WCI #165: What is Direct Primary Care?

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This is White Coat Investor podcast 165 direct care medicine at some point in.

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Welcome back to the White Coat Investor Podcast. I missed you guys. I'm glad you're here. I had an interesting shift last night in the er.

You know, it's kind of the classic.

Experience in the er.

A patient who doesn't happen to have.

Any insurance or is in the process.

Of applying for Medicaid and not only.

Needs a couple hours of my time.

Suturing up lacerations, but needs several specialists as well to take care of her as an outpatient. And it's just such a pleasure to call up doctors of multiple different specialties and have them be willing to take care of this person who's having one.

Of the worst days of her life.

Despite knowing that they're probably not going to get paid. And if they don't get paid, certainly not what their time is worth.

And so thanks for what you do.

It's not easy. It's hard work sometimes there's a lot of risk. It took a lot of training and now you may be headed home from work or headed in and you're exhausted and you know, you haven't slept well the last few nights. It's not easy.

So thank you. Our quote of the day today, like.

Last week, is from Robert Dorigozi, cardiologist and author, who said physicians, like artists and athletes, make their living by having A skill or talent that results in a high level of remuneration that does not necessarily require a high degree of business skill. And that's the truth. If you want to be a good business person, you're going to have to pick up those business skills at some point. Whether it's running your own business or whether it's just running your own family, you're going to need them. If you need some help. If you have a business and you're trying to set up a practice retirement plan, you need some help with that. We have a new resource for you. We have a retirement accounts recommended page and there are several things on there. First of all, advisors and people and companies that specialize in setting up practice retirement plans for your partnership or for your dental practice or whatever it might be. If you need some help setting those up, you want to get a good 401k plan or whatever is appropriate for you, or figure out if what you have is decent. You know, if you just need a second opinion or you need some advice on how to get better investments in it, these are the folks you're looking for. So check out that page. It's under the recommended tab@whitecoatinvestor.com also be sure if you need two other things, we have them on there. If you need a self directed IRA or 401k, we have several companies we trust that put those together for a reasonable price. If you're looking to put, you know, alternative investments like real estate into retirement accounts, those may be good options for you. We also keep our recommended HSA providers there on that list and you can check those out again. That is the Retirement accounts recommended page@whitecoatinvestor.com so speaking of practices, we have a really interesting podcast I've been looking forward to recording today. We're going to have a special guest on who's going to talk to us about direct patient care medicine. So let's get her on the line and we'll introduce her. And so let's have a great discussion.

I have a special guest today on the White Coat Investor podcast. I have Dr. Amy Ostick, who is a primary care physician, but more importantly a direct primary care physician. And we're going to be talking about direct care medicine today on the White Coat Investor podcast, which I think is fantastic. She describes it as a revolution. I don't know if it's quite a revolution yet, but it certainly is the way I would be running my practice if I was a primary care doc. So I think it's great. And I kind of want to highlight it today and talk about what it is and talk about its advantages both.

For the physician and the patients and those sorts of issues.

But first, before we get into this, I want to let you introduce yourself a little bit. Dr. Austick, can you tell us a little bit about you and your upbringing?

Sure, absolutely. So I'm a family medicine physician. I grew up in Woodland Hills, California, which is a suburb out here in Los Angeles. I got into primary care from an early age. My grandfather was a primary care doc out here and he was a big influence. He had five kids, none of which went into medicine. I was raised by two hippie musicians and got into it in a roundabout way, but very compassionate, kind people. I went to Santa Monica Community College for a couple years and went up to Berkeley and then out to the east coast to Philly Jefferson Medical School where I met my husband who's also an ER doc. And we have three crazy, currently homeschooled children.

So was there any influence from your grandparent for you to go into medicine or was it just totally lucky that two generations back you had a physician in the family?

Yeah, no, he was definitely a pinnacle in our family and was a very well trusted figure. And I remember just that kind of influence in anyone he really met and had a relationship with. So for sure, from that level of esteem and looking up to him and wanting to have that type of influence on people and be that trusted figure in people's lives. So for sure he was an influence. And then just being a science nerd and liking science and then being encouraged. So my parents were very encouraging from that standpoint too. My dad had a very amiable relationship with medicine. I mean, his dad was in it. He never wanted to do it himself, but he thought it was a very noble profession. So they were very encouraging.

And yeah, you mentioned your education and training, particularly out on the East Coast. Did you have any exposure to direct patient care, direct primary care during your training or did you even hear about it or. This is all totally post training that you really got into this totally post training.

