Medical Memberships Fill Some Gaps When People Can't Afford Insurance
When Joe Morris had a heart attack last Easter and had to be rushed to the ER, it was the first time he’d been to the doctor in more than 40 years — since high school.
Back home in the small community of Neosho, Mo., Morris needed follow-up care to manage his heart disease and diabetes, but he didn’t have a doctor — or insurance.
Paying cash to a doctor in nearby Joplin was costing him $285 a visit — plus gas and time. It was too much.
“If you can’t afford it, you can’t afford it,” Morris says. “I could either have a home and eat or give it to a doctor and live on the street.”
Then he heard about a doctor in Neosho doing something different. This doctor didn’t require insurance, offered unlimited office visits, provided some labs and medications at wholesale cost and gave out his cell phone number so patients could call or text any time. All for just $60 a month.
The doctor, Joseph Sheppard of the Free Market Primary Care in Neosho, runs a direct primary care practice, a model of care that’s growing more popular.
Direct primary care practices don’t take insurance or charge copays. Instead they’re a membership program. Patients get access to as much primary health care as they need — for a monthly fee.
It works a little like Netflix, explains Dr. Josh Umbehr, a physician at Atlas MD, a direct primary care clinic in Wichita, Kansas, and early adopter of the model.
“It was $8 to get a movie at Blockbuster for one viewing, and for $8, I get 10,000 videos from Netflix and I have all month long,” Umbehr says. “That difference, we wanted to apply to medicine.”
Direct primary care clinics have become more popular over the past few years. There are now 557 clinics in 47 states and Washington D.C. that use some sort of direct primary care, according to the advocacy group DPC Frontier.
Direct primary care is not a replacement for insurance— it only covers primary care not hospital visits or specialist care — but it does provide patients — especially rural and low-income patients — with access to basic medical care for a low cost.
If the Affordable Care Act is repealed, more Americans may lose coverage and have to look for new ways to afford health care. This is nothing new in Neosho, Mo., and many other communities in states without Medicaid expansion.
In this rural area, Newton County, 24 percent of adults are uninsured, nearly double the national rate of 12.8 percent, based on 2015 numbers. And according to the U.S. Census, nearly 15 percent of residents in Newton County live below the poverty level.
This group of people — lower income individuals and people living in rural areas with fewer options for health care — were the people the ACA was supposed to help. But without Medicaid expansion, many still lack coverage.
Sheppard’s clinic has been open for almost two years and already has 490 patients in town signed up.
Sheppard says there’s a secret to his low prices.
“You cut out the insurance and you cut a lot of the overhead that’s generated by the insurance billing process and the prices come down considerably,” Sheppard says.
He says the model is counterbalance to current trends in medicine. Doctors who used to spend the majority of their time treating patients are now relegated to “clerk work,” Sheppard says.
“You spend all your time rushing from room to room filling out paperwork. The joy of medicine is gone,” Sheppard says.
With direct primary care, he gets to spend more time with patients and less time worrying about paperwork and billing.
But it’s by no means a cure-all. Dr. Sheppard recommends that his patients combine a membership to his clinic with other coverage like a catastrophic health insurance plan, since he can’t treat serious health emergencies — things like surgeries, cancer treatments or Joe Morris’s heart attack.
Without some form of insurance, patients are still at risk for enormous medical bills if they should become seriously injured or ill.
Take Morris’s heart attack. He is now on the hook to pay $103,000 after a few days in the hospital and two heart surgeries. If he had a catastrophic insurance plan at the time, he would have instead had to pay just about $7,000, his hypothetical out-of-pocket maximum.
But a catastrophic healthcare plan through the ACA can be both expensive and hard to qualify for — an individual has to either be under the age of 30 or meet a certain “ hardship exemption.”
For those who do qualify, combining a catastrophic plan with Sheppard’s membership fee, a patient’s total costs may be equivalent or lower than a plan on the insurance market, and there are no additional co-pays.
A catastrophic plan costs an average of $260 a month for a Newton County resident through the Affordable Care Act marketplace. While the average price of a basic (Bronze) plan on healthcare.gov is $325 a month. And then, even after buying the insurance, patients must still pay a deductible and any additional office visit costs, which can be substantial.
Dr. Sheppard says that’s just too pricey for some of the people living in the area. For them, direct primary care memberships are often a better choice.
“Even if the [ACA] plans are quote unquote affordable, they might not be a wise financial decision,” Sheppard says.
Dr. Umbehr with the Atlas Clinic in Kansas agrees.
"We have a lot of patients who are not signing up for insurance and are just taking the penalty," Umbehr says. "Paying $1,100 dollars, $900 for an exchange-based plan just doesn't make sense for most of our patients."
And that’s what keeps him motivated to run his business.
“I would make the argument that if we take our oath seriously of “Do no harm,’ that has to include ‘Do no financial harm,’” says Umbehr.
And some of Dr. Sheppard’s patients, like Joe Morris in Neosho, don’t partner their membership with any form of health insurance due to these costs.
Dr. Michael Munger, the president-elect of the American Academy of Family Physicians, says the model is still growing. While he doesn’t see it overtaking the traditional model for primary care, Munger says he expects it to become more popular in the future as it fills a gap for some patients.
“The patients demographics have been lower income, but also those who maybe have chronic illnesses and health care needs where this type of model can be very successful,” Munger says.
In Neosho, Dr. Sheppard’s clinic is one of the only options for some residents — short of going to the ER. Morris says he wouldn’t bother going to the doctor if Dr. Sheppard wasn’t around.
Morris hands out pamphlets for Dr. Sheppard’s clinic at his tire shop, and also helped his only employee, Sean O’Hara, sign up for a membership. O’Hara has multiple chronic conditions, and says that he stopped going to the traditional clinics in town because the costs were adding up and becoming unmanageable.
If not for Dr. Sheppard, “I just couldn’t afford it,” O’Hara says. ”Probably [I’d be] getting sicker and letting my blood pressure just go higher and higher until I probably croak from it.”
This story was produced by Side Effects Public Media, a news collaborative covering public health.
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