Post Index

Making cost reduction claims more honest and helpful to decision-makers.

Claims of cost reductions need to look comprehensively at all costs. Consider this chart from an Iora presentation of some years ago. The net drop in spending would look a lot bigger if prescription drugs (the green bar) were not part of the picture. A lot of how primary care, direct or otherwise, works isContinue reading “Making cost reduction claims more honest and helpful to decision-makers.”

DPC and Medicaid expansion politics.

DPC docs uniformly recommend that their non-indigent patients have wrap-around insurance coverage. But for indigents, particularly for what are known as “Medicaid expansion adults” too many DPC docs are willing to push their state for an indigents’ program heavy on direct primary care coupled to, at best, skimpy coverage of downstream costs. They’re eager forContinue reading “DPC and Medicaid expansion politics.”

A moment of clarity about selection bias – at a DPC summit.

At 2019 Summit, Mike Tuggy, MD, FAAFP, presented this: What Have Primary Care Practices Provided to Employers Who Invested in Primary Care? The Results Speak for Themselves–Reports from Across the U.S.2019 DPCSummit62019 Direct Primary Care (DPC) Summit His presentation began with high praise for Qliance and others. He suggested that these models might be usedContinue reading “A moment of clarity about selection bias – at a DPC summit.”

An HSA break for DPC monthly fees?

HSA owners have the privilege of using before tax dollars for medical expenses but they are generally barred from using HSA dollars to pay supplemental health insurance premiums. The HSA privilege itself is usually justified by the argument that more “skin in the game” or “financial stewardship” for patient/consumers breeds cost-consciousness, reducing overutilization when comparedContinue reading “An HSA break for DPC monthly fees?”

DPC + Cat is not a good substitute for full ACA Medicaid expansion

When Brain Forrest MD, the founder of the Access Healthcare direct primary care clinic, does legislative advocacy at, for example, the United States Senate, he shows the data of the foregoing chart. It’s from a 2013 course project by three NC State post-baccalaureate management students. He advocates pro-DPC legislation, apparently telling policy makers that theContinue reading “DPC + Cat is not a good substitute for full ACA Medicaid expansion”

A calculus of mOOP

DPC practitioners seeking to recruit insured patients often tout that the cash costs for primary care services and/or for downstream services procured through the DPC entity (e.g., advanced radiology) might be lower than even the patient cost-share for the same services procured under the insurance policy, especially high deductible policies. Patients should, however, carefully considerContinue reading “A calculus of mOOP”

Actual University Study of Direct Primary Care

Health Programs Group, University of Wisconsin School of Medicine and Public Health, Population Health Institute. Direct Primary Care (DPC): Potential Impact on Cost, Quality, Health Outcomes, and Provider Workforce Capacity, A Review of Existing Experience & Questions for Evaluation, October 8, 2019. On-line publication. My own analyses miss a hell of a lot. Not moreContinue reading “Actual University Study of Direct Primary Care”

Spin Doctor: DPC office visits are four times as long as PPS office visits. Don't believe it.

“A university study found that patients treated in one Apex practice enjoyed average 35-minute office visits, more than four times longer than the average visit in a more typical practice. They also spent 85 percent less money.”  Kathlerine Restrepo, John Locke Foundation press release of March 22, 2017 As discussed in a prior post, Ms.Continue reading “Spin Doctor: DPC office visits are four times as long as PPS office visits. Don't believe it.”

Spin doctor says DPC saves 85%. Don't bet on it.

In a May 2018 “Policy Position” for the John Locke Foundation, Kathleen Restrepo wrote the following: A study conducted by University of North Carolina and North Carolina State University researchers found that patients seeking treatment from Access Healthcare, a direct-care practice located in Apex, North Carolina, spent 85 percent less on total health care spendingContinue reading “Spin doctor says DPC saves 85%. Don't bet on it.”

Marshall on Dershowitz; or is he talking about me on DPC?

To put it baldly, if it’s a topic and area of study you know nothing about and after a few weeks of cramming you decide that basically everyone who’s studied the question is wrong, there’s a very small chance you’ve rapidly come upon a great insight and a very great likelihood you’re an ignorant andContinue reading “Marshall on Dershowitz; or is he talking about me on DPC?”

11% claims reduction, with no adjustment for selection bias, is pretty tame.

Paladina Health maintains a news and information page on its website. As of the start of 2020, Paladina’s most recent entry of favorable cost reduction results is entitled “Paladina Health gives Akron schools a cost-saving model” and links to this Crain’s business report of an 11% reduction in claims. There was no adjustment for selectionContinue reading “11% claims reduction, with no adjustment for selection bias, is pretty tame.”

A few brags from a few DPC companies is not a sound basis for public policy decisions.

