DPCA Articles

MEDICARE is federally run government healthcare for older Americans. MEDICAID is a state-run healthcare system for low-income individuals. Most MEDICARE patients are those over 65 years old but can also include people on disability (don’t forget about that one).There are 3 main parts of Medicare:

• Part A (traditional hospital coverage),
• Part B (traditional out-patient coverage,
• Part C (private Medicare advanced plans run by private insurance companies like BCBS or Humana), and
• Part D (the drug benefit portion).

This is confusing but the good news is opting out of Medicare means you really won’t have to worry about these issues and your Medicare patients can continue to see you and use their Medicare insurance.This is a common question for us both from patients and physicians, “can DPC docs work with Medicare patients?” Simple answer: 100% yes.Most DPC docs do opt-out of Medicare and when that is done you are still in the Medicare system and retain a PECOS (Patient Enrollment Chain and Ownership System) number which allows you as a physician to order medications, imagining and referrals without any issues from Medicare. Opting out of Medicare does not change your PECOS status at all and nothing changes for your Medicare patients except they pay you directly. You do have to have Medicare patients sign a Medicare agreement with you (see example here). So, DPC works well with Medicare patients as they get more of your time and access as well as use their Medicare for larger medical expenses like insurance should be.MEDICAID rules vary by state and the ability to contract with Medicaid patients will depend on your individual state’s laws. Check out DPC Frontier for more information on Medicaid.

Having a good business plan is essential not only for organizing your thoughts but also if you are trying to secure financing from other sources for start-up costs.

The elements to include:

1. Summary of your business—a snapshot. What is your “Why?” Why will your DPC be the best? Your business success will be directly related to answering this question. Consider reading Sparks Start Fires by Julie Gunther, MD or Start With Why by Simon Sinek.
2. Description of DPC and how it relates to your own business.
3. Market analysis—Research, research! How are DPC practices around you doing? How full are they? How fast was their growth? What are some of their obstacles to success? How much are they able to charge?
4. Services—What you will include in your practice and how will it be advantageous to your practice. (See Choosing Clinical Services)
5. Marketing strategy—Research effective marketing. Most DPC practices build by word of mouth and boots on the ground. Keep marketing expenses to a minimum. Ask your mentor (See How to Find Your DPC Mentor
6. Funding request—How much money do you need for your plan? Hopefully, starting out, this number is very very low. Start with the lowest start-up costs possible (See Financial Considerations)
7. Financial projections—Calculate estimate based on membership rates, projected growth and retention rate, and overhead costs.

Explain why you care about DPC and your patients, the positive impact on the community, and how your passion will drive your growth and financial estimates.

Don’t forget to reach out to your mentor(s) for advice if needed!

MEDICARE is federally run government healthcare for older Americans. MEDICAID is a state-run healthcare system for low-income individuals. Most MEDICARE patients are those over 65 years old or on dialysis but can also include people on disability (don’t forget about that one).

There are 3 main parts of Medicare: Part A (traditional hospital coverage), Part B (traditional out-patient coverage, Part C (private Medicare advanced plans run by private insurance companies like BCBS or Humana), and Part D (the drug benefit portion). If you establish a relationship with a Medicare beneficiary, you MUST bill Medicare, unless you are opted out. Most DPCs will opt out of Medicare before seeing Medicare patients. This is a tough decision for startup practices who may rely on moonlighting opportunities for income as their practice builds. There are some who decide to do DPC and only bill Medicare. Credentialing your practice with Medicare requires a separate practice NPI and the steps to bill Medicare are outside the scope of this article. Most opted-in practices who bill Medicare will only see patients with traditional part B as you may have to credential with each private insurance company to bill those with Part C Medicare Advantage.

You should also realize that your opt-out is effective for 2 years and will automatically renew every 2 years unless you apply to be reinstated. You have a 90 day window to change your mind, otherwise, assume you are opted-out for 2 years because opting back in within the 2 years is extremely difficult and rarely successful.

Those who opt-out of Medicare (internal link) are still in the Medicare system and retain a PECOS (Patient Enrollment Chain and Ownership System) number which allows you as a physician to order medications, imagining and referrals without any issues from Medicare. Opting out of Medicare does not change your PECOS status at all and nothing changes for your Medicare patients except they pay you directly. You do have to have Medicare patients sign a Medicare agreement with you (see example here) as well as an advanced beneficiary notice (ABN). 

If you have been credentialed with Medicare as a private entity, you will likely only be able to opt-out once per quarter (Jan 1, April 1, July 1, and Oct 1) so you must plan accordingly. If you miss the deadline, you are stuck until the next quarter and you cannot accept payment from Medicare patients. In some areas, if you have only been credentialed as part of a larger organization, this limitation does not apply to you. And the opt-out process does have some regional variation, so speak with an attorney or DPC mentor near you to help you determine whether these deadlines are likely to apply to you, and how to opt-out in your region.

MEDICAID rules vary by state and the ability to contract with Medicaid patients will depend on your individual state’s laws..Dr. Phil Eskew’s DPC Frontier has the go-to resource for legal issues on working with Medicaid and Medicare.

What is Direct Primary Care (DPC)?

Direct Primary Care (DPC) is a practice model in which physicians and patients work together directly, without interference from third parties. DPC enables a stronger, healthier, more beneficial doctor-patient relationship.

At this time, most use the definition of DPC put forth by Eskew et al in 2015: “A DPC practice must be a primary care practice that (1) charges a periodic fee for services, (2) does not bill any third parties on a fee-for-service basis, and (3) any per-visit charges are less than the monthly equivalent of the periodic fee.” What, exactly, does that mean for patients and physicians? Let’s examine each of those items separately to get a better idea.

1. Charging a periodic fee: This means that patients pay their physician a recurring fee (monthly, quarterly, or annually) in exchange for healthcare services. People often view this as sort of a membership fee or access fee. Typically this fee covers the majority of care and communication that occurs between the physician and patient. The advantage for the physician is that financial well-being is not predicated on how many patients they can see in a set amount of time. This enables the physician to cover smaller patient panels and provide a more comprehensive service to patients. For the patient, this means increased access to and enhanced care from their physician.
2. Not billing third parties on a fee-for-service basis: This means that when a patient sees the doctor, a bill is not sent to their insurance company. The advantages of this for the physician are no more chasing payments from insurance companies, no more jumping through hoops trying to ensure optimal reimbursement for their work, and no more headaches when insurance companies find excuses to deny coverage. The main advantage of this for the patient is that they will never see an unexpected bill from their insurance for the care their doctor provided.
3. Visit fees are less than the equivalent of the periodic fee: This means that if the physician’s monthly fee is $50, and they also charge a per-visit fee, that per visit fee needs to be less than $50. If any per-visit fee is over the monthly fee, the practice shifts from a DPC arrangement to more of a traditional fee-for-service, where the main income to the practice is from service fees. Most DPC practices do not charge per-visit fees. The advantage to physicians is that monthly billing (and thus bookkeeping) is easier to manage than FFS billing, and eliminates the overhead of office billing staff. For patients, this means a flat, fixed fee will be charged.

One of the benefits of the DPC model for both patients and physicians is the simplicity of the model. Most DPC practices work with local businesses to negotiate cash prices on labs, imaging, counseling, PT, and a host of ancillary services. This improves price transparency and adds benefits to your DPC membership that patients cannot necessarily access on their own. The basic idea here is to add as much value as you reasonably can for your potential members.

Ideas for clinical services to include in your practice model are:

• In-house lab draws (many DPC docs ‘relearn’ phlebotomy, can use MA or nurse)
• Basic in-office tests: flu, strep, covid, EKG, urinalysis, pregnancy, audiometry
• Splinting and casting
• Procedures: laceration repair, biopsies, joint injections, toenail removals, I&D, aesthetics, IUD placement, and removal, etc
• Wound care services/materials
• Nebulizer treatments
• In-house medication dispensary (aka pharmacy) and/or relationship with mail-order pharmacy
• DME: wrist splints, ankle braces, post-op shoes
• OMT (Osteopathic Manipulative Treatment)
• Loaner equipment: wheelchair, knee scooter, crutches, BP cuff
• In house therapeutic phlebotomy
• Cash priced imaging
• Inpatient care
• Obstetrics

Start with a basic list of services and procedures you are comfortable offering, and add more over time as your time, interest and budget allow. Expanding this list is a great way to add value for your patients while growing and learning professionally.

We are so excited you found us.

One mission of the Direct Primary Care Alliance is education. While there are many resources about independent medicine and how to start your own DPC clinic available, it was the hope of the leadership (and membership) of the DPCA at its inception that, over time, the DPCA would evolve to be the resource for all things DPC.

The DPCA Articles were launched in 2019 as one facet of the educational mission of the DPC Alliance and continues to evolve and expand. The DPC Alliance convenes "writer's workshops" intermittently to review, update, and expand the content of the Articles.  If you are a member and are interested in helping, please contact our Executive Director Tiffany Leonard, MD.

The following documents are the result of the work of many physicians (and a few "friends"), who generously gave their mind-share, experience, and time to create this resource.

A big thanks to the following who wrote, edited, contributed and provided content for the University:

• Dr. Staci Benson
• Dr. Kissi Blackwell
• Dr. Lara Briseño Kenney
• Dr. Michael Ciampi
• Mrs. Christine Davenport
• Dr. Jeffrey Davenport
• Dr. Allison Edwards
• Dr. Jack Forbush
• Dr. James Gaor
• Dr. Michael Garrett
• Mr. Joe Grundy
• Dr. Julie Gunther
• Dr. Kirby Farnsworth
• Mrs. Erin Lassey
• Dr. Vance Lassey
• Dr. Tiffany Leonard
• Dr. Marcy Meyer
• Dr. Ryan Neuhofel
• Dr. Shane Purcell
• Dr. Kenneth Qiu
• Dr. Clodagh Ryan
• Dr. Alex Santiago
• Dr. Nathan Seeberger
• Dr. Creighton Shute
• Dr. Kelsey Smith
• Dr. Thanh Taylor
• Dr. Luke Van Kirk

CLICK HERE TO ACCESS THE CHECKLIST

CLICK HERE FOR FAQs

Part One: Introduction and Basic Principles

If you have a wealthy benefactor, a trust fund, or otherwise have money to spend at your leisure, enjoy the ease of your DPC startup, and please feel free to skip this section, and know that the rest of us are jealous, and we expect you to buy our dinner and drinks at the next DPC conference.

We doctors generally have decades of scientific education, but little to no education about business or money. I had ZERO business knowledge, but I knew I had to do DPC so I jumped in, and I learned as I went. The good news is that most of this stuff turns out to be straightforward and common sense.

The first thing to know is that you’re going to have to keep your overhead down if you ever want to make money again. Learn it. Know it. Live it. Keep that overhead down. The profound waste that is a problem inside the system will destroy your DPC.

One good way to keep your overhead down is to avoid interest payments. That means starting up without a loan if you can. This is possible, but rarely so without major sacrifice. But, starting a clinic doesn’t have to cost a fortune, so look at your situation and see if you can make a no-loan startup a reality. Zoom out as far as you can and make some overarching assessments of your financial situation, and your goals. Then, make yourself a few guiding principles and boundaries, follow them as much as possible, and the solution should p assessments, principles, and solution (yours will be different, of course). resent itself.

I’ll demonstrate this by using my own goal,

Goal: Be self-employed ASAP. Pure DPC. Doing medicine right and having time for my patients, family, and self is more important than my income, and when this works, the money will follow, even if it doesn’t, I’m #nevergoingback.

Assessment 1: I owe some money on my house and my 115 acre farm. But not that much. Otherwise, I am almost out of debt, and want to get all the way out.

Assessment 2: I am so dedicated to my DPC goals, that I am willing to make painful sacrifices to achieve them. <<strong>Principle 1: No loans. I hate paying interest, and don’t want to go into debt.

Principle 2: No/Minimal moonlighting. After 9 very long years on the inside, I was due for some much-needed time for my family and my physical and mental health.

Solution: Liquidate.

I sold about ⅔ of the land I’d killed myself working on the inside for 9 years to buy. That was my sacrifice, and it hurt. But, the sting of letting go of it was short lived, and the deep breath of fresh air on the outside of the system instantly made it more than worth it. And, with the profit on the sale, I paid off all my outstanding debt, and put some money in the bank, enough for us to live on for a year or two. We drove old used cars, lived in a tiny house, budgeted tightly, and paid for my clinic’s startup costs, which I kept LOW. And achieved zero debt, which is a good place to be if you’re starting any business.

So that’s how I started a clinic without a loan. But I had equity I could liquidate. The alternative (taking out a loan) is often chosen, sometimes by necessity. This requires income to pay interest on your loan. Assuming you don’t ramp up your clinic overnight, you’re going to find yourself moonlighting all the time to pay for all this, and if your business fails, you’re hosed. I’m not saying there’s anything wrong with this approach, but one of the things that is attractive about DPC is that you no longer work 7 days a week away from your family. If you’re running your new business M-F and moonlighting at nights and on weekends to pay for it while it ramps up, you’re not much better off than you were before. That being said, such pain is temporary, and doing this requires a sacrifice in every case. If that is the sacrifice you must make, then make it. The rough schedule will motivate you to strive all the more to be successful and gain independence in DPC so you can quit the side hustles. There are numerous ways to make money on the side while your DPC clinic ramps up, but that is not the focus of this article.