And you know, I think, you know, we. I graduated Medical School in 2008 and there is very much the narrative when we were in medical school that the private practice model is dead. Everybody's getting bought up by corporate medicine. And so there really wasn't even any effort to educate us on how to run a business or what a private practice model would look like or what, you know, so really very naive to not only just direct primary care, but being a Business owner and everything else. So I got into it just in the last couple of years. I was with a big HMO group, Kaiser, out here for several years and then with UCLA for a couple years. So got really good, you know, exposure to different types of payment models. And then my former resident, co resident got into on the east coast and was just turned around in terms of his falling in love with medicine again. So that was really the exposure that I got. Cool.

Well, let's start with the very basics. Can you give us a quick definition of what direct primary care means?

So DPC really aims to put the patient doctor relationship back at the forefront. So back in the center and the contract is between the physician and the patient. There's no third party payer that's involved. The patient pays a monthly membership fee, kind of like a Netflix, which gives them access to the physician, to the practice, to a variety of quality and financial advantages to the practice, like in house dispensing, et cetera, which is kind of like a Costco. So it's really been likened to those types of memberships where it's sort of a wraparound fee but a very low cost.

So a lot of people talk about concierge care. How is DPC different from concierge?

Yeah, so I'm very familiar with that being out here in la and I always am trying to make that distinction between concierge and DPC doesn't bill any third party. So where a lot of concierge practices will still probably charge an access or maybe an administration fee, a monthly annual fee, then they'll also bill insurance for each visit. The DPC monthly fee is really all you ever pay the practice or for that physician. So that fee, the other distinction really is the cost. I mean, the DPC fee is usually between $50 and $150 a month, where concierge fees can be much, much higher, probably more in the thousands. DPC also really tries hard to provide price transparency to the patient. So that's the real, I think more advocacy part of this is that we really try to find great cash prices for labs, for radiology procedures, even some outpatient surgical procedures. And that's really where a lot of my education and my time goes, is to help to advocate for my patients financially how to access medical care. So that is a big distinction too from concierge.

Now a lot of those concierge providers talk about, you know, here's my cell phone number, call me anytime, I'll come over to your house, whatever. You know, it's this, this super close access to a doctor. Are most DPC practices like that or most of them don't offer that sort of level of service that you can email and call the doctor at any time?

Yeah, I think the phrase that I've heard a lot is if you've seen one DPC practice, you've seen one DPC practice. So some are very, have a small panel, Maybe they have 50 to 100 patients and they're very hand holding, more maybe like a concierge model. Some probably maybe are a little bit bigger and they have bit more boundary setting and okay, I'm after hours, you know, or they have a patient agreement that might look a little bit different. So that's what's great about it is you can model it based on how you like to interact with patients. What type of patient would fit best for your practice? So my particular patient practice is more accessible. People can call and text me and I just like that. I think it's efficient, especially in this pandemic world that we're running practices in. So people love texting me. Rashes parents text me all the time when they're worried about something and it's just easier, efficient, it's safer. So I like that personally. So I think it just depends on the practice.

Well, it's awesome because you don't have to worry about how to bill for a text conversation or a phone call or any of that. I mean it's super nice that way to be able to avoid that. The other thing that would be great is not only not having to wait months to get paid by the third party payer, but not having to have the staff required to fight with the third party payer. How many fewer people do you think you have in your practice as a result of that? Do you think you have fewer staff members because you don't have to do all that crappy coding and billing crap?

For sure, yes. The estimates around 60 to 75% of a typical primary care insurance based practice goes toward billing. Like having a billing person or billing department fighting for, you know, going backtracking, recoding, telling Dr. To recode the visit and then submitting again to the clearinghouse or the insurance company. So that's a lot of legwork. It's a lot of time. Right. So I have one nurse and myself and that's it.

What about pre authorizations? You have to do any pre authorizations for anything.

I haven't had to do a pre often in nine months. And that's if we are really fighting for A medication that we cannot get because again, I buy all of them wholesale through a wholesaler, can't get through a generic wholesale company. We might have to. And we have to go through insurance, but I haven't had to do one yet. You know, I have about 250 patients now in my practice. You just remove so many of those headaches because you just. The patient needs this retin a cream and that's what they need. And you order and it's $6 and you. And they show up the next day and they buy it from you. And it's. There's none of this. It's not in our formulary that we can only use the ointment, not the cream. I mean, all of that is removed.

So most of your patients, as far as their medications go, are they still using insurance to pay for that? Are they buying them through you somehow? How are they getting their medications?

