Yesterday, I posted a chart detailing the characteristics of new and traditional primary care models. Today, I’m going to try to identify who would be a best fit for each model.
The following is a primer on how primary care works, how people spend on care, and how spend can be affected by the various new models of primary care.
I’m a firm believer in matching the right tool for the problem at hand. ACE Hardware sells a $14 hammer. But you can also buy a $14,000 solid titanium hammer. In the past, doctors had one tool— an ongoing relationship with a patient that took place within an exam room and a bill where the more they did in the visit, the more they got paid. To fix a problem, you had to visit the doctor and pay them a variable, unknown rate. Now, there are multiple tools/primary care models available disrupting that relationship/exam room concept.
To that end, we need to define the “problem” to be solved and, to do this, we need to define the various types of healthcare users. For this exercise, I’m going to just consider adults over age 18 to retirement. I tend to split them into 4 categories:
- The Super Healther: likely no chronic illnesses, actively engaged with their health (they run every day!) with the occasional mild to moderate acute issue that needs treatment quickly and easily.
- The Kinda Healther: mild, chronic lifestyle issues (mild to moderate obesity, etc.) that, if not addressed, will turn into issues later, but who get by enjoying life, being somewhat inactive, taking one or two low cost medications per day, and still have the occasional mild to moderate acute health issue
- The User: They either have a daily chronic health issue (like asthma or allergies or high cholesterol) or frequent acute issues. They probably take a medication or two every day and visit a doctor a few times a year.
- The Power User: They have daily chronic health issues and take a few relatively expensive medications every day. Or they were a Kinda Healther and broke their pelvis in a car accident. Or they were a 30 year old Superhealther and developed cancer. Or they had a complicated pregnancy or birth. Or they were actively chronically ill with COPD and obesity and they’re just struggling to make it through just another day while continuing to work.
It’s important to note, as highlighted above, this is a fluid group. A person can go from a Superhealther to a Power User in a split second. And, vice versa, they can go from a Power User one year back to a Superhealther the next year after their pelvis heals from the car crash. However, the majority of people stick to their categories for years on end. Now, let’s match up these types of users with how they spend. This data comes from a 5,000 person group from total healthcare usage in 2017. Here’s how this group spent on care:
That 41.4% is the Superhealther. The 30.2% is the Kinda Healther. The User is the 17.8%. And the $5,000+ is the Power User. Half of this $5,000+ Power User group will go back down to their previous group the following year.
Based on this data, let’s try to match up the needs of each kind of user.
The Super Healther (41% of people) needs:
Easily available, low cost, transactional flat-rate priced care for the occasional mild to moderate acute illnesses and injuries.
Average primary care provider visits per year: 0 to 2
Average medications per year: 0 to 1 or 2 short-term
Average procedures per year: 0
The Kinda Healther (30% of people) needs:
Easily available, low cost care for mild to moderate acute illnesses and injuries + easily available low cost preventive care to manage their mild chronic illnesses, inexpensive daily medications, and offer guidance that inspires them to improve their lifestyle. The business model for this kind of patient should be either low cost transactionally priced care or low cost fixed rate for unlimited care management.
Average primary care provider visits per year: 1 to 3
Average medications per year: A few either short-term or one or two inexpensive daily meds
Average procedures per year: 0
The User (18% of people) needs:
Easily available, low cost care for mild to moderate acute illnesses and injuries + Easily available low cost preventive care to manage their mild to moderate chronic illnesses, moderately costly daily medications, and offer guidance that inspires them to improve their lifestyle.
Average primary care provider visits per year: 3 to 12
Average medications per year: A few either short-term or two or three mild to moderately expensive daily meds
Average procedures per year: 0 to 1
The Power User needs:
A high level of frequent in-person primary, specialty, and hospital care. They need a point person/service that ties all of this care together for them and works on their behalf to provide ongoing care management, guidance, and advocacy for simplifying their frequently used care, both expensive and inexpensive. This is often complicated care with lots of moving parts, multiple specialists, and expensive medications. This is a complicated project to be managed over time. To the patient, it feels like a part or full-time job and may even mean the heaviness of dealing with issues around life and death. This person needs real human support from an empathic provider partner and advocate.
Average primary care provider visits per year: 6 to 50
Average medications per year: The sky is the limit
Average procedures per year: The sky is the limit
Now that we defined how a person uses and spends on healthcare and what their needs are, we need to match up the right primary care tool to the user.
