Primary Care Without Insurance: Do Flat-Fee Medical Plans Work?

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Monica Vigna-Bony was at the drugstore picking up a prescription for Advair, an asthma inhaler, when she finally lost her cool over the astronomical price of being uninsured. “I thought, ‘This is crazy. I can’t believe it is $240 for Advair,’” she says. Because she works part-time at a retail store, Vigna-Bony, 44, doesn’t have health insurance, and neither does her husband, a chef in Carmel, Calif.

But the cost of managing her asthma plummeted in January 2010, after Vigna-Bony sought advice from a new primary care physician she found through MedLion, one of a handful of so-called direct primary care providers that sidestep traditional health insurance plans. These providers bill patients a low per-month fee in exchange for unlimited office visits with primary-care doctors.

MedLion charges Vigna-Bony $50 per month, with an additional $10 surcharge per visit. Other such services include Symbeo Health in Bloomfield, N.J., Access Healthcare in Apex, N.C., and Qliance in Seattle, which is backed by Amazon founder Jeff Bezos and other investors. The specific terms and fees vary by service. For instance, Qliance charges each of its 4,000 patients $49 to $89 per month, depending on age. Some providers require year-long contracts, while others let members cancel at any time. What they all share is a monthly fee of no more than $89, no need for patients to have health insurance, and no limits on pre-existing conditions.

Low-cost direct primary care providers are not to be confused with white-glove concierge services that cater to the wealthy and offer comprehensive medical care, including perks like house calls. “We are providing affordable access to primary care to as many people as possible,” says Dr. Samir Qamar, who founded MedLion in Monterey, Calif., in 2009 and opened a second office in nearby San Jose in May.

As with regular primary care providers, these services handle things like flu shots, routine physicals and consultations for a variety of health problems, from rashes to allergies to dizziness. They can also serve as the initial point of contact for more serious conditions such as mental illness or sexually transmitted disease and will see patients of all ages.

The number of doctors working with each service varies: small providers may have just one or two general practice clinicians; a larger network may include seven medical doctors and two nurse practitioners. Because physicians in direct primary care practices typically have fewer patients than those who work with insurance companies, they are able to schedule longer appointments and see patients on shorter notice. Patients can book appointments online and doctors will reply directly to patient emails. The extra time with doctors often means that “all of the little things that you don’t think need attention get paid attention to,” says Gin Hammond, 39, a theater artist and Qliance customer who has gone to her doctor for everything from ingrown-hair removal to prenatal care.

But while the direct primary care model may make sense for those who can’t afford to buy regular health insurance, anyone considering it should understand that it is not a substitute for complete health coverage since it does not include the cost of seeing a specialist or going to the hospital. “Not having catastrophic insurance is a big gamble,” notes health care analyst Liz Boehm of Forrester Research.

Robert Berenson, a health care expert and fellow at the Urban Institute, says that patients should pair direct primary care with some health insurance if possible (it will be required if Obamacare is enacted in 2014), but adds that for those who can’t afford to do so, “It’s certainly better than nothing.”

Cutting out the insurance middleman enables direct primary care providers to stay afloat without charging patients a fortune. An estimated $.30 of every dollar in revenue at a typical primary care practice goes toward dealing with insurance companies, according to Norm Wu, founder of Qliance. But although their monthly fees may be low, there are plenty of add-on costs, which consumers should know about before signing up for a plan.

Vigna-Bony now gets her asthma medication for free, thanks to a program from GlaxoSmithKline for low-income patients that her doctor told her about, but her case is the exception: prescriptions and lab costs are not included in the flat monthly fee charged by direct primary care physicians. However, most direct primary care physicians will detail all additional costs upfront and are proactive about finding discounts for their patients. Most lab tests are discounted at 25% to 50% off retail rates. A cholesterol screening at MedLion, for example, costs $45 versus $150 at a local lab.¬†And all Qliance patients get a month’s worth of prescription drugs free.

Even when patients end up needing to see a specialist, having direct primary care can help lower overall costs. Gin Hammond, 39, kept seeing her primary care physician at Qliance through the first trimester of her pregnancy last year before opting for full maternity coverage that cost $450 a month. (Her doctor was experienced in basic prenatal care, as are many family physicians.) Estimated savings: $1,150 over three months.

Meanwhile, Trish Younggren, 58, was able to catch a precancerous tumor in her pancreas during a routine physical with her Qliance doctor. Recently divorced and uninsured after her COBRA coverage expired, Younggren couldn’t afford health insurance. “Since I’m over 50, even catastrophic insurance would have been $500 a month,” she says.

When Younggren experienced tenderness and pain during an abdominal exam, her doctor ordered an ultrasound, followed by a biopsy, which determined that the tumor had an 80% chance of becoming cancerous. As luck had it, Younggren started a new job soon after the tumor was discovered, and the entire $800,000 bill for her surgery and 21 days in intensive care was covered by her new employer’s insurance.

Had it not been for the primary-care visit to Qliance, she says she may not have discovered the tumor until too late. Estimated savings: possibly her life.