Typically, it's almost always cheaper to buy them through me. I mean, I don't order any Schedule 2 medications or a Schedule 4 benzodiazepines or anything like that. So it's mostly your run of the mill antibiotics, hypertension medications, cholesterol medications. But I also dispense Parkinson's medications that are really expensive for them to get through their insurance. So I can get them a lot more affordably. And yeah, almost always it's cheaper to get them from me than from a big pharmacy.

So is there no legal barrier there to doing that? As a physician, I feel like I've always been told we can't dispense medications because we're not pharmacists. And maybe that's because of the payers, maybe that's because of the hospital, maybe that's because the state. Can you talk a little bit about how you got into dispensing medications?

It's part of. It really is part of almost every DPC practice that I'm aware of is part of the benefit as being a member of the DPC is that part of my time and effort goes into having a good inventory of wholesale medications and keeping stock and being judicious with that. So certain states, like, I think I know Texas for sure, where physicians. It is illegal for them to dispense medications. They can write the prescription and how they want it to be dispensed, but then for them to actually put that pill in a bottle, it's illegal in California, there is not a legal issue there. So it's really nice. It's a great benefit and it's cleaner and easier for me. And again, as a physician I know exactly what I'm giving my patients and how much and there's much more communication there. Imagine me telling them exactly how I want them to use it or how it should be applied.

So what's a day look like? I mean, how many patients do you see in a day? How many phone calls do you take during the day? How many emails do you during the day? How many people call you after hours? What's a typical day in the life of a dpc, Doc?

Yeah, a typical day is, you know, they say about a typical primary care physician will see that 1% of their panel in a day. So if you in a typical insurance based practice, that's 2,000 to 3,000 patients in one person's panel. So that's 20 to 30 patients a day. I have about 250. So that's probably two to five patient interactions in a day, some of them in person. A lot more of those are virtual texting, emailing, calling. So that's the typical patient load. But then a lot of my time, again, like I mentioned, is advocating for patients coordinating care. We have a patient getting a liver biopsy on Monday, so we're calling the radiology center to make sure that he knows exactly what the orders are so that nothing, you know, when does he need his COVID test? What is that going to look like for him? He needs the coordination with the rheumatologist and the dermatologist follow up. So we do a lot of coordination of care, which is really important and patients, you know, we just write something on a piece of paper or write an electronic order and we thrust them out there in the healthcare world and a lot of things get confused and mixed and not done or not done properly because we don't have the time to coordinate that care for them. So that's a lot of what I do as well.

So at some point you made a decision to leave traditional primary care for lack of a better term, third party primary care and go dpc. Tell me about that decision, the decision and what your fears were, how many of them were realized, what pushed you over the edge, why you chose a DPC practice. Take me back to that time if you can remember.

Yeah, I think again, having never any intention of going into private practice at all, being a little bit afraid of being a business owner and just thinking it's too complicated, it's too hard for me to understand us doctors, that's for the administrators to deal with. But then being in that world long enough and seeing Just how silly the decisions that the administrators are making on our behalf clinically. You know, double booking patient appointments or saying a patient, you know, just I felt like. And losing that autonomy of when and how I wanted to see my patients, what I thought was important to discuss in that visit, coding and all of that, just taking more and more and more and more of my time. I knew there had to be a way out. And for most people, for most good clinicians, docs that just get burnt out that way, it ends up either leaving and going into administrative role, which I knew I didn't want to do, going way down, going part time, which we couldn't really afford. So once I really learned about this model and realized it's not concierge, so I'm not really abandoning a whole host of patients that I would feel guilty about and providing kind of a have and a have not world when it comes to medical care. It's not that it's really something accessible. And also there's a movement to change primary care and I'm part of this cool movement. It was an easy switch for me. We went to a conference, my husband and I, in Orlando in 2018. We were drinking the Kool Aid. At the end of the conference, we made a business model. We marched out our business model and there was no looking back after that.

You know, I had a great time researching for this interview. I spent some time on your website if listeners are interested in that. It's healthandhealingdpc.com you have some testimonials on there. There's clearly a few people that love you. The one of them on there says, I can't say enough about our visit this morning with Dotstick and her nurse. They are both so personable, kind, extreme, extremely thorough, and just amazing in a million other ways. It was so nice to not just be a number in a huge waiting room then getting a quick 15 minute rushed exam. Especially when it comes to my kiddos. My sweet boy was so sick and so sad. We were treated so kindly. Tests were run, results were given, medicine was provided there at the time of the visit. My little one is already feeling better. Another best part, it was so less stressful for me. You guys are the best. So glad we switched from the crowded, crazy, just a number doctor office that we'd become used to while dreading it. So what do the patients think?

