What Payroll Option Should I use for my Direct Primary Care Practice?

Payroll for your direct primary care practice can be scary - for most doctors who start a direct primary care practice, this is the first time paying themselves and it’s their first time paying employees.

But, don’t be scared any more! By the time you finish this blog post, you will have a good idea of how to pay your employees in a reasonably easy way.

All the options

There are several payroll options available for small business owners, including:

1. Manual Payroll: This involves calculating and processing payroll manually using spreadsheets or paper-based systems. While this option is low-cost, it can be time-consuming and prone to errors. I strongly recommend against doing this. Your time is WAY better spent taking care of patients or growing the business. Unless you have a background in accounting, do not do this.

2. Payroll Software: Payroll software can automate the payroll process, including calculating wages, taxes, and deductions. There are several software options available, ranging from simple and low-cost solutions to more advanced platforms with additional features such as time-tracking and benefits administration.

   One example of a payroll software is Gusto. Gusto offers a cloud-based payroll platform that automates the payroll process. It includes features such as direct deposit, tax calculations, and benefit administration. Gusto also offers time-tracking and HR features, such as onboarding and document management. Small business owners can choose from several pricing plans based on the number of employees and the features they need. Payroll software like Gusto is a good option for small businesses that want to streamline their payroll process and have more control over the payroll function.

3. Online Payroll Services: Online payroll services provide a cloud-based platform for managing payroll. These services often offer features such as direct deposit, tax filing, and time-tracking. Online payroll services are typically easy to use and affordable, making them a popular choice for small businesses.

   An example of an online payroll service is ADP. ADP offers a cloud-based payroll platform that provides payroll processing, tax filing, and compliance management. ADP also offers HR features such as time and attendance tracking, employee benefits, and talent management. Small business owners can choose from several pricing plans based on the number of employees and the features they need. Online payroll services like ADP are a good option for small businesses that want a simple and easy-to-use payroll solution, without having to invest in additional software or hardware.

   Options 2 and 3 have some overlap because Gusto can be completed online (without downloading a software suite). Other companies that offer payroll software include QuickBooks, PayChex, Xero, and others.

4. Accountant or Bookkeeper: Small business owners can also outsource payroll to an accountant or bookkeeper. These professionals can handle all aspects of payroll processing, including calculating wages, taxes, and deductions. While this option can be more expensive than other options, it can provide peace of mind and ensure compliance with tax laws and regulations.

5. Professional Employer Organizations (PEOs): PEOs are third-party companies that manage HR and payroll functions for small businesses. They offer a range of services, including payroll processing, benefits administration, and compliance management. PEOs can be a good option for small businesses that need comprehensive HR services. If you want to completely outsource payroll and benefits, you’d use an option like this. i don’t know any DPC doctor who uses something like this, as larger businesses would use this option.

It's important for direct primary care doctors to consider their specific needs and budget when selecting a payroll option. They should also consult with a financial professional or tax expert to ensure compliance with tax laws and regulations.

What we use at Plum Health DPC for Payroll

When I started my DPC practice and hired my first employee, I had a really hard time with this. It was more of a mental barrier than anything. I ended up picking Gusto because they have a really nice user experience/design on their website.

I ran payroll for a year using this, but my account found that Gusto was NOT paying my taxes accurately, so we had to put some extra money in at the end of the year. After discovering this, we switched to “RunPayroll”, an online-based platform. I now submit payroll via RunPayroll and my accountant checks on it quarterly.

I pay $62 monthly for accounting, $250 quarterly to my accountant for them to review my books and make sure that all of my expenses are categorized perfectly, and about $1,800 annually for tax preparation for myself and for my business.

DO I NEED A PAYROLL COMPANY IF I’M THE ONLY EMPLOYEE?

Usually you don’t need a payroll company if you’re the only employee in your direct primary care practice. Once you hire another doctor or a medical assistant, you’ll need to set up an account with a payroll company so that they can help you keep track of payroll taxes.

If you’re a solo doc and if you have an accounting software like Quickbooks, you can pay yourself through an owner’s draw. This is a simple way of paying yourself when you’re just starting out.

When you take an owner’s draw, you should set aside 40% of that owner’s draw for taxes. You will likely pay 25% to 35% of your Net Operating Income in taxes, so be mindful of these numbers. Your accountant should be able to calculate the amount of taxes that you need to pay each quarter.

With quarterly income taxes, you will mail up to three checks to your city, state, and the federal government from the money you make during that period. Here in Detroit, Michigan, we have city taxes paid each quarter (about $125) and state taxes paid each quarter (maybe $1,250). This is usually an estimate. If you over estimate, you could get money back during tax time or have a small tax bill. If you under estimate, you could owe a larger balance during tax time.

