What’s it Like to be a Direct Primary Care Doctor?
Just about every week, a new medical professional visits our Plum Health DPC clinic in Detroit, Michigan. Earlier this month, we had a great visit from John Zakhary, a medical student from upstate New York. John is studying at Touro College of Osteopathic Medicine and he wanted to know more about our Direct Primary Care (DPC) model of healthcare delivery. John spent the day at our practice, observing how we take care of our patients at Plum Health and getting to understand the flow of our practice.
Before he came through, John read our book, Direct Primary Care: The Cure for Our Broken Healthcare System. Beyond the content of the book, and beyond the day of learning in the clinic, John had the following questions. He wanted to know more about how DPC addresses the problems of the current fee-for-service system, how we’re able to spend more time with patients, and resources that make DPC effective.
Here’s the full interview on YouTube, and below is the transcription of the conversation - enjoy!
Written by Paul Thomas MD and John Zakhary, DO Candidate, Class of 2023, Touro College of Osteopathic Medicine - Middletown, NY
How Does Direct Primary Care Address Problems in the Current Fee-for-Service System?
[John] I think one of the big issues with primary care is that it's not incentivized enough for providers and it's not that accessible for patients. My first question is, how does Direct Primary Care make healthcare more accessible for patients and what problems in American healthcare do you think this delivery model is addressing?
[Dr. Paul] There are a lot of people who fall into the gaps of coverage. For our practice in Detroit specifically, there are a lot of people in Michigan who earn out of Medicaid coverage, so if you make $17,000 or more, you disqualify yourself from Medicaid in Michigan. That's a lot of people who are in the service industry like hairdressers, truck drivers, bartenders, restaurant workers, et cetera. That’s a huge portion of our population! There are actually twenty-eight million Americans who are uninsured currently. Everywhere in the United States, you're gonna find folks who are uninsured. There are also folks who are underinsured. Perhaps if you're making $50,000 per year you might purchase a low premium, high deductible health insurance plan or catastrophic coverage plan that doesn't really afford you great primary care access. That's where direct primary care can come and be very impactful. We can start providing that basic bread and butter primary care access and really give people great health care experience while we're at it.
What is the Value of Direct Primary Care for Patients?
[John] It seems like there's a financial incentive for patients. How would you describe the value that your office offers to patients that they really couldn't get elsewhere?
[Dr. Paul] Let’s say you're uninsured, underinsured or on Medicaid, a lot of times you go to the emergency department because it's “free” or an urgent care because it's low cost. But you really don't get that consistency of having a solid primary care physician who can be your advocate and can guide you through difficult problems that you might be facing, like a chronic condition such as high blood pressure, diabetes, chronic back pain or some of the most common concerns that we have, a physician who can guide you through managing that without opiates, whereas like you might see somebody in the emergency department. Just to get you out of there, they might give you five or ten Norco.
It's like that continuity piece and having somebody who actually cares for you and wants to help you with your concerns. In other environments, like an emergency department, really high volume primary care office or really high volume urgent care, the incentives aren't there to build relationships. It's more about getting the work done for the patient in the immediate term and then getting out the door quickly. On to the next person.
Does the Direct Primary Care Model Allow You to Spend More Time with Your Patients?
[John] How much time do you spend with patients and what can you do with your patients with that time that other providers aren't able to do?
[Dr. Paul] A typical family physician is going to have about 2,400 patients; that’s the average that's across the board for any family physician, internist, or pediatrician. You just have to see about 24 patients a day or one-percent of your panel each day to make enough money to keep the lights on, pay your staff, pay for your overhead, your rent, your lease, et cetera. In our model, we can keep the panel to about 500 patients so we’re seeing one-percent of our panel, or about five patients a day. That means we can spend 30 minutes to one hour with each patient rather than 15 minutes or 20 minutes in the fee-for-service system. Plus, our charting system, or electronic medical records system is pretty streamlined; It takes us five minutes to write a comprehensive note. When using an electronic medical record such as Epic, or other popular EMR’s that are used in hospitals, there's a lot of box checking, it's pretty clunky and it takes a long time just to write basic primary care notes. And then to bill that out, it takes longer than that; it has to go to a biller and a coder just to ensure reimbursement and you get paid 90 days later. All of these problems are baked into our current system for primary care, and direct primary care resolves a lot of those challenges.
What are Some of the Resources that Make your Direct Primary Care Practice More Efficient and Effective?
[John] One of the things that disincentivizes medical students from going into family medicine or any primary care field is that they don’t think they can accomplish much with their career or with their patients, or perhaps. When I shadowed you however, I was fascinated by all of the resources that you had that made your job easier and enabled you to handle more involved cases that providers might normally refer for. Could you speak to some of the resources you use that make your job easier?