Oh, I mean, many of my patients, like my colleagues, think this is just too good to be true. And they have a hard time understanding and switching paradigms when it's like, I don't understand. You don't take insurance. What does that mean? That's a real hard barrier for them to initially get over and that they feel like they're paying extra for something. And a lot of people's experiences, if they switch some of their things with their benefit package, they can end up saving money for sure. But once they're in it and once they have a visit with our office, realize how easy it is to access their primary doctor. And there's no call center they have to go through and barriers that are put forth in front of them, they're bought in. There's really, you know, many of my patients are like, are you sure that's all you're charging? How are you doing financially? You know, they're worried about it, but no, but they are very. They love it and they're really bought in for the long term. And that's. I want this. I went into medicine to do it for 30, 40 years. I didn't go into medicine to do it for 10 years and burn out.

So the other thing I found fascinating about your website is it's a menu. You have the prices on your website, which is like my dream to run an ER where people actually know what we're charging them. Right. But this is really fun. You go on there and you see that an adult pays $89 a month, a senior pays 99, a family pays 199, a kid's 39amonth in addition to an adult. You know, it's 20 bucks for an additional child after two. And then there's a non refundable $99 registration fee per household. I mean, it's awesome. You actually know what the price is when you walk in the door. So that's fun. You also do after hours visits available within 10 miles for a $99 per visit fee, which I think is pretty exciting as well. How many patients do you think a family doc needs under this model for it to actually work? You know, for them not to take a pay cut from their old job, but to actually make this work. How many patients do they need?

So we, I mean, we broke even, frankly speaking. And my husband and I are very, again, because we're so into price transparency. We've been very transparent with our colleagues about what it takes to our P and L statements and everything else, but we broke even around 200 patients when it came to our overhead. And I have, like I said, I have one full time staff, so one full time nurse. I have rent, I have med Malpractice that I pay for, an EHR that I pay for. And I'll be making what I, what I was making at my previous employer at around 400 patients, which is 1/5.

To, you know, 1/7 what you'd be seeing in a typical practice. So obviously dramatically fewer. Now you talked a little bit about how to kind of start a practice like this from scratch. Your own experience where you drew up a business plan and started recruiting. What if you're already in a typical practice? Right. You've got an insurance based practice and you want to go to a dpc. How do you make that change?

There are actually several of my colleagues in the DPC world have done it that way again kind of as a just being fed up with the system and they have 2,000 patients and they want to convert. So they basically what you have to do is obviously educate your patients about the new model and what it's going to look like. The legal part of it is really opting out of Medicare. You have to opt out of Medicare in order to keep your Medicare patients and stay clean kind of legally to, in order to charge them that monthly fee you have to break your insurance contract and say no thank you, I'm done. And now your contract is really with your patients. And then you probably have to really downsize in terms of your operations and what that looks like and whether you're going to have one MA or a nurse or what that looks like and then educate your patients and see who's really up for that type of model. I mean you probably have of your 2000, that would be great because there's definitely 10% of those patients who are looking for this type of care who either want it for access purposes but also, you know, like you or maybe they even financially this might be a better option for them. So that's kind of how you would convert it from a typical practice.

Do you have any idea what the conversion rates are? If you send out, you know, if someone's going to convert their practice, they send out letters to their patients and say we're going dpc. What percentage of the patients stay and start ponying up the $89 a month or whatever it is?

I mean, I don't know. I think I can tell you I had a panel about the last practice I was in. I had 600 patients because I was fairly new to the practice only in their two years and I took about 50 of them followed me. I don't know if that gives you some idea. So maybe 10%, I think. But it just depends how long you've been in the practice and how long you've had these patients. I mean, a lot of primary care docs, their patients are pretty, once they have their own practice for a long time, their patients are pretty devoted and maybe want to follow them no matter what it looks like.

Now, I thought it was pretty interesting that you do both after hour visits and home visits. At least you offer that service. How many do you actually do?