I hope this was helpful, and best of luck with your DPC practice!

- Dr. Paul Thomas with Plum Health DPC in Detroit, Michigan.

You Have a Business When You Have Your First Customer

What Does it Take to Start a Business?

This week, a friend asked about next steps for starting a new direct primary care business.

For smart people who’ve never started their own business, people like young doctors, young lawyers, or young dentists, graduating from medical school or professional school and entering the work force, it can feel like the only option for you is to get hired by a big firm or to join an existing practice.

But, you have to know that you can start your own business - and that’s the point of this blog post!

So how do you know when you have a business? When someone tells you that they want to pay you, yes you directly for your services, you have a business. For example, if a neighbor lady asks your son or daughter to mow their lawn, your child has a business. If that same neighbor wants to hire you as their doctor, you now have a business.

In short, you have a business when you have your first customer.

You Have a Business When You Have Your First Customer

Now that we know what makes a business, how do you capitalize on that business? Meaning, how do you legally accept payments from someone as a business, and not as an individual?

1.) Register for a PLLC - your PLLC can be anything, ours is "PLUM HEALTH PLLC" but we're doing business as (dba) Plum Health DPC. You could be Fred’s PLLC and dba "Smart Street Health", or Karl’s Dad's PLLC and dba Cool Dad DPC etc... The PLLC tells the state government that you have a business. Here in Michigan, we register PLLC’s, but it may be different in your state.

2.) Get an EIN from your accountant - once you register your PLLC, get the EIN from your accountant. This is a unique number that is essentially a social security number for your business. You need it to open any major accounts, including a bank account. From the IRS:

An employer identification number (EIN) is a nine-digit number assigned by the IRS. It's used to identify the tax accounts of employers and certain others who have no employees. The IRS uses the number to identify taxpayers who are required to file various business tax returns.

3.) Set up a bank account! I started mine with $90 that I had in my pocket:

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A post shared by Paul Thomas MD (@plumhealthdpc)

4.) Deliver services - this could be refilling a medication, performing a physical exam, performing a Beck’s Depression Inventory, or giving a joint injection. Never underestimate how much value you can provide for patients with your brain and your stethoscope. As your company grows and as you refine your services, you’ll be offering more services and broader services. But for now, focus on getting started rather than having everything that you could possibly need to start.

As an example, I didn’t have an office when I first started - I started by making house calls for the first 2 months of my business. I also didn’t have an EKG machine when I started, but I bought one within 3 months of starting. I didn’t have a spirometer when I started, but I bought one within 5 months of running the business. As you get more revenue, you can use that extra revenue to make your services more robust.

5.) Track payments. This could be as simple as a spreadsheet with a Microsoft product or a Google Doc spread sheet, or it could be a more sophisticated product like QuickBooks or FreshBooks. I started during my first two months using Microsoft Excel to track revenue and expenses, but it was tedious! I quickly switched over to QuickBooks and I’ve never looked back. Often times, these companies will offer a free 30-day trial or a discounted fee for the first 3 months - it makes taking the leap easier. If you hate the service or the product interface, you can always switch companies!

NOW GET OUT THERE AND GET MORE CUSTOMERS.

Have a great weekend,

- Paul

P.S. If you enjoyed learning this material and if you want to take the next step, please check out the Startup DPC book - there’s a step-by-step guide on how to start your direct primary care practice in the book

Additionally, check out the Business Plan Course where I take a deep dive and show you how to write a business plan that will help you grow your direct primary care practice, starting with a written foundation.

How Does Direct Primary Care Make Sense from a Numbers Perspective?

How Does Direct Primary Care Make Sense from a Numbers Perspective?

Lots of people want to know how direct primary care makes sense for doctors from a numbers and earnings perspective. This came up on Twitter today and I was mentioned in one of the responses. Here’s the original question:

I’ve been trying to wrap my head around how DTC healthcare can make $ bc the margins are low. The only way it makes sense to me is if you expect low utilization of services, whereby an ongoing retainer (subscription) is not redeemed often or pt requires very little management.

