FMCC 2016 Direct Primary Care Breakout by Jay Keese
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Transcript of FMCC 2016 Direct Primary Care Breakout by Jay Keese
Direct Primary Care:
An Alternative Payment Model
American Academy of Family Physicians April 18, 2016
Jay Keese
Executive Director,
Direct Primary Care Coalition
www.dpcare.org
What Is Direct Primary Care?
High-functioning primary care and prevention services: A Medical Home
Direct agreement between doctor and patient
Monthly retainer paid by individual, employer or health plan
No third party, fee for service billing
Significantly reduced administrative costs
Medical services: Not insurance or health plan
Defined in ACA §1301 (A) (3),
13 + State Laws (WA 48.150 RCW)
• DPC Practices in 46 States + DC *
• Median fee about $70 per month *
• Better outcomes, patient satisfaction
• Savings of +/- 20%; employers, exchanges and Medicaid
* Journal American Board of Family Medicine , Nov. 2015
DPC Laws in 13 States Washington - 48-150 RCW
Utah – UT 31A-4-106.5
Oregon - ORS 735.500
West Virginia- WV-16-2J-1
Arizona: - AZ 20-123
Louisiana – LA Act 867
Michigan – PA-0522-14
Mississippi – SB 2687
Idaho – SB 1062
Oklahoma – SB 560
Missouri – HB 769
Kansas – HB 2225
Texas – HB 1945
• Defines DPC as a medical service outside the scope of state insurance regulation
• Passed in thirteen states
• Ten additional states considering additional bills in 2016
2016 DPC State Legislation As of April 14, 2016
Alaska - House Bill 159, An Act exempting certain health care agreements from regulation as insurance. Pending
Florida- HB 37; SB 132, Direct Primary Care. Passed House. Did not advance this session.
Georgia –SB 265, The Physician Direct Pay Act and SB 291, the Georgia Affordable Free Market Health Care Act. Did not advance this session,
Idaho- DPC legislation proposing a pilot for the uninsured and/or Medicaid is being drafted. Pending
Massachusetts- State insurance Commission issued favorable guidance on DPC and insurance. Legislation may be introduced January (2017) to codify or modify this interpretation.
Michigan- DPC legislation proposing a pilot in Medicaid managed care is being drafted as part of the budget process. Pending
Nebraska- Legislative Bill 817, The Direct Primary Care Agreement Act. Passed – Signed by the Governor.
Virginia- House Bill 685, Direct primary care agreements; Commonwealth's insurance laws do not apply; Passed House and Senate, Governor sent bill back to be reconsidered in the 2017 session
Tennessee- HB 2323 and SB 2443, The Health Care Empowerment Act. Passed – On the Governor’s Desk
Wyoming - Senate Bill SF0049 Direct primary care-insurance exemption. Passed – Signed by the Governor.
NJ State Employees
• Direct Primary Care Medical Home
Pilot Program
• Introduced by Sen. Majority Leader
Stephen Sweeney (D-NJ);
Supported by Gov. Chris Christie
(R-NJ)
• Backed by 9 public employee
unions
• Voluntary program
• Up to 800,000 police officers,
firefighters, and state, county and
municipal employees and family
members
• Aetna, Horizon Blue Cross TPAs
DPC working with Health Plans
Self-Insured Employers
Medicare Advantage
Medicaid MCOs
DPC Policy Barriers: Where do we go from here?
Fix DPC issues in the Tax Code: Health Savings Accounts DPC not a qualified medical expense {IRC 213 (d)}
IRS considers DPC a “health plan” {IRC 223 (c)}: DPC disqualifies HSAs
Primary Care Enhancement Act S. 1989 clarifies tax code on both points
Bring DPC to Medicare/Medicaid – the nation’s highest utilizers of care
No Regular FFS Medicare/Medicaid payment methodology
DPC in Medicare Advantage Medicaid Managed Care
S. 1989 – defines DPC as “Alternative Payment Model”
State Legislation Insurance definitions passed in 13 states: More needed to prevent future
regulation
Legislation needed to bring DPC to Medicaid
State Legislatures must weigh in with Congress on HSA issues
S. 1989: Primary Care Enhancement Act
Sen. Bill Cassidy, MD (R-LA) Sen. Maria Cantwell (D-WA) Bipartisan Bill - clarifies HSA Provisions in the Tax Code
DPC is not a health plan under IRC §223 (c)
DPC is a qualified health expense under the IRC §213 (d)
Allows individuals with HSAs to pay for DPC services with HSAs.
Provides Medicare and Dual Eligible payment pathway as an Alternative Payment Model (APM) CMS can pay a flat fee up to 20% of the average cost of care
Demonstration goes permanent after three years of positive outcomes: ACO quality reporting
Voluntary Program; no “balance billing” for covered services.
Creates waiver for qualified “opted out” physicians wishing to participate in the program.
Allows for Medicare Advantage plans to pair with DPC practices as primary care partners in an ACO-like structure.
Health Savings Act of 2016
Senator Orrin Hatch (R-UT) - Representative Erik
Paulsen (R-MN)
Simplifies and enhances HSAs, FSAs and HRAs
Section 206 — Treatment of Direct Primary Care
Service Arrangements: Amends IRS Sec. 221 (c ) to
clarify that direct primary care service arrangements
shall not be treated as a health plan or as insurance.
Section 603 – Certain Provider Fees to be Treated
as Medical Care: Amends the current definitions of
medical care in IRC Sec. 213 (d) to include periodic
fees paid for specific medical services as tax-preferred
qualified health expenses
Direct Primary Care Coalition
www.dpcare.org
For further information contact:
Jay Keese
Executive Director,
(202) 669-4061
DPC Can Reduce Health Costs by 20% 2013 data: DPC with employers
Per 1,000
Qliance
patients
Per 1,000 Non-
Qliance
patients
Difference
(Qliance vs.
Other)
Savings per
patient per year
Hospital Inpatient days 100 250 -60% $417
Specialist Visits 7,497 8,674 -14% $436
Advanced Radiology 310 434 -29% $82
Primary Care Visits 3,109 1,965 +58% ($251)
Savings Per Patient --- --- --- $674
Total Savings per 1000
(after Qliance fees) $684,000
% Saved Per Patient 20%
Data Sources: All claims data (except prescription claims) from carriers for selected large employers; Qliance EMR data; Employer eligibility data.
Claims Attribution: All claims incurred by Qliance patients prior to first Qliance visit were excluded; All employees with any interaction with Qliance included
as our patients, even if the employee used another primary care provider (which is possible in some of the plan designs among clients); All claims incurred
after any interaction with Qliance included, regardless of employee’s intent to use Qliance as their primary care provider; All non-primary care provider visits
included under “specialist” category (such as physical therapy, acupuncture, etc.)
Population: Eligible members in employer-sponsored health plan; Employees only, to remove confounding factors from differences in dependent benefits
structures and participation variances among clients.
Iora Health and Medicare Advantage
• Boston, MA company building a new
team based primary care model from
the ground up.
• Purely value based payments (no fee
for service)
• Self insured employers and union trusts.
• Partnerships with Humana and Tufts to
build practices dedicated solely to
Medicare Advantage patients
11 Medicare Advantage practices in 5 markets;
Total 29 practices,11 markets, 10 states
• Value based payment model doubles the
typical 5% spend on primary care, plus an
increasing up and downside share of savings
on total spending.
• 4 to 4.5 star MA quality measures in less than
a year + Net promoter scores above 90%
• Commercial practices show 37% drops in
hospital admissions and 12% drop in net total
spend *
* relative to well matched controls with
equivalently sick populations v. MA.