In this episode, we tackle the question: Are Direct Primary Care (DPC) providers just in it for the money? Dr. Capella and Dr. Boucher share their personal experiences and insights, offering a candid look at the realities of running a DPC practice and the motivations behind it.
Link to podcast: Are DPCs Just in it for the Money?
Welcome to DPC Pediatrician. We’re Dr. Phil Boucher and Dr. Marina Capella, two DPC pediatricians who are on a mission to share our love of direct primary care with you. Hey everyone, welcome to another episode of DPC Pediatricians. Today, we have a good discussion, I think. We kind of, unfortunately,
0:18
sometimes we talk right before we start recording and then we’re like, whoa, whoa, whoa, let’s save this, the good stuff for when we’re recording. And today we’re talking about the common-ish question of are direct primary care doctors just in it for the money,
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which makes me chuckle because I have taken a huge pay cut in switching to direct primary care. And I think that would be almost a universal rule of direct primary care, especially as you’re starting off, is you’re going to take a big pay cut.
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And I think it takes a long time for people to realize that and then do the math of starting a practice and all those sorts of things. But maybe, Marina, can you kind of kick off the discussion for us of what the thoughts are, the questions, or how this question came about?
1:02
Yeah, absolutely. Well, first off, I’ll say that When I first heard the term concierge medicine way back in the day, I just automatically made a lot of assumptions about it. I thought of concierge medicine as someone who charges, you know, hundreds to thousands of dollars per month to, you know, basically be at someone’s beck and call. Right.
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That it was that level. It was only for wealthy people. And when I learned about direct primary care, I was pleasantly surprised when I actually started reading about what it really was and hearing the experiences of DPC doctors, that it was really for a much broader segment of society. And it aimed to be as accessible as possible.
1:46
While still, of course, you have to charge money in order to make a business work, right? No business can survive on pure altruism. And in our current healthcare system, people get charged money, right? And so we’re just using a different model to actually save the system money overall. But of course,
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because of the way our current healthcare system works, patients have to pay the monthly fees. But recently there was a discussion in a Facebook group and this debate kind of happened about like, you know, is DPC really a model that helps everyone? And some people were on the side of the fence saying that, oh,
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DPC doctors are just selfish and they’re not able to serve everyone. I’m going to stay in the system because I really value all of my patients and I don’t want to like not be able to serve them. Whereas other people were defending DPC and saying, well, actually, it really serves a lot more people than you would think.
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And we had to escape the system in order to save our careers, because some people are just so burned out that really the decision is, should I leave medicine? Or is there another way like DPC where I can actually be happy again, then I can have balance between my work and life and feel satisfied with my career.
3:04
So that’s kind of what made me think of this topic as an episode topic. And yeah, I’m curious to hear, you mentioned that you took a huge pay cut. So that’s the reality for me as well. Tell me a little bit more about what your perceptions were going into it and how
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would you respond to accusations that were just in it for the money?
3:24
Right. I think my perceptions were the same. I mean, there was a show like on USA Network. I think it was called Royal Pains or something like that, where it was like in New York and he would fly on a helicopter to take care of rich people. And I think that often gets like…
3:39
associated with what cash pay practices are in general. And I think it’s worth, and you need to separate out direct primary care from concierge care. So concierge care, as kind of the standard definition goes, and there’s always little quirks and things like that, is you charge a membership fee but then you also bill insurance.
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And so the insurance is for your co-pays, your deductibles, all those sorts of things. The membership fee is essentially to gain access to the club. So it’s like belonging to a country club, but also having to pay to use the pool or something along those lines. Whereas a direct primary care membership typically does not use insurance.
4:18
And instead you form that relationship with directly with the patients and cut out the middleman of insurance, which allows you to charge a lot less because you don’t have all of the associated overhead. So all of the billing people, all of the billing software,
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all of the claims and essentially the staff that go into just adjudicating all the claims that get denied and the billing and the coding and all those sorts of things gets eliminated. And so it’s much more affordable from a practice owner standpoint because you don’t have all the overhead.
4:47
And then from the patient standpoint, we’re able to pass those savings along to patients. And so I think that’s kind of like the big distinction between the two. But I do think even growing up, my dad had like essentially what was a concierge doctor who charged, you know, several thousand dollars to just be part of the panel.
