What Questions Should I Ask My Accountant When I Start a Direct Primary Care Practice?

This is a big questions that a lot of soon-to-be direct primary care doctors have - what should I be getting out of my accountant or what questions should I be asking of my accountant when I start my direct primary care practice?

What Should I ask my accountant before I start my Direct Primary Care Practice?

First of all, congrats on starting your direct primary care practice! When you first meet with your accountant, make sure that you trust them and make sure that they’ve worked with similar businesses in the past. There’s nothing worse than an accountant that sees you as a dollar sign.

Next, you can find out what your accountant prefers in terms of everyday tools that you’ll need to be successful. For example, you could ask your accountant how they intend to manage your profit and loss sheets. You can also ask them how to manage your payroll services. You can also ask your accountant if they’ve had experience in helping doctors get funding for their direct primary care practices. All of these will help you pick an excellent accountant.

What is an Employer Identification Number (EIN) and why do I need one for my Direct Primary Care practice?

Before you meet with your accountant, you should probably register your business with your State so that you can get an EIN. According to Wikipedia: “The Employer Identification Number (EIN), also known as the Federal Employer Identification Number (FEIN) or the Federal Tax Identification Number, is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to business entities operating in the United States for the purposes of identification.”

The EIN is important for you because you’ll need this number to set up a bank account for your business. Once you have a business bank account, you can transfer money into this account and then start making purchases through your business bank account. This will help you to build credit in your business and help you to become eligible for a loan in the future.

Which Accounting Software Should I Use for my Direct Primary Care practice?

When you meet with your accountant, you should definitely discuss accounting software. There are a few options out there in the marketplace, but I currently use and enjoy using Quickbooks by Intuit. Quickbooks is about $70 monthly and it shows you how much money you’re bringing in or your profit and how much money your spending on your business or your losses. These two elements and the charges therein comprise your profit and loss statement.

Personally, I check my profit and loss (P&L) statement everyday as it gives me a good idea on how well our business is performing. Every quarter, I review my P&L with my accountant and we discuss what’s going well and reconcile any ambiguous, erroneous, or duplicate charges.

If you don’t know your numbers and you give complete control of your profit and loss statement to your accountant, it will be hard for you to keep your finger on the pulse of your business. That’s why I recommend discussing these things up front when you first meet up.

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.

Other things to discuss with your accountant when starting a Direct Primary Care practice

There are so many other things you can discuss with your accountant when starting your direct primary care practice. Here’s a few other topics to broach:

• How long have they been an accountant?

• How long do they plan on continuing to practice accounting?

• What kind of lending options or practice finance options they’re familiar with for medical startups?

• Which payroll do they frequently work with and what are the pros and cons of using that payroll service?

Some banks have a strong practice finance division that could help fund your startup and find out if your accountant has worked with these banks in the past and understands the processes involved.

Find out which payroll company your accountant recommends and then compare that one to others like Gusto or Paychex to make sure you're getting a good/honest deal.

HOW CAN I LEARN MORE ABOUT STARTING A 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 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 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

Startup DPC Mailbag: Should I Hire a Second Doctor for My Direct Primary Care Practice?

This week, I received an insightful email from a medical student who’s interested in starting and growing a direct primary care practice of her own. This is super exciting - I love hearing about medical students who are looking to create fulfilling, successful independent practices. Here’s the first part of the note I received from this eager student, followed by their further questions:

So, I have a finance and small business administration background, so I'm really interested in the nuts and bolts of how things are working or not working for direct primary care doctors like yourself right now.  I have a few questions for you:

What works well financially for a direct primary care practice?

What is working well financially for you right now?

Our direct primary care practice is working well for us financially at this time. We currently have 680 or more patients between two doctors. Because of our membership model, we have a guaranteed revenue stream from our patients as long as we continue to give excellent service to our patients.

I think we set our prices just right at the outset of starting our practice because we have roughly 30 new members enrolling in our service each month. That tells me that it’s not too cheap so that a deluge of people are enrolling, but it’s not so expensive that the cost of the membership is prohibitive for people looking for this type of service. Rather, we’ve hit a sweet spot in the marketplace where we’re financially successful at a relatively low price point.

We’ve kept our overhead low and supplemented our clinic revenue with Botox services and Osteopathic Manual Therapy services. I also earn revenue from consulting with doctors who are starting and growing their direct primary care practices and through course sales via this website. These earnings are modest relative to the revenue earned through my clinic, but it’s worth mentioning.