If you’ve got no choice but to go into debt to start your clinic, you’re still much better off starting the clinic on a very strict budget. It is not difficult to spend hundreds of thousands starting a clinic, and then remain a slave to the bank for years and years to pay it off. Get a line of credit, and use only what you have to, because the smaller the loan, the smaller the payments and the more quickly you’ll be able to pay it off and become a profitable business. Including paying my nurse a full salary for ~6 weeks before we opened, I was able to start my clinic for under $30,000, and I’ve heard of others doing it for even less. I made all that back in a few months and was in the black in no time, with no loan and no moonlighting.

Don’t forget to live on a tight budget. Income is thin for a while during your ramp up. If you don’t want to burn yourself down working multiple side-jobs, it helps to get yourself out of debt ASAP. Sell fancy cars, buy a used car. If you are paying off a mortgage on a big house, sell it and downsize to something you can pay cash for with the money. Clip coupons and don’t shop at Whole Foods. Then you can live in low-stress peace with your weekends off, with 100% of your time available to give to your own business as you build it and ramp up. When you’ve got a successful DPC clinic and have become financially comfortable in a few years, knock yourself out. Delay gratification.

Part 2: Medical Inflation (fake prices in medicine)

In medicine, the cost of everything has become hyperinflated. Stupidly hyperinflated. Fake prices going out and fake prices coming in. Maybe this will get better as a result of our efforts in free-market medicine, but until it does, we have to deal with it. The problem we have in DPC is that the over-pricing in medicine has trickled down to the suppliers and wholesalers, too. If they sell an office chair to a business office, the cost is, say $100. But if it’s medical supply, they take the same chair, label it a nurse’s chair, and list it for $350. But can you blame them? If a clinic is charging patients $125 for a $3 CBC, the “medical furniture” place can justifiably gouge the clinic for an office chair. But if you’re in DPC and you sell that CBC for $3, you need to avoid being gouged, so you won’t be forced to pass these costs on to your patients. Part 3 addresses ways to fight medical inflation and fake prices.

Part 3: Cost-Savings Pearls

1) Get as much free stuff as you can. Free > Cheap.

Of course I’m going to be talking about getting cheap and/or used stuff, but why stop there? Why not go for free stuff? Example: I found a non-profit hospital, and approached the guy in charge of their materials management department. I asked him about surplus stuff--anything they might have--and asked if he would be interested in selling it at low prices to a clinic that was going to be caring for lots of uninsured people, etc. He said that as a non-profit, he couldn’t sell it, but that much of their surplus inventory was going to be thrown away and I could have almost anything I wanted, for free. I got a like-new electric exam table, a power procedure table, an autoclave, numerous cabinets, office chairs, waiting room chairs, paper towel dispensers, glove box holders, a scale, a lab-drawing chair, wall-mounted otoscope/ophthalmoscopes, countertops, curtain track, halogen exam lights, physician’s exam stools and so much more. Buying that stuff new would have cost me thousands and that relationship continues to pay dividends even after 6 years. I send him a huge platter of cookies at Christmas. Who cares if the stuff is used? Clean it up, slap a coat of paint on it where necessary, and admire your not-empty bank account! Later when you’re flush with cash, if some of the used stuff is looking tacky, you’re in a better position to replace it with something nicer (don’t buy new even then–see section 3 below).

This brings to mind another thing: Make your needs known. Talk to your patients, and tell them you’re looking for a ceiling-mounted surgery light. Tell them you’re trying to find another doctor to join your practice. Tell them you wish you were better at painting when they comment on all the paint on your hands. People respect the heck out of you and what you’re doing for the community and want to be a part of it. They will donate time, stuff, money, and labor to you out of the goodness of their heart. When I was painting my new clinic (3,100 square feet–massive job!), one of my patients and his brother showed up with loads of painting equipment, and painted alongside me for 2 days in a row, just to be nice. A homeschooling family of 12 showed up with their 10 kids and did all my landscaping, as a community service project. A patient of mine who knew I was looking for help told a very strong and experienced electrophysiology nurse practitioner that she had encountered in a neighboring city about our model, and that I was looking for help. She gave him my number, and within a week we’d met and shook hands. He became my partner a year later when the new clinic opened, and we are like brothers now. Talk to people.

2) Get free advice and whenever possible, Figure it out.

Don’t forget more than just stuff can be free. Advice can also be free. There are plenty of opportunists who will try to get you to buy services or advice from them, or attend for-profit seminars or boot camps, and they’ll do everything they can to convince you that without their magic small business, marketing, social media, or even DPC knowledge, you’re going to fail. They’ll tell you they can help you build your practice, teach you how to start a business, do your marketing, design your website for you, etc. They’ll even promise you a certain rate of growth, as if they have any control of that! This is all bogus. These services or advice are available elsewhere for free. Just because you’ve never designed a website, marketed a business, set up an internet domain, done the financial books on a business, or whatever it may be doesn’t mean you need to pay some schmuck thousands to do it for you. Figure out how to do it and do it yourself. There are scores of DPC docs out there in numerous online forums, the DPC Alliance, and others, who have gone before you who would gladly give you free advice. Don’t fall for the scams. They’re everywhere--people who want to cash in on your fear and uncertainty, and they’ll grab your energetic leap of faith and suck it dry.

3) Get used stuff, cheap.

This is huge. Don’t buy anything new unless you have no other option. Don’t buy surgical instruments from surgical supply stores, because they gouge you hard. Instead, hit up eBay and Craigslist. I used to use hemoclips in my vasectomies, and the clip appliers from supply places were like $150-200 as I recall. I got a like-new brand-name clip applier on eBay for $10. I got a pristine ConMed Hyfrecator for $350 on eBay, which currently sells for something like $1,000 new. Another option is to find clinics/hospitals that are closing, and contact them about buying used stuff. It’s all surplus to them, and hard to sell much of it, so you can cash in. Call your state medical society and ask about clinics that are closing. Keep your eyes out for auctions and go to as many as you can. I’m not just talking about medical auctions. You can find furniture, cabinets, wire storage shelving, wall art, and much much more. I went to an auction at a hotel that had gone out of business. There, I nabbed a big stainless steel wire storage rack, probably worth at least $250 new, for ONE DOLLAR. At the same auction I got a big UPS worth hundreds (to keep computers on in case of power failure) for FIFTY CENTS, a new mini-fridge for $20 that I keep insulin in, and a break room microwave for $3. I went to an auction of a restaurant that was closing and filled the back of my truck with high-quality toilet paper for $20. I went to a Habitat For Humanity Re-Store (this is like Goodwill but for hardware and building supplies) and found 12 gallons of hand sanitizer gel for maybe $15 (worth $360 today on Amazon). You never know what you’ll find, and you might leave empty-handed, but you can save SO much money if you just look around.

4) Get your hands dirty.

Manual labor is the most expensive thing you’ll buy if you’re building or renovating anything. In my first small clinic location, the materials for the somewhat extensive renovation were approximately $4,000. My Dad and I spent over 720 hours (combined) over about 6 weeks doing all the work ourselves. At the time, that labor would have cost me well over $15,000, and it might have been shoddy work. Lack of experience is a lousy excuse for not doing this. If you can learn to perform surgery on a human being, you can learn to lay bathroom tile, install a sink, or refinish window trim. Watch a YouTube video and learn how to do the work. It’s not hard, and if you’re willing to invest sweat equity, the dividends will be massive.

5) Renting? Negotiate to get paid for your labor!

On top of your labor savings, if you’re renting, you can negotiate the value of your labor against the value of your upcoming rent, since you’re fixing up the owner’s building. In the case of my initial clinic location, the building owner felt that he would be able to rent it for way more after I leave in a couple years (after I completed my dedicated clinic–which I mostly built myself too) because it’s way nicer than it used to be, and that’s worth something to him. We crunched numbers and figured that the value of my labor offsets my rent and utilities for 2 years. So I spent 6 weeks busting my butt fixing up the place, and then I didn't pay a penny of rent or utilities for 2 years. If you’re absolutely unwilling to do manual labor, then barter for it. Find a builder who is getting robbed on his health care, and trade him a year or two of care in exchange for renovating your clinic. And since you’re the one paying him (in medical services) for the work, you can then barter with the landlord for a couple years of rent in exchange for increasing the value and rentability of his or her facility. (See illustration below.) With that smart deal, you get free rent AND free renovation labor. More on bartering coming up.

6) Make your labor a valuable (and free) advertisement.

Another neat thing about doing the work myself, is it gave me a huge selling point on social media, where I did all my own (free) advertising. Occasionally I’d post pictures of myself covered in paint or sheetrock mud, patching up walls or a time lapse video I made of me laying flooring. The tagline on every post went something like “If I don’t have to pay somebody to install this floor, neither do my patients. Welcome to Direct Primary Care.” The patients get that. You’re saving them money. That’s effective marketing, it’s true, and it’s free. Plus, patients like having a doctor who’s a real live human being, and your humility, work ethic, and idealism (you’re doing this to save them money) is a valuable selling point.

7) Bartering.

This one is a little bit tricky, but has its place. When you trade for goods and services, both parties need to feel like they’re getting a good deal. This never works otherwise. Value is in the eye of the beholder. If you can’t both agree that your deal makes sense to you both, switch back to using money. Josh Umbehr once told me “Both parties can agree on the value of a dollar.”

Example: I had a farmer who wanted to trade me about $400 worth of beef for about $1000 worth of membership fees. But my freezer was already full. Obviously, I didn’t like the deal. (Luckily he found out that I could save him over $120 monthly on his meds which more than offset his $100 membership and we didn’t have to keep having the beef negotiation!)

But perhaps you could give a housekeeper free membership in exchange for his or her services. When you take a social history and your new patient tells you he’s a computer/IT specialist at your local bank, ask him if he’d ever be interested in trading a month’s membership fee when you need your computer fixed. Probably will only take him 15 minutes, and saves you a bundle--you both win. Bartering is generally a no-money traded affair, but you’re trading goods or services with a monetary value. For this reason, you need to agree on the monetary value of the traded services and keep records for tax purposes- this is something to discuss with your accountant.

You can also make bartering arrangements with more than one party as mentioned earlier, and demonstrated in the table and illustration below:

HASDOESN'T HAVE/NEEDSDOCTORExcellent Medical Care to GiveRent-free Clinic SpaceLANDLORDBuilding to Rent (in need of remodeling)Time or Money to RemodelBUILDERTime and Skills to RemodelQuality Health Care

8) Ask others.

You’re not the first person to start a DPC clinic on a dime. When you can’t figure out a cheap way to do something, ask somebody who’s been there before you. Join, then reach out to fellow members of the DPC Alliance, use the DPCA’s University database, etc. There are online groups, discussion forums, and books. Many DPC docs have come up with novel ways to save money.

9) Join a GPO.

Group Purchasing Organizations are basically like a discount membership. You pay a fee or buy a product (such as an EMR, for instance) and with it comes discounts at places that sell stuff you might need (medication wholesalers, medical equipment suppliers, wholesale labs/pathology services, etc.). If you can’t get the thing you need anywhere else, and you’re stuck getting it from a supplier, you might as well be part of a GPO so you get a group discount. Along these lines, get Amazon prime. A flat fee gets you free shipping, and often (not always!) you can get things there at lower prices even than your wholesale suppliers, or suppliers in your GPO. Things I sometimes get there include paper towels, business card magnets, certain orthotics/braces, medical supplies for patients (they benefit from my free shipping if they don’t have prime), office supplies, and random odds and ends.

10) Form an informal GPO.

Join up with all the DPC docs in your region. Together you can save each other money by buying in bulk and sharing on things like immunizations, medical supplies, things that expire like suture, meds, etc. Other benefits of this kind of arrangement is selling extra stuff. Maybe toward the end of the flu season, you’ve got 20 extra flu shots that are going to expire on you, but a colleague nearby needs some. You can sell it to them at cost, saving them on shipping and you don’t have to eat the cost of the unused vaccinations. Or trade them some flu shots for some suture or lidocaine, etc. Members of our regional DPC Alliance routinely show up to the quarterly meetings with stuff to trade.

11) Combine several methods listed above.

Here’s an example of how I got a $1300 high-end laptop computer for $700:

1) I bought a deeply discounted open box computer online. This computer did not come with the manufacturer or retailer’s warranty-- a risky purchase if you aren’t a computer guru. As I was worried might happen, the like-new computer had been registered and passworded, etc. by the original owner, so it didn’t work and was locked down like Fort Knox.

2) My patient who works at the bank and is a computer/IT guru traded me 2 months worth of care (a $60 value) and he spent about an hour fully wiping this computer and reinstalling all the software. Now it’s as good as new, and I basically got it for half price.

Starting a DPC clinic doesn’t have to be incredibly expensive, but it is if you’re not willing to be creative, look for deals, find mentors, and negotiate wherever possible. Regardless of how you go about it, do it. DPC is incredibly rewarding!