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And so that was kind of my initial impression is, well, it is just for rich people because who has an extra like $5,000 a year just to spend to get to say so-and-so is my doctor. Right. Looking into it more, understanding more of the DPC model. Well, that’s not the case at all. Not those sums.
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And then also we don’t have all the other associated costs with it. And so there’s no copays. There’s no deductibles. They get unlimited access essentially to their doctor. And so when people do the math, I think people realize, wow, this is actually… a really good deal.
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And the only reason I don’t think it’s a good deal is because I’m so tied to insurance companies and the way that insurance companies work and the huge premiums that I pay for insurance. I want to get a little something out of it,
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even if it’s just a copay and then a coinsurance where I’m paying still like 80% for that ear infection. And so I think that’s where a lot of people feel like, wow, they must be making loads of money off of all of these patients. When in reality,
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we’re just saying there’s a better way to practice medicine that doesn’t have to be super expensive. Now, one question that I have for you is you left the system and you certainly had patients that you were like, hey, I can still be your doctor. I can’t be your doctor anymore. How did that go? The idea of, okay,
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these aren’t my patients anymore, or how am I going to keep them as my patients knowing that they can’t afford my new offer?
6:33
Yeah. Since I worked in pediatric urgent care right before opening my DPC, I didn’t have that, but I have, I mean, that’s a tough issue. And There were some people who did know me even from urgent care because they were frequent flyers or whatever, and and they had expressed some interest in following me.
6:51
I think that’s a tough issue. And I think the way that I kind of grappled with that bigger problem of like, well, I can’t serve everyone and some people are just not going to be able to pay the fee economically speaking. And some people maybe have just, you know, reasons of their own that maybe they could pay,
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but it doesn’t feel right for them. I think ultimately I came to the conclusion that I can’t fix all of healthcare’s problems. We are in this very dysfunctional system and no single person… me included, can take the responsibility of fixing the whole system, right?
7:30
Every choice you make as a physician of where to work or in what setting and what population to serve and how much to get paid. I mean, the fact is you make decisions, whether you work at a swanky private practice that only takes, you know, high paying insurance plans versus a federally qualified health center.
7:46
Like we make those decisions already within medicine, even the insurance based system. But yeah, I ultimately just had to say, you know what, in order to serve people, in order to help people and continue helping people for the decades of my career that I have left, I have to be happy. And right now, I wasn’t happy.
8:05
And I was kind of like dragging my feet going to work many days and just thinking, is there another way? Is this just what I’m doomed to experience for the rest of my career of just like counting down the hours until the end of the shift or the end of the day, right? And that Didn’t seem sustainable.
8:23
And so DPC was really a way for me to continue to remain in the profession of medicine in a way that I’m happy. And since I’m happy, I’m able to continue to serve people and give them the best care possible. And really, I had to just, you know, grapple with my price points.
8:42
And I think that’s the challenge of DPC is like, what’s the right price point for you, for your community? through your level of expertise for the specific services that you offer. Some people are solo and just want a really tiny practice. Some people like us,
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we have a lot of staff and people that we have on our team that we have to pay. The fact is we have overhead. We have to pay rent. We have to pay malpractice. We have to pay all of those ridiculous professional fees. We have to pay wages and benefits and all of those things.
9:13
So we have to charge money for our services, right? And I would say most of us in the DPC community are not charging really, really high fees that exclude most middle-class families. I would say most of us make our fees as accessible as possible while still paying ourselves a fair amount
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of money and taking care of our overhead and our staff.
9:37
Well, I think one of the things that is a good learning point for everybody is that the system doesn’t care about you as a pediatrician. And for so many, it’s either I’m just going to leave or I’m going to be miserable. And in decades past, the physicians of old would just be like, well, it’s up to me.