[Dr. Paul] When you were here, we had a patient with depression and I just pulled up a Beck’s Depression Inventory that I have in a Google form. They put in their unique medical record number, ‘150’ for example, and then they answer that questionnaire digitally while in the office. I review it, we compare it to the last visit, and we refill their prescription in the office. For example, Sertraline 50 milligrams is two-and-a-half to three cents a pill, so they have their 60 or 90 day supply of Sertraline for three to nine dollars, and they have my cell phone number in case they have a breakdown or something concerning happening in regards to their depression.
We also have more complicated patients with multiple chronic conditions, and we have enough time to set aside an hour to really dive into their conditions. What’s your hemoglobin A1C? How has your blood pressure been? How's your back pain?
And we really look at all the medications they are taking to make sure that they're on an even keel, taking their meds, not having any side effects or contraindications; things like that to make sure people are healthy and then taking it one step further. For example, “I would like to bring your A1C down further; let's talk about exercise.” We can spend 20 minutes just talking about diet. Those are the tools that I have, but it’s mostly time based. I just have more time to dive into these conversations with people.
How Do You Mange Referrals for Your Patients?
[John] I remember when I was shadowing you that there was a patient who presented with a fractured distal phalanx of the thumb, and he was really concerned due to a basketball tournament he had coming up. What you did was you you wrote a report to an orthopedic surgeon on this website who was on call, he gave you his input, and I think you had the whole thing resolved in just a couple of hours. I thought that was amazing. Could you speak to how that process works and what that resource is?
[Dr. Paul] I actually saw that guy earlier that week and he’s a really busy restaurant owner who jammed his thumb playing basketball and he thought it was a bad jam; I thought it might have been fractured, so I ordered the x-ray. He ended up getting it done that Friday at two o'clock and I had checked ‘stat’ on it. They read it right away, they read it as a fracture, and I called to confirm with the radiologist. We quickly took those images from the digital record of that x-ray and put it into what's called Rubicon, the Econsult platform that you mentioned. We sent that to an orthopedist who gave a recommendation, and they actually recommended that he require a pinning surgery. But then we sent a text message to a local hand surgeon specialist that I worked with previously, and he recommended splinting and following up with him in the next week. We made that appointment for the week after, and made a point to consult with another doctor who encouraged continuing with the splint and then after healing for four to six weeks, engaging in some higher intensity physical therapy. As a physician, I regularly utilize text messages, email, Econsult platforms and phone calls with the radiologist, and we were able to give a comprehensive care plan to this guy.
Let's say you got the x-ray done at 2 o'clock on a Friday. Good luck getting in to your PCP in the fee-for-service system. And then, good luck getting a specialist consult that same day or two specialist consults for that matter. That doesn't happen every day, but it happens at least once a month where we’re diving into situations with differing opinions on what to do with patients and trying to help patients navigate those difficult decisions.
How are Direct Primary Care Doctors Able to Provide At-Cost Labs, Meds, and Imaging Services?
[John] One of the other things I thought was fascinating about your office is how accessible imaging, labs and medications are for patients and the agreements that you set up with different imaging centers and labs in the area. Could you talk a little bit about how that works and what that is?
[Dr. Paul] For the patient who got the hand x-ray, the cost was $45 at Regional Medical Imaging which is just down the street from us, and that x-ray would have been $150 to $200 at the hospital. We have the benefit of having an online portal, seeing the digital recording online, and having the radiologists cell phone number so that we can call and discuss it.
We also draw blood in our office and run a comprehensive metabolic panel for six dollars, whereas a patient, if they went to the hospital, might pay $150. We have all those prices on our website, plumhealthdpc.com if you want to check it out; we're saving patients 50 to 90 percent on those labs. It’s the same for medications which we purchase at wholesale prices and give to our patients for at-cost prices. As I mentioned earlier, Sertraline 50mg, I believe, is two-and-a half or three cents a pill. These patients are paying about 90-cents a month, or a couple of dollars for a three month supply.
How Are Direct Primary Care Doctors able to Provide Same-Day and Next-Day Appointments?
[John] One of the other things that I loved about your office was the ease in scheduling a same or next day appointment, even by call or text. I’m wondering if you reserve time slots each day for last minute, same day appointments and how quickly a patient could get in if they needed to see you?