Should Your Direct Primary Care Practice Have a Scaled Membership Fee Structure?

Is the scaled membership fee you have working well for you?  

At our practice in Detroit, Plum Health DPC, we have relatively low price points. Our membership is $10 each month for children and starts at $49 each month for young adults. Keep in mind that Detroit has an average household income of around $26,249, so our price points are intentionally low to accommodate all members of our community. Even with relatively low membership price points, we are able to earn a comfortable living by keeping our overhead low and by being judicious with our collections.

At our Plum Health DPC clinic in Detroit, we have relatively low price points that respect the relatively low incomes of our neighbors. The median household income in Detroit is roughly $26,249. Despite these low prices, we are able to make a comfortable living with our direct primary care practice and we’re able to pay our medical assistant a living wage.

The scaled membership works really well because it right-sizes the cost of primary care services for our individual members. For a single mom, $69 each month fits for her and her two children under the age of 18. For the 30 year old restaurant worker without any other form of insurance, the $49 monthly fits for his budget and lifestyle. For the 50 year old truck driver with high blood pressure and hypothyroidism, the $69 monthly as well as the convenient access for appointments when “just passing through” makes the service very valuable for him.

And this is super important and something that doctors can lose sight of when starting and growing their direct primary care practices: you must provide a tremendous amount of value to your patients in order to have a successful direct primary care practice. If you don’t provide a lot of value for your patients’ healthcare dollars, you will struggle in this venture.

Notably, to be viable in a direct primary care practice, your collection rate should be at or above 90%, meaning that you need to collect 90% or more of all of your charges. If you fall below this threshold, it becomes much harder to build a sustainable practice. I mention this here because if you’re providing a valuable and useful service, your patients are more likely to engage with your services, use your offerings, and pay for your membership.

What Would You Have Done Differently in Starting and Growing Your Direct Primary Care Practice?

Now that you're a few years in, what would you have done differently at the outset?  

I met with another provider here in Richmond who keeps a pharmacy for her patients.  She says it's a TON of work, but she wants to do it (for now).  She also mentioned that she was a little TOO available at the outset and she wishes she hadn't done that.)

I have very few regrets about how I’ve started and grown my direct primary care practice. I started my journey by taking small business courses, which were tremendously helpful in helping me transition from Residency to a Small Business owner. I graduated from Residency in June 2016 and took those small biz classes from July through November of 2016. I took two separate classes that ran pretty much consecutively.

I won $7,500 in grant money from the second small business course and I launched my practice in November 2016 with about 7 patients. It took me about 2.5 years to get full, and then I was able to hire a medical assistant and a second doctor. Hiring a second doctor allowed me to grow in so many different ways, and I’ve also gained a trusted colleague and a great friend.

Next, I’ve been able to build a dream practice for myself in a historic location in Detroit’s Corktown neighborhood. Our practice sits on the former site of the Tiger Stadium, where baseball greats played, like Babe Ruth and Ty Cobb.

Looking back over the past three and a half years, I’ve worked really hard to create a thriving business, and I wouldn’t really change anything. I love dispensing meds out of our office because I love saving my neighbors loads of money on the costs of the prescriptions.

I love being available to our patients because I’ve saved countless members thousands of dollars each by preventing unnecessary Emergency Department visits. Here’s one ER visit we saved by sewing up a dog bite on a Sunday night:

View this post on Instagram

Another week another laceration repair. This time it was Sunday evening at 6:20 pm when I got the text 📲 Our guy got bit by a dog 🐕 and a few stitches 🧵 would be needed. I met him up at the office at 7:10 pm and gently placed 3 sutures. Usually you leave dog bite wounds open, but the Infectious Diseases Society of American (IDSA) recommends closing facial lacerations because it is cosmetically important and has a lower rate of infection relative to other areas, perhaps due to better blood supply. It took about 1 hour of my time in total, but saved my patient a few thousand dollars 💵 by preventing an ER 🚨 visit. Also, we stock the Augmentin antibiotic that he needed, which only cost him $8. In this #directprimarycare model, our patients get the care and attention they need, when they need it at an affordable cost. Our healthcare system is better off too, because now the ER doc can focus more time and attention on the patients who are coming in with heart attacks and strokes. #winwinwin #somuchwinning #fixinghealthcare #familymedicine #primarycare

A post shared by Paul Thomas MD (@plumhealthdpc) on Feb 18, 2020 at 3:58pm PST

How much money do you need to start a Direct primary Care practice?

