Direct primary care tries to put market forces back into healthcare

[urbanlibertarian]

Excerpted from The Obamacare Revolt: Physicians Fight Back Against the Bureaucratization of Health Care
Will it make a difference?
Jim Epstein | March 13, 2013

http://reason.com/archives/2013/03/13/the-obamacare-revolt-physician-fight-bac

Dr. Ryan Neuhofel, 31, offers a rare glimpse at what it would be like to go to the doctor without massive government interference in health care. Dr. Neuhofel, based in the college town of Lawrence, Kansas, charges for his services according to an online price list that's as straightforward as a restaurant menu. A drained abscess runs $30, a pap smear, $40, a 30-minute house call, $100. Strep cultures, glucose tolerance tests, and pregnancy tests are on the house. Neuhofel doesn't accept insurance. He even barters on occasion with cash-strapped locals. One patient pays with fresh eggs and another with homemade cheese and goat's milk.

"Direct primary care," which is the industry term for Neuhofel's business model, does away with the bureaucratic hassle of insurance, which translates into much lower prices. "What people don't realize is that most doctors employ an army of people for coding, billing, and gathering payment," says Neuhofel. "That means you have to charge $200 to remove an ingrown toenail." Neuhofel charges $50.

Direct primary care is part of a larger trend of physician-entrepreneurs all across the country fighting to bring transparent prices and market forces back to health care. This is happening just as the federal government is poised to interfere with the health care market in many new and profoundly destructive ways.

Obamacare, which takes full effect in 2014, will drive up costs and erode qualityâ€"and Americans will increasingly seek out alternatives. That could bring hordes of new business to practitioners like Neuhofel, potentially offering a countervailing force to Obamacare. (One example, the Surgery Center of Oklahoma's Dr. Keith Smith, profiled for Reason TV in September, is doing big business offering cash pricing for outpatient surgery at prices about 80 percent less than at traditional hospitals.)

Whole article here: http://reason.com/archives/2013/03/13/the-obamacare-revolt-physician-fight-bac

[fsquid]

Can't argue with that.

[JeffreyS]

Wow if only we had given the Healthcare industry a chance to be efficient and competitive for years before Obamacare stepped in. Oh wait we did they dropped the ball to the tune of averaging 20% increased premiums per year and refusing to cover anyone who wasn't young and healthy then dropping them if they ever had the gall to be sick.  Now we all know that a private system could work but the history of Humans is that private healthcare refuses to work.

[urbanlibertarian]

In 1947, I believe, healthcare was tied to employment by the federal tax code and selling health insurance across state lines became illegal.  We currently have a relatively free market for elective surgery.  Customers pay directly out of their own pocket.  Pricing info is readily available and surgeons compete against each other on price and quality.  Studies show quality increasing and prices decreasing.

[avonjax]

insurance and the healthcare industry could have fixed this problem years ago, but greed has driven the entire industry for what seems like forever. I don't blame doctors who spend a great deal of money for their education for wanting to be compensated for their work and years of their life to become a doctor, but the cost of healthcare is out of control. Both sides are guilty of ridiculous charges and over billing. Healthcare Reform is not the best it could have been but it's a start. The entire healthcare industry had it's chance but they blew it so stop groaning about "OBamacare."

[urbanlibertarian]

In 1947, I believe, healthcare was tied to employment by the federal tax code and selling health insurance across state lines became illegal.  We currently have a relatively free market for elective surgery.  Customers pay directly out of their own pocket.  Pricing info is readily available and surgeons compete against each other on price and quality.  Studies show quality increasing and prices decreasing.

Actually UL, Thats really only true about cosmetic surgery in general, and a few procedures like gastric bypass and what are now called 'procedures' ----not really a common term in the 40s--- that have been vastly cheapened by technology.

If you read the whole article these doctors who don't accept insurance can charge substantially lower fees for a whole range of services because of the paperwork that is eliminated and because of the horse trading between insurance companies and big providers.  Cosmetic and laser eye surgery is not covered by insurance and providers compete on price and quality by, among other things, improving technology.  Severing the link between private health insurance and employment and allowing interstate sales would increase competition in the health insurance market.  Insurance companies, unions and most big businesses don't want this but it would help lower costs.

[urbanlibertarian]

insurance and the healthcare industry could have fixed this problem years ago, but greed has driven the entire industry for what seems like forever. I don't blame doctors who spend a great deal of money for their education for wanting to be compensated for their work and years of their life to become a doctor, but the cost of healthcare is out of control. Both sides are guilty of ridiculous charges and over billing. Healthcare Reform is not the best it could have been but it's a start. The entire healthcare industry had it's chance but they blew it so stop groaning about "OBamacare."

Competition overcomes greed in a free market.

[peestandingup]

In 1947, I believe, healthcare was tied to employment by the federal tax code and selling health insurance across state lines became illegal.  We currently have a relatively free market for elective surgery.  Customers pay directly out of their own pocket.  Pricing info is readily available and surgeons compete against each other on price and quality.  Studies show quality increasing and prices decreasing.