1. First Steps: Creating a Plan

• Identify and meet with mentor(s)-- successful DPC physicians are great; other entrepreneurs and business owners also give good advice & support.
  • Ask questions. Lots of them
  • How do you want to shape your own practice? As you speak with others, have your own vision in mind. What works for others may not work for you, and that’s ok.
  • Start researching and exploring other DPC practice websites. Get familiar with the basic commonalities.
• Connect with DPC organizations
  • DPCA
  • local/regional organizations of independent DPCs
• Find your resources: guidebooks, startup books, DPC workbooks, etc.
• Attend DPC events
  • DPCA masterminds
  • DPC summit
  • HINT summit
  • D4PC Nuts and Bolts to 2.0
• Write a business plan
  • Mission and Vision statements
  • Timeline to opening (3-18 months depending on lots of factors)
  • Determine the medical services (broadly) you’d like to include in “primary care”
    • Medication dispensing? Allowed in most states, but review your state’s regulation/restrictions here.
  • Decide on features of practice (accessibility, house visits, texting, emails, hours, etc.)
  • Financial plan
    • Calculate total start-up (one-time) costs = $ _
    • Calculate ongoing (operating) expenses = $______________/year
    • There will be lots of unknown expenses that you could not possibly have predicted, so add a nice buffer category of “unknown expenses”
    • Determine desired self-pay (take-home) pay = $ _/year
    • Set membership prices on a cost-basis (tips here)
  • Decide if you’d like to work with employers (sponsored memberships for employees)
    • If so, will need to create unique contracts for employers, employer-sponsored memberships and consider marketing to employers.
  • Get personal financial house in order
    • Secure some side gigs! (i.e. moonlighting options to make income outside of DPC practice while you're ramping up)
      • Tips on jobs if opted out of Medicare
    • Personal/household budget
    • Personal insurances: Life, disability, health
    • Personal retirement accounts

2. Make it Official: Legal Items

• Pick a practice (business) name -- more info on creating a brand below
  • Review this article for considerations on your name
  • Run the options by others: mentor(s) vs. crowdsourcing vs. branding consultant
  • Check name “availability” by Google search, trademark database search, social media platforms, and/or https://www.namecheckr.com
  • Register a trademark? (not absolutely needed, but may be helpful if wanting to protect the name and brand) (Tips here.)
• Set up accounting services
  • Hire accountant and/or bookkeeping course
• Select & learn accounting software (e.g. Quickbooks, Xero, etc)
• Review your state-specific issues that may relate to DPC practice
• Consider attorney(s) if/when needed--may not be needed for many basic matters
  • One for general business matters (help with most issues in business formation)
  • One for issues specific to medical practice (strongly suggest one familiar with helping DPC practices--many will not be familiar)
• Decide on and apply for business structure (LLC, PLLC, S Corp, C Corp)
  • Tips here, ask your accountant/lawyer for personalized advice
• Register business with state agencies (DIY, LegalZoom, or use attorney)
  • Usually this is easy to do on your own. Find your state’s Secretary of State website to register your LLC
• Obtain federal employer tax ID (FEIN) number
• File for DBA (Doing Business As) if needed
• Obtain State employer tax ID number
• Obtain practice (business) NPI (IF you are going to be billing Medicare - may also be beneficial if you opt-out)

3. Financial Basics

• Open business checking account with bank or credit union
• If needed, secure start-up loan and/or line of credit
• Get business credit card
• Obtain retail tax license (only needed in some states, or for some services/items)
• Obtain sales tax license (only needed in some states, or for some services/items)
• Obtain business insurance (aka businessowner's policy). This covers property and general liability; not related to malpractice.
• Obtain personal malpractice insurance policy
• Obtain practice malpractice insurance policy (separate from individual policy)
• Obtain any other insurance your lease or state requires. Such as commercial auto insurance, disability, business interruption insurance.

4. Create Brand and Establish Identity

• Create Logo
  • Use local graphic designer or online design options (99 Designs, Fiverr, Canva, etc)
• Create brand identity/theme: colors (2-3), fonts, etc.— provided by any graphic designer & can be included in logo design
• Purchase domain (web address) name (e.g AcmeHealth.com): Can use Google, GoDaddy, Hover.com other domain registrar, or a website builder service
• Set-up email host (G-Suite makes all below easy, but other options available)
  • Set up personal domain name (e.g. @acmehealth.com)
  • Sign a HIPAA BAA with email host
  • Obtain address for each user needed (e.g. doctorX@acmehealth.com, hello@acmehealth.com, etc.)
• Create website
  • Browse other DPC practice websites to get ideas, ask your favorites who they used/how they did their site
  • Decide if can do DIY with website builder such as SquareSpace, WIX, etc. -or-
  • Hire website design professional (warning: can be quite expensive)
  • Info to contain: bio, services, pricing, FAQs (policies), disclaimers (“not insurance”), clinic location, hours, contact information, social media accounts. By law must include privacy policy.
  • Embed enrollment form or information on how to enroll
• Register with Google “My Business” (hugely helpful for web traffic)
  • Do both your clinic name and your name (you will have 2 google business listings)
• Create social media profiles (not all-inclusive list)
  • Facebook and Instagram (most helpful for marketing and community connections/brand awareness)
  • Twitter (good in some communities, but better for media & policy outreach)
  • Yelp (may help increase search engine optimization)
  • LinkedIn (only good for connecting with potential business partners)
  • Tiktok
  • Others
• Claim online "review" profiles and change practice information

5. Offline marketing plan

• Promotional print materials (local print services, or online options)
  • Business cards
  • Flyers/Brochures/Rack cards
  • Other swag (pens, notebooks, chapstick, hand sanitizer, etc.)
• Send a press release to local/regional news outlets announcing your opening
• Set up meetings/presentations to spread the word (audiences may include churches, Lion’s Club, Rotary Club, various Chambers of Commerce, 1Million Cups, small-business groups, insurance brokers, financial advisors/accountants, realtors, etc.)
• Join business/networking organizations - Chamber of Commerce, Rotary Club, Lion’s Club, AWBA, BNI, church groups
  • Attend networking and business meetings - meet business owners, spread the word, make connections
  • Practice 30 second “elevator pitch” and be prepared to give this at every meeting
• Community involvement
  • Develop relationships with a teaching hospital: teaching students, FM rotation, research, residency, etc.
  • Join the County Medical Society, City Medical Society
  • Join to Chamber of Commerce(s)
  • Visit small businesses and specialists in the area
  • Booth at community events (Farmer’s Market, etc)
  • Local podcasts
• Plan open house/town hall meetings
  • Promote on social media
• Traditional marketing strategies? (Many will not see benefit or good return on this investment--very dependent on your local market)
  • Mailers? Flyers? Local newsletters?
  • Billboards?
  • Newspapers?
  • Yard signs?
  • Radio?

6. Leaving practice or transitioning existing practice to DPC

Employed positions may pose more challenges here

• Review relevant professional and employment contracts for transition
• Notify existing patients: 3 notices (by all methods possible)…
  • 90-180 days out….First announcement letter-- tell the “why”, and broad goals for leaving/switching to a new model of practice (don’t need much details yet)
  • 60-120 days out….Further introduce new DPC practice (more details, website). *** Notify no longer can serve as PCP if not in DPC plan (especially important if transitioning insurance-based practice) ***
  • 30-60 days out….Reminders, share more details of practice (pictures, features, etc.), build excitement for future
• Cancel existing insurance contracts (some require 90 days or more notice) -- tips here
• Opt-out of medicare if desired
  • Submit opt-out form at least 30 days prior to the quarter you want to begin seeing medicare patients

7. Creating a clinic space (if necessary)

• Consider hiring a commercial realtor (can help with many issues below)
• Find physical space for clinic
  • Decide on renting (typically 3-6 month process; longer if major renovations) versus purchasing (typically a minimum of 6-12 months of planning; longer if new construction)
  • Hire contractor (+/- architect if major stuff) if renovations, or DIY if handy
    • Special local building codes for medical practice?
• Register or update new clinic address with all agencies
  • State business registry (typically Secretary of State’s Office)
  • State medical board
  • Malpractice Provider
  • Medical license and DEA
  • County or city agencies
  • Add address to website and social media accounts
  • Add clinic to DPC mapper
• Register with Google “My Business” (hugely helpful for web traffic)
  • Do both your clinic name and your name (you will have 2 google business listings)
  • NOTE: you need a Brick and Mortar address that is accepting USPS mail first, because to verify you they snail mail you a confirmation code
• Obtain business insurance (aka. businessowners policy or BOP). This covers property and general liability; not related to malpractice.

8. Hiring staff & HR issues

• Decide on staff members needed
  • Clinical staff (e.g. RN, LPN, MA, etc); _________________
  • Non-clinical staff? *not always required with small, lean practice
• Obtain payroll services (accountant or online service)
• Obtain workers compensation insurance policy (local insurance broker, or built in payroll service options). See state laws.
• ID Badges (may be required by state)
• Clarify OSHA type requirements
• Post appropriate federal wage and OSHA posters in “workroom”

9. Running the Practice: Legal Items

• Obtain CLIA waiver if doing onsite simple lab testing (e.g. urinary dipstick, rapid strep, etc.)
• Patient Forms: write your own, or borrow from others with permission.
  • Privacy Policy
  • Patient Contract
  • Release of Records
  • Authorization to Discuss PHI (i.e. w spouse, parent, etc)
  • Credit Card Authorization for Recurring Payments
  • If working with employers: Employer Contract
    • Patient contract for employer-sponsored memberships
• Agreement for Controlled Substances (if applicable)
• Consent for Procedures
• CMS waiver (if opting out)
• HIPAA waiver
• Ensure Business Associate Agreement (BAA) in place for any non-employee who has (or could have) access to records.

10. Clinic Office Equipment

• Computer(s): Laptops vs desktops vs tablets (or some combo)
• Printer (laser B+W most efficient option)
• Scanner (w/ double-sided capabilities)
• Label maker(s) for printing medication, lab, & shipping label stickers
• Phones (landline, VOIP phones, or mobile phone)
• Shredder (ideally P4 or higher for HIPAA-complaint shredding)

11. Practice Software and Communications

• Choose patient health records system
  • Paper records? If you want!
  • Electronic: Commonly used EHR options in DPC = Cerbo (formerly MDHQ), Atlas.md, Elation, Practice Fusion
• Choose patient billing service/software that can do recurring billing/payments
  • Commonly used DPC specific options: Hint Health, Atlas.md (also serves as EHR)
  • Other web-based subscription billing platforms (trickier to implement with integrations and HIPAA-compliance)
• Patient communications
  • Allow regular (non-secure) email?
  • Allow regular (non-secure) text messaging (SMS)?
  • Require or offer secure messaging services/apps: Commonly used = Spruce, Hale, Twistle, Twine (some will integrate with EHR & other softwares)
• VOIP phone (voice) services: Good for rerouting calls, and other functions. Some local phone companies will offer this, but lots of internet-based, HIPAA-compliant options, but commonly used HIPAA-compliant are: Ring Central, 8x8, RingRx, Answer Advantage, Grasshopper, Ooma, MightyCall, webfones among others
• Fax service:
  • Traditional (phone-line + machine)
  • HIPAA-compliant web-based options including RingCentral, Interfax.net, UpDox, Faxage, FaxCentral, eFax, etc).
• Other software
  • Pharmacy dispensing software (stand-alone or combined with EMR)
    • MDScripts
    • FlexScanMD
    • Atlas.MD
  • Mail hosting
  • Intraoffice communications
  • Macro/text expanding software
  • AI software
  • PDF Editing software

12. Practice Operations

• Purchase initial clinical supplies (bandages, gauze, syringes, needles, etc.). Will depend on clinical services, but common supply list here, or ask a mentor!
  • For surgical supplies, check eBay and Craigslist- generally surgical equipment is massively marked up from medical supply places, but there is good equipment available affordably on eBay.
• Get basic office supplies (i.e. pens, printer paper, stapler, scissors, etc. etc.)
• Non-legal policy documents developed:
  • Philosophy of care & clinic explainer
  • Employee Health Assessment (for employers who give discount for well checks)
  • Equipment Lease Agreement (for crutches, splints, etc.)
• Create account with wholesale medication/medical equipment supplier (regardless of if you’re dispensing meds or not)
  • Vendor options: Andameds, Henry Schein, McKesson
• If dispensing meds, decide on medication formulary (what you will stock)
  • Make initial order (most practices will start small, but may eventually stock 50-150 meds)
• Obtain lab contract & pricing: typically done via “client billing” arrangement
  • First check your state’s laws. Some states make difficult or have restrictions.
  • Possible companies: Quest, LabCorp, Physicians Reference, Local lab -- ask local mentors)
  • Pathology: (can potentially be tricky d/t legal restrictions)
• Create repository of clinical worksheets/forms
  • ADHD Evaluation, PHQ-9, Epworth Sleepiness, ASQ, etc.
• Storefront Sign & Sign permit
• Internet service
  • Broadband options and requirements
• Office network
  • Wired vs. Wireless
• VPN/remote access
• Backup procedures: onsite, cloud, offsite

13. Medications (if applicable)

• Dispensing license regulations by state
• Create account with wholesale medication/medical equipment supplier - Vendor options: Andameds, Henry Schein, McKesson, Bonita
• Decide on medication formulary (what you will stock)
  • Make initial order (most practices will start small, but may eventually stock 50-150 meds)
• Order meds, bottles, lids, other supplies
• Consider pill counter vs Pilleye App vs other

14. Labs/Imaging

Client billing for labs/pathology/imaging not legal in all states

• Contact Quest, LabCorp, CPL and ask for “client bill rates”
  • Consider using GPO/GPP
• Contact local imaging centers for cash list of all services offered
  • Ask about possible “client bill” discounts
• Contact local pathology companies
  • Consider MC Pathology for basic pathology needs

15. Open Clinic

• Start seeing patients
• Continue online and offline marketing
• Plan ribbon cutting ceremony through Chamber of Commerce 3-6 months in

There are many considerations that go into whether you hire a virtual assistant or an in-office employee. Some considerations include the work you need done, how your office is physically set up, your desire to manage payroll and payroll taxes, what you can afford, and how you communicate best with others.