Do you have any long term liabilities related to start up? Everything I hear says you probably want around 10-20k to startup, which sounds about right - how did you navigate the startup process and what were your best resources?

I wrote an entire blog post on this one question, here’s the full blog post on how much money you need to start a direct primary care practice and here’s an excerpt from that blog post:

This is a question I recently received from someone interested in the direct primary care movement. And, it's a good question. I'll start by saying that I've addressed this question in great detail in my course on Writing a Business Plan for your Direct Primary Care practice.

So, for a full answer to this question, please go to our Take Action page and check out the Business Plan course!

To answer the question more directly, a direct primary care practice can be started with $5,000 or with $50,000. It depends on how expensive your lease is, how many staff members you have, how much equipment you need to buy, and how resourceful you are.

For many doctors in the direct primary care movement, they know how important it is to keep their overhead low. A lower overhead leads to a lower price point for patients and therefore a more sustainable medical practice.

For me, I launched my practice with about $20,000 in the bank. I bought a $700 exam table, a $1,700 EKG machine, and a $700 pulmonary function test (PFT) machine. I spent about $600 each month on rent, $450 each month on my malpractice insurance, $300 monthly on the electronic medical record system, $500 monthly on medications, and $500 monthly on lab work. Those were the biggest expenses when I started, and my monthly expenses for the first few months of practice were in the $3,000 monthly range.

This low overhead made it easy to break even for operations, and I broke even for operations with around 85 patients or 85 members in my practice.

Looping back to your initial inquiry, I navigated the startup process by taking some small business courses from some excellent sources here in Detroit. One was via the Build Institute and another was through TechTown’s Retail Boot Camp. They were each 8 weeks long and walked me through forming a business entity, branding, marketing, public relations, raising money for your business, acquiring customers, creating a customer avatar, networking, negotiating lease documents, and building out retail spaces. These courses presented a ton of information over 16 weeks in total, and it was a huge time investment on my part, but it paid off as I was able to create a thriving business based off of these teachings.

I know not everyone has the time and the capacity to take in-person classes, so I’ve distilled much of what I’ve learned from those courses into these courses on our website and I’ve streamlined the material to focus on what doctors need to know. I really tried to focus time, energy, and attention in the courses to those natural blind spots that physicians have when starting a business.

I highly recommend taking these courses because they will accelerate your growth and help you skip over many mistakes and pitfalls along the way, which could in turn save you thousands, if not tens of thousands of dollars.

Should I hire a second doctor for my Direct primary care practice?

Last one: I see you have a partner in your practice!  Do you find this has been financially advantageous for you practice compared to a solo practice?  

There are so many tangible and intangible benefits to hiring a second doctor in your direct primary care practice. I mentioned this above, but by hiring a great physician in my practice, I’ve gained a trusted colleague and a great friend.

Direct primary care doctors often ask if they should hire a second doctor for their direct primary care practices and how to hire a second doctor for their DPC practices. I answer the first of these questions in this blog post. Above, Dr. Paul Thomas MD and Dr. Raquel Orlich DO of Plum Health DPC pose at their office in Detroit, Michigan.

Having a second doctor allows me to have someone to share an interesting case with, who can help me manage my patients better by teaching me things along the way. A second doctor also allows me to take a vacation in a relatively care-free way - I don’t have to close my clinic or not be available for my patients because the second doctor can absorb those urgent concerns in my absence.

For me, I didn’t hire a second doctor to make more money, but I did hire a second doctor to build a more sustainable practice. Eventually, as my colleague fills their panel with more patients, I will earn more money, but this was never a top priority.

My top priority has always been delivering excellent care and service to the people in my community, and my practice partner joined my practice to help me achieve this goal. And, that’s why we’re successful.

HOW CAN I LEARN MORE ABOUT STARTING A 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 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 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

Should I start a direct primary care practice during this recession?

This is Dr. Paul Thomas with Startup DPC - I help doctors start and grow their direct primary care practices. A common question that I have been getting lately is in regards to if it’s a good idea to start a direct primary care practice right now because of the coronavirus and the effect on our economy.

Should I start my Direct Primary Care Practice During a Recession?

The first thing that I’ll say is that there’s never a good time to start a mediocre business. If you write an excellent business plan, and if you consistently deliver excellent care and service to your patients, you will be successful with your direct primary care practice, regardless of the greater economic forces. On the other hand, if you start a mediocre DPC practice, that gives okay service, that doesn’t put customers first, you’ll have a difficult time regardless of the economic ups and downs.

