improves. Timely care that values the relationship and is focused on the whole patient means that doctors are in the position to respond quickly and guide the patient to the right diagnosis, coordination or medical management as efficiently as possible. The hallmark of quality primary care is taking care of the individual, not the visit,” Dr. Dino Ramzi, EverMed DPC’s Chief Medical Officer states.

With healthcare reform, many individuals and even businesses opted for plans with higher deductibles in order to secure lower premiums. Direct primary care serves those with high deductible plans to manage their day to day health, knowing their insurance is in place should they require more extensive care. The trend across the country is to increase individual out-of-pocket expenses. This trend is unlikely to reverse, but DPC makes those expenses more budget-friendly.

“We have had a number of members who purchased a Bronze plan through the exchange but signed up for DPC to take care of their more common needs, assuming they wouldn’t hit their deductible. We have had several taking part in Christian medical share programs that also saw DPC as a way to bridge the gap,” Sjostrom shares.

“Our most common membership, though, has been through employers with self-funded medical plans. They see DPC as a fixed variable in their annual medical cost plan while serving as a way to manage costly medical interactions by avoiding unnecessary Urgent Care an Emergency Department visits.”

How do businesses and individuals enroll in EverMed DPC? “Members can enroll directly through our website or 800 number, but we strongly encourage prospective members to learn more about DPC through their licensed insurance broker. Healthcare can be complex, we want to be part of a package that really meets our members’ needs,” Sjostrom says.

Direct primary care programs on their own do not meet the obligations required in the Affordable Care Act, though they can be a complement that makes sense for a lot of people and companies seeking for a solution that provides real healthcare value.

“No copays, no deductibles, the smallest administrative burden…with EverMed DPC, we return the focus of healthcare to the patient,” Sjostrom adds.

Meanwhile PanZoe‘s efforts to raise funds for a national giving effort for DPC is going strong as we apply again to the Community Foundation of Southwest Washington.

Primary care is key piece to U.S. healthcare puzzle

Another article, this one published in the Vancouver Business Journal on June 19, 2015, found here.

 

Healthcare in the U.S. is sick, bloated and ineffective. In some circles, investment in primary care infrastructure is prescribed as one of the important components in an effort to fix the U.S. healthcare system. My personal opinion is that primary care infrastructure is the single most important piece of the puzzle.

Healthcare is a $4 trillion industry that represents more than 1/6th of GDP. It is also growing at a rate that threatens to exceed the 20 percent threshold in the next few years. The Soviet Union’s economy collapsed when non-productive spending on defense exceeded 25 percent, and it has been argued that this level in healthcare expenditures would cause enormous misery for U.S. businesses. However, it is a mistake to examine healthcare as a monolith. The system is made up of various parts, each of which has varying interests to assure their survival within the system.

Hospitals, for instance, rely on flow-through of as many procedures as possible. Orthopedic, heart and urological procedures traditionally lead the way. Physicians in these specialties are especially prized by hospitals since they tend to refer the most valuable patients. Other physicians have professional and financial interests that are diametrically opposed. If primary care was enabled to do its job, it would keep interventions in community offices, where charges are at lower rates and the care, while some would argue is technically less precise, is often more personalized and therefore more prized by individual patients.

Even the insurance industry is not monolithic in the market conditions that maximize their bottom lines. Some insurers manage care very little, limiting the review of utilization and making their money from processing transactions. In some ways, these companies are aligned with the hospitals and specialty physicians. The managed care plans assume risk for their subscribers’ healthcare costs. They stand to make money if patients use fewer services and as such, are more closely aligned to the average primary physician rather than the average specialist.

Of course, this varies tremendously from person to person. A provider at Kaiser tends to think of fewer procedures, tests and consults as better care, whereas a for-profit primary care practice may gravitate to concierge care, and developing niche service lines like Botox, varicose vein treatments and selling nutraceuticals. Some of the more abusive niche products are narcotic pill mills, medical marijuana clinics and some of the new testosterone-centered men’s clinics.

Primary care has been marginalized in an overtly specializing society. The main driver of this phenomenon is that the financial incentives for a significant portion of the industry are aligned with generating more procedures, more testing and more specialty consultations. After all, that is where the best margins are.

On the other hand, managed care and primary care tend to have aligned interests in saving money for people and the health system in general. Primary care cannot stand on its own; there is no point to having preventive services and first line care if curative care and specialized care is not available. But not every person with high blood pressure or heart failure needs a cardiologist. In fact, specialists would spend more time treating and caring for conditions more suited to their degree of specialization if front line medicine was better built up than it is today.