Work Needed:

Take some time to make a detailed list of what tasks you need your employee to manage for you. If you need their assistance with filing of paperwork, completion of prior authorizations and pre-certifications, and contacting patients with results this can be completed by either someone in the office or virtual. If you are comfortable with the work being done in an asynchronous set up (ie the work can get done at their convenience rather than at hours directed by you) a virtual assistant would be a good option. However, if you need someone to room patients, collect vitals, draw blood, and assist with procedures you will need an in-office assistant. If you prefer the work to be done during specific hours/times, virtual may be an option, but in-person may be better.

Office set-up:

Does your office have space to comfortably have an additional person in there? If you are working in a small 500sqft space, you may not realistically have space for you and an in-person staff member. If you have enough space, do you have any space for them to “get away” for a few minutes? Even something as small as a kitchenette for them to sit in and get away from their desk for a few minutes can make a big difference in their overall happiness at the office.

Payroll Management:

Do you want to manage employee payroll and taxes (unemployment, workman’s comp, etc)? If you hire a virtual staff member you have the choice of paying them as an employee or as a 1099 depending on your expectations and working agreement. However, it is much more complex to pay an in-office employee as a 1099.

Financial Capabilities:

With virtual staff you have the opportunity to hire someone based outside the US. Often, a living wage for virtual assistants outside the US is significantly lower than one based within the US. If you find yourself in the situation of needing help but uncertain if you can support cost of in-office staff, a virtual assistant based outside the US may the perfect solution.

Communication Preferences:

If you are the sort of person who is comfortable with electronic communications virtual staff is a great option. However, if you greatly prefer in-person interactions and conversations, you would likely do better with an in-person staff member.

In summary, when deciding to hire virtual vs in-person support staff, it is important to know what you need, what you want, and how you would best function and hire accordingly. If you know you need help with rooming patients, it would be silly to hire someone to work virtually. In contrast, if you know your office is too small to comfortably have a second person present regularly, it would be silly to hire an in-person staff member (unless you are actively enlarging your space and have real plans and timelines in place).

What are the top 35 lab tests that most DPC doctors order? 

• CBC
• Complete Metabolic panel 
• Basic Metabolic panel
• Lipid Panel
• TSH
• Free T4
• Hemoglobin A1C
• Urine microalbumin
• Urinalysis
• Urine culture 
• CRP
• ESR 
• ANA
• Vitamin D
• Vitamin B12
• Iron
• Ferritin
• TIBC
• Testosterone
• FSH
• LH 
• Insulin level 
• PSA 
• FIT test 
• Stool culture
• Stool O&P
• C. Diff toxin 
• Uric Acid
• Acute hepatitis panel
• Gonorrhea and Chlamydia TMA or PCR 
• Vaginitis panel 
• HIV
• RPR 
• D-dimer 
• Intact PTH

In a traditional, insurance-based practice, you may need to cancel existing insurance contracts prior to starting or joining a DPC practice. In that process, there are a few considerations.

First, it’s advisable to obtain and review all of the active insurance contracts--whether you are self-employed or employed. Of note, many insurance contracts are “auto-renewing” and will often remain in force until you pro-actively cancel them.

EMPLOYED? Some employed physicians do not sign insurance contracts as individuals; rather, the contract is with the business entity (hospital or medical group). In that case, if you leave the practice, you would not need to cancel the contracts. However, you must clarify this with each contract and your employer, because, in some cases, the individual physician is signing a contract with the insurance plan.

TIMELINE. Once you get the contracts, you should search through them to find the “terms of cancellation” or similar section. Some may be canceled within 30 days, while others could require up to 1 year of notice! Most commonly, the effect of cancellation is in the 60-90 day range. In any case, having this information will be required as you choose the start date of your new DPC practice.

NOTICE OF CANCELLATION: You will need to find out what is officially required to cancel a contract. While several options may be permitted, the safest option to ensure cancellation is to mail a certified letter. Make sure you send it to the correct address and get confirmation. It is advisable to call after 30-60 days to confirm the cancellation was processed.

DEPENDING ON TIMING you may not be able to recruit certain pts until the contract with their insurance ends. You aren’t required to still see these pts and bill their insurance, but you should be aware that abandoning them is not allowed either. In your notification letter, you might consider educating your pts to begin looking for other PCPs available to them. You could also see the pt and continue to bill the insurance or see them for free until the contract terminates. You can pick and choose which pts to offer these options to. Be aware that they may not convert to DPC with you no matter what but the longer you continue to care for them the better your chances.

VISION

In deciding to transition to DPC, it is necessary to have a clear vision for what you want to create and why you want to create it.

1. How does this vision:
   • Benefit your patients?
   • Benefit you and your family?
   • Improve the practice of medicine?
2. Why is this transition necessary for you?
   
3. What would happen to you if you did not transition to DPC?

INTEGRITY

Nothing sells better than integrity.

• Figure out your why, simplify it, and don’t look back.
• Your vision, your model, your why, and your passion for patient care will shine through as you transition to DPC.

PRACTICE YOUR SELLING PITCH

Selling often seems unfamiliar and uncomfortable for physicians. However, every physician-patient interaction is an exercise in trust and is a type of “selling.” Be authentic, not apologetic.

• Learn how to describe Direct Primary Care and your practice in 30 seconds or less
• Practice on family members and friends
• Ask friends in marketing to listen and provide advice
• Teach your family, friends, and office staff how to present DPC quickly and confidently
• Fake it till you make it - practice really does make it easier
• Check out marketing videos on other DPC physician websites
• See How to Create a Great Elevator Pitch for more details

BECOME COMFORTABLE WITH MONEY - KNOW YOUR WORTH

• To figure out your rates, see Setting Membership Pricing for some useful tips
• Do not undervalue yourself
• Present your pricing in a confident manner
• Use analogies that others have used before you, “ for the price of your cellphone bill”, “the Netflix of medicine”

First and foremost, create a financial plan to help guide you. You might want to talk to a local DPC mentor about their start-up costs and expenses to get a better idea of these numbers in your area. Remember that the lower your overhead and start-up expenses, the less you have to charge and vice versa.

• Calculate total start-up (one-time) costs = $ _____________
• Calculate ongoing (operating) expenses = $______________/year
• Determine desired self-pay (take-home) pay = $ _____________/year
• Determine what portion (if any) of your patient panel will be offered charity care
• Determine per-member-per-month need

Once you have these numbers in mind you should consider the type of population you want to take care of in your practice.For example, if you prefer to have younger patients or small families with children, you might consider instituting an aged-based membership. This gives a lower cost to younger adults and families with children under 18, who generally feel that they are healthy and only need care on occasion.
An example would be the following:

• Children up to age 18: $40 without adult membership, $20 with adult membership
• Adults to age 44: $60 per month
• Adults 45-64: $80 per month
• Adults 65 and older: $100 per month

Conversely, if you prefer to have older patients in your practice or perhaps you do not see children, you may want to institute a single cost per member, which may be higher than what a younger person would want to pay but lower for the older patients.

• For example, if your per-member-per-month need is $80 per member, charge each member a flat $80 per month.

Some prefer to set one cost for children and one cost for adults to simplify things. For example:

• Children: $40 per month
• Adults: $80 per month

If you are a pediatrician, you may want to consider a higher cost for newborns and infants when you know they will need more well care and lower the cost as they get older. For example:

• For children less than 2 years old – $100/month
• For children 2 to 5 years old- $75/month
• For children 6 to 18 years old – $50/month

Some doctors will set a “family rate”. While this can be a good way to gain members and young families, proceed with caution as some very large families may be very time intensive.

Obviously, there is no one right answer with regards to how to charge and every practice is a bit different. Consider your location and population as well. You might be able to charge more if you are in an affluent neighborhood or prefer to attract this population. You might consider charging less if your town's per capita earnings are low or your practice is in a lower-income part of town.

Remember, this is YOUR practice. You can choose to set pricing however you see fit.

One of the cornerstones of DPC is unprecedented physician access. The time DPC doctors have to devote to their patients and the access the patients have is what makes it what it is.

However, like anything good, too much of it can probably be bad.

One of the most frequently asked questions by doctors looking into transitioning their practice to DPC is some version of “But how can you be available to your patients by phone, e-mail, and text, and for urgent in-person needs, virtually 24/7 and still have a life?”

The answer is “It’s not as bad as it sounds.” It really isn’t. It helps that DPC docs have a limited patient panel size. That being said, every DPC doctor does have the occasional over-user. More on that later.

When it comes to setting boundaries with patients, generally we’re referring to what kinds of things patients can contact you for, when, how often, etc.,as well as how often they schedule appointments, how often they interact with your staff, etc. When deciding where to draw the line for these kinds of boundaries, most DPC docs will tell you that where you are in establishing your DPC practice will help define how strictly you set such boundaries.

Most DPC docs start out with fairly lax, --even very lax-- boundaries. We give our patients something amazing that they tell their friends about. There is tremendous value in a non-sustainable willingness to cheerfully answer a call about a lisinopril refill at 11:30 pm on a weeknight, or a text asking how many carbs are in a half cup of peanut butter on a Sunday afternoon. I know, I know, this sounds painful. And it is. But this pain is only temporary, for 3 reasons:

1. When patients use you in this way, it’s what Dr. Jeff Davenport has called the “New toy at Christmas phenomenon”. The toy gets played with a LOT for a short time, and before long is collecting dust somewhere. DPC services are often used like that. When the patients know you’re available, the novelty wears off, and you’re there if they need them, and the usage/text frequency drops off dramatically. 
2. Often patients who are new to you come from inside the system, where they have had poor continuity, polypharmacy and basically, medical neglect. Once these patients are “tucked in” and their issues sorted out, the usage frequency drops off.
3. As your patient panel fills up and you get to the point where your time is more limited, you can begin setting more strict boundaries with your patients. By this time, they have recognized the huge value of their membership, and they’ll back off with communications/usage that are unnecessary--if you ask them to.

OVER-USERS

So what happens when you have a full panel and 99% of your patients fall into the above-described categories, and recognize that you have 500 other patients and a life and therefore leave you alone for minutiae, but 1% of them drive you nuts? This is where we recommend more-strict boundary-setting. If you don’t set some boundaries, you’ll begin to resent the patient and the quality of care and the physician-patient relationship will be damaged. This is usually as simple as kindly asking them to call the office tomorrow and asking a staff member for assistance. Some docs will employ “therapeutic neglect” with over-users and won’t reply to frivolous messages quickly. There are numerous ways to kindly work with these patients to decrease over-use. In the rare circumstance where your boundary-setting offends a patient and they leave your practice, it’s probably for the best; they may not have been a good fit. And such patients are usually <1% of your panel, yet represent >95% of your text/e-mail interactions, so their leaving frees up a lot of time to use for other patients.

OVER-SETTING BOUNDARIES

Just as patients can over-use your services, doctors can over-set boundaries. Some DPC docs have lamented the lack of patient sign-ups and their having to moonlight to make ends meet due to the slow growth of their DPC practice. When auditing their business model, successful DPC docs have found that these physicians often have overly-strict boundaries. Perhaps the doctor doesn’t allow after-hours contact by phone, text or e-mail. Or perhaps the doctor doesn’t text with patients at all. This has the overall effect of lowering patients’ perceived value in the DPC membership. In essence, you have to give them something for their money, or they’ll take their money elsewhere.

Ultimately, every DPC doctor will find themself frequently moving around their boundaries as their circumstances evolve, to generate the perfect mixture of access/quality and work/life balance.

Welcome to the world of direct primary care. If you’re reading this, you’re likely in the position of owning your practice (or working with a DPC doc who owns the practice). This means: you’ve now got more control over your schedule than you’re likely ready to deal with.

Things to decide:

• How long will your initial visits be? Typically want these to be pretty extended. Often you will spend time talking about the logistics of the practice and how you accomplish taking care of pts as well as the typical new pt medical things.
• How long will your follow-up visits be?
• How long will you schedule for procedures? Obviously, this may differ for different procedures. Don’t forget to consider when you need assistance and/or chaperones
• Will you take walk-ins?
• Do you need a buffer added to your visits to complete notes? Put in orders?
• How many days a week do you plan to see patients? Will this change as you grow?
• How much can be triaged to your staff? How much do you want to triage directly?
• What expectations do you want to set for text, email, phone, and/or in-person visits?

Once you decide your schedule and preferences, various software providers can help automate your scheduling while others don’t allow for outsourcing your scheduling:

• AtlasMD (via their Mac App)
• MDHQ
• Elation
• Calendly, Google Calendar

Keeping your Schedule Open

Some DPC doctors are emphatic that schedule management should be carefully triaged and managed by either the physician or a highly trained staff member (to keep the schedule open and address things without an in-person visit). Others open their schedule to direct scheduling so that no clinic bandwidth has to go into scheduling. Each has its pros and cons; decide what flow you think fits best.