I do them a lot now. I mean, after hours, it's interesting. That's the biggest concern that I gave a talk to some residents earlier in the year and they all looked at me like, oh my gosh. The patients had their cell phone number that just, they couldn't fathom that extra layer of access that patients could have. But when you put it into all of it, the direct primary care model, where you're seeing again, two to five patients a day and you are free to make the decisions that you need to make, you can block off the hour to go to your kid's volleyball game. You have that schedule flexibility. You find yourself saying yes more than you did ever before. And so the after hours become like, yes, please don't go to the er, please come to my house and I have a cat's extractor and I'll pull that piece of apple out of your 2 year old's nose. Please don't go to the ER for that. I love those. And that's why I got into medicine. I could not have imagined doing that in a my former practice with 3,000 patients because you're already up to your eyeballs in patient interactions and people pulling at you. So I think I probably do maybe two to three after hour visits a month. And the home visits, I offer more as a service and right now to my elderly patients because of sort of the stay at home orders here in Los Angeles. So again, it doesn't seem as intrusive as it did before because I'm committed to these patients and I want to be there for them.

So you mentioned two or three of the after hours. How many home visits do you think you actually do in a month? I mean, it's a little odd time right now, obviously, but I guess pre and post pandemic, I think I probably.

Do four or five home visits. And again, a lot of them I initiate because I'll get some seniors that come onto my practice and I don't know them very well and there's just a story there about falls. And I'll say, you know, I really need to do. I want to do a home visit, I want to take a look at your house, I want to do a safety eval. So it's about. I just want it to be more comprehensive. So probably four to five in a.

Month and you charge $99 for those. The question I say is $99 for a physician to go out to your house. I mean, how is that a good use of your time, especially given the commuting time and overhead and all that?

I think it's very useful in the sense that in the context of my day, so my day is not jam packed with 30 patient encounters, so I have the time to do it. And also again, for a subset of patients, it really gives me a lot of context. I walk into their bathroom and there's pill bottles all over and they don't know what they're taking and how. So for me, it fills in a lot of gaps in history. So I love doing home visits. It's a very rich experience and a rich visit for me. I don't offer them, I'm offering them more out of convenience right now and safety for the pandemic, pre pandemic. If it's a low risk patient and a kid or whatever, then I'll have them come into the office because it is a little bit easier.

So speaking of your fees, how do you set those? For instance? Why not charge more? How did you decide on $89 a month for an adult and $39 for a kid?

I knew it was going to be between $50 and $150. That's kind of how most DPC practices work. And we went to this conference and the beautiful thing about DPC is there's a community of docs all over the country that are ready and willing to share their information, share their stories, share their documents, share their fee schedule, all their forms that they have patients fill out all those things so you can get a good sense of what you need and what you need to. I set my fees based on a couple of DPC practices that are around me here in Orange county, just for cost comparison. And we sort of basically backed our way out. So if I wanted to make what I was making at my prior practice at a full panel of patients of 4 to 500, we sort of backed our way out into what that would look like after overhead, monthly cost per patient. So that's kind of how we worked it out.

So some of the other interesting things, on your website you have a list of radiology procedures with prices, including a no contrast MRI of $325. It doesn't even list body parts. It's $325. Ultrasound is $150, non con CTs, $275. X rays are $40 to $75. Did you negotiate these and do they include the radiologist fee?

No, I don't negotiate them. So basically this was the biggest barrier for me and the hardest sort of effort, energy expenditure before I set this up was getting lab and radiology prices. And it's because in this world we're used to basically radiology centers or labs charging insurance. These fake inflated amounts based on the insurance contract the insurance says will pay 20% of that amount and they collect whatever it is. So the higher you charge, the more you're going to collect. So it's hard to get these prices. A lot of radiology centers don't want to jeopardize their contracts with insurers. So they'll say they don't want to put anything in paper or in writing. If you as a cash patient, ask them verbally, places will have these numbers, but they don't want to put anything in writing. I just found a really nice local, smaller radiology group out here that was willing to do that for me. Just said, yeah, this is what we charge. And they were just willing to work with me. And then similarly with the labs, that was another big barrier. But I basically joined a group purchasing organization. So not only do they provide you discounts for like sprints and things like that, but they provide you discount for quest diagnostics. So I had to jump through a lot of hoops. You get that relationship. And our rep then had to give me a cashless price for all of our labs.

So does this $325 for the MRI, does that include the radiologist reading it?

Yeah, it includes all of it.

And I assume the patients have to show up with cash on the barrel head to get these prices.

Actually, no, not all of them. A lot of them will just bill you, but some will ask for the payment up front. It depends. There's two different centers that I work with. It depends on what their protocol is.

Do any of your patients try to pay for this sort of stuff using their insurance or they all basically go to this radiology center and try to pay cash.

What we'll do is they'll pay for my fee, obviously cash, and then we can use their insurance to bill the lab and the radiology center can bill their insurance if they don't have a high deductible fee or they've met their deductible for the year, then Quest or whoever can just bill insurance for it.