What is the most important thing that you can do to build a strong Direct Primary Care business, regardless of the economy?

The most important thing that you can do to build a strong direct primary care practice is to build trusting relationships with your patients and the broader community. As long as you’re producing quality care and not mediocrity, you can build strong relationships with your patients. With everything going on in the world today, with our economy taking a hit from the Coronavirus and people who are scared of the global pandemic, people are looking for a trusted physicians to talk to.

This is where you come in - you can be that trusted physician to help guide your community through these troubling times. You can communicate your knowledge in an understandable way and help people to navigate these difficult times. You can provide people with affordable and accessible healthcare, even as they lose employment and therefore their health insurance policies.

How to Weigh Price and Value when selling your Direct Primary Care services

If you're adding value to a consumer, you'll be in business. The value proposition is measured in terms of value versus price. If you believe you're offering value and a quality service but aren't seeing customers, marketing is needed. If your marketing plan is solid and customers know about you, but you're not getting business, you should re-evaluate your value proposition.

If you still can't figure it out, find a business strategy expert who will work with you to increase your chances of success. They can help you find the gap in your marketing plan and business plan, and help you break through whatever gaps exist.

HOW CAN I LEARN MORE ABOUT STARTING A DIRECT PRIMARY CARE Practice?

If you want to learn more about starting and growing your direct primary care practice, look no further than 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 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

Startup DPC Mailbag: Questions about Starting a Direct Primary Care Practice right out of Residency

This is Dr. Paul Thomas with Startup DPC (https://www.startupdpc.com/) and I receive new questions each day about how to start and grow a Direct Primary Care practice. I believe in the power of the Direct Primary Care model to restore our broken healthcare system for both patients and doctors. That's why I'm really passionate about this topic and why I'm on a mission to educate my fellow physicians and the public about their options in the direct primary care model.

Our questions today come from a Resident Physician in Florida. Here's the questions:

If I have a big student loan debt, can I still start a direct primary care practice?

1. How did your decision to pursue DPC work affect your student loan repayment strategy?

I graduated from Residency with a student loan burden of $170,000. This was the average student loan burden for graduates in 2013. In 2019, the average student loan burden increased to $190,000. That being said, I went on a straight 10-year repayment plan, and I spent about $2,000 each month on my student loans.

In order to do this, I didn't splurge on unnecessary expenses and I focused on the practice I wanted to build. I also started moonlighting as soon as possible in residency to have enough money to pay down my student loans and have a comfortable lifestyle.

In short, my large student loan debt did not deter me from starting my direct primary care practice. My mission of serving others via this DPC model outweighed any misgivings I had about a large student loan balance. If you have a dream of starting a DPC practice, you can do it, even if you have a big loan balance.

How do you build a strong personal brand while a Resident Physician?

2. As residents, we’re mostly responsible for our patients. We connect with some of them but don’t know how to engage them while they wait for us to complete residency, what was your strategy?

This question is really about building a strong personal brand, and how do you build a strong personal brand in during your Residency training. It comes down to engaging with people in your community in a positive way.

Be a leader, a volunteer - work with different free clinics or hold a board position. Reach outside of your network and get to know professionals from other fields, like law, finance, philanthropy, the food and beverage industry, the hospitality industry, and others.

You can also take time to build your presence on one or all of the following social media channels: Facebook, Instagram, Twitter, LinkedIn, YouTube, TikTok, or SnapChat. If you build a strong personal brand on these channels, you'll be more easily able to invite your audience to become patients of your direct primary care practice.

I take a deep dive on these concepts in my course on Attracting Patients to your Direct Primary Care practice, here: https://www.startupdpc.com/take-action

Can you work a second job (moonlight) while starting your direct primary care practice?

3. Private practice finance is a big issue, didn’t working multiple jobs interfere with your time commitment to your private practice patients?

No, you can work 20 hours a week pretty easily while you start your direct primary care practice. For me, I was moonlighting for 12 hours on a week day and 8 hours on a week end day and earning enough to support myself and pay down my student loans.

I worked at an urgent care for $70 to $80 an hour, which allowed me to grow my direct primary care practice organically. I worked at my DPC practice 4 days each week and at the urgent care 2 days each week. I was able to care for and manage my DPC patients easily over that 4 day work week, as I had fewer patients at that time.