The most widespread, newest tool is the urgent care center. The urgent care center rose to popularity due to one simple belief each patient who leverages an urgent care center has:
“I need my mild to moderate acute problem solved quickly, easily, and I don’t care about a relationship nor the quality of the doctor— I’ll just show up and take who I get.”
There are an estimated 7,000 urgent care centers in America. If every one has 2 doctors who each see 20 patients a day, that’s 350,000 visits per day. That’s huge and evidence that for many people, this is their primary care solution. To put this in another perspective, TelaDoc, the leader in phone/video visits in America, did ~1.1M visits in the last 4 quarters, which is ~3 days of urgent care visits in America. And this is after over 12 years of operations and 2 years after going public.
The next upcoming model is Direct Primary Care and there are ~900 practices scattered across America. The defining feature of these practices is they “directly” contract with individual patients and charge ~$900 per year to have a deep, ongoing relationship with the same individual doctor. Only a few DPC practices take any form of insurance. Some DPC doctors also offer:
- In-office medication dispensing at either cost or no-charge
- Discounted labs
- Discounted radiology
- Text/SMS communication
- Email communication
- Mobile phone communication
- Home visits
As you can see, this is a high level of care compared to a traditional PCP and similar in scope and services of traditional concierge practices, at a lower price point. The high level of care is supported by the more expensive yearly fee and the DPC doctor limiting their practice size to ~500 total patients. There really is no standardized DPC set of features so it’s unclear if this is just one doctor and one patient or the DPC doctor employs a care team that includes lifestyle coaches and project managers. It appears the model is the doctor is doing not only the clinical work, but also the care/project management. This level of care is good for high need, costly patients who benefit from a long-term ongoing relationship with a doctor who knows them and their medical details extremely well. However, for people with multiple moving parts and complicated care situations involving multiple specialists, without a team-based approach, the doctor must also spend their expensive time on non-clinical project management that’s probably best offloaded to a less expensive team member.
And, finally, there is Virtual Primary Care, pioneered by Sherpaa. This model is best described as:
“What would happen if the primary means of communicating with your own personal doctor and care team was online at any time of any day and you could expect a response within 12 minutes and office visits were used as a tool of last resort?” This is what that world would look like.
VPC is based on continuity and a relationship with the same doctor. But instead of primarily being an exam room relationship, it’s an online relationship. VPC doctors can still order tests, coordinate care with local specialists and facilities, and serve as a resource for a patient throughout a health condition, from simple to complex. The only thing a VPC doctor cannot do is a physical exam and simple primary care procedures. When in-person care is necessary, which is ~20% of the time, the VPC doctor strategically coordinates the most cost-effective local care with the most appropriate preferrred local providers. VPC also employs a care team of, in addition to the Sherpaa PCP, care coordinators (to handle project management and administrative tasks assigned to them by the PCP and also to loop in partners like services that coordinate surgical procedures at bundled prices), and psychologists (to handle mental health issues and medical management of mild to moderate depression). The VPC model uses strictly online communication with your doctor and care team, instead of exam rooms, to problem solve with patients.
With that in mind, I’m going to attempt to match the right modern primary care tool with the right type of person.
Concierge Primary Care
Super Healther: Overkill. Expense doesn’t justify use.
Kinda Healther: Overkill. Expense doesn’t justify use.
User: Closer to a decent ROI, but still too expensive to justify use. Their expenses probably don’t lie in lots of PCP visits. It’s rather tests, specialist visits & their simple procedures, and medications.
Power User: A decent fit. However, you can get the same benefits from the lower cost DPC.
Direct Primary Care:
Super Healther: Overkill. The $900 yearly fee doesn’t justify use.
Kinda Healther: Overkill. The $900 yearly fee doesn’t justify use.
User: A pretty good fit. They must live or work within a convenient travel time to the DPC practice. Based on the desires of the user, they could choose either DPC or VPC. Again, their expenses probably don’t lie in lots of PCP visits. It’s rather tests, specialist visits & their simple procedures, and medications.
Power User: An really nice fit. It’s the same level of care as a Concierge Primary Care doc, at a fraction of the cost. The lack of other specialized members of the care team makes this model less efficient, than, say, Iora, a care team driven, brick and mortar-based in-house clinic model.
Virtual Primary Care
Super Healther: Perfect. Accessible to all members anywhere in 47 states, $100 Episodes of Care for the one or two mild to moderate acute illnesses and injuries with no required annual $900 yearly fees.