Now speaking of which, what do they typically carry? I mean obviously this fee they're paying to you is not going to cover them. If they're in a terrible traffic accident and end up in the ICU or get cancer, that sort of a thing, what else are they buying?

Right. So typically what this really works well with are high deductible plans. So DPC works well with high deductible plans because it's similar in the world of insurance. We don't use our car insurance to replace a windshield wiper. Right. We really shouldn't be using our insurance to access low cost primary care. And when we do, the more we do the next year, the more that drives up premiums. So what we advocate, what I tell patients is get that high deductible HSA plan, incur some of that, take on some of that lower amount for risk as far as primary care, get it with a DPC practice, pay cash. And then when you, you know that high deductible plan is there for all of the big stuff, all of the surgeries, the cancer, God forbid, cancer diagnosis, the heart attack, et cetera, the ICU stay, the NICU stay, all those big financial catastrophes. But we, we don't need to use your insurance for your $20 flu shot or your, you know, $6 wart removal that's going to cost $800 after you run it through insurance and code and everything else.

So what about health sharing ministries? Are any of your patients in a health sharing ministry and can you talk about the differences they're running into using DPC with that versus a high deductible health plan?

Right, and it's similar. So basically some of my patients also have a cost sharing plan. Those are much more affordable kind of co ops where you pay a monthly membership fee. And basically there are list of things that are shareable and then unshareable and most of the things that are shareable are maybe elective surgeries or an ER visit for a ruptured API. So if you run into those, that's basically when the cost sharing plan will kick in and pay for that after your initial unshareable amount, an IUA which is similar to kind of a deductible but you pay out of pocket X amount and then after that amount the sharing ministry will pay for that. And DPC is great for that because we are making primary care very affordable. So patients Will pay cash, labs, X rays, medications for primary care. And as soon as that, they need to go get a colonoscopy or do something more expensive. They can access their health sharing ministry to help them with that.

So the other fascinating part on your website were the lab prices. So you charge five bucks for lab draw and then these labs, I mean, it's 403 for a BMP, it's 504 for a CMP. A CBC is 305. The most expensive thing on here is a serum iodine at 73 bucks. I mean, how are you, how's anybody making any money charging $3 for a CBC and $5 to draw it?

So I don't make money off the labs I draw. I charge $5 for my phlebotomy charge. My nurse draws all the labs. I act as basically a pass through. So I charge those prices and then Quest charges me the same exact price that I have basically contracted or negotiated them with through my gpo. And then I charge the patients. So the patient pays a typical panel for their physical, 30 to $35. And then they pay me and then I pay Quest. I'm kind of a pass through, but that's how much it costs. It's not expensive to run these labs. We just have these fake inflated prices when you get an ER bill that it's $800 for your CBC, $150 for your Tylenol. So we're just used to seeing either no price and nobody will tell you how much it is, or very inflated prices for these things.

Yeah, it's fascinating to see what the actual prices are. I mean, Quest wouldn't offer you this price if they weren't making money at $3 for a CBC.

Exactly right.

But you know, I mean, the bill that goes out in my name for a CBC has got to be 100 bucks or more for it. You know, I mean, it's just crazy to actually look at the prices here that a lab is actually willing to work for. So. All right, so here's the big question a lot of people have. Do you think a DPC doc on average makes more than a regular primary care doc, and if so, how much more?

So I actually don't think so, and I don't know this for sure. You know, I think a lot of the DPC docs that I know that went into this take probably a small minor pay cut at the end when they're all full at capacity. And definitely that first year of building their practice, they probably, they, you know, they Take a pay cut. And it just depends on the practice style. I mean, once you add a second doctor, that is probably where you can start making some more money as a business model. But a lot of docs are kind of a, a lot of practices, DPC practices are one woman show. They, they just find it easier to maintain the quality of life is better. You know, there, that's really kind of what people are after. And physicians want to do this for the. And then you find yourself, like I mentioned earlier, saying yes, a lot more to patients and in your life in general, you have more time for your family, more time for your patients. And that's kind of the invaluable piece to this. And I remember leaving my former practice and my medical director was like, oh, that's just concierge. You're just doing it for the money. And I get that. I understand that that's sort of an offhanded way of thinking about it, but it's not really a cash grab at the end of the day. It's really a mission oriented model that aims to try to restore the doctor patient relationship back at the center. And DPC docs are just happier and they just love, they love clinical care again. And I think that's kind of what they're all after.