Actually UL, Thats really only true about cosmetic surgery in general, and a few procedures like gastric bypass and what are now called 'procedures' ----not really a common term in the 40s--- that have been vastly cheapened by technology.

If you read the whole article these doctors who don't accept insurance can charge substantially lower fees for a whole range of services because of the paperwork that is eliminated and because of the horse trading between insurance companies and big providers.  Cosmetic and laser eye surgery is not covered by insurance and providers compete on price and quality by, among other things, improving technology.  Severing the link between private health insurance and employment and allowing interstate sales would increase competition in the health insurance market.  Insurance companies, unions and most big businesses don't want this but it would help lower costs.

urban libertarian.  This does sound nice in theory.

Any examples of it being true anywhere around the world?

http://www.bizjournals.com/seattle/news/2013/01/03/cambia-health-solutions-invests-in.html?page=all

http://www.yelp.com/biz/qliance-medical-group-seattle

There are others. Just search for "direct care". Usually on the west coast.

[JeffreyS]

I do not believe this is a big fix for the U.S. but hey more power to them if they can lower costs.

[peestandingup]

^I don't know of any that have completely kicked the insurance racket out of the communities (that aren't government socialized, like Cuba). At this point, its probably way too intrenched in the medical world to do that here now. Although I'm sure small towns/communities do exist (like in very rural or poor parts of the country) where a primary doctor doesn't work with insurance at all & just lets people pay directly (think a "Doc Hollywood" type setting), I don't know of any specifically though. Its prob not one of those things that gets noticed or a lot of press.

But I do know that back in the day it was a lot more common. The town I grew up in, everyone paid directly & there was only a couple docs in the whole town/county. And if you go back even further (like in my parent's day), then even more so. This was rural Kentucky. But its prob not like that now though. Even a basic visit out of pocket would be quite a bit of money now.

I'm with you though, Stephen. I despise the system. I either want to go back to direct pay between patient & doctor, or a complete revamped socialized system. All these slime ball middlemen are fucking killing us. And from what I understand, while Obamacare does do some good, its mostly forcing everyone into the racket. And if you don't want to play, then you're going to pay.

[peestandingup]

Let's hope it can/will be modified for the benefit of the people (and not the insurance companies). I tend not to put too much hope into these things until I see the final results. But really this all boils down to profit before people. Its the same with everything these days, even philanthropists like Bill Gates knows it. http://www.wired.co.uk/news/archive/2013-03/14/bill-gates-capitalism#.UUGe-5TS1fE.reddit He's done a lot of good, but he also knows that it can only go so far as long as things are the way they are (the whole profit over people thing).

I'm not blaming capitalism in its pure form & when its giving everyone opportunities & not leeching off people, but thats not what we have. And I also think the days of everyone getting a job, going to college, etc & still being able to live some meaningful life are indeed coming to an end. We've let the big baks, corporations, etc milk this thing dry. What a sad state we're all in when they have the power to make or break all of us in so many different ways. So we're going to have to rethink the way society as a whole works, or keep the current system & dive headfirst into the abyss IMO.

But again, anytime you bad mouth the system that we have people think you're a damn dirty communist, so there you go.

[buckethead]

I do not believe it (obamacare) is better than what was happening before. It is more of the same, with deck chairs moved around, guaranteed profits for insurers (who aren't hurting currently), more bureaucracy (private and public), forced participation, and higher premiums.

I'm sure Republicans are to blame in this, so I'm fine with saying it's their fault.

I am initially an absolutist in principle, then upon reflection I generally move to middle ground and pragmatism.

I've had plenty of time to reflect on Obamacare. It is simply more of a bad thing: Private insurers extracting value form the Health Care sector, with providers being complicit.

There are two solutions: Single Payer, or pay as you go on an individual basis. Both tend towards absolutism, but our current system is so muddled, I see no reforming it.

[fsquid]

The first thing that should have been done to help solve Medicaid and access for the poor to quality internal/family medicine physicians........was to have the states pick up their malpractice insurance costs in exchange for treating/accepting, for no charge, a certain number of Medicaid patients a year. The states could get a much better rate. It's a win win.

Instead you have a situation where physicians have no incentive for taking on an enormous headache.

[ChriswUfGator]

Malpractice costs account for somewhere less than 2% of healthcare spending, and 90% of those claims come from the same 10% of doctors. I know towing the party line saves cracking a book, but that really isn't the problem, nor will tinkering with it do anything to solve the problem.

[carpnter]

Malpractice costs account for somewhere less than 2% of healthcare spending, and 90% of those claims come from the same 10% of doctors. I know towing the party line saves cracking a book, but that really isn't the problem, nor will tinkering with it do anything to solve the problem.

Are those costs the actual payments made for malpractice claims or is that the cost of malpractice insurance that doctors carry to protect themselves?  How about providing some context for your stats.