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

If you want to learn more about starting and growing your direct primary care practice, look no further than 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 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

Praise for Startup DPC

We work really hard to help doctors start and grow their direct primary care practices, and we get results! We help doctors attract new patients and grow their practices. It’s enjoyable to do this work and it’s nice to get some positive feedback from our doctors who have been successful. This doctor took one of our courses and had some nice things to say:

A nice note from one of our customers who took one of our courses on Startup DPC. You can visit these courses at our Take Action page!

Here’s another piece of praise for our work at Startup DPC, this time for the Attract New Patients to your Direct Primary Care Practice Course:

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

If you want to learn more about starting and growing your direct primary care practice, look no further than 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 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!

-Paul Thomas, MD

Startup DPC Mailbag: How Much Money Do You Need To Start a Direct Primary Care Practice?

Just about everyday, I get some great questions about starting and growing a direct primary care practice. A colleague just read my book and asked the following questions:

How much money do you need to start a direct primary care practice?

This is a question I recently received from someone interested in the direct primary care movement. And, it's a good question. I'll start by saying that I've addressed this question in great detail in my course on Writing a Business Plan for your Direct Primary Care practice.

So, for a full answer to this question, please go to our Take Action page and check out the Business Plan course!

To answer the question more directly, a direct primary care practice can be started with $5,000 or with $50,000. It depends on how expensive your lease is, how many staff members you have, how much equipment you need to buy, and how resourceful you are.

For many doctors in the direct primary care movement, they know how important it is to keep their overhead low. A lower overhead leads to a lower price point for patients and therefore a more sustainable medical practice.

For me, I launched my practice with about $20,000 in the bank. I bought a $700 exam table, a $1,700 EKG machine, and a $700 pulmonary function test (PFT) machine. I spent about $600 each month on rent, $450 each month on my malpractice insurance, $300 monthly on the electronic medical record system, $500 monthly on medications, and $500 monthly on lab work. Those were the biggest expenses when I started, and my monthly expenses for the first few months of practice were in the $3,000 monthly range.

This low overhead made it easy to break even for operations, and I broke even for operations with around 85 patients or 85 members in my practice.

A quick breakdown of the Startup Costs for our Direct Primary Care Practice

How much money do you need to start a direct primary care practice? Here's some basic numbers during my first few months of operation with our direct primary care practice at Plum Health DPC:

• One-time purchases:

  • Exam table $700

  • EKG Machine $1,700

  • Legal services/patient contracts $2,500

  • PFT Machine $700

  • Bookcase $200

  • Comfy Chair $200

  • Basic supplies and equipment: $1,000

  • Small Business courses/educational resources on how to operate a business successfully: $1,000

• Monthly costs:

  • Lease on a space $600 monthly

  • Malpractice Insurance $450 monthly

  • Electronic medical record system $300 monthly

  • Cost to purchase medications $500 monthly

  • Cost of laboratory services $500 monthly

  • Cost of misc supplies and equipment $500 monthly

In my first 9 months of practice, my overhead costs averaged at $3,664 monthly.

By month 9, my revenue was at $7,679.10, aka profitable!

Conclusion: You could start a very simple DPC Practice for $5,000 to $10,000, because we started our direct primary care practice for a relatively small amount of money.

Again, I take a deeper dive into these startup costs for a direct primary care practice in our business plan course.

#Startup #DirectPrimaryCare #StartupCosts #Overhead #ProfitAndLoss

What is the typical startup cost for a direct primary care practice?

Every direct primary care practice is different! When you’ve seen one DPC practice, you’ve seen one DPC practice, meaning that each clinic is going to be unique based on geography, demographics, state laws, and the doctor’s preferences. Therefore, there’s going to be a wide range in startup costs for a Direct Primary Care practice.

If you’re just buying supplies to furnish a small office, you should plan on spending $10,000. If you need legal help to set up contracts, you should add in $2,500. If you include things like your first month’s rent, malpractice insurance, the cost of your electronic medical record, internet, utilities, and phone lines, you should budget an additional $5,000. If you have a medical assistant on staff, you can plan on spending $3,500 each month for their salary. So, startup costs for a modest one or two room office might be $17,500 without a staff member or $21,000 with a staff member, which could include your first month of operation.

What is the average malpractice insurance cost for a family medicine doctor?

The next question is harder for me to answer. I only know what my experience has been like. For me, I purchased malpractice insurance for $450 each month. I was told that Wayne County’s malpractice insurance rate is the highest in the State of Michigan, so this cost is likely much lower in other areas of the state.