I responded with the following:

we use a membership model for health care - we take care of about 450 patients per doctor and charge about $60 monthly. A family doctor can make a typical salary if they keep their overhead low. I love DPC and we’re able to serve an HPSA in SW Detroit with our clinic

Dr. Albert - we use a membership model for health care - we take care of about 450 patients per doctor and charge about $60 monthly. A family doctor can make a typical salary if they keep their overhead low. I love DPC and we’re able to serve an HPSA in SW Detroit with our clinic pic.twitter.com/j5WX0Xa4QD

— Paul Thomas, MD (@PlumHealthDPC) October 6, 2022

I added the following:

I have about 450 patients - I see my patients 3 - 4 times each year on average. I see about 4 - 8 patients in a typical work day. Our #PlumHealth clinic is in SW Detroit and we serve an underserved community with affordable and accessible healthcare #directprimarycare #detroit

I have about 450 patients - I see my patients 3 - 4 times each year on average. I see about 4 - 8 patients in a typical work day. Our #PlumHealth clinic is in SW Detroit and we serve an underserved community with affordable and accessible healthcare #directprimarycare #detroit pic.twitter.com/AZQJqDcdMX

— Paul Thomas, MD (@PlumHealthDPC) October 6, 2022

Thanks for reading and watching, and have a great day.

-Paul Thomas, MD with Startup DPC

Dr. Paul Thomas at Pearls for Primary Care Conference

Dr. Paul Thomas at Pearls for Primary Care Conference

Today, Friday September 30th 2022, I was invited to give a presentation on Direct Primary Care for my family medicine residency program. It is a great honor to be invited to this conference to speak about Direct Primary Care and my practice, Plum Health DPC.

This was a great day of lectures and learning and it was truly a privilege to be invited as a speaker in this environment. My talk focused on the Direct Primary Care model. We went through the following learning objectives:

• Define and understand direct primary care as a financial payment model for primary care delivery

• Discuss the details of the direct primary care model for physicians and for patients

• Highlight the growing number of direct primary care doctors in Michigan and why more physicians are choosing the direct primary care model

• Demonstrate how to start and grow a direct primary care practice in Michigan

There are many challenges in our current fee-for-service system. The biggest challenge being that doctors and patients don’t have enough time together to fully address the health concerns of the patient. This can lead to burnout and a less-than-fulfilling practice of medicine.

The direct primary care model helps patients by lowering the cost of care and allowing for doctors to have more time with their patients to build meaningful relationships and address concerns fully. These trusting relationships can lead to better health outcomes as doctors can spend more time on motivational interviewing to help patients lose weight or taking the time to discuss the pros and cons for vaccines and helping people protect themselves from vaccine-preventible diseases.

Oakwood Annapolis Family Medicine Residents Who Are Direct Primary Care Doctors

Interestingly, several Oakwood Annapolis Family Medicine Residents have taken the leap to start or grow their own direct primary care practices. I have had the great privilege of consulting with some of these doctors and I am always rooting for their success - I believe strongly in the direct primary care model, and the ability of the model to support independent practice and uplift the doctor-patient relationship.

That being said, my residency colleagues who are now in a Direct Primary Care practice include:

• Paul Thomas, MD with Plum Health DPC in Detroit, MI

• Joe Bacala, MD with Quill Health Direct Primary Care in Las Vegas, NV

• Remmya Nair Reddy, MD with Our Family Doc DPC in Alpharetta, GA

• Nabaa Zalzala, DO with My First Family Clinic in Alpharetta, GA

• Jeff O’Boyle, DO with Beyond Primary Care in Ann Arbor, MI

How Long do Patients Stay at Your Direct Primary Care Practice?

How Long do Patients Stay at Your Direct Primary Care Practice?

This week, we had a great question from one of our business analysts about the length of membership at Plum Health DPC. He wanted to know how long patients stay with our practice?

This is a difficult question to answer as our relationships with patients are ongoing - people are signing up with us this month who may stay with us for months or years or decades. We don’t know what these relationships will look like as they are just beginning.

However, we have been practicing at Plum health for the last 5 years and 8 months, so we have a pretty good idea of what to expect.

Ongoing members vs Members who have joined and left

There is some nuance to this conversation - and it starts with two distinct groups. You have to think about the members who are still with us and the members who have joined and left our practice as two distinct groups.

Our Plum Health DPC practice has had a total of 2,499 patients enroll in our practice and we currently have 1,150 active members.

Members who have joined and left

The average length of membership for a patient that has joined and left is 10.24 months. This feels about right for me as a physician. A lot of the folks who enroll with us are in between jobs, or in between cities, or making a career transition, or they’re not satisfied with the care that they’re getting from another health care system. They join our practice as a stop gap between insurance coverages, or they join our practice for us to help them through a rough psychological or physiological or medical transition where they may need more care than typical.