Leave aside the specific critiques of the last twenty or so posts. The support for direct primary care in the report Healthcare Innovations in Georgia: Two Recommendations ultimately turns on the source material from which the report authors drew the key assumption that direct primary care reduces downstream care cost by 15%. That material comprisesContinue reading “A few brags from a few DPC companies is not a sound basis for public policy decisions.”

Total claims cost caution: when DPC is implemented primary care claims vanish. AEG/WP's 15% estimate is not conservative in the least.

When the direct primary advocates toss out figures about overall claims cost reductions, it’s important to carefully separate overall cost, downstream care claims costs, and overall claims costs. For example, the authors of the AEG/WP pitch for DPC in Georgia, have assumed a 15% reduction in downstream care costs and claimed that it “represents theContinue reading “Total claims cost caution: when DPC is implemented primary care claims vanish. AEG/WP's 15% estimate is not conservative in the least.”

A possible 11% reduction in overall care cost, adjusted for risk, is suggested by Union County's 2018 report.

Here’s some data that shows plausible overall cost reduction from direct primary care even after adjusting selection bias. It comes from the Paladina-operated clinic in Union County, North Carolina, the principal subject of two prior posts. The county employees choose either a high-deductible HSA under which primary care is received on a fee for serviceContinue reading “A possible 11% reduction in overall care cost, adjusted for risk, is suggested by Union County's 2018 report.”

To learn how much direct primary care can do, try it first in the ACA-compliant, full-benefit individual market.

If Georgia must mandate the availability of direct primary care, here’s how. For some future open enrollment period, the individual market will offer paired plans that differ only by how primary care is paid for and how it is received. Bigco, for example, offers Bigco Silver FFS and Bigco Silver Direct ; MajorCo probably offersContinue reading “To learn how much direct primary care can do, try it first in the ACA-compliant, full-benefit individual market.”

Three bad ways to bet the health of Georgia citizens on direct primary care.

Every published claim that direct primary care makes a significant dent in necessary health care spending is dubious at best. See, for example, here, here, here, here, here, here, here, here, here, here and here. When the data from the Union County clinic — a Georgia Public Policy Foundation favorite — is age-adjusted, it indicatesContinue reading “Three bad ways to bet the health of Georgia citizens on direct primary care.”

AEG/WP's chosen actuary did not validate the assumption that direct primary care reduces downstream care costs.

AEG/WP report declares that “[Nyhart, an independent] actuary determined that “(1) the modeling assumptions are reasonable for this type of analysis and (2) the illustrative projections and savings are reasonable outcomes based on the modeling assumptions and data inputs selected.” This statement sounds like powerful support for report’s key assumption that direct primary care bringsContinue reading “AEG/WP's chosen actuary did not validate the assumption that direct primary care reduces downstream care costs.”

Bupkes. Nextera reported a claims cost reduction of $72 PMPM; subtracting a $70 fee, and AEG/WP's billion dollar promises fall nearly 95%.

Asked for sources supporting their assumption of 15% downstream care claims cost reduction, the authors of Healthcare Innovations in Georgia — Anderson Economic Group and Wilson Partners (AEG/WP) — point to Nextera’s contract with DigitalGlobe, as reported in Nextera’s self-published study here. And here’s the exact table from that study showing claims cost reductions forContinue reading “Bupkes. Nextera reported a claims cost reduction of $72 PMPM; subtracting a $70 fee, and AEG/WP's billion dollar promises fall nearly 95%.”

Nextera's marketing presentation establishes huge selection bias, while revealing modest evidence that Nextera cuts cost for some of its patients. But the data set is tiny, old, and contaminated by results for fee for service patients!

The basic premise of AEG/WP’s advocacy for direct primary care is succinctly stated in “Healthcare Innovations in Georgia: Two Recommendations” at page 24. “Establishing a relationship with a doctor for a fixed monthly fee can induce and empower many patients to see their primary care physician regularly, which results in decreased healthcare expenses and reducedContinue reading “Nextera's marketing presentation establishes huge selection bias, while revealing modest evidence that Nextera cuts cost for some of its patients. But the data set is tiny, old, and contaminated by results for fee for service patients!”

The two largest and most current AEG/WP examples of downstream cost reduction failed to adequately address selection bias.

Although the AEG/WP report does not support its key claim with data or citation, the report’s authors responded to my request for information by indicating their sources. One of them was an e-zine article about the CHI clinic. The other two were promotional brochures, denominated case studies used, by the DPC companies Paladina and Nextera,Continue reading “The two largest and most current AEG/WP examples of downstream cost reduction failed to adequately address selection bias.”

Why did Wilson Partners' research into DPC cost-reduction bypass uniquely available and pointedly relevant data?