The price of the policy does decrease as we add more doctors in the practice.

Are you able to make a decent living as a direct primary care doctor?

Yes! Yes, you can make a good amount of money as a direct primary care doctor. It depends on how good you are at running a business, the cost of your overhead expenses, the prices you charge your patients, and the number of staff members that you have.

The person who asked this question went on to say: “ You have roughly 500 patients paying you about $69 each month, which comes out to only $34,000 each month! And then you have overhead costs like rent, utilities, taxes, staff payroll, etc… Additionally, you’re placing yourself on call for your patients around the clock. Is it worth it?”

For me, I didn’t start a direct primary care practice to make money. I started my direct primary care practice to take care of my patients on my own terms, to develop a fulfilling practice of medicine, and to treat my neighbors and patients with kindness and respect. I definitely want to make money and I need to make money to be successful, but it’s not the main motivation for my practice. In fact, nothing pays like autonomy - I can practice medicine how it’s supposed to be practice and I am not at the mercy of a giant hospital system telling me what to do or how many patients I must see in an hour or in a day.

How is direct primary care different than concierge medicine?

That’s another can of worms, and I’ll leave you this blog post that I wrote for Plum Health DPC, which is one of the most frequently visited pages on our blog and a top hit on Google when you search for DPC vs concierge medicine. Here’s that blog post!

How do you offer your direct primary care services to small businesses?

We offer the membership services to small businesses in our neighborhood. We have several small businesses enrolled in our services at Plum Health DPC. The employer usually pays for the monthly costs of the employees, and the employees pay for any additional services like labs, meds, or imaging services. Here’s our sales page for employer groups via Plum Health DPC.

How can I learn more about starting a direct primary care practice?

If you want to learn more about starting and growing your direct primary care practice, look no further than 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 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.

How can I find a Great Direct Primary Care doctor?

If you’re looking for a great direct primary care doctor and you’re in the Detroit area, we’re at Plum Health DPC. If you’re not in the Detroit area, there’s a great website called the DPC Mapper where you can find a DPC doctor near you!

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

-Paul Thomas, MD

The Startup DPC Show Episode 4: What's It Like to be a Direct Primary Care Doctor?

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.

What are the Ages of the Patients in Your Direct Primary Care Practice?

How Old Are the Patients in Your Direct Primary Care Practice?

A question that comes up frequently is how old are the patients that populate your direct primary care practice? I have been asked this question several times by reporters, medical students, prospective direct primary doctors, and fellow direct primary care colleagues.

In this blog post and the accompanying video, I tackle this question head on! First of all, I am a primary care physician and a family medicine doctor, and that means that I take care of patients of all ages and stages. All patients are welcome at our practice regardless of age.

Currently, our youngest patient is two months old and our oldest patient is 102 years old. That being said the majority of our members at Plum Health DPC are between the ages of 20 and 65 years. 

I think there are a number of factors at play that cause the majority of our patients to be in that demographic.

First of all, we are a primarily urban practice, and we take care of several young urban professionals who are highly mobile and without children. Detroit and Southeast Michigan has a strong economic output, that attracts top talent to the region in various professions like law, medicine, automotive engineering, and others. Perhaps we would have more pediatric patients if we were in a suburban community where there are more children and families.

Second, I am 32 years old and I primarily use Facebook, Instagram, YouTube, and LinkedIn to market my direct primary care practice. These social media platforms typically have users that are my age. Facebook may skew a little bit older, and Instagram may skew a little bit younger in terms of age, but whenever I post on their social media platforms, the audience is primarily within my age demographic.

Third, the people that I know trust me and are more likely to become my patients. The people that I know are mostly my age, plus or minus a few years. That probably skews our data or the number of patients in our practice who are around the age of 32 somewhat. I’d be willing to wager that if you sought out a direct primary care doctor who is 45 years of age, they will likely have the majority of patients around their age, especially if they are marketing to them using social media channels in which they have the most contacts and connections in their own age demographic.

Fourth, our country provides health insurance coverage for people under age 26 through the affordable care act. As long as a child’s parents have health insurance, that child will be covered under their parents’ health insurance plan. Also, those individuals over 65 are covered by Medicare, and because they may be on a fixed income they may be less inclined to seek out a direct primary care practice where they have to pay over and above their Medicare coverage.