Additionally, there are many opportunities to train up your nursing staff to provide basic care visits (any visit that can be directed by an explicit algorithm -- cerumen washout, uncomplicated UTIs, strep visits w the Centor Score, Ottawa ankle rules, etc., etc.).

Some physicians elect to transition their current private FFS practice to a hybrid DPC practice, meaning that part of their practice is made up of pure DPC patients and the other part is still insurance-based fee-for-service. Some physicians elect to continue Medicare contracts only in order to both keep Medicare patients as well as keeping the ability to moonlight in more traditional settings. Other physicians prefer to keep all or part of their commercial insurance contracts. Still, others use hybrid as a stepping stone to eventually become a pure DPC practice over the course of months to years.

Some of the reasons people give for wanting or needing to do a hybrid practice:

• Some insurance contracts can take 90 days or more to cancel. Ignoring this requirement leaves a physician liable to a breach of contract allegation.
• The physician may be the sole breadwinner of their family and they fear that losing most of their patients all at once will put them into a difficult financial position
• The need to continue moonlighting opportunities which are more limited when you opt-out of Medicare.
• Concern for abandoning patients or losing patients they have seen for years
• Wanting to continue seeing a large portion of patients over 65 who may not be able to afford services not covered by Medicare

The potential benefits of running a hybrid practice include:

• The ability to drop insurance contracts at a slower pace allowing the practice to continue a more steady revenue stream during the transition
• The ability to support family and lifestyle while transitioning, including having the flexibility to moonlight for extra income

The potential disadvantages of running a hybrid practice include:

• Potentially competing against yourself. It may be difficult to recruit patients to DPC when you are continuing to support their using insurance to pay for your care.
• The need to differentiate care for DPC patients vs. Insured patients (It can create a perverse incentive. You would want to enroll DPC patients but are financially incentivized to pack your schedule with insured FFS patients.)
• The need to continue administrative tasks and inability to lower overhead due to the need to continue maintaining the staff and software to deal with insurers and meet data collection requirements.

If you’d like to read a little more about hybrid DPC practice, this is a great article by Dr. Lee Gross.

Most patients will be intrigued by what you are doing, especially if you get really good at getting your point across in a few sentences. Some get it right away and are ready to take the plunge with you. Others take a little more education but eventually come around. Some don’t understand right now, but once you are gone and they get lost in the system, they realize you were right and come find you.

The most difficult thing to deal with are those patients that get angry. These patients just don’t understand and some feel you must be leaving them because you are looking to line your own pockets.

If you must deal with someone who is angry face to face, stay calm, and let them know that this was a decision you did not take lightly. Let them know you are very sorry they are angry but that you are doing this for both the improvement of patient care, as well as for your own sanity. Don’t try to reason with them if they continue to be angry. Just let them walk away.

If you are dealing with someone who is angry and has verbally abused your staff, call them directly and try to allow them to voice their concerns. Again, be calm but firm in how you deal with them.

Lastly, combat anger with education. Give your patients plenty of opportunities to learn about your new model. Send out letters, hold town hall meetings and allow for plenty of time for questions and answers, make Facebook posts, talk to all your patients at each visit leading up to your opening date. Think about scheduling fewer patients if possible and having a little more time with each one to talk about your DPC future.

“Pre-enrolling” entails signing up patients (members) prior to your official opening date, so that, when the time comes to open your practice, you can bill patients from your first day of practice. This allows you to have a revenue stream from the very beginning. While this seems enticing, there are a few things to consider when doing this:

EXISTING OBLIGATIONS: If you are in an existing practice, you need to clarify any employment obligations and current insurance contracts before creating a pre-enrollment process.

FIRM(ISH) LOCATION & OPENING DAY: In order to pre-enroll, you should have a fairly solid clinic location secured and an opening date, hopefully, 3-6 months (or longer) in advance.

PRACTICE DETAILS, FORMS, & POLICIES: Have you created a patient contract[UPDATE LINK]? Are you building a website with embedded enrollment forms? Does your EMR potentially have a link you can embed into your website? Do you have business cards or flyers? Having these all in place prior to starting a pre-enrolling process is advisable.

PATIENTS COMPLETING FORMS:

• Online enrollment is likely the easiest choice here. This generally involves using your chosen membership management or billing program.  which will allow you to embed an enrollment form on your website.
• You can have patients manually (in-person) complete required forms and then enter information into your systems later. This can be more leg work, but some doctors prefer this method to make sure patients understand the model and are a good fit.

ROLLING START DATES? If you are successful in pre-enrolling hundreds of DPC patients, you may consider using a staggered start date for their membership. If you are pre-enrolling your current patients that is the best of all worlds. You already know them and won't have to have a “new patient” visit to get to know them.

A saying about retail enterprises is to consider “location, location, location.” And the location is that important to your success. Where you decide to open your clinic in terms of city/town is largely up to you. There is no one recipe or one right answer. It is logical to assume that if you move to a community completely new to you and open a practice, your growth will be more challenging. Physicians who have done this have had varied experiences. It also seems logical that if you open a practice in your hometown, growth will come more naturally. This, also, is not always the case.

Lease or Buy (or Free!): For the most part, the best recommendation for an entrepreneurial start-up is to stay as financially lean as possible. What does this mean? Spend as little money as possible and commit to as few ongoing expenses as possible. If you can’t afford it now and you don’t absolutely need it, don’t buy it, lease it or sign a contract for it. The Lean Startup is a great resource on this topic.

1. Free: if you can find a room in another health-related space and trade care for office space, this is the leanest start-up option possible.
2. Rent a space: find another physician or other business that will sublet space or a room in their office to you
3. Buy or rent a Facility: find a building to buy or rent

Direct Primary Care (DPC) offers a seemingly perfect solution for physicians and patients; however, it is not perfect. As such, DPC comes with some unique challenges.

• Marketing and Community Outreach: Developing a marketing strategy to effectively communicate the benefits of DPC to potential patients is essential. This might include online presence, community events, or partnerships with local businesses.
• Patient Acquisition: Attracting and retaining patients can be challenging, especially in a new market. Building a patient base and getting the word out about your practice is crucial.
• Business Ownership: Starting any business has its challenges, but when you are starting and building a model of care which directly threatens the current model, you may be faced with contrarians and opposers who may propagate their assumptions about what DPC is. This can make growth difficult initially. That is until you prove them wrong - which you will do.
• Financial risk: You will need to prepare for and accept the risk of receiving less income initially. You may need to supplement your income in other venues such as Urgent Care Clinics, Emergency Departments, etc as your practice grows. (Review the Member Only article Moonlighting and Side Hustles for more information)
• DIY Medicine: It can be very nerve-wracking as you may have to find “hacks” to help save patients money or even venture into areas of medicine which you hadn’t fully considered such as performing venipuncture, scheduling patients, answering your phone calls, and/or re-learning procedures you may not have done in a while.
• Patient Relationship Management: Building strong, trusting relationships with patients in a membership-based model requires a shift in how you interact with them compared to traditional fee-for-service models. Some patients may overestimate their relationship with you or grow to feel entitled to the care and attention they receive from you. Setting clear boundaries early on in the patient-physician relationship is highly recommended. Specific patient populations may pose certain challenges. “Low utilizers” may not find value in a monthly membership for a service they don’t regularly use. “High utilizers” may have a false sense of entitlement of what they think you should be providing to them. Other patients may overestimate their relationship with you assuming that, in addition to being their physician, you have a more personal relationship that can easily be abused.
• Recruitment and Staffing: Typically physicians would not have any experience with hiring/firing or creating the healthcare team that they work with daily as this was formerly done by the employer. However, in DPC, you’ll have full responsibility to create the team that will embody your vision of practicing good medicine. This can be both exciting and challenging.

As mentioned in our Boundaries article, having clear guidelines on how your patients should communicate with you is essential. If you are the type of person who loves texting, you may want to encourage your patients to text you with questions.  If you hate texting, you might encourage email instead.  If you anticipate having staff right from the start, you may want to encourage calls to the office during business hours but texting to your cell after hours.  Be realistic about what would work well for you, and make sure you communicate this with your patients at their intake appointment.  

Many physicians will give out or incorporate their policy into their patient agreements, provide a 1 page handout of their policy to new patients, or provide a card with their policy.  Below you will find a sample copy of a card used by one of our physicians as well as a sample 1 page policy.

Do I have what it takes to start a DPC practice?

Entrepreneurs have a vision and are willing to take risks and prepared to work hard. They prefer autonomy over stability. Direct primary care physicians have a persistent passion for patient care. Do you have both? Are you ‘wired’ to be employed? Are you ‘wired’ for autonomy? If a DPC-oriented business offered you a job tomorrow, would that make more sense to you?

Do I still love medicine?

Stop now and answer this question:

Is it time for you to quit medicine altogether or do you still love the work of being a physician but can no longer tolerate your job?

DPC is not the easy path - you will still work hard. It is different in that you are working for yourself and your patient and building something for your future. This inherently restores the autonomy and joy of being a physician, and leads to immense self-growth, and developing new non-clinical skills.

I went to medical school, not business school - how do I start my own business?

Most business owners have not gone to business school either - many may not have gone to college. Running a small business is hard work but not very complicated. If you can become a physician, you can run a business. Check out small business resources from U.S. Small Business Administration.

What do I want my DPC practice to look like?

When deciding what kind of practice to start it is helpful to consider:

• What do you want to build? A small solo practice with just you and your patients? A multi-provider practice? A business you can eventually sell or step away from?
• What resources do you have? Do you need to/want to share them with another doctor?
• How important is autonomy to you?
• What is my ideal patient?
• What niche do I enjoy the most?
• Does it make sense to continue to support an insurance-based practice while trying to grow/build a DPC? (See Risk and Benefits of Hybrid DPC Practice for additional information)
• Do you want to fully separate from insurance billing? Can you do so? (See Terminating Insurance Contracts for additional information)

There are some basic health insurance terminology and concepts you should understand when venturing into working with employers.

Premium--monthly fee paid to insurance company for health insurance coverage

Deductible--the amount the employee is responsible to pay before covered services are paid by the insurance company (average deductible for a family in 2018 was $2800)

Co-Pay--the amount of payment to be paid to health care provider by the employee at the time of service in a Fee for Service model (usually $20 to $40 in primary care)

Co-Insurance--the percentage of covered services employee is required to pay until max out of pocket is reached. In an 80-20 plan, after the deductible is met, you still pay 20% of covered services until the maximum out of pocket is reached.

Maximum Out-of-Pocket Costs--this is the maximum the employee is responsible for in a plan year

Claims--is a formal request from a policyholder to an insurance plan for payment of health care event

Third-Party Administrator (TPA)-- Organization that processes insurance/health coverage claims and manages other aspects of an employer’s benefit plan which can be structured as a self-funded or partially self-funded plan. TPAs can be involved in many aspects of the benefits plan, including but not limited to utilization review, membership enrollment, retirement plans processing, and HSA/FSA processing, in addition to claims processing.

Fully Funded insurance plan-- These are the most common plans employers use and are Fee For Service type plans. These can be PPO (Preferred Provider Organization) plans, HMO (Health Maintenance Organization), or even HSA (healthcare savings account) plans. These plans are mainly offered by large commercial insurance companies like Blue Cross Blue Shield, United, Aetna, or Cigna. In these plans, the employer (or individual or both) pays the monthly premium and the insurance company administers the health plan, pays all the claims, and assumes all the risk.

Self-Funded Plan-- Health insurance plans that are designed outside of traditional commercial insurance; they are designed with the help of benefits advisers/brokers and typically administered by a TPA. They are usually described as partially self-funded where the employer pays benefits up to a maximum amount. They then purchase Stop-Loss insurance to cover anything over the max amount, so claims over this amount are covered by the Stop Loss insurance company. The employer pays the small claims, the Stop-Loss premiums, and therefore, assume more risk than fully funded plans. Some really big employers form self-funded plans that pay the full amount of all claims and do not use Stop-Loss insurance. They control the entire health insurance spend. These self-funded plans allow employers more flexibility in designing their health care benefits but require specific rules for employers to follow. These types of plans are governed by a federal law called ERISA (amongst other regulations and state laws/regulations).

ERISA--The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that sets minimum standards for most voluntarily established retirement and health plans in private industry to provide protection for individuals in these plans.

Minimum Essential Coverage--MEC plans are used by some smaller employers just to meet the essential insurance requirements the government requires. They are often cheaper but cover fewer services and may have higher deductibles. Some brokers/advisors will use these with DPC services.

Health Sharing Plans-- These plans are NOT insurance at all but are organizations that pool patients’ money and share health care expenses. These are used more by individuals not employers but some small employers are starting to use some of these plans. Check out Medishare, Samaritan Ministries, Sedera, Zion.

Broker or Benefits Advisor-- these are the people that help set up health benefit plans for employers be it fully funded commercial plans or partially self-funded plans. Most advisors and brokers are paid directly by commercial insurance companies to provide employer policies. They should be working directly for employers but most are not. If you work with larger employers, then you will be dealing with brokers and/or advisors. If you meet a broker or adviser that charges the employer directly a consulting fee and doesn’t get a commission from selling plans, those are the types of brokers/advisors that you want to know. Since they don’t get paid on commission they typically are looking for what is BEST for their client. If they do a great job they keep getting paid.