The trend toward healthcare purchasers utilizing narrow networks of high value providers is related to effective primary care and an appropriate specialty network. Trouble is that the infrastructure for primary care has been neglected for so long that competition for primary care services is likely to raise prices to the extent that, in the near future, it will compete with current health plan offerings. For now however, high-value primary care holds the promise of reducing employer costs and putting enough money into primary care to attract medical students and resident graduates into areas of healthcare that have been spurned for so long.

Direct Primary Care and the Working Poor

This post was written for PanZoe‘s blog on May 21, 2015, here.

 

One of the easiest vulnerabilities to spot in healthcare after the Accountable care Act are those individuals who simply cannot afford their deductibles. The insurance mandate in Obamacare leads those who work low wage jobs without benefits to buy the cheapest policies.

These policies have huge deductibles, so even with great subsidies, these individuals simply can’t afford to see a doctor. In fact, they are often exposed to the full “rack rate” for health services and have inflated out of pocket costs 2 to 3 times as high as insurance companies pay providers.

A 40 year old man sat at home with a cold, or so he thought. When his fever did not get better after three weeks and he started getting so short of breath that he couldn’t work, he finally came to see me. His cold was really a pneumonia and could have been treated weeks earlier by someone who recognized the red flags early enough. Instead, he ended up in hospital and his $8000 deductible got charged pretty fast.

Low wage workers are the productive members of society trying to transition out of multi-generational cycle of poverty, and succeeding to some extent. Such shocks can throw them back on the public rolls. One of the major advantages of Direct Primary Care for low income individuals just above the Medicaid threshold is unlimited access to high-impact primary care. They can get minor illnesses treated quickly, before suffering serious illness requiring hospitalization. In addition they have access to prevention, care coordination and chronic disease. The technology that goes with Direct Primary Care, like secure video and texting is of particular importance to people whose trips to the doctor often impact their income. In jobs without benefits, if you don’t work, you don’t get paid.

In policy circles Direct Primary care suffers from an image of care for the elites. But the low price point makes it most appropriate for low and middle income individuals. These are the people most likely to benefit from a close relationship with a primary care provider.

Lawmakers Must Raise Medicaid Reimbursement

This article was published in The Columbian on March 25, 2015 during a legislative session when the WSMA and others were trying to prevent the ACA increases in primary care physician fees from sunsetting. To this day, we continue to under-fund the most important cost-containment mechanism inherent in the healthcare system.

 

 

Nearly 31,000 more people in Clark County have gained health insurance through Medicaid over the past year. When uninsured, many patients forgo basic care and can wind up in the emergency room when their health conditions can no longer be ignored — a very expensive and inefficient way to deliver health care.

Now, insurance coverage is opening doors to see a primary care doctor for preventive care and management of chronic conditions — in theory. In reality, many doors remain closed because low Medicaid rates mean many providers aren’t able to accept more Medicaid patients.

Medicaid expansion was a critical first step in covering more people in our state. But now it’s up to our state Legislature to take the necessary second step to ensure that coverage translates to access to actual health care — funding a fair reimbursement rate for Medicaid primary care providers.

Right now the reimbursement rate to care for Medicaid patients is woefully inadequate, and it is a key reason why some providers don’t take Medicaid patients. In an attempt to address this problem, the federal government temporarily raised Medicaid rates to pay primary care services at the same rate as Medicare. That temporary rate increase expired in December.

For the state, it’s a simple financial equation. Without access to quality primary care, preventable emergency room visits increase while health outcomes worsen, costing the state money, productivity and lives. Several studies in Washington state demonstrate a significant reduction in emergency department visits and hospitalizations as the result of increased primary care utilization, particularly when integrated with mental health care.

Positive effects

We also know that maintaining fair Medicaid reimbursement rates improves patients’ access to primary care. A recent study looked at the effect of enhanced Medicaid payment rates on primary care access in 10 states (not including Washington). It showed that the availability of primary care appointments for new patients increased by 7.7 percentage points in states with the enhanced rates.

A recent survey in this state showed similar impact. Just over one-third of primary care physicians in smaller practices indicated increased willingness to accept new or continue providing care for current Medicaid patients as a result of the federal government’s temporary Medicaid payment increase.

Providers with larger numbers of Medicaid patients reported the greatest impact of the payment increase, indicating that it had made them more willing to accept new Medicaid patients and to continue providing care for current Medicaid patients.

The loss of the rate increase will reverse these gains. The survey found that nearly three-quarters of primary care physicians not in large health care organizations would limit or reduce the number of Medicaid patients they see when the payment increase ends.

The plan has gotten positive feedback from local legislators. Let’s hope that translates to commitment when budget negotiations get tough. The ability for thousands in Clark County to use their Medicaid coverage and get the care they need depends on it.