After about 10 months of care, they’ve moved on to the next thing. This is an important piece of information for our business because it helps us to inform our price point. If our average price point is $60 per member per month, then we typically make $600 per member who enrolls in our service.

ongoing members or currently active members

The average length of membership for a patient that has joined and is still active or still currently a member of our practice is 24.69 months. This is amazing - at Plum Health, we love taking care of our patients for the long term.

This information is helpful, because it can continue to inform our price point going forward. The two pieces of data above help us calculate the value of each new patient that enrolls in our practice.

Why does this information matter?

The next piece of data to look at would be how many appointments and chart interactions, or about how much time our doctors spend with each patient, to calculate the value per hour for each physician’s time and effort.

From the Patient’s perspective

Most patients who enroll in our service perform the mental math in their head. They might say to themselves, “if I enroll in this service at $60 per month, and I plan to stay with Plum Health for 1 year, I will spend about $720.”

The second part of that conversation is something like, “in order for my insurance to kick in, I need to spend $7,000 (my deductible) on my own health care before my insurance pays for any of my health care expenses, so paying about 10% of that amount or $720 to Plum Health for unlimited primary care is a good deal.”

Or, if the patient is uninsured, they may say “I have no health insurance, and paying $720 a year to Plum Health to keep me out of the hospital or the emergency department or the urgent care is well worth it for me.”

Closing thoughts

I hope that this blog post is helpful for you as you start and grow your own direct primary care practice. This is an important model for our health care system here in the United States as direct primary care doctors tend to help folks who are left out by the traditional fee-for-service system.

Understanding how long patients typically use your service is invaluable. Understanding the lifetime value of the patients who uses your practice is also invaluable. These numbers will give you an idea of what you can expect in your direct primary care practice. The caveat is that our patient population at Plum Health DPC in Detroit may be younger and more mobile than other direct primary care practices.

Thanks for reading and have a great day,

-Paul Thomas MD with Plum Health DPC

Did you enjoy this blog post? If so, read more of Dr. Paul Thomas’ thoughts on Direct Primary Care in the Startup DPC book, and watch more videos about direct primary care in the Startup DPC courses!

Startup DPC Reviewed on GoodReads.com

Startup DPC Reviewed on GoodReads.com

This week, we took a look at our reviews for Startup DPC on GoodReads.com. Most of our reviews for Startup DPC are on Amazon.com, where we have 103 reviews for Startup DPC with an aggregate of five stars overall. On GoodReads.com, we have 15 ratings and 2 reviews for the Startup DPC book with an aggregate of 4.67 stars. These aren’t the most important metrics of all time, but they do give us an insight into our readers, and these positive reviews and great feed back show us that the material in the Startup DPC book is valuable for our readers - doctors who want to start and grow their own direct primary care practices.

This is a screen shot from GoodReads.com, a site that has 15 reviews for Startup DPC, our book about how to start and grow a direct primary care practice.

We got a glowing review from one of our readers, Ronald:

Dr. Paul Thomas writes: “You should start a direct primary care practice because you can become the doctor you’re meant to be.” There is a Japanese concept called Ikigai, or “your reason for being.” There’s no doubt what Dr. Paul’s reason for being is: to transform healthcare in the United States, transform the lives of his patients, better his community, and his profession. His passion bleeds through this book, and makes it an incredibly compelling read. It also is a nuts-to-bolts guide on how you can start your own Direct Primary Care practice, from marketing, branding, pricing, and a host of other issues that need to be addressed. When you read that we lose one doctor every day to physician suicide, the equivalent of an entire medical school graduating class, you realize that good people are working in a bad system. I absolutely love his question: “Who in this room would want a five minute haircut? No one raised their hand except for a bald guy. Why do you settle for a seven minute appointment for your health, for God’s sake?” Concierge and DPC medicine are transforming the way doctors provide, and patients consume, healthcare. It’s more affordable, convenient, accessible, but most importantly, it restores the sacred doctor-patient relationship. You will get an insider’s account of how Dr. Paul started his own practice, Plum Health, along with the trials, tribulations, and successes along his journey.

As someone who is interested in Key Performance Indicators (KPIs) that actually measure customer success, I loved the KPIs he measures at Plum Health: How many hospitalizations have we prevented? How many urgent care and emergency department visits have we prevented? If a patient has a weight loss goal. Management of their anxiety or depression, have we helped them meet that goal? How much money have we saved our patients? Have we decreased morbidity and mortality in our communities? These are much more difficult to measure accurately, but they get much closer to the truth regarding Plum’s efficacy as clinicians.

I hope this book is read by doctors looking to get back to why they became a doctor in the first place, rather than serving insurance companies and an unsustainable fee-for-service business model. And if you’re a patient, seriously consider finding a DPC doctor.