In this image, each individual orange line represents an individual patient, and you can see that we have one patient who is 102 years old. What is somewhat confusing about this image is that we have roughly 6 patients who are between the age of zero and one year of age, and they have no lines to represent them but there is a small gap between the Y access of the chart and the one-year-olds. That gap represents the 0 year olds.

In the above image, each individual orange line represents an individual patient, and you can see that we have one patient who is 102 years old. What is somewhat confusing about this image is that we have roughly 6 patients who are between the age of zero and one year of age, and they have no lines to represent them but there is a small gap between the Y access of the chart and the one-year-olds. 

Thank you so much for reading and watching, I truly appreciate all of you who are taking the time to learn more about direct primary care!

If you live in the Detroit area and he would like to become a patient of our direct primary care practice, you can find out more on our website, www.plumhealthdpc.com

If you are a direct primary care doctor and you’re ready to up your game, to attract more patients, and to grow your direct primary care practice, take a look at the other materials on our website, specifically the courses on our take action page. 

Thanks again for reading and watching, - Dr. Paul Thomas

Startup DPC Mailbag: patient population, future of Direct Primary Care, weaknesses of the DPC model

Just about every day, there is a medical student, medical resident, or practicing physician who reaches out to me about Direct Primary Care, my book, or my practice Plum Health DPC. This time around, a medical student from Temple University read my book, Direct Primary Care: The Cure for Our Broken Healthcare System and sent the following email. I’ve done my best to answer all of the questions (in bold).

Our book, Direct Primary Care: The Cure for Our Broken Healthcare System, has recently received 40 ratings and reviews on Amazon. One year after writing the book, it’s still generating good questions and conversations around Direct Primary Care and healthcare policy and practice.

Without further ado, here are the questions:

First of all, thank you for writing this book. I absolutely love the fundamental principles of family medicine but was discouraged when I saw very busy doctors during my rotation getting burned out. All of the reasons to go into primary care (or medicine in general) that you had mentioned in your book very much resonated with me. I want to be the change and provide the care that my future patients deserve. 

Like I mentioned to you before, I did have some followup questions: 

What is your patient population like in your Direct Primary Care practice?

Regarding patient population, what type of patients do you mostly see? If patients have to pay a monthly fee, I would think that you mostly see people who need frequent care i.e. kids with recurrent infections/asthma attacks/allergies and elderly with many chronic diseases. What proportion of your patients is in their 20-40s? And I wouldn’t think Medicaid patients who join the membership since they can see doctors for free (or ~$5). Trying to get a sense of what type of patients I’ll see if I go into this. 

First, our patient population is broad and diverse. Our youngest patient is 6 months old and our oldest patient is now 102 years old. However, the majority of our patients are in the 30 to 65 years of age range. They typically have some sort of health insurance, but they choose to use our service because we offer a wow experience and deliver excellent care and service with each visit.

Our patients have very diverse financial situations as well. We take care of many people who fall through the cracks of the traditional system. For instance, we take care of many people who are bartenders, hairdressers, and truck drivers. These folks earn too much to qualify for Medicaid, but don’t earn enough to afford private health insurance coverage. The cutoff for Medicaid in Michigan is roughly $17,000 for an individual.

But some of our patients are independently wealthy, the business elite in our community. They use our services because we offer excellent service, on-time appointments, and no-wait appointments.

We also work with businesses to take care of their employees. Many business have fewer than 50 full-time equivalent employees. When this is the case, the business is not mandated to offer private health insurance. But, many of these businesses want to offer some sort of health care benefit to their employees, so they choose our service.

How can you help patients who can’t afford your Direct Primary Care membership fees?

And about the patient with herpes outbreak you mentioned, was she financially capable of paying the monthly fee to get the care from you? Did she have to agree on the membership fee before she could get the medications she needed? Do you have different payment plans for those who can’t afford the regular prices? How do you go about doing that to offer care to the financially unstable individuals, while not making it seem unfair to those paying the regular prices? 

For that particular patient, she is still a member of our service. She comes in quarterly to have her chronic medical conditions managed, including her herpes simplex virus. She is financially capable of paying our monthly fee - she drives a bus for a local school district and cannot afford private insurance, but she can afford our primary care service.

As for folks who can’t pay for our service, we offer a number of ways to help people in our community and to do no financial harm. First, if someone cannot afford our services, we can send them resources to help them enroll in Medicaid or a discounted Affordable Care Act plan. There are also free clinics in our community and FQHCs that we recommend. For our patients who can no longer afford our membership fees, we help them to find a doctor who they can afford through the above resources, and then we close out their account. We don’t send people who can’t pay to collections.