Regarding employee benefits, you can do whatever you like (within reason and the law). It is not a requirement to offer benefits, but it can be a great way to show your employees how much you appreciate them. You may also want to consider speaking with your accountant regarding financial strategies for your particular situation. Great staff creates a great clinic.

Things to consider:

• Retirement savings
  • Talk to your accountant. Options will depend on your tax structure. Also very strict rules on what can be offered to some but not all employees. What you can do for yourself without involving the same for employees. Definitely use your accountant’s expertise here.
• Health insurance
  • You can sign up for traditional PPO small business health insurance at any time. Find a local broker to learn about more options.
  • Consider giving a set cash amount per pay period, month, or year that your employee can put toward their insurance/healthcare. Seek accountant advice again. Some things are taxed vs tax deductible, etc.
  • Health cost-sharing options such as Sedera or Samaritan ministries. There are many options – google.
• Dental/Vision insurance
  • You can offer the actual insurance, or consider bartering with a local dentist and optometrist to provide annual screening or other discounts for your employees. This could be an opportunity to encourage the other party to consider a membership option. For example, ask if they would consider X dollars for two teeth cleanings, fluoride, and X-rays per year or some other package. Teach these professionals what you do. They may be interested in the model as well.
• Other insurance
  • Disability, life, etc.
• Profit-sharing
  • Variety of ways you could do this. Consider a bonus if it helps sign up new patients. Or a bonus for every 100 patients enrolled. Get creative. Your staff is a very important part of the business and its growth – help them feel valued as such.
• Vacation
  • You are not required to provide paid vacation time, but it’s a perk to consider.
  • Most full-time employees will expect 1-2wk/yr of paid vacation
  • You do not have to provide PAID vacation, holiday, or sick leave
• Days off
  • You must give time off to serve on a jury and perform military service. You may have to give time off to vote (state by state requirement)
  • Consider calling them “Earned Time Off” or “Personal Days” as your staff may have children and need to take time off for them, not just their own sick days.
• Flexibility
  • Many DPC docs love the flexibility that this model provides them in terms of their work schedule. Your staff can also benefit. They can still answer the phone from home when they have to leave early to pick up a sick kid. Again, get creative and find ways to allow your staff to have some flexibility too. But don’t let your staff abuse this.
• You must:
  • Give time off to vote (state by state), serve on a jury, and perform military service.
  • Comply with workers’ comp (see your state laws)
  • Withhold FICA taxes (see your accountant for specifics)
  • Pay state and federal unemployment taxes
  • Company with Federal Family and Medical Leave (FMLA)
  • Contribute to any other state programs such as short-term disability (talk to your accountant)

A final concept on benefits to consider: Within the laws of your state and rules you have to follow based on your location, recognize that each employee or group of employees may not need or want the SAME benefit. For example, one employee may be a divorced mom that has health coverage from her ex but be more interested in a few more paid days off in case of a child’s illness. Another employee may have military benefits and prefer a little more in their paycheck or a bonus of some kind. Another employee may thrive from some recognition like a special birthday gift or award. Ultimately don’t assume you know what they want or need. They very well may prefer some benefit that you wouldn't consider beneficial or preferred yourself. If you give them health insurance that costs $400 per month and what they would prefer is 5 more paid days off per year which would cost you $800 per year … you cost yourself a lot more for a benefit they appreciate a lot less.

Many states now require electronic prescribing (eRx), at least for controlled substances. eRx laws are different in all states. Almost all EMR’s used most often in the DPC community either have electronic prescribing built in, or they have 3rd party arrangements with eRx companies so you can eRx from the EMR.  In all of these cases, the EMR company will have all the information and customer service you might need to set up your eRx account.

Electronic prescribing can also be done outside of an EMR, through separate standalone apps/software/websites.  However in these cases, any prescribing you do through them wouldn’t be recorded in the EMR, so such arrangements are typically only used by those rare DPC physicians who still do paper record-keeping, but need to eRx to be compliant with prescribing laws.

IDENTITY VERIFICATION FOR SETTING UP ERX

When setting up an electronic prescribing platform, the eRx company has to verify the physician’s identity and credentials. This is usually done through credit bureaus, who offer that service. Be warned: if you have had credit freezes for any reason (i.e. fraud, freezes due to travel you name it) the online identity verification process will fail. When it does, the process becomes painfully slow to verify identity, and can require snail-mailing photocopies of your driver’s license, and other rage-inducing demands.  For this reason, if you’re planning to set up eRx in the near future, it’s a good idea to call one of the credit bureaus and make sure your credit report is free of any holds, freezes, or other issues or obtain your free annual credit report to verify no holds or freezes. 

GETTING YOUR DONGLE

When you e-prescribe controlled substances, a 2-step verification process is required, regardless of which system you use.  They will send you a little keychain dongle thing that has a button and digital readout on it.  When you push the button it generates a 6-digit number that has to be entered to complete the controlled rx.  There are also websites and smartphone apps that generate the codes as well. It’s a good idea to set up your eRx software to work with the online app or the phone app in addition to the dongle the company will send you, in case you find yourself away from the office and need to eRx for a patient and don’t have the dongle with you.

DPC vs. Concierge

Direct Primary Care (DPC) and Concierge Medicine are often confused. Both models accept payments directly from their patients, both have smaller panel sizes (allowing for improved relationships with patients), and both tend to advocate for advanced communication between the doctor and patient (via text, email, after-hours calls, virtual visits, etc.).  To make matters even more confusing, some practices that follow a DPC model will advertise as “concierge” for brand recognition. So how, then, is one to know the difference?

If you look closely at the standard DPC setup and compare it to the standard Concierge set up, there are a few key differences:

1. The “Membership Fee”. In concierge practices, the membership fee is traditionally an annual fee; In DPC, your membership fee is traditionally a fee charged monthly, quarterly, or annually.
2. Average Membership Cost. Concierge doctors often charge more in annual fees than the average DPC doctor. Although the average fee is around $1,800 a year, some concierge practices charge as much as $25,000 annually! DPC fees typically range from $600 to $1,500 per year.
3. Insurance. Generally, concierge doctors also accept insurance; in addition to the annual fee, they bill insurance for each patient encounter.  This means that patients may get “surprise bills” several months later after insurance pays their portion (of an amount typically not revealed to you until you get your bill). With DPC, insurance is not billed.
4. Copays. With concierge, because they accept and bill insurance, they are required to collect copays at each visit.  DPC clinics do not bill insurance, so there are no required copays for each visit. (That said, there are some exceptions to this rule as some practices charge a “per visit” fee.)
5. Patient panel size. Both concierge and DPC traditionally maintain a patient panel of 600 patients or less. This enables both provider types to have longer, more in-depth appointments with their patients, and a deeper, more satisfying relationship between doctor and patient.
6. Insurance Regulation. Because concierge doctors typically bill insurance, they are held to several insurance regulations including MACRA/MIPS and other documentation requirements. Since DPC does not bill insurance, they are not required to follow these regulations, enabling the physician to document more efficiently and not waste their time with checkbox documentation.
7. Office overhead costs. Concierge physicians typically have higher overhead costs, owed in large part to their acceptance of insurance which is required to negotiate insurance contracts, bill insurance, process insurance payments, and then resubmit bills when the insurance fails to pay in a timely fashion (which happens all the time). Since DPC physicians do not bill insurance, they do not require staffing and overhead to manage these revenue cycles, resulting in lower overhead.
8. Culture: Concierge practices often market services like “advanced testing” or more customer experience services like special parking spaces to justify their memberships. DPC practices focus more on care navigation and price transparency.

When you find an employer--small or large--that really wants your DPC services, you will need to have a written agreement between you and the employer. These agreements are similar to individual patient agreements but also cover other employer-related issues:

• Details on specific services provided by your clinic
• Details on what specific services are paid for by the employer
• Details on fees and how payments are made
• How to handle dismissal of patients and grievances
• Term limitations of the Contract and renewals (longer the better for you)
• Section on indemnification or “hold harmless” clause (employers ask for this)

You should have a lawyer familiar with these issues and DPC helps you here. The indemnification issue can get sticky sometimes as employers do not want to be sued for something a physician they contracted with may have done. It is best to work out these contracts way in advance. Get your employer’s lawyer and your lawyer to hash it out months before the plan starts or it will slow your onboarding of new patients.

Find more info on employee contracts, see this helpful article from DPC Frontier.

Direct Primary Care patients pay a set fee per month. This can be thought of as the physician receiving a set payment per member per month (“PMPM”) -- a term often associated with capitation. Capitation gained popularity with the rise of HMOs in the 1990s as a payment model which would, theoretically, help curb healthcare costs. With capitation, insurance companies pay physicians a set amount per patient per month. The more care the patient receives, the less money remains for the physician at the end of the month. While DPC and capitation share a set amount of money per patient per month, the payer and underlying psychology set the two models widely apart.

Capitation, in its original form, is rarely seen at this point due to people exploiting the model. Since the payer was insurance, the physician had no fiscal responsibility to the patient and as such only needed to play the “game” according to the rules set by the insurance company. The rules of the game allowed maximization of income by minimization of patient interaction. Patients found themselves shut out by physicians, having an increasingly hard time making appointments or noticing the quality of the physician’s office declining significantly.

DPC fundamentally changes the rules by making the payer the patient rather than a third party. The financial risks and benefits now tie directly to patient care. Should the patient find the physician to not meet their needs, they will go elsewhere, and the physician has no guarantee that another patient will fill their spot. In addition, incentives are aligned in keeping the patient healthy and out of the office.

The capitation model lends itself to abuse. DPC gives little room, if any, for abuse, because the interests of patient and physician are aligned.

While capitation and DPC can be made to sound the same, the fundamental difference, the core of DPC, is the direct relationship, medical and financial, between the patient and physician.

As a cost-reducing model, DPC intuitively helps those who have a hard time affording care in the current model; yet to many who are involved in healthcare policy, the idea of paying the physician directly sounds like an added cost to patients and detrimental to a group often collectively called “the poor” or "the underprivileged". Within this group, there are a few subgroups to identify to help show how DPC can be beneficial to "the underprivileged".

HEAVY UTILIZERS - Patients requiring frequent visits 

• Decreased need for a more costly "low deductible" plan
• Decreased costs for multiple medication regimes
• Longer visits at more frequent intervals
• The DPC physician acts as one central advocate to help coordinate their specialist and hospital needs. 
• More engagement in their treatment plan due to having a stronger physician-patient relationship
• Decreased anxiety because they can easily reach their physician who knows their history
• Fewer referrals compared to fee for service referral mill practices

WORKING CLASS - patients that cannot afford insurance and do not qualify for government subsidies or safety net insurance. 

• These patients ignore health problems often for years because it is so expensive for them to get routine monitoring.
• Chronic disease monitoring and preventive health monitoring at an affordable price tends to lead to fewer complications with better disease control and decreased ER visits
• DPC allows these patients the freedom to see their doctor before small problems become complicated

GOVERNMENT INSURANCE - Medicare, Tricare, and Medicaid eligible patients 

• Many physicians do not accept Medicaid patients due to poor reimbursement. These patients have coverage but may not be getting the best CARE, especially with long wait times, 5-minute visits, and only partial coverage services.
• Medicare patients often join your practice for the increased access and longer visits with more detail to their care.  

UNINSURED/UNDOCUMENTED

• Many DPC physicians waive their fees or set up private charity funds to help care for those who cannot afford the monthly fees
• Most physicians went into medicine to help people and have large philanthropic hearts. DPC allows you to do what you think is the right thing for your patients, giving you back control over how you live your life and practice medicine.
• Caveat: Learn to differentiate those patients who really need your help from those who can afford it but do not respect the membership or you enough to pay a reasonable monthly fee. Set your boundaries, and stick to them.

DPC exists to take care of primary care services which do not make sense to finance through insurance. People do not use their car insurance for oil changes or filling up gas. In healthcare, people shouldn’t use health insurance for chronic disease or basic urgent care. Although Direct Primary Care physicians do not accept or bill insurance, patients can still opt to use insurance for ancillary services. Most insurance products will still recognize and accept an order from out-of-network physicians (ie DPC physicians). Exceptions include:

• Medicare Advantage Plans
• HMO's
• Medicaid (state-dependent)

This means that if a patient chooses to, they can utilize their insurance for:

• Imaging
• Medications
• Lab work
• Specialist or ancillary services referrals

CONVENTIONAL INSURANCE:

Many insurances require per-certification or prior authorization for certain imaging or medications. Suggestion: when ordering what may be an expensive test/medication, give the patient an order/prescription and ask them to check with their insurance if/how this will be covered. You may need to give billing or CPT codes for some insurances (which drags you back to your system days once in a while and makes you appreciate the daily simplicity of your DPC life!).

HIGH DEDUCTIBLE PLANS:

It is often less expensive for the patient to pay cash for the test if they have a high deductible, which saves them money, and your time. It is worth having this discussion with your patient:

“I’d like to order an MRI of your knee. What is your insurance plan and what is your deductible? How much of your deductible have you met this year?”

Usual answer: “I don’t know my deductible, and I don’t know how much I have met”.

Empower the patient - give them some homework and a cost-saving carrot to entice them to do it.

“Well, I don’t anticipate this is going to need an expensive surgery and you are generally healthy. MRI of the knee would cost you around $400 at this location. If you go through your insurance with a high deductible that you have not met, it may cost around $3000-4000. It is your choice which way you would like to proceed.”