[Dr. Paul] That happens every day. I typically have about three or four scheduled patients each day, and I usually fill in with two to five same day appointments depending on the day and time of the year. You came in early January, so you saw a lot of people just walking in, just like the patient with the fractured thumb. He got that x-ray at two o'clock, texted me to share the results of his x-ray, and asked when he could see me, so I told him to “come right now!”. A lot of folks are texting me each day and getting an appointment. Yesterday, for example, a little three year old girl came in with her father because he had noticed her eyes had some purulent discharge. Her eyes were erythematous, there was some puss, and her eyes were red. He sent me a text at one-thirty and I saw her at three o'clock. That's typical, that’s standard, that’s every day. We're really happy and proud to do that because that's what differentiates us from any other doctor. Our patients will text me anytime and I guarantee a same day or next day appointment appointment. Let's say you text me at 4 o'clock. Perhaps I could offer a four-thirty or five if you're lucky, but definitely eight-thirty or nine the next morning, I can see you.
Business Management
In Order to Start Your Direct Primary Care Practice, Did You Take A Leap of Faith?
[John] Can you speak to the leap of faith that you took starting PlumHealth fresh out of residency and any challenges or setbacks that you might have faced in the process.
Dr. Paul: [00:14:53] Yeah, I think it is more of like a leap of determination.
Dr. Paul: [00:14:55] I think, you know, as a physician, when you graduate from residency, you're always going to have an opportunity to moonlight on the side. And, you know, so for me, I worked in urgent care for 20 hours a week on the side and that allowed me to have a reasonable income and then four days a week where I could devote to building up plump health. So, you know, if you're willing to sacrifice it for me, I don't have like a country club membership. I live in a reasonable house. I drive like a Ford Fusion. Know, I'm not living large here, but I am investing into my business. You know, that's really important to me that I'm investing in club health so that I can have like a really sustainable practice that I enjoy working at each day. And that makes a happy when I come to work each day. So like. Part of my ethos is investing in my business. And building a practice that aligns with my personal values of back and serving people in the community. So I knew that I could be successful in this model as long as I had some kind of side income for a year. And so I did that. I worked in urgent care for a year during my first year of starting my direct care practice. And then when I built up to, let's say, 150 members of my T.P.S. practice, I could walk away from urgent care work and focus full time.
Dr. Paul: [00:16:16] And by my Direct Primary Care practice. Sure. So, you know, part of that process was I took some small business courses. I wrote a business plan in my residency. If you if you're watching this, you want to learn how to write a business plan. If you want a copy of our original business plan and our current business plan, it's on one of our courses on this website, startup T.P.S. Slash Take Action. There's like a business plan. Course you can take it takes about an hour to go through that course, show you everything you need to have your business plan. That's like mandatory. You have to write a business plan. That's a skill I didn't know how to do. There weren't a ton of great resources, so I wanted to put together a course to help the next doctors want to do this. The next thing I did is I took some small business courses that taught me about branding, marketing, how to build out an office, etc.. Again, I've tried to put some of those resources on my Web site, like how to office, how to brand yourself, how to market yourself. All those things to help the doctor, the next doctor. Well, let's assume through T.P.S. practice.
[00:17:16] So in my for me, when I graduate residency, I took two small business classes. Each were about eight weeks and they covered a whole bunch of different small business topics. And then on top of that, I read about 50 business books in the first year after residency. I read authors like Gary Vaynerchuk and his classic CRUSH IT!, Grant Cardone and The 10 X Rule as well as If You're Not First, You're Last, Tony Robbins, Seth Godin and others. Just like a lot different, you know, virtual mentors. In a way, you can kind of get a flavor for how they operate their business through their books.
What is the typical panel like for a Direct primary care doctor?
[00:17:57] John: Sure. Yeah. And so something you mentioned, you mentioned that for a Direct Primary Care doctor, it's typical to have a patient panel of about 500. How is the process of building a patient panel and how many patients did you need to break even?
[00:18:14] Dr. Paul: You could say sure, yeah. There's two different things there. And I talked about this in the business planning course, but there's like a break even on your operational expenses. And for me, when I first started, my overhead was about five thousand dollars a month. That was the rent lease EMR malpractice insurance. The amount that I spent on meds and labs each month was about $5000 on average in my first one year. So if you think about the number of patients, that's five. That's one hundred patients. If you're making 50 dollars per member per month, that's about $5000 you break even operationally. Then, you know, when you want to start paying yourself, you're looking at getting to like two hundred patients because then you're making $5000 for your overhead five thousand dollars to pay yourself and then incremental your overheads going to increase with more and more patients could give five more minutes, more supplies, maybe hire somebody, use additional services to make your business run smoothly and then your your overhead is going to gradually increase over time. Yes, so a break even point, depending on your price point, depends a lot on your lease. The price of your lease and the customers that conservatively might be a hundred around one hundred patients.