9:54
I have to do it. Even if my family suffers and if my mental health suffers, even if I’m addicted to this, that and the other thing, all these things, you know, it’s for the good of people. And then there’s been so many lessons that have happened over the past decade that
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have shown physicians where they are in the importance ladder when it comes to big organizations, that you can be replaced in a minute, that entire departments can be fired and replaced, that you can be asked to do things that you would not feel comfortable with, which has led to this burnout crisis, which has led to people saying,
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hey, if I’m going to do this and I’m going to be like a sane human being, and I’m going to take care of myself, my family, I have to find another option, then DPC represents a great option for that where you’re able to provide and use your skills and help others. And oftentimes,
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it opens up a lot of doors that you wouldn’t otherwise have open to you when you’re inside the system that then you can serve in other ways and you can help out and volunteer and do things that you never had the margin time or bandwidth for when you were in the system,
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because you were so beat down by that. And at the end of the day, like, you don’t have to be a martyr. Nobody’s going to name you Saint Pediatrician of FQHC because you lost everything that was important to you for the system that literally if you quit,
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tomorrow they’ll have a new somebody in that replaces you to keep seeing those patients. And so I think- When people say you have to give it to the system, and that’s the only way, I’d say, well, my life is not about being a pediatrician or a family practice doctor or whatever it is. That’s one part of it,
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and it might be an important part of it, but I’m not going to just sacrifice everything for this job that shows me how much they care about me seven days a week. Yeah. I think that’s kind of my pushback when people will say that.
11:49
I mean, I’m usually nicer than I am and less spirited than I am right now about it. But I do think that people can make those choices. And in every other business and industry in the world, no one would think twice about it. So I kind of try and give those moments of reassurance. Now,
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Is there anything that you do in your practice when people say like, this sounds amazing. I would love to do this, but I can’t afford it. Like, how do you frame that conversation when we’re talking less about the like theoretical and the physician mindset perspective and more about the patient interaction side of things?
12:25
Yeah. I mean, first of all, my published prices are set to give me some wiggle room so that if I need to give a discount to some families or I want to give a discount to some families who really need it, then I can do that. And I actually provide free care for a few families as well.
12:41
Like my employees, I see their children for free. Yeah. a couple of other connections that I know just couldn’t pay and are on Medicaid and things like that. And then some families I’ll just offer a 50% discount to as well. Or I’ll say, you know, I know the membership model doesn’t make sense for your financial situation.
13:01
So you can do the just fee for service, like flat fee, and I’ll give it discounted just the twice a year that your kid needs something, you can utilize that. So I have kind of you know, flexibility built in. And that’s one of the nice things about being an owner of my own practice is that I
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can make those decisions. In the fee-for-service world, no matter what sob story someone came to me with, I had no control over the billing and the finances and things like that. So I couldn’t even if I wanted to, right? So yeah, I have that. And then also sometimes it’s just accepting that if it’s not right for someone…
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If it’s not right, it’s not right. And my job is not to make this model work for everyone. In fact, I think a really important point from my perspective is that DPC is not the solution to all our healthcare problems. I think it is part of a multi-pronged approach to helping repair the healthcare system.
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but I don’t think it can fix everything. I just really felt like I needed a life raft to save my career. And DPC was that life raft. And I’m doing a lot of good for a lot of people. And ultimately, I hope the healthcare system goes in a more positive direction where we can serve
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everyone even within DPC. But Again, that’s not something within my power to fix. Right.
14:25
You can’t fix that. Yeah. I think that, that is a big like piece of it too, is like in the system, it’s like trying to fix the things that you see in the national news. Like me as a single voter can’t do anything. And so why do I have to shoulder the whole burden?
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of all the terrible things going on in the world. Well, I can’t, and I should focus on what I can control and stick to that and try not to let the other things distract me from my mission and my purpose. In my practice, so it was a little bit different because I moved from fee-for-service to direct
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primary care, and I invited all my patients to come with me if they so choose. Now, a couple of ways that I framed that for them. One was if you’re coming, if you want to join, I already know you, I’m going to waive the registration fee.
15:12
And it’ll be a little bit of work on our end to like move your charts and all those sorts of things. We can handle that, not a big deal. And then I also offer discounts, especially if people signed up before I open, like this will never be the price that is offered at again.
15:24
This is a founding members rate. And so that made it more attractive and more affordable. And we opened with like 150 members on day one because of that. Some of my patients were on Medicaid. Some of them were complex. Some of them I hadn’t known since they were babies and they had chronic medical issues or they had,
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you know, chromosomal abnormalities or something like that. Those I said, Hey, I want you to come with me. I know that you might not be able to afford this. That doesn’t matter to me. I want you to be my patient. We’ll waive the fee and all of those sorts of things. And some of them did.
15:54
And a lot of them didn’t, despite me offering like free service to continue on because a lot of people just it’s hard to sign on dotted lines and people are overwhelmed and overburdened and just the path of least resistance is the path taken. And so they didn’t come with, totally fine.