We have had the pleasure of interviewing Dr. Paul two times, and a third one coming up on this book on June 26, 2020. You can listen to the first two interviews here…

This is a screen shot from GoodReads.com, a site that has 15 reviews for Startup DPC, our book about how to start and grow a direct primary care practice. One contributor wrote an in-depth review of our Startup DPC book, and for that we are grateful.

This is an extremely kind review, and we’re grateful for our readers and supporters. Our goal is to help as many doctors start and grow their direct primary care practices as possible. This model, and this movement, is essential to helping our patients and communities live healthier lives.

- Dr. Paul Thomas

How do you price your Direct Primary Care Practice to earn $70 per member per month?

How do you price your Direct Primary Care Practice to earn $70 per member per month?

Today I got an email asking a great question:

Dr. Thomas,

I'm getting close to giving my 120-day notice to my employer, with a target DPC start date of September!

I have a pricing question. If you prefer not to answer, I totally understand. In your business plan, you stated that your target average PMPM monthly rate was $70. Have you been able to achieve that?

Thanks, and have a great day!

This is a great question because in your business plan, you should figure out how much money you need to make to have a successful and thriving practice.

Because we work in a lower income community, Southwest Detroit, our pricing is lower to meet the needs of our community. Our per member per month revenue is around $50. We recently increased our prices to bring our per member per month revenue up to $55 monthly. This will help us to be more sustainable and profitable in the long term.

If you were to price a Direct Primary Care practice to make $70 per member per month, it would probably look like this:

• $25/month for children

• $65/month for young adults

• $80/month for older adults

The cut off for kids would be 17 and under, the cut off for young adults and older adults would be around 40 or 45 or 50 years of age, depending on your demographic.

@plumhealthdpc I help doctors start and grow direct primary care practices via #StartupDPC - today I’m answering a question on pricing 💯 #doctor #familymedicine ♬ 茉 莉 花 茶 - CHILLVIBE

I’ve been active on TikTok and I’m happy to answer any questions you have like this!

Best of luck in building your DPC practice,

-Dr. Paul Thomas with Startup DPC

Sample Voicemail for a Direct Primary Care Office

Sample Voicemail for a Direct Primary Care Office

Throughout starting and growing a direct primary care practice, you will need to continuously refine your operations. One of the most important parts of growing a practice is having an excellent experience for your patients and potential patients when they call your office line. If you can answer your phone within a few rings and address any concerns quickly and with kindness, you can reap continuous business and referrals from satisfied patients. Answering the phone in a timely manner is crucial. But, in the event that you cannot answer the call due to a capacity issue or a cell signal issue, having a phone tree or voicemail is very important.

One thing I’ve learned over the years is that pharmacies expect the voicemail to say not only the practice name, but also list the doctors within that practice.

Here’s an example of our daytime voicemail:

"You've reached Plum Health DPC, the offices of Drs. Thomas, Orlich, and Rabaut. Please leave a voicemail and we will return your call as soon as possible. Alternatively, email [our email address]. Our office hours are 9 am to 5 pm, Monday through Friday. If you've reached our voicemail during this time, you can try calling back in 1 hour. Our fax number is [our fax number]. If this is an emergency and you cannot wait, please dial 911 or go to your nearest emergency department."

Here’s an example of our after-hours voicemail:

"Thank you for your call. You have reached the after hours line for Plum Health DPC, the offices of Drs. Thomas, Orlich, and Rabaut. Please leave a voicemail and we will return your call as soon as possible. Alternatively, email [our email address]. Our office hours are 9 am to 5 pm, Monday through Friday. If your concern is non-urgent, please call back during our office hours. Our fax number is [our fax number]. If this is an emergency and you cannot wait, please call 911 or go to your nearest emergency department."

Obviously, our goal is to have every phone call answered promptly with a calm and kind demeanor. Sometimes, due to cell service issues or capacity issues, these call can be missed. Setting up a voicemail for these contingencies is important.

-Dr. Paul Thomas with Startup DPC

Paul Thomas MD at Hint Summit 2021

Paul Thomas, MD will be Presenting at the Hint Summit 2021

This Thursday, I’ll be leading the Direct Primary Care Accelerator at the Hint Summit 2D’21, which will help doctors start and grow their direct primary care practices. I’m really excited to be working with Hint Health and their team to give the best information in a short amount of time to the aspiring and growing DPC doctors. It’s important to know that this conference is FREE for students and residents, so register today!