Are patients joining your Direct Primary Care practice because of high costs?

Regarding finances, what are the common complaints that your patients have? Do they have trouble paying for expensive imaging tests (and in that case, do you refer people to specialists that are covered by their insurance)? Do they have problems meeting their deductible since membership fees don’t count towards their deductible? And do you foresee a policy change in the near future that will allow patients to have their membership fee count towards their deductible? 

Our patients are concerned about the high cost of care across the board. Every week we help someone find a lower price on labs, medications, and imaging services. We leverage local resources, like independent or free-standing imaging centers, to get cash prices on imaging studies that are often 50 to 90% lower than what these same imaging services companies charge insurance carriers.

I have not heard any concerns from my patients about our membership fees not being categorized as a qualifying expense for their health insurance deductibles. I’ve never had a patient leave my service for the above reason. I don’t really see public policy changing in this regard.

That being said, most people don’t sign up for our service to save money. They sign up for our service because they have access to a trusted physician.

The Growing Direct Primary Care movement and System Changes

Regarding the future of DPC, as DPC gets more ubiquitous (which I am hoping it will), what potential problems do you see arising? Is there effort being made to change the healthcare system in a way that separates primary care from insurance? And how do you see DPC surviving in a society where big hospitals are dominating over healthcare?

You’re right - DPC is growing! When I first started my practice in November 2016, there were roughly 400 Direct Primary Care practices across the country. Now, there’s roughly 1,200 DPC practices across the country! This is exciting because it’s starting to become normal for people to have a Direct Primary Care doctor - it’s no longer a fringe thing to have a DPC doc.

Ideally, DPC would grow to have every primary care physician and every person in the United States using the DPC model of care. Pragmatically, there’s probably an 80/20 rule at play, where 80 percent of people are comfortable with their health insurance and 20 percent of people are willing to make a change to DPC.

I think the overall healthcare system has started to change. People have started to see their insurance as a tool to protect them from bankruptcy and our services in the Direct Primary Care model as a way to get excellent primary care service.

I see Direct Primary Care surviving and thriving in any environment. We’ve already seen DPC docs create successful practices in urban, rural, suburban, wealthy, middle class, and economically disadvantaged neighborhoods. Hospitals already dominate our healthcare ecosystem here in Detroit, and we’ve been very successful in growing our DPC practice because we give patients what those juggernauts can’t - a reliable, personable, supportive, caring, empathetic physician that is available when our patients need us.

Weaknesses in the Direct Primary Care Model

And lastly, what are some of the weaknesses of DPC that you see? Where do you see a need for improvement? Are there any limitations as a DPC doctor as opposed to a normal family medicine doctor (visiting patients in the hospital, delivering babies, etc.)?

The biggest weakness in Direct Primary Care is probably vaccine costs for children. Vaccines are free for most kids and families because of insurance coverage and Medicaid coverage. However, because we don’t bill or use insurance, we cannot get vaccines for the children in our practice for free. How we solve this in our clinic is to send children and families to local health departments or the hospital’s no-questions-asked vaccine clinic. In the future, there would be a great opportunity for a company to bill insurance on behalf of DPC doctors for vaccines only.

Can Direct Primary Care alleviate physician burnout?

You mentioned that DPC reduced your burnout but when you do feel burned out, what usually causes it?

As for burnout, I was feeling burned out for a number of reasons. I felt like I was spending far too much time on mandated data entry tasks, and ultimately that data was not useful for the individual health of my patients. I felt like I couldn’t get the care that I needed for my patients due to restrictive care networks and prior authorizations. I was feeling burned out because I was experiencing a loss of autonomy over my work.

I usually feel burnout when I’m overwhelmed with trivial tasks that don’t help my patients live healthier lives. I want to maximize the time I spend counseling and caring for my patients and minimize the time I spend typing into my computer or checking boxes. Practicing in the Direct Primary Care has allowed me to accomplish both of those goals.

Thank you for writing this book. I’m sure you’re inspiring not only your patients, but also future doctors, policymakers, and other healthcare workers. I hope this is the stepping stone towards transforming the broken healthcare system. 

Looking forward your response, Xxxx Xxxxxxxx

Thank you for your questions, I’m sincerely happy to help. - Dr. Paul Thomas with Startup DPC