So a critic of this model might say there's an ethical problem here. You're filling your practice with people who can afford you and dumping Medicaid and Medicare and low income patients on other clinics or emergency departments in order to make your life easier and more profitable rather than really serving those who need it most. What's your response to that criticism?

Yeah, so I mean, I think in fact many of my patients, and this is true for a lot of DPC practices, especially even in urban areas, many of my patients are just above the safety net. So they make, you know, $1,000 too much to qualify for Medicaid or whatnot, so. Or they have a few part time jobs so they don't qualify for an employer based insurance plan or they have very high deductible plans. They just can't access primary care. It's very expensive in a typical insurance based practice. I still see a lot of Medicare patients and I've kind of, I mentioned before, I opted out of Medicare to make that legal and clean. I also have several Medicaid patients that can never get into their assigned FQHC or assigned Medicaid doc and they pay me a fee to have better access. They call me, text me anytime. They pay cash for low cost Labs, radiology exams and in fact I become their medical home in that way and their ER has stopped becoming their medical home. So in fact my former practice at a very well known academic center nearby didn't see any Medicaid patients at all. And that's because of the reimbursement rates and we've all run into those situations trying to refer patients to a specialist and they just don't take Medicaid. So in fact my panel I think is now more diverse than ever. I have some refugee patients, I even have undocumented patients. I don't care. I want all comers, I want to be accessible and that's why the price point is where it is. Patients that are kind of low resource patients actually can afford me and in some ways we can offload the eds from becoming kind of their primary care and keeping them out of the er.

So my parents in Alaska are in some sort of a weird plan. I don't know if it's a hybrid, I don't know if it's dpc, I don't know if it's concierge, but they pay an annual fee and the practice also bills their Medicare. Can you speak for a few minutes about that sort of a model and how successful you think it might be and whether some people who aren't really ready to take a full step to DPC might consider something like that?

Yeah, I think that there are people who do hybrid as a way. Exactly what you kind of mentioned. It's like they are in a typical insurance based practice and they're not quite ready and they don't also maybe they have a lot of Medicaid or Medicare patients and they're not ready to opt out of Medicare yet. So they will do some patients that are DPC that they'll just, that'll be part of their DPC kind of, and they'll pay an access fee and they'll still bill insurance. And it just gets a little messy. A lot of docs that I know that start out that way end up going full on over to pure dpc. That's just cleaner. I mean there you're still dealing with a lot of regulatory factors and what happens at the end of the day is that you're still having to bill and code each visit which can take up to 60% of the time of your visit. Your notes become these big billing machines and then you're still doing prior auths and you're still doing all of that. So I don't think it gets rid of what we're trying to kind of reform here, which is primary care in its purest form, which is the patient doctor relationship.

Do you think it'd work for other specialties and if so, which ones?

I think the best ones it would work for specialty wise would be room, endo, ID, renal, maybe even like non procedural based specialties. I think procedures that are costly can get difficult to pay cash for probably, and certainly you want to do specialties that have a long term relationship with their patients. But there are places in the country that are really pushing for price transparency even with elective procedures. There's a place called the Surgery center of Oklahoma. That's a great model. And so there are places in the country that are really pushing for that. So there are specialists, anesthesiologists, ophthalmologists that they don't have a DPC pure model, but they do have a fixed price for procedures and elective surgeries.

I guess another thing that I might worry about is that, you know, people respond to incentives. You know, it's the first law of economics. So you're now offering somebody care, however that might be defined, for $89 a month. What's to keep your practice from filling up with somebody that comes in and sees you twice a week to get the maximum amount of money out of their $89 a month payment?

Yeah, you know, I do make them sign a patient agreement that basically does have some safeguards in there that say that I'm accessible 24 7, but that I'm not an E.R. if you don't hear from me within 30 minutes, that you need to go to the E.R. and that, you know, basically, you know, I have a family life and there are some boundaries and I can sniff those out. You know, I've been in practice now for a long time. What's really interesting is it's more the anxious patient that I can see people getting worried about. Like you're saying the heavy users, people call all the time. And I have several of those that followed me from my old practice and they have said to me out loud, like I'm just so used to having to call all the time because I never get an answer and nobody ever calls me back and I'm worried and having to advocate for myself all the time that they're not used to when I call their doctor that she answers the phone. So I think there's a little bit of anxiety there. The first few weeks of a typical heavy user and then they call a lot and then once they realize, oh, she texts back oh, she actually calls me, oh, I can get an appointment tomorrow. They kind of chill out and they realize, oh, that anxiety kind of subsides and they become usual users.

Have you had to fire anybody for that sort of a problem?