As noted in a prior post, the report by the Anderson Economic Group and Wilson Partners supported the assumption that direct primary care reduces downstream care cost by 15% with nothing more than a cryptic reference to “research and case studies prepared by Wilson Partners”, presented with neither data nor citation. Initially, I thought thisContinue reading “Why did Wilson Partners' research into DPC cost-reduction bypass uniquely available and pointedly relevant data?”

Selection bias infected the best documented argument that direct primary care reduced downstream costs.

A unique and powerful opportunity for quantitatively informed assessment of such claims has come from a DPC clinic serving employees of Union County. There, health plan members are able to choose between receiving primary care in a DPC clinic or through physicians under traditional model of insurance and fee for service. Mark Watson is theContinue reading “Selection bias infected the best documented argument that direct primary care reduced downstream costs.”

The marketplace reached a judgment about direct primary care pioneer, Qliance.

Washington State is deservedly recognized as the birthplace and one of the most prominent frontiers for DPC, in large part because of Qliance. The Seattle-based DPC conglomerate is recognized as an exemplary market force in the private sector of health care. Major investors such as Amazon CEO Jeff Bezos have propelled Qliance . . .Continue reading “The marketplace reached a judgment about direct primary care pioneer, Qliance.”

"Trust us. We did studies." AEG/WP have a special way of showing that direct primary care reduces the costs of downstream care.

The focal assumption of the AEG/WP report’s calculations is that DPC membership will reduce the claims cost for downstream care by 15%, a number represented as a low end estimate. The sole support offered in the AEG/WP report for this 15% presumption is a statement that, “the factor is based on research and case studiesContinue reading “"Trust us. We did studies." AEG/WP have a special way of showing that direct primary care reduces the costs of downstream care.”

DPC advocates talk about lemonade stands. Strangely!

When an opinion piece in JAMA suggested that direct primary care might resemble primary care capitation plans sometimes tried by insurers in raising issues of allocating resources between primary care and other medical care, Kenneth Qiu, M.D. gathered enthusiastic approval from many supporters of direct primary for the following response. DPC looks like capitation butContinue reading “DPC advocates talk about lemonade stands. Strangely!”

$938,824,142. How fair adjustments to the $70 DPC assumption reduce the billion dollar savings claimed in the AEG/WP report by 85%.

A billion here, a billion there, and pretty soon you’re talking real money. Attributed to Senate Everett Dirkson (R-IL, deceased) This spreadsheet recomputes net five year savings from direct primary care if AEG/WP’s assumptions of (a) a $70 per month DPC fee that (b) stays constant for the next ten years are replaced with theContinue reading “$938,824,142. How fair adjustments to the $70 DPC assumption reduce the billion dollar savings claimed in the AEG/WP report by 85%.”

Origins and future of the report "Healthcare Innovations in Georgia"

The Medicaid goal of the political right in Georgia has always been careful stewardship of tax-payer funds. Three years ago, the Georgia Public Policy Foundation began to flog a bargain basement Medicaid waiver plan priced at $2500 per capita. The core rationale for this seemingly meager amount was that $60-$70 a month direct primary careContinue reading “Origins and future of the report "Healthcare Innovations in Georgia"”

Monthly direct primary care fees will not hold steady at $70 for a decade.

That alone makes the AEG/WP report off by about $500,000,000. In “Healthcare Innovations in Georgia:Two Recommendations”, the report prepared by the Anderson Economic Group and Wilson Partners (AEG/WP) for the Georgia Public Policy Foundation, the authors clearly explained their computations and made clear the assumptions underlying their report. One of the assumptions was that theContinue reading “Monthly direct primary care fees will not hold steady at $70 for a decade.”

$70 lowballs the monthly direct primary care fee.

On that score alone, the AEG/WP report is off by $750,000,000. In “Healthcare Innovations in Georgia:Two Recommendations”, the report prepared by the Anderson Economic Group and Wilson Partners (AEG/WP) for the Georgia Public Policy Foundation, the authors clearly explained their computations and made clear the assumptions underlying their report. One of the assumptions was thatContinue reading “$70 lowballs the monthly direct primary care fee.”

Good for you, GPPF!

AEG/WP accurately reported that health coverage costs real money. Annual premiums are: $8,829 in the individual market $6,668 in the small group market $5,845 in the large group market. In the lowest priced large group, members of the vast majority of plans also are subject to at least some cost sharing (deductibles, copayments, and/or coinsurance).Continue reading “Good for you, GPPF!”

Mischievous Foundations?

Early in 2017, I became aware of a policy initiative by the Georgia Public Policy Foundation the gist of which was to expand Medicaid in Georgia to more beneficiaries while, simultaneously, reducing the total per person expenditure on Medicaid to $2500 per annum. The Foundation’s plan also purported to eliminate the burden of uncompensated careContinue reading “Mischievous Foundations?”

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