Dr. Paul Thomas will be speaking at the Hint Summit 2D’21

Here’s what the Hint Team has to say about the upcoming Hint Summit:

Hint Summit 2D'21 is less than a week away, running Thursday and Friday, October 28-29th. Register now and join hundreds of other DPC professionals and business leaders for this year's virtual event! Hint Summit will provide you with the most up-to-date information on alternative primary care payment & delivery models as well as personal stories from pioneers of this movement.

Hint Summit 2D’21 Session Highlights

• Collaborations Transforming the Health of our Nation, One Community at a Time

• Forward-looking Care Delivery Models to Serve Your Patients & Grow Your Practice

• Healthcare House of Cards: A System Ripe for Disruption

• Advancing Direct Care Models through Employer-Sponsored Plans

• Digging into the Way We Pay for Healthcare

• Advanced Primary Care: Integrating Specialties into Your DPC Practice

Audience-favorite DPC Speed Dating is back!

You’ll meet old friends and make new connections through this fun, rapid-fire networking activity.

Interview for the DO Magazine

This week, I was interviewed for the DO (Doctor of Osteopathic Medicine) Magazine by one of our rotating students. Here’s what I had to say:

What would you like residents and attendings to know about opening and running a DPC?

• At the core, practicing in a direct primary care (DPC) model allows physicians to engage in work that is satisfying. We can all agree that work is satisfying when we have autonomy, we can engage in complex decision making, and when there's a direct relationship between effort and reward. Unfortunately, these factors are slowly being eroded from employed practice in large health system groups or in insurance-based primary care.

• As a direct primary care doctor, you have the ability to regain your autonomy, to be your own boss. You set your schedule, you determine the price points, you decide on which days you work, you decide when you go on vacation, you decide on which medications you will stock, and you determine which areas of medicine you will focus on. Interestingly, by doing this, by practicing on your terms, you will attract a certain patient or customer for whom this style of practice resonates. You will find patients who respect, appreciate, and seek out care from the authentic doctor who has established this DPC practice. It’s hard to put this concept into words, but you may find your patients have a lot in common with you in interests and in personality.

• When I finished my first book on direct primary care, I sent a press release about its publication to Devin Scillian of WDIV and host of the Flashpoint program. He invited me to an interview on his program after he received the press release and asked some very insightful questions. He closed the interview with the topic of money – “I don’t know how to ask this delicately, but is this lucrative for you? Do you make a fair amount - enough money? Or are you just messing with the system?” Now this is something that we talk about at every national DPC conference. My answer was informed by a panel of physicians at the 2017 DPC Summit hosted by the AAFP. The moderator asked if the panelists – a smattering of doctors in vastly different DPC practices – were making more or less money. The consensus seemed to be that folks were making slightly less money but had much greater fulfillment because of the autonomy that they experienced while practicing in the DPC model.

• Informed by that conversation, I followed with this answer, “As the membership grows, as the doctor gets to full capacity, you earn about what you would make as an employed physician, maybe a little bit less. But, we have a saying in the direct primary care movement that nothing pays like autonomy. I can be the physician I was meant to be. And, in this model, it’s really inspiring for other doctors who want to join this movement because you have the ability to practice medicine on your own terms, and not at the dictates of insurance companies or government health care systems.” You can see the full interview here: https://www. plumhealthdpc.com/blog/2018/12/23/family-doctor-on- flashpoint-with-devin-scillian .

• And for me, five years into the practice, this feeling still holds true and still resonates with me. I’m making slightly less than I would have had I signed the contract with the large hospital system. But, that higher income would have come with seeing 25 to 35 patients each day. That higher income would have come with less time with my family and more time clicking check boxes. That higher income would have come with less time for self-care and a higher risk of burnout. That higher income would have come with a decline in my mental and physical health.

• And you’ll find that I’m not alone in how I feel about this topic. You will find that DPC docs are a self-selecting group who take risks for the sake of their independence and the integrity of their practices. They continuously advocate for policies at the State and National level that protect their ability to practice with autonomy. DPC Docs aren’t likely to make or keep alliances with larger organizations at the expense of their autonomy. As long as we stay alert and proactive, DPC and independent practice will thrive.

How has Plum Health navigated the business challenges of a DPC practice?