End result: Patient learns more about how their insurance works, they have been part of the cost-saving solution and feel empowered by that, and you have written an MRI order for a cash pay location without time wasted on precertification. WIN WIN WIN.

MEDICATIONS:

You may consider the same tactic with medication dispensing.

“Your medication costs $10/months through our pharmacy and $13/month paying cash with GoodRx. Why don’t we send the first month to the pharmacy, let them run your insurance and see which option is most cost-effective.”

The more your patients understand about the cost savings and the different options that they have, the more that they become invested in the Direct Primary Care model and are likely to spread the word, marketing for you.

MANAGED CARE/HMO

This one gets tricky. You must be upfront with an HMO patient. You cannot write referrals for them and they need to have an In-network PCP to do that. Some DPC physicians develop relationships with local HMO network physicians who are happy to see their patients for referrals and take a backseat while collecting the monthly capitation (with less work). Others are not. Here are some options if you decide to take HMO patients.

• Co-manage a patient with their in-network PCP
• Patients pay cash for all their services (less expensive if the deductible is high)
• Not accepting managed care patients at all

MEDICAID:

Although Medicaid can be an exception, this is state-dependent. In some states, it is illegal for Medicaid patients to pay cash to see a doctor. In other states, Medicaid has an “ordering and referring provider” status that the physician can apply for which would enable Medicaid to honor their medication and imaging orders. As this is state-specific, the best advice would be the check with physicians practicing in your state or check dpcfrontier.com for state-by-state regulations.

See Federal and State Regulations here.

MEDICARE:

It is illegal to be a medicare provider and charge cash for services that Medicare covers (Medicare fraud). Please see Working with Medicare - The Basics, and Medicare: Opting In or Out for more details.

If you’re considering adding larger employers for additional patients and revenue, you need answers to these basic questions:

• Do you have the capacity to add patients?
• How many can you safely add? And at what rate? Employers can be tricky because you never know how many employees will really accept the offer of DPC even if the employer pays the full amount for it. An employer with 100 employees will likely only bring you 30 or 40 patients -- but can you take all 100 if that happens? It’s tricky.
• Will you take all ages?
• Take Spouses and kids?
• Will you do vaccines?
• Is your practice scope limited in any way that employers need to know about?
• Do you have office space for adding patients? Meaning: Is your office physically big enough?
• Is there enough parking?
• Do you need to get a new location or even add some equipment? Be sure you have plenty of room to accommodate patients and staff.
• Do you have enough staff to add new patients? Maybe you need to add a physician partner or a medical assistant or some front office help? It often takes considerable time to get the right person for these positions. Plan ahead for that...and for the significant increase in overhead that comes with expanding your staff.
• How will you onboard all the employees? One at a time, manually? Will the company HR help? Do you have a link where each employee can do it themselves (often very inefficient)?

Consider carefully the major technology investments in your practice for your EMR [link], billing service, and VOIP phone service https://www.dpcalliance.org/DPCU-Practice-Management-Patient#ComparisonOfVOIP.[see "Practice Software & Communications" section in the STARTING A DPC PRACTICE CHECKLIST]Besides these, below are helpful tools. Check your EMR if any are offered already or may be integrated. Also, don't forget to check for discounts for DPCA members[LINK].Telehealth (HIPAA compliant): doxy.meMedical Dictation Software: Dragon[LINK]Text to Speech softwareText Expansion tools: https://textexpander.com/ , breevy, https://www.phraseexpress.com/Team & Task Management: https://slack.com/Document Management: https://www.ilovepdf.com/, https://intakeq.com/, https://www.hellosign.com/ , https://www.jotform.com/, https://signaturely.com/, https://www.docusign.com/en-us/Video Creation software i.e. for patient education: https://www.loom.com/Password Manager: https://www.dashlane.com/ , https://1password.com/, https://www.lastpass.com/

The U.S. Department of Labor (DOL) is a department of the federal government that exists to ensure fair, safe, and healthy working conditions for employees by maintaining and enforcing federal laws regarding minimum hourly wage and overtime pay, protection against employee discrimination and unemployment insurance. 

The federal minimum wage is $7.25 per hour effective July 24, 2009. There are also state minimum wage laws and in cases where this differs, the employee is entitled to the higher minimum wage.

Covered, nonexempt employees must receive overtime pay for hours worked over 40 per workweek at a rate not less than 1 ½  times the regular rate of pay. There is no limit on the number of hours employees over 16 years of age may work per workweek. There is no requirement to give overtime pay on weekends, holidays or regular days of rest unless overtime is worked on those days.

Under the Fair Labor Standards Act (FLSA), in order to provide a set salary, employees must meet the following criteria:

1. The employee must be paid a predetermined and fixed salary that is not subject to reduction based on variations in hours worked.
2. The amount of salary paid must meet a minimum specified amount (“salary level test”). Currently the standard salary level is $684 per week ($35,568 per year). Under the new rule from 2019, the employer may use non-discretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the standard salary level.
3. The employee’s job duties must primarily involve executive, administrative, or professional duties as defined by the regulations (“duties test”).

The DOL rules implementing the FLSA specifically categorize LPNs and LVNs as non-exempt, meaning they cannot be salaried and must be paid overtime. RNs may be considered exempt if they are paid at least $684 per week, and they meet the duty requirement for the learned professional exemption. Employers should also familiarize themselves with their local state laws, as they can sometimes differ from the Federal requirements.

In addition, an official poster outlining the requirements of the Fair Labor Standards Act must be displayed at the place of work.

Employers should keep in mind that the U.S. Department of Labor (DOL) can audit employers at any time, although the most common reason for an audit is a complaint from an employee. The DOL has also targeted employers in low-wage industries for wage and hour violations, particularly in the areas of agriculture, day care, food service, garment manufacturing, guard services, health care, hotels and motels, janitorial services and temporary help. By understanding the audit process and following the guidance below, employers will be better prepared for a DOL audit.

The DOL typically provides little advance notice of an audit. However, you can request time to gather records. Typically, the amount of time an employer will have will depend on the auditor.

Contact the auditor to find out specific information about the audit. Key questions to ask are the focus of the investigation (e.g., overtime pay compliance, exempt vs. nonexempt classification, minimum wage compliance), the time period for records the auditor wants to review, and the names of any employees that may be interviewed.

• Gather the records in accordance with guidance provided by the auditor.
• Be prepared to provide documentation related to the company compensation policies and procedures.
• Keep track of exactly what information was provided. Do not provide records other than what the auditor requests.
• Designate a company representative to work with the auditor. Some employers choose to designate their company’s legal counsel; other employers will designate senior managers. The representatives will have the duty to provide documents requested, arrange for any additional records to be provided to the auditor (if necessary) and coordinate employee interviews.

During the audit, be courteous to and cooperative with the auditor. It is a good practice to provide a quiet area for the auditor to work in.

At the end of the audit, ask the auditor to provide a summary of the results of the investigation. This information will help an employer review options for resolutions if any violations are found. If violations are found, employers are encouraged to consult legal counsel before any settlements are reached with the DOL.

To be proactive, employers should consider a self-audit, which consists of the following steps:

• Review job descriptions.
• Understand both federal and state law and ensure the employer is in compliance.
• Ensure that FLSA classifications are correct.
• Keep accurate payroll records.
• Apply policies consistently.
• Make sure all records are complete and work to resolve any inconsistencies.
• Determine how to address any areas of concern identified via the self-audit.

Cryotherapy is a simple, safe, and effective treatment for numerous dermatologic conditions. It can be done very affordably in a DPC clinic. Descriptions and videos for this procedure abound online and in books such as Pfenninger and Fowler’s Procedures for Primary Care.

Traditionally, liquid nitrogen is used to perform cryotherapy. A storage container for liquid nitrogen (called a Dewar) is a costly piece of equipment, generally several hundred dollars. Liquid nitrogen refills are relatively affordable (generally $20-40.) However, the nitrogen boils off usually in a few weeks regardless of how much is used. Tools for applying liquid nitrogen vary from a styrofoam cup and a cotton-tipped applicator to expensive pressurized spray tools.

One way many DPC doctors have lowered costs for performing cryotherapy is by using pressurized canned air. Can’s of “Medical Freeze” are available online for under $30 and can be used numerous times each. They are often used with otoscope speculums to focus the cold on the lesion being treated.

As always, getting a mentor who performs these procedures to help you find affordable equipment and answer questions is highly recommended, and easily done through social media and DPCA message groups.

The first official step in opening your practice is to create a legal entity. The regulations surrounding this process vary by state, and it is important to note that even if you are not set on a name, you can choose a name and then later file a “doing business as” (DBA) if you end up choosing a different name. Some opt to do this independently using Legal Zoom or directly with the Secretary of State; others opt to use a lawyer for their entity creation. In Texas, for example, a physician practicing medicine can file their business as a “professional association” (PA) or a “professional limited liability corporation” (PLLC). In other states, a simple LLC is all that is required. Check your state laws for specifics or allow your lawyer or CPA to guide you in what may be required in your state.

Your business type will affect your tax classification. Consider hiring a CPA that understands DPC -- or small business management at a minimum -- to help decide which legal structure is most beneficial for your clinic. The Small Business Administration (SBA) is another highly beneficial resource; you can browse their website or set up a (free!) business coaching session locally.

There are several IRS business structures to choose from.

• Sole proprietorship
• Partnership
• Corporation
  • S-Corp
  • C-Corp
• Limited Liability Company (LLC)

You’ll want to review the differences between these at length before selecting one. Most DPC practices start as an LLC. Your business structure affects how you pay taxes, raise capital, and even your personal liability. As your business evolves, your structure may change.

After you choose a structure, you will file for a federal tax ID number (FEIN or EIN). It’s free to apply and simple to do. You will need your EIN before you can apply for a business bank account, credit card, any business licenses, permits, etc. You will also need it when you sign up for vendors such as pharmacy wholesalers and medical supply companies. Do not delay this step

If you don't want to wear ALL the hats, then having a micropractice is not for you.

A micropractice clinic essentially has no staff; you are the receptionist, data entry clerk, biller, contract reviewer, inventory & supply manager, nurse, MA, office manager...and physician.

WHY

So why would you consider having a micropractice?

You're just starting out

To save on payroll & tax

To avoid HR issues & have complete control and compliance on office policies

To communicate with patients directly and succinctly

To have more flexibility i.e. having a part-time schedule, have a telemedicine-heavy practice

You're financially OK with a smallish patient panel

HOW

Follow STARTING A DPC PRACTICE CHECKLIST 

SPECIAL CONSIDERATIONS for the Micropractice:

It's very important to set patient expectations up front about your available hours and how patients may communicate with you.

Will you allow non-secure emails & texts?

Have this in your patient Agreement and / or a welcome FAQ handout.

OFFICE HOURS

Based on personal or family needs, do you want 2 hr lunches/ admin time? a half-day off? extended early morning or late evening hours?

OFFICE SPACE

How much space do you actually need?

Do you want the public to know (on your website or social media) that you have no staff?

Install extra security features in your clinic & surroundings.

GROUP MEMBERSHIPS

On-boarding new members of a group is more time intensive initially.

EFFICIENCY

Automate. Automate. Automate.

Maximize tech tools to your benefit

Get a robust EMR system with integrated fax & eRX and patient portal.

Patient portal self service includes scheduling, bill pay, encounter summaries, refill requests, documents, secure messaging.

ADMIN DUTIES

Create admin duties for front & back office staff (should you later hire for these positions), and how often they need to be done.

Block recurrent times on the schedule for these duties.

EXTRA SERVICES

You may or not want to provide and fit these into your schedule, without assistance:

Housecalls

Medication dispensing

Phlebotomy

PFT / diagnostic testing/ POCUS

Aesthetics

ROLES to OUTSOURCE, or not

Housekeeper

Landscaper

Bookkeeper

Contract reviews

Marketing

WHEN IS IT TIME TO TRANSITION?

Set your criteria to close your panel or add staff or a partner, i.e. when you're unable to respond to patients' needs within 48-72 hrs?

Or you find someone you can depend on 100% to hire.

VARIATIONS on the Micropractice:

micropractice with a Virtual Assistant

micropractice in a group practice (physicians only and no staff)

Here are some potential disadvantages to working with employers:

1) EMPLOYERS ARE A MIDDLEMAN: Even if employers pay you directly (without going through a Patient Care Management Organization, broker, or third party administrators) they still are paying you instead of the patient paying you. That's someone in between you and your patient. That “someone” can remove the “directness” of DPC leading to less power for patients.

2) EMPLOYERS MAY TRY TO INFLUENCE YOU: Employers could try to strong-arm you into doing something you don't want to do. If you don't lower your rates, provide time-consuming unproven data metrics, take chronic pain patients, etc. they could dump you and you lose a large number of members and income overnight. Preventing this requires lots of legal expenses to write protective contracts, which are even more expensive to enforce in case of a breach. Be very careful not to compromise significantly just to land a big client. It is a slippery slope. Diversification also helps this (get one-hundred 5-employee companies, instead of one 500-employee company) but then you have to deal with 100 employer contracts and a small legion of HR people.