How do you balance being a physician and a small business owner?
[00:19:33] And then when you can start paying yourself probably around 200 patients right now, something that I foresee as a potential challenges. You are a doctor. You're a compassionate family doctor. At the same time, you're a business owner. Sure. How do you balance your time between the two and how do they how do those two aspects of your life kind of interact with each other?
[00:19:59] Yeah, that's a great question. I think on one side of your brain, you're the doctor where, like, you leave no stone unturned. Mistakes are frowned upon at best and punished at worst. Right. If you make a mistake, you're going to hear about it from your attending, going to get chewed out or whatever in the business side of things like mistakes are valued because of the learning experience. You made a mistake. That's also you're never going to make that mistake again. Are you going to do things differently in the future? It's indirect. As for learning, and the more mistakes you can in quick succession, you can be more successful. You can become so like when I take care of my patients. I definitely have my doctor and where I'm focus on the details and making sure that I hear everything, the history and come up with a comprehensive care plan. But when I'm working on my business, I'm turning on my business brain where I'm making really quick decisions and trying to do things relatively quickly and not over think things are hammer on things for too long. Because when you wait too long, you're going to miss opportunities. So that's not something you're taught in medical school. You're just not. And that's something you kind of have to learn through experience.
[00:21:16] Right. The other challenges, like, you know, being the doctor and seeing patients and then being a business person, collecting revenue, collecting money from your patients. And that was my next question then. Me super uncomfortable. Listen, I know I was just treating you for diabetic foot infection, but you also have an outstanding balance of two hundred dollars because this has, you know, this hospitalization set you back. And if you're honest with people, you just level with them like, listen, I'm I'm your doctor might also make money, too. Usually it works out fine as long as you communicate with people about what you need to do. And then as you grow, perhaps you delegate more of those tasks to your medical system or you hire a billing company. So that if it really makes you uncomfortable for me, I'm able to navigate that pretty easily. It's just. Yeah, I'm delivering you a valuable service. And you've been out selling, sending balance 50 bucks or 100 bucks. Can we sell your balance or do you need to close out your account? Do I need to write it off? I'm good with you that just let me know. Right. And a lot of ways to respect that approach.
[00:22:24] Right. And I would say everybody has different circumstances. At the same time, however, you know, obviously you're you're offering an extremely valuable service asset, an extremely affordable price. And, you know, I think that just those circumstances allow for more honest conversations between people. And you also have more time to you know, maybe this is just something back to some of the questions I had earlier. But the amount of time that you have with your patients also enables you to have those types of conversations about their personal life, about maybe stress, financial issues, other things that are going on. I noticed that when I was there. You do a lot of listening. You do a lot of listening and they do a lot of talking. And not to say that you're not doing your job, but it's I you could say it's therapeutic for them in a way, and it helps you to understand what they need and to help them more, you know? Yeah, totally.
[00:23:18] I mean, I think the majority my job is just listening to people.
[00:23:22] I'm carrying out their concerns fully and then coming up with a plan to address those concerns. And a lot of time with therapy is just then having somebody that they can trust to tell them his concerns about. Now, I haven't told anybody about this, but I'm struggling with this and just being listening here, not judging and just, you know, sometimes not saying anything and just listening. Tell me more about that or I'm sorry to hear that. What can I do to help? And sometimes it's like I don't know if he can. I just wanted to tell you that. Or it might be. They really open up about a concern. And that's like it sounds like you're depressed. Let's do a depression screening. And you. Yeah, there's there's a lot that goes into these appointments. And as a family doc, I'm grateful for this practice model because actually the more time just to listen.
[00:24:09] Right. How are we doing on time? I still got a few more questions for if that's a good idea.
[00:24:13] Let's let's do it then. Definitely fewer minutes.
How Do You Purchase Malpractice Insurance for your Direct Primary Care Practice?
[00:24:17] All right. I did have one more business question, and that was. Sure. How malpractice works, is it the same for you as it would be for another family doctor?