• Many doctors look at the direct primary care model and practice style wistfully. They see the benefits for both patients and doctors and they aspire to become a DPC doctor. However, they think that this is only achievable after becoming an MBA. But… You DO NOT need an MBA to be successful as a DPC doctor - if you’re smart enough to finish medical school, gritty enough to complete residency, and compassionate enough to choose primary care, then you have ALL of the ingredients of a successful DPC doctor and business owner. Direct primary care is all about removing the middle men and the barriers between doctors and patients. What makes this DPC practice model so unique and so powerful is the doctor’s ability to get rid of the unnecessary steps and intermediaries between doctor and patient, delivering a streamlined and intuitive primary care service to patients. So doctors, I know that it can be a scary leap to go from an employed physician with no training in branding, marketing, sales, web development, search engine optimization, and other essential skills for a successful DPC practice, but you don’t need to hire an MBA to do this. What you can do is read through the available resources in the DPC ecosystem, learn the new skills that you can, and hire individuals for the skills you don’t have, but you do not need to hire an MBA to manage the entire process. We need more doctors to stand up, start their own practices, and take back medicine for the betterment of the doctor-patient relationship and the health of our communities.

You do not need an MBA to be a successful DPC doctor.

What is your story? What attracted you and how did you get involved with a DPC practice?

• I initially discovered direct primary care while on a road trip – I was driving back to Detroit from a residency position interview at the University of Minnesota. I heard a podcast interview with none other than Dr. Josh Umbehr discussing his startup in Wichita, Kansas. It was refreshing to hear a Family Medicine doctor speaking so passionately about saving people money, delivering better care, and practicing in a unique way. The message resonated with me, but at that time I was pursuing a faculty position at a residency program because I enjoyed teaching so much. Suffice it to say that I filed this “direct primary care” concept in the back of my mind.

• Between my second and third years of residency, I went to the Michigan Academy of Family Physicians (MAFP) annual meeting in Traverse City. It was July 2015 and a full year before I graduated from Residency. This was a critical moment because I had to decide in which direction I would take my career. There I met Dr. Clint Flanagan of Nextera Healthcare in Boulder, Colorado. He spoke unequivocally about the value of being a primary care doctor and the tremendous value that we provide for our patients. His passion for the profession came through in a way that I hadn’t experienced before.

• These two leaders in the field served as a contrast to the typically burnt out and grumbling physician that I had met thus far in training. Even the best doctors grumbled about paperwork, prior authorizations, late patients, packed schedules, and all of the other difficult parts of being a primary care doctor. At that point, I knew that I would pursue an alternative practice model. It only made sense – less-than-fulfilled physicians practicing in a less-than-ideal system surrounded me and I knew that life could be better on the other side.

• Additionally, I always had this inner drive to deliver medicine in a more equitable and just system. Direct primary care seemed to align with my values as an individual and as a doctor, but I needed to dive deeper. As an elective rotation, I drove out to Wichita, Kansas and Boulder, Colorado and spent a week learning from both Drs. Umbehr and Flanagan. I kicked the tires, took copious notes, and tried to bring the best of their practices to my community in Detroit, Wayne County, and Southeast Michigan. How did I accomplish this feat in the middle of residency? I wrote an elective rotation curriculum for myself and I presented it to my Program Director. I was the Chief Resident during my third year, and she accepted the curriculum that I gave her. It allowed me two weeks of travel and immersion time in these practices and I had to meet the criteria that I set forth in my curriculum. If you’d like to download that elective rotation curriculum, you can find it on our website: www.StartupDPC. com.

• At this point, I had already written my business plan. You see, a few months prior to the elective rotation, I had taken a mandatory rotation called Practice Management. During that rotation we had to write a business plan for a potential clinic. They had intended the assignment to be an exercise in futility wherein you became overwhelmed by the complexities of running a practice in the fee-for-service system. Instead, I wrote a relatively simple eight-page document demonstrating how I would run my direct primary care practice. With my business plan in hand, I spent time with Drs. Flanagan and Umbehr and learned a great deal about their practices. They also read over my business plan and gave me their advice and critiques.

How has Plum Health fostered a better doctor-patient relationship?

• We value the doctor-patient relationship. We intentionally set up one-hour initial appointments and thirty-minute follow- up appointments so that we can have enough time to really get to know our patients. We also have enough time to engage in shared doctor-patient decision-making, and thereby empower our patients to make the choices that are best for their health, wellness, families, and budgets.

• We value autonomy, the ability to choose what is best for our patients apart from the insurance company mandates and algorithms.

• We also value price transparency for our healthcare services, so our patients can make the best decisions possible for their personal and financial wellness.
  

How has Plum Health achieved the quadruple aim of medicine-- improving the work-life balance of physicians to make the triple aim of medicine happen?