Kinda Healther: Perfect. Accessible to all members anywhere in 47 states, $100 Episodes of Care for the 3 mild to moderate acute illnesses and injuries with no required annual $900 yearly fees. Looping in lifestyle coaches and psychologists can also tackle lifestyle and mental health issues to prevent their mild chronic issues from getting more serious.
User: A pretty good fit, depending on the unique issues and desires of the user. If they are comfortable handling most of their care online, VPC combined with care coordination with local retail health clinics, urgent care centers, specialists, and facilities. However, if they have issues that need routine physical exams or simple primary care procedures, DPC is a far better fit with a better ROI.
Power User: VPC offers some good value here with online communication and care team management, but often this type of care is best suited with frequent in-person communication and problem-solving with multiple members of the care team and outside specialists. The Iora model is probably best in class for this type of user.
Traditional Primary Care
Super Healther: Two week waits. Bad for their acute needs.
Kinda Healther: Two week waits. 7 minute visits. A mess.
User: Two week waits. 7 minute visits. A mess. Each visit involves maximizing billing.
Power User: Two week waits. 7 minute visits. A mess. Each visit involves maximizing billing.
Super Healther: Accessible. Good for acute issues. Expensive and incentivized to bill as much as possible. Lack of continuity means care is not consistent and organized.
Kinda Healther: Accessible. Good for acute issues. Expensive and incentivized to bill as much as possible. Lack of continuity means care is not consistent and organized.
User: Bad fit.
Power User: The worst fit.
Super Healther: Perfect fit for the rare true emergencies. Accessible. Good for acute issues. Way too expensive and incentivized to bill as much as possible.
Kinda Healther: Perfect fit for the rare true emergencies.Accessible. Good for acute issues. Way too expensive and incentivized to bill as much as possible. Lack of continuity means care is not consistent and organized.
User: Perfect fit for the rare true emergencies.Bad fit for primary care.
Power User: Perfect fit for the rare true emergencies.The worst fit for primary care.
Super Healther: Decent fit for 50 simple issues. It’s a fixed cost per visit. Follow up visits generate another cost. VPC enables continuity with the same doctor + a consistent cost for the cost of an Episode of Care that may last 3 weeks.
Kinda Healther: Decent fit for 50 simple issues. It’s a fixed cost per visit. Follow up visits generate another cost. VPC enables continuity with the same doctor + a consistent cost for the cost of an Episode of Care that may last 3 weeks.
User: If this person has VPC or DPC, retail clinics are almost always unnecessary.
Power User: If this person has VPC or DPC, retail clinics are almost always unnecessary.
Super Healther: Decent fit for 30 simple issues that can be fixed with a simple 10 minute conversation, no need for follow-up, and no need for tests to confirm a diagnosis. It’s a fixed cost per visit. Follow up visits, if necessary, generate another cost. Also, if the video visit doctor can’t help, patients are typically charged for this visit in addition to the typically in-person visit probably at an urgent care center.
Kinda Healther: Same as Super Healther.
User: If this person has VPC or DPC, video visits are always unnecessary.
Power User: If this person has DPC, video visits are always unnecessary.
VPC is a very good tool for ~90% of people
Super Healthers (41% of people)
Kinda Healthers (30% of people)
Users (18% of people (depending on if they want to interact more in-person or online with their doctors))
VPC scales to all members in every square mile of 47 states and solves ~1,450 issues which is ~95% of a what traditional PCP can diagnose and manage in their office.
DPC is a great tool for
Users (the fraction of this 18% who want a more traditional office-based DPC doctor)
Power Users (Since half of this 10% of the population are only in this category for a year, DPC is consistently great for this 5% and temporarily great for the other 5%)
For Users and Power Users who live a convenient drive to one of the ~900 practices in America, DPC is a wonderful fit.
Traditional primary care is a great tool for:
Urgent care is a great tool for:
When VPC needs an urgent exam, simple procedure, or simple lab/imaging test on an urgent basis.
When DPC doctors for some reason or another are not available (vacation, after hours, can’t reach, etc.)
Emergency Rooms are great tools for:
The rare true emergencies. No better place.
Retail Clinics are great for:
50 simple issues when people don’t have access to VPC or when VPC doctors need to confirm an issue with a very simple in-office lab test.
Video visits are great for:
30 simple issues when people don’t have access to VPC or a DPC.