[00:24:26] Yeah, I think it's essentially the same. You know, I called up a few different malpractice carriers and I asked them for good prices. One of the pieces of advice I give to doctors starting their GP practices is get three quotes. Call. Don't be lazy. Don't take the first quote. You know, if you're building out a new office or if you're getting a malpractice insurance or if you're getting a website designer or if you're hiring a photography to provide for. Look at three different quotes. Compare and contrast. Gather the information. Then quickly make a decision or move on. For me, I got three quotes on malpractice insurance. One. You know, sometimes a little bit lower because I'm seeing one fifth of the patients of a typical family doctor. I'm spending five times as much time with those patients. So my malpractice insurance should be a little bit lower just in full transparency. I pay about 450 a month. It's like fourteen fifty a quarter for that malpractice insurance. It's pretty standard about six thousand a year. So it's it's not that different. The only difference is if you've always been employed by a hospital system, you've probably never made that phone call. There's some terms you need to understand, like tail coverage and maximums and all this kind of stuff. But if you have a good agent, you can ask them to describe it to you and then you call the next agency and you ask them to describe their coverage for you. And then you reach out to a mentor of yours. Look at your older family, doc who's bought a few different insurance coverage is and say, what do I need to look out to for where can I get burned in this?
Personal Questions
How Much Money Do You Make in Direct Primary Care?
[00:26:07] John: Right. OK. I have a few questions that are potentially sensitive, more personal about you and kind of, you know, the personal side of what you do, if that's all right.
Dr. Paul: Yeah, sure, man.
John: I think one of something else that disincentivizes people from going into primary care, especially family medicine, is compensation for the work that they're doing. And what I'd really like to understand is. And especially as a business owner, how would you say our income compares to that of a different family doctor? And more of a traditional office setting?
[00:26:49] Dr. Paul: I think that's a great question.
[00:26:50] I think every medical student would want to know that before choosing a Direct Primary Care path. So, you know, when I graduated, I was offered $165,000 each year plus a $10,000 signing bonus by the institution that I trained with pretty standard. When I was moonlighting in urgent care, I was making $70 an hour. We're seeing about four patients an hour or three to four patients an hour. So that that was like, you know, for reference, that's that's the kind of money I was offered or what I was making moonlighting. You can get higher if you're in a rural or. It depends where you are. All these are regionally dependent.
But metro Detroit, it's pretty saturated with physicians. So you're not going you're not going to get like a huge salary unless you're doing a huge volume. Like if you're seeing 40 patients a day, perhaps you could earn up to $400,000. That's like exactly the opposite of what I want to be, too. You know, I want to be spending more time with my patients. So in the first year of my practice, I pay myself what a resident might make, you know, six, seven thousand dollars a month. I've paid myself progressively more and more. Last calendar year, the year 2019, I paid myself about $110,000 over the course of the year. Now, I could have paid myself much more. But this last year, I also spent two hundred thousand dollars building out this beautiful office that I occupy now.
[00:28:23] John: It's beautiful. Yeah.
Dr. Paul: Yeah. Thank you. Awesome. Yeah. And and, you know, so part of this is as a business owner, I think differently about money than an employee might think about money. So for the doctor that I hired, she has the opportunity to make $200,000 to $240,000 a year, whereas perhaps I would want to make less than that. So I can keep reinvesting money into the business to grow a more sustainable practice for the future and for future growth.
So like right now, I'm sacrificing my personal income for a long term income potential in my business. And I think that's not the way doctors typically think about income. Many Doctors say to themselves, “Did I just sacrifice eleven years of undergrad and med school residency? And now I just want to get paid, you know?”
But as a business owner, you're thinking differently. You're you're investing for the long term. And that's a I'm I'm kind of playing the long game. I could pay myself more, but I would come at the expense of like I grow more slowly in terms of my business because I wouldn't have enough money to invest in marketing or invest in hiring another doctor or hiring another medical assistant or building up an office which helps us be sustainable long term.
What is the Income potential for a Direct Primary Care Doctor?
[00:29:39] John: Exactly. As a lot of people know, you're doing something else.
[00:29:43] Dr. Paul: The other thing is like I'm intentionally working a lower income community.
[00:29:47] And in terms of the spectrum of charging people money for DPC, I'm on the lower end, charging $10 a month for kids and $49 a month for adults as their starting rate. Whereas other doctors in the movement are charging on average, let's say, $70 or $80 a month or $90 a month. So, you know, it the cool thing about this is don't let my salary dictate what you can earn. If you want to go out and make half a million dollars a year in a DPC practice, you could probably do it. You probably bordering on a Concierge Medicine service. You know, you'd probably charging like $120 a month or something like that. But if you want to do that, it's your right. You have the autonomy. And so that's like the second part of the answer is, like a lot of DPC doctors are making a little bit less than what they would have in the fee for service system, but they're more fulfilled. And then they might say nothing pays like autonomy because you get to decide what to charge your patients, what you want to do for your patients, what kind of service you want to offer, the hours that you want to work. Yeah. If I worked 8am to 6 pm every day, I might be making more money, but I'm working 9 am to 5 pm and I have a really good work life balance.