• I believe that the direct primary care model empowers patients with a transformative opportunity to take more personal responsibility for their health. By practicing in a DPC model, you will empower your patients to take better care of themselves. For example, I met a man named Frank last year who enrolled in our practice at Plum Health DPC. Frank works as a truck driver and delivers medications and supplies for a local pharmacy company. His employer does not provide health insurance and he earns too much to be enrolled in Michigan’s Medicaid program. But, his salary isn’t high enough for him to comfortably afford health insurance. Frank knows that he has high blood pressure and diabetes, but it was too expensive for him to access the fee-for-service system. When he tried to use the fee-for-service system, he spent about $100 monthly for medications and around $500 for a visit with lab work to check his kidney function, electrolytes, and long-term blood sugar values (hemoglobin a1c level). Because of this high cost of care, Frank neglected his personal health. Unfortunately, due to his uncontrolled diabetes, Frank went to the hospital for a large abscess in his right hand. Frank required a long hospital stay with intravenous antibiotics and a complex incision and drainage procedure, followed by further debridement of the wound. At the time of discharge, the discharge nurse informed Frank of our Plum Health DPC practice. Frank signed up that day, and followed up with us the day after discharge. We reviewed all of the medications he was taking – a statin for high cholesterol, two blood pressure medications, and two insulin products. These medications might have cost $100 to $200 monthly at the pharmacy, which would have been cost- prohibitive for Frank. Frank started with our practice, got his comprehensive metabolic panel for $6, his Hemoglobin a1c for $6, and a 90-day supply of his medications for $11.52. We gave him 90 tablets of the lisinopril, 180 tablets of the metoprolol, and 90 tablets of the statin for that $11.52. We were able to get Frank’s Tresiba and Novolog for free from NovoMedLink, a special program from Novo Nordisk. What happened after was tremendous – Frank started to actively manage his medical conditions. He took an active log of his blood sugar levels, and had fasting glucose levels of 139 mg/ dL, 121 mg/dL, and 111 mg/dL during his first week of taking the new regimen. We talked and he told me that this was the first time that his medical problems felt manageable. There are so many people who have given up on taking care of themselves because health care has become too complicated and expensive. As DPC doctors, we have a unique opportunity to empower our patients to live their best lives. For me, helping people like Frank is the reason why I started my direct primary care practice and why I continue to work diligently in my DPC practice. I believe that health care should be affordable and accessible, and the opportunity to serve people like Frank makes that personal and professional mission come full circle. Caring for Frank and patients like Frank allows me to achieve my Ikigai, my reason for being. When I am able to solve complex challenges for patients and empower patients to take care of themselves, I am fulfilling my purpose and working in my true vocation. I am good at this job, I’m delivering a service that the world needs, I’m being paid for this work, and I’m doing what I love. These are the elements of the Ikigai framework, and they are fulfilled in caring for folks like Frank. I’m proud of the work that I do and I am grateful to have the opportunity to serve people and the greater community in this way, and I’m very excited for you to have this same opportunity.
  

How has the COVID-19 pandemic affected Plum Health?

• We have had to become more flexible in our health care delivery.

• We have shifted to more curbside testing and virtual care to ensure the safety of those that visit us in the clinic.

• Direct primary care and the continuous revenue stream from monthly billing, has allowed us to have a stable income during this time

• We weren't fired or furloughed by a larger health system, or replaced by mid-level providers during this time

• In fact, our care has become more needed by our patients as they've been grappling with their typical health care concerns and all of the issues surrounding covid - vaccinations, infections, exposure, testing, etc...

Where do you see DPC practices going in the future?

• There is likely an 80/20 rule at play

• 80% of patients and physicians are fine with the current system

• 20% of doctors and patients are looking for something like DPC, even if they don't know what to call it

• Currently, only 1.5% of the primary care workforce practices in the DPC model

• So, there is a huge growth potential for direct primary care

• As more and more entrepreneurial and tech savvy doctors graduate from residency, we'll see more and more physicians adopt the DPC model

• Further, doctors do not want to feel like cogs in the health insurance industrial complex, they want to have time to care for their patients face to face, time to understand them and time to make complex decisions, and the DPC model offers doctors that ability.

• I'm excited to see more and more physicians offer this model and help their patients in this way.

HOW CAN I LEARN MORE ABOUT STARTING AN DIRECT PRIMARY CARE PRACTICE?

If you enjoyed reading this blog post and if you want to learn more about starting and growing your direct primary care practice, look no further than our book and our courses on how to start and grow your direct primary care practice. We at Startup DPC have begun compiling some of the best content available on this blog, in our book, and in our courses.

The best place to start is to take our Direct Primary Care Business Plan course, available here. From there, you can learn how to attract new patients to your direct primary care practice and how to find the perfect location or build out the practice of your dreams.

Thanks for reading and watching, and best of luck in your direct primary care journey!

-Dr. Paul Thomas with Startup DPC