16:09
But some did, and we’ve continued to have them paying nothing. We’ve had some that we gave discounts to And then over time, we’re like, hey, you’re at 90% off. If you are able to move up to 60% off, we can offer another family access at a reduced fee. Would you be able to do that?
16:25
Most people do when they’re able to, or they say, no, but can you ask again in three months or six months? And then we just honor that. So that’s been a way that we’ve been able to extend our offer to lower income families or those that don’t see how they couldn’t make it work.
16:42
And on the flip side of that, we have patients that book a meet and greet, They have Medicaid. They come in and this just happened last week. I went through the whole thing. They said, do you take, like at the end, they’re like, do you take Medicaid? No, we don’t take Medicaid. Okay, what’s the monthly fee?
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That’s it. And they signed up right away. And so I think there’s this misconception that like you can’t have people that don’t have insurance or that don’t have two large household incomes participating in it. They can do the math and they can say, wait, If I go here.
17:15
Yeah.
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and I don’t have to come in for every little thing. And I don’t have to take time off work to go have my kid’s eczema looked at because they know my kid has eczema and they can see if I text them a picture that they
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have eczema and that their eczema has flared up and we need a plan for their eczema flare up. If they can handle that over a text message, that saves me missing half a day of work because let’s be honest, when you go into a regular office, there’s the waiting for the appointment, there’s the waiting at the appointment,
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there’s waiting after the appointment, there’s all the waiting that goes on with that. That’s a lot of hours out of work when people really need each and every one of those hours and so there is a misconception i don’t think there needs to be a misconception that it’s not
17:55
feasible for all families uh-huh yeah i’ve had i it’s interesting with the medicaid population because i have a history of having worked In a hospital and residency, that’s pretty much all Medicaid population or uninsured. And then I worked at an FQHC for four years. That was, again, all Medicaid, uninsured, some TRICARE.
18:16
And it’s interesting because for some Medicaid families, truly, I think that… Paying anything. They can barely put food on the table, right? And like paying anything is just not going to be doable. There are others that kind of vastly. I’ve had many Medicaid families join.
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And then after a couple of months, they say, hey, like financially, we can’t make it work. And sometimes I’ll offer a discount. But if I already had them at a discounted rate and they’re still paying it, it’s like, you know what? It’s okay.
18:44
I have to accept because if I lower my rates too much for too many people, my business doesn’t survive. And that is one of the challenges of DPC is, I mean, I think most of us as physicians, we are naturally very altruistic and we want to help everyone.
19:01
And I think we can do a certain amount to do that. But ultimately, we can’t discount everyone 90% or else we can’t pay our bills. We can’t pay ourselves. We can’t pay our staff. Right. And then we can’t serve anyone. Right. Yeah. But it is one of those tight ropes that I think I have to walk.
19:18
And maybe you feel the same of like, how many families can I realistically discount? Yeah.
19:25
I mean, it’s a huge issue. And I think it’s something that regular businesses do all the time. Can we give them a discount? No, we can’t. But we in healthcare are so unused to talking about money and looking at those numbers and things that it feels so foreign and icky when really it’s something
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that people in small businesses do all the time. Can we make an exception? Can we do this? Is there a way that we can help them? Those are things that small businesses face all the time. But you’re so unused to it in healthcare that it just feels like we shouldn’t talk about it or think about it.
19:58
We have no idea how much it’s going to cost. I have no idea how much this visit is going to be or how much your prescription is going to be at the pharmacy because those are unknowable things until you decide, okay, I’m going to learn these things and figure out what this actually costs.
20:12
For us, we just have it capped at 20%. Like 20% of our patients can be on some non-standard fee. And then we use that as kind of the barometer of, do we have room to add on a family that is asking for a discount or do we need to
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put them on the wait list and move them to another time? And we just randomly selected that number and we made sure that the math maps But that’s how we’ve kind of structured it in our business. So I think as long as practices have a plan of like, how am I going to adjust or figure this out?
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And then how am I going to feel okay about this? I think those are the two biggest things, the two biggest real hurdles that you have to work through.
20:48
Uh-huh. Yeah, I think that’s a good point. How am I going to feel? Because sometimes, you know, you can get sometimes those families where they’re only paying like a nominal fee and then they’re texting you every two days. And it’s like, wait a minute, how do I put the brakes on this?