3) HIGHER TURNOVER POTENTIAL: Many times employees have much less DPC buy-in than patients who directly contract with their DPC doc. They often see their membership as a random benefit that comes with the job, not as something in which they've made an investment. For this reason, they don't often see the value in your services, and if they leave the employer, you lose them as a patient. You can try to keep them but the retention rate is VERY low. Also, you find yourself with new patients daily and doing a never-ending stream of establishing care visits.

4) PROBLEM PATIENTS: Since employee-patients get you by default, you can get patients who might not be a good fit for you for some reason (drug-seeking, abusive, etc.). You can still refuse them care or fire them with good cause, but because you have a deal with the employer and the patient has HIPAA rights, this becomes a challenging path to navigate, often leaving you mismatched with some patients.

5) LOSS OF AUTONOMY: Even though you'll strive to contractually protect yourself, if your patients don't find and invest in your services on their own, at some level, you can't help but realize that you are beholden to the company that's paying the bills. You feel less in control of your practice. Employers will often use some type of insurance plan that you will be forced to work with. If you are not careful you'll be right back into the Fee-For-Service style of practice--prior authorizations, limiting referrals, medication step therapy, ghost coding, and time wasted on unproven data metric reporting.

Learn about the Pro's of Working With Employers.

Traditional telephone service or “plain old telephone service” uses physical wires to connect phone calls between locations. This technology hasn’t changed much in the past century which has created challenges for businesses.

Voice over Internet Protocol (VOIP) eliminates the limitations of a physical phone line by connecting calls over any internet connection. This offers greater flexibility and can substantially lower costs.

Plain old telephone service (POTS)

Advantages

Perhaps the greatest advantage of a “landline” or “plain old telephone service” is reliability particularly when your internet service is slow, faulty, or “goes down”. Plain old telephone service often functions despite power outages.

Disadvantages

One of the biggest reasons companies are steering away from traditional landlines is that landline services are significantly more expensive than VOIP services. Installation and ongoing costs are remarkably higher than VOIP.

Another disadvantage to landline services is the lack of features in comparison to VOIP. Landlines are limited to audio communication, so video conferencing is not an option nor is hold music, call recording, analytics, or SMS.

Voice over IP (VOIP)

Advantages

Perhaps the most appealing factor of VOIP is that it is very cost-effective and a cheaper solution when compared to regular telephone systems. The only additional cost to obtaining a VOIP service is internet installation; however, if you already have active internet service, then the cost of adding on a VOIP system is small.

Additionally, VOIP systems generally come with additional features at no added cost such as call waiting, call parking, call forwarding, conference calling, multimedia communications, auto-attendants, and voicemail to text or email messaging, not to mention integration with customer relationship management (CRM) tools, project management applications, and email marketing software

Disadvantages

The main disadvantage of using VOIP is that you need to have a stable internet connection. Although the bandwidth requirement for VOIP calls is incredibly low (10-32 kbps), other resource-heavy applications can affect the overall quality of your VOIP calls. To offset this, many businesses and organizations institute quality of service (QoS) feature on their computer network to prioritize bandwidth resources.

In light of potential power outages, a disadvantage to VOIP is that unless calls are routed to a secondary device (oftentimes a mobile phone), it will not be possible to make or receive phone calls during a blackout.

Clinical Laboratory Improvement Amendments, or CLIA, are made up of three federal agencies: The Food and Drug Administration (FDA), Center for Medicare and Medicaid Services (CMS), and the Centers for Disease Control and Prevention (CDC). 

The FDA categorizes tests based on complexity, reviews requests for Waiver by Application (for companies applying for their test to be waived), and develops rules and regulations for CLIA complexity categorization. 

CMS issues laboratory certificates, collects user fees, conducts inspections, enforces regulatory compliance, monitors lab performance on Proficiency Testing, approves Proficiency Testing programs, and publishes CLIA rules and regulations. 

The CDC provides analysis, research, and technical assistance, develops technical standards and lab practice guidelines, conducts lab quality improvement studies, monitors proficiency testing practices, educates professionals and provides resources, and manages the CLIA advisory committee (CLIAC). 

Below is an excerpt from the Q&A section of CMS regarding CLIA and how to obtain a certificate of waiver for your practice (please note that in some states there may be a separate application/process): 

What is a laboratory? 

Under CLIA, a laboratory is defined as a facility that performs applicable testing on materials derived from the human body for the purpose of diagnosis, prevention, or treatment of any disease, impairment, or assessment of health of human beings. 

I am a physician performing urine dip sticks and finger sticks for blood glucose in my office as part of the patient’s visit. Am I considered to have a laboratory and do I need a CLIA certificate?

Generally yes, as those tests likely qualify as waived laboratory

testing, you need a CLIA Certificate of Waiver and you must follow the manufacturer’s instructions. This kind of testing requires a CLIA certificate regardless of how many tests you perform, even if you do not charge the patient or bill Medicare or other insurances. However, you may not need a CLIA certificate if your laboratory is located in the states of New York or Washington, as those States operate their own laboratory regulatory programs. Contact the appropriate State Agency to determine if you need a CLIA certificate.

What is a waived test?

As defined by CLIA, waived tests are categorized as “simple laboratory examinations and procedures that have an insignificant risk of an erroneous result.” The Food and Drug Administration (FDA) determines which tests meet these criteria when it reviews manufacturer’s applications for test system waiver.

Where can I find a list of waived tests?

For a list of waived tests sorted by analyte name, visit the FDA website at:

CLIA – Currently Waived Analytes

Can I perform tests other than waived tests if I have a Certificate of Waiver?

No, only those tests that are CLIA-waived can be performed by a laboratory with a Certificate of Waiver.

How do I enroll in or apply to the CLIA program?

You can enroll your laboratory in the CLIA program by completing an application (Form CMS-116) available on the CMS CLIA website or from your local State Agency. Send your completed application to the address of the local State Agency for the State in which your laboratory is located. Additionally, check with your State Agency for any other state-specific requirements. If you do not have online access and do not have information about your State Agency, you may contact the CLIA program at 410-786-3531 for the address and phone number of your State Agency.

If I have more than one office and perform waived testing at more than one site, do I need additional certificates?

You will need a CLIA certificate for each site where you perform testing, unless you qualify for one of the exceptions listed below:

• If your testing location changes, such as with mobile units providing laboratory testing, health screening fairs, or other temporary testing locations, the testing may be covered under the certificate of the designated primary site or home base, using its address.
• If you are performing limited public health testing, you may file a single application to cover multiple locations. Limited public health testing is defined as not-for-profit or Federal, State or local government laboratories that engage in limited testing (not more than a combination of 15 moderately complex* or waived tests per certificate). So you may be able to cover the waived testing you perform at more than one office if you meet this exception.
• If your testing locations are within a hospital and are located at contiguous buildings on the same campus and under common direction, you may file a single application for the laboratory sites within the same physical location or street address.

Contact your State Agency if you have questions or you are filing a single application for more than one testing site.

Will I receive an identifying CLIA number?

You will receive a ten-character alpha-numeric code on the CLIA certificate. This number will be utilized to identify and track your laboratory throughout its entire history. You should use this number when making inquiries to the State Agency and CMS about your laboratory.

When can I start performing the waived testing?

After you apply for your certificate, you will receive a fee coupon assessing a fee. Follow the instructions on the fee coupon for payment. After your payment is received, your certificate will be mailed to you. You generally may begin testing once you have received your CLIA certificate, but you also need to check with your State Agency, since some states have additional state-law requirements.

If I only perform waived tests, what does CLIA require that I do?

For waived testing, CLIA requires that you:

• Enroll in the CLIA program by obtaining a certificate;
• Pay the certificate fee every two years;
• Follow the manufacturer’s instructions for the waived tests you are performing; and
• Notify your State Agency of any changes in ownership, name, address or Laboratory Director within 30 days, or if you wish to add tests that are more complex.

How and when will I be inspected?

Laboratories with a Certificate of Waiver are not subject to a routine inspection (survey) under the CLIA Program, but may be surveyed in response to a complaint or if they are performing testing that is not waived.

What does it mean to follow the manufacturer’s instructions for performing the test?

To follow the manufacturer’s instructions for performing the test means to follow all of the instructions in the package insert from “intended use” to “limitations of the procedure.” The manufacturer’s instructions can be found in the package insert for each test. It is good laboratory practice and important to read the entire package insert before you begin testing. Be sure the package insert is current for the test system in use, the correct specimen type is used, the proper reagents (testing solutions) are added in the correct order, and the test is performed according to the step by step procedure outlined in the package insert.

Some waived tests also have quick reference instructions included, which are cards or small signs containing diagrams or flow charts with essential steps for conducting the test. Be sure that quick reference instructions are current for the test system in use and are available to the individuals performing the test.

How do I know if I have the current manufacturer’s instructions?

Always use the package insert or quick reference instructions that come with the test system you just opened. If you are unsure whether you have current instructions, contact the manufacturer at the telephone number listed in the package insert.

Why is it important to follow the current manufacturer’s instructions?

It is important to always follow the current test system’s instructions precisely to be sure your results are accurate. This includes performing any quality control procedures that the manufacturer recommends or requires. Over time, a manufacturer may make modifications to a test system that result in changes to the instructions. Failure to use the current instructions could cause inaccurate results that may result in a misdiagnosis or delay in proper treatment of a patient.

Do I need to follow all the manufacturer’s instructions on how to perform the test?

Yes, all the information in the test package insert instructions is considered part of the manufacturer’s instructions and must be followed. Some examples of this information are:

• Observing storage and handling requirements for the test system components;
• Adhering to the expiration date of the test system and reagents, as applicable;
• Performing quality control, as required by the manufacturer;
• Performing function checks and maintenance of equipment;
• Training testing personnel in the performance of the test, if required by the manufacturer;
• Reporting patients’ test results in the units described in the package insert;
• Sending specimens for confirmatory tests, when required by the manufacturer; and
• Ensuring that any test system limitations are observed.

Can I follow the quick reference guide instead of following the package insert?

No, the quick reference guide is only a synopsis of the entire package insert.

When performing waived testing, am I required to do everything in the instructions, even if some of the items are manufacturer’s recommendations or suggestions?

Yes, you must follow all instructions when such terms as “always,” “require,” “shall,” and/or “must” are used by the manufacturer.

You have the option to follow the recommendations or suggestions of the manufacturer. However, adhering to the manufacturer’s recommendations and suggestions will help ensure the accuracy and reliability of the test, and is considered good laboratory practice.

As a laboratory director, what kinds of things can I do to help ensure the accuracy and reliability of the waived testing in my laboratory?

In order to ensure the accuracy and reliability of waived testing in your laboratory, you should develop and maintain good laboratory practices. Some examples are listed below:

• Provide specific training to the testing personnel so that you are certain they:
• Collect specimens appropriately;
• Label and store specimens appropriately;
• Understand and then follow the manufacturer’s instructions for each test performed;
• Know how to perform the testing;
• Know how to document and communicate the test results; and
• Are able to identify inaccurate results or test system failures.
• Observe and evaluate your testing personnel to make certain the testing is accurate.
• Do they positively identify the patient and specimen?
• Do they collect a proper specimen?
• Do they know how the specimen should be preserved, if applicable?
• If the specimen needs to be transported, do your testing personnel understand and adhere to the transport requirements?
• Check for extreme changes in such things as humidity, temperature, or lighting; as these may affect test results.
• Make sure that the patient specimen is handled properly from collection to test completion.

Where can I find more information about good laboratory practices?

The Centers for Disease Control and Prevention has published recommendations for “Good Laboratory Practices for Waived Testing Sites” in Morbidity and Mortality Weekly Reports (MMWR); Recommendations and Reports. The MMWR publication provides comprehensive recommendations for facilities that are considering introducing waived testing or offering a new waived test, and good laboratory practices to be followed before, during, and after testing. You can find this article on the CDC CLIA Waived Testing website.

Additionally, there are free educational materials on waived testing on the CDC Division of Laboratory Systems website.

Can I make any changes to the test system instructions?

No, it is not acceptable for you to make changes to the current instructions provided with the test system. This could change the “intended use” of the test system as approved by FDA and result in a test that is no longer waived. For example, if a test specifies urine as the waived specimen type and you test a different body fluid, then you are no longer performing a waived test and your laboratory is subject to an inspection and additional CLIA requirements. You must be sure that testing personnel follow the directions exactly, and add the proper reagents in the correct order and amount given by the manufacturer to ensure correct test results.

Resources: https://www.cms.gov/regulations-and-guidance/legislation/clia/downloads/howobtaincertificateofwaiver.pdf

CDC Guide for waived tests (has free forms and guides for download)

Many direct primary care doctors transition to DPC to move away from creating financial hardship and ruin for their patients. Even so, large, unpaid invoices can pile up into something (in business the invoices you’re expecting to be paid are called your “accounts receivable.”)

After a significant time has passed (usually a specific time window of 90 or 180 days) without payment, some businesses looking to receive payment for unpaid invoices will sell unpaid bills to a collection agency. Collection agencies will often chase after unpaid debt and will keep a certain percent of the eventually collected bills as payment for chasing down the charge. Each agency has a unique contract; if you’re going down this path, just make sure to read and understand the terms of the contract.

Many DPC doctors do not send patients to collections. Some share that it isn’t worth the trouble or potential bad publicity. Others believe that it breeds bad karma (and potentially poor reviews!) that just aren’t worth it in the long run.

TLDR? Collections are a hassle, often a lost cause, and creates bad karma.