I haven't had to fire anybody. Again, in my patient agreement, I don't do any chronic pain and that's just becoming a little bit easier to enforce now. But so I don't have any, I haven't had any of those types of patients where I've had to fire.

Now you occasionally, obviously have to refer people out to specialists and they go to specialists and find out what specialists are charging for their visits. Often I suspect dramatically more than it might cost even for you to come to their house. Are they surprised when they find out what, you know, what the rest of medicine is charging or they just roll with the punches there? What's your experience been referring people out, do they not want to go see the specialist or what's the experience?

You know, we take a very individualized approach so we know what insurances my patients have. So we will do the legwork for them and say, you know, and make sure a, that their specialist is in their network, if they have a network so they can, they know what to expect. But then a lot of times my patients will come to me to draw the lab to the specialist order because they know if they get it done there that they're going to get a bill for $1,200. So they'll text me and go, do you have these labs? And then they'll rattle it off. I go, yeah, I have most of those and if I don't, I can get a cash price for one. And we draw them here and it's just, you know, they've learned that if you don't ask and if they don't tell you, you're probably going to get a surprise bill.

Awesome. Well, we're starting to get short on time, but this is probably going to be downloaded and listened to by about 30,000 people, mostly docs. What have we not talked about that they should know about DPC or anything else? You know, you got a platform here to actually talk to people about whatever bee's been in your bonnet lately. What would you say to these listeners?

I mean, I really believe this is the future of primary care and I've never felt so passionate about clinical care and fallen kind of in love with medicine again than I have in the last nine months since I started this practice. We've absolutely destroyed the integrity and utility of Primary care in our country. And even though every piece of literature you'll pick up about primary care says that people with good access to primary care live longer with healthier lives. And the conglomeration of corporatization of primary care has destroyed that, destroyed the relationship between the doc and the patient. And it really just falls all downhill from there. Increases referrals, increases the acuity of care, the access to care. So, you know, I believe, I really, truly believe, while I know there's a scaling issue, and I understand that for sure, I think this is a great conversation to start about how to at least reform primary care, how to put docs back in charge with deciding what the best decision for the patient is. The other thing I'll just say is I talked to a lot of docs from out of residency and they're worried about taking on more debt, starting a business. What does that look like? That's probably one of the number one questions I'll talk to people about. They're worried about that because they come out of medical school with a half million dollars of debt. My husband and I paid off $550,000 of medical school debt after six years. We just got busy and we lived like a resident and we lived on a budget. And I think if you do those practices, this is why I think it works so well, you learn how to live simply, can give you this freedom and this choice. And once we paid off that debt, we were able to say, oh, we know how to do this. We can save and we save towards starting a practice. And then once you have that set up and that saved, you know, starting fund, then kind of the world is your oyster and you can build what you want to build. So that's the only other thing I'll say is be careful about out leveraging yourself. If you want to start a DPC practice and borrowing an extra $50,000 from somebody to do this, because it takes time, but if you're diligent, you can definitely do this.

Awesome. Dr. Amy Ostick, thank you so much for coming on the White Coat Investor podcast today. It's been wonderful having you and talking about dpc.

Thank you so much. I really appreciate it. Thank you.

You're welcome. And if the listeners would like to learn more about you, you can go to healthandhealingdpc.com yes, and like I said, your prices and everything is right there on the website. So you can really almost have a model of how you can start a practice like this yourself just by perusing your website. So thank you so much.

Thank you.

That was a great episode, huh? It makes me excited to go be a primary doc. Just not dealing with the rigmarole of non transparent pricing, overinflated pricing in the er, it can be especially bad. You know, you feel terrible ordering tests. I try to talk people out of MRIs all the time. I tell them the hospital would love for me to order this test. But if you go home and you order it, you know, at an outpatient radiology center, it'll be one quarter of the price, you know, and it just feels icky. Sometimes dealing with a system. It would feel so good to be in a pure system where you say here's the menu, here's the prices. This is what it costs, take it or leave it and move forward. So I don't know, I find it pretty refreshing. I'm excited to see a lot of primary care practices going that direction and I think it is part of the solution to our significant healthcare crises.

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Outlets that we have.

You guys can stop sending songs in foreign languages. I got four or five more of those this month. I'm not going to put them all on the podcast just because you record a song on the Speak pipe, but some are pretty interesting even if I.

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My dad, your host, Dr. Dahl, is a practicing emergency physician, blogger, author, and podcaster. He is not a licensed accountant, attorney, or financial advisor. So this podcast is for your entertainment and information only and should not be considered official, personalized financial advice.