21:03
Because like the amount of time and the money just doesn’t make sense. Right. And that’s part of this, like risk pooling. Health insurance companies use risk pooling, you know, I had to pay $100 a month for me and my husband, even though we only saw the doctor once a year for well checks versus someone else
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who has multiple sclerosis or hemophilia and is getting expensive medications. And it’s this risk pooling system. So we do the same in DPCs. We have to find a rate that just averages out to where if some patients are utilizing us a lot and some patients are utilizing us a little, it all works out.
21:44
I do want to go back to the issue of money because for me, I lost a lot of money the first year. I was paying myself and paying my living expenses through a side gig while I basically invested tens of thousands of dollars into starting my business and I wasn’t great at marketing as an introvert.
22:03
And so I grew pretty slowly that first year. And I think that’s a common issue. In fact, on Facebook, someone recently posted saying, hey, I’m 12 months in. I’m still working a side gig to pay my bills because I’m a sole provider and I’m paying my overhead, but I’m not paying myself yet. And that’s 12 months in.
22:23
It’s painful. It’s a painful place to be. And a lot of people commented with commiseration because they’re like, I feel you. I am in the same boat, right? I think people underestimate the challenges of starting up a business and how long it can take to be successful. And we take a huge financial hit.
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I took a huge financial hit the first year. The second year, I was able to pay myself a limited salary, but nothing close, maybe 50% of what I was making before. Now in my, you know, after three years, I’m like at 70% of what I was making before, but I’m still not there. And the goal is,
22:59
you know, again, it takes much longer to really be successful as a business than people realize. So I think that really contradicts that idea that like, we’re just in it for the money because actually we took a huge financial hit in, in most cases, there are some exceptions. There are always exceptions to the rule.
23:16
Some people are six months in or are doing great, but that’s not everyone. So what do you have to say about that?
23:23
I think that’s totally true. And I think that that’s something that people really have to look at in a major way that even really successful practices, it takes a long time to get off the ground. There’s a lot of expenses in starting something like this.
23:36
So coming up with a good business plan and talking it through and having those things in mind as you’re getting started is super important. And then being tactical about growth like when are we going to bring in an employee when are we going to do this
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or that those are things that you have to really take into consideration in a major way because those are huge expenses and you often don’t realize all the hidden expenses of bringing on an employee or something along those lines that it’s it’s a huge shock and i don’t think most people when they think oh they’re a direct
24:04
primary care doctor all they’re there and for the money they don’t realize that like a lot of dpc doctors are giving their own shots and drawing their own labs and checking patients in themselves and doing all these different things that they’re not even accustomed to even considering. Like most of my former pediatricians that I’ve worked with,
24:21
to their credit, not to their fault, do not know how to give a shot. Like that is not something that they would do. And we do that all day long. So there’s definitely like the pluses and minuses, but there’s also a lot of things that we do
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that a typical doctor does not do because they have a bunch of employees to do that because they charge insurance and it costs patients a lot more from that regard. So I think in the big picture, I just try and encourage people that are looking towards direct primary care to not
24:48
feel guilty about doing something that might save their career and allow them to keep doing what they’re passionate about for a lot longer and take care of a lot of families in a really special way.
24:58
Yeah. Yeah. I will add one more thing. So I know that there are some DPC practices that use the term concierge and that’s completely kind of like more of a, a marketing thing. It’s like, you know, your community, you know, your market in some communities using the word concierge is going to bring in more patients. And,
25:17
you know, as a business, you have to do what you need to do in order to like make money and survive. Right. And I will say that most people who do charge higher fees in DPC, um, Many of them do it in a way as this kind of Robin Hood model of care that like
25:32
families who can pay much higher fees will pay that. And then they’re able to have more cushion in order to discount care for other people who really need it. And that’s also, I think, a beauty of DPC is you’re able to do that if your market is right for that.
25:50
Yeah. There’s so many different ways. And I think if you listen to any other episodes of this, you’ll realize that it’s always, you know, you’ve seen one DPC practice. You’ve seen one DPC practice.
26:01
Exactly. Exactly. Yeah. All right. Well, thanks for your thoughts. Any other lingering thoughts to share, Phil?
26:07
I think that’s it for today, but I’m excited to continue the conversation and don’t forget the mastermind is just around the corner. So if you have not yet signed up, like get to Las Vegas, February 27th,
26:23
March 1st. Yeah.
26:24
Yeah. And join us at the DPC Mastermind.
26:27
Absolutely. All right. Thanks everyone for listening until next time.
