Let’s Keep Leveraging the DPC GROSS KISS (Get Rid Of Stupid Stuff, Keep It Simple Stupid)

One of my colleagues Kenneth Qui recently posted:

“Most Americans, for the better part of a century, expect medical care through health insurance, which is long enough to feel like the natural order of things. But insurance is just a vessel for funds. The actual payors of healthcare in this country are the government, employers, and individuals. Government programs cover roughly a third of Americans, employer-sponsored plans cover about half, and the remainder pay through individual market plans or out of pocket.”

Agreed. But that’s the problem.

Third party payers (government programs and employer sponsored plans) are the problem. How so? Thankfully our current administration is ferreting out massive amounts (literally billions of dollars!) of fraud and abuse of our taxpayer dollars going to groups and individuals that are robbing us and those truly in need. Let that marinate. Billions! That should enrage and gratify at the same time. Enrage because it’s unbelievable that this level of incompetence occurred! Gratify because this atrocious disaster is being identified and rectified.

But it’s not just the government. When employer sponsored plans put their thumb on the scale, free markets don’t work. Business is always looking to help itself. These plans weren’t even a thing until WWII, after which they became a lucrative way for businesses to recruit employees and obtain a tax benefit. It started off with good intentions… we know where that road leads.

Kenneth goes on:

“Each of those payors has different constraints. Governments and employers have to provide care across very large populations. They cannot easily strike one-off arrangements with one clinic on one block. They need standardized contracts, predictable performance, and someone to call when things go sideways. DPC practices, on the other hand, are mostly small, local, and unorganized in any formal sense. The two ends of the market do not naturally meet.”

Government programs don’t need individual DPC contracts

I politely disagree with this assertion. Neither the government nor employers have to provide medical care. For millennia (literally), the church and other kind-hearted individuals and organizations (often parachurch, nonprofit groups like the Salvation Army and the YMCA) assisted those truly most in need in the USA. The Catholic hospital system is international. 

Because we’ve voted to have the government take our tax money and then redistribute it through entitlement programs, we now “need” to have it manage medical care. As with almost all things “managed” by government bureaucracy, they are failing miserably – just look at the waste, fraud and abuse that continues to be exposed, most recently with the Medicaid home health fraud in Columbus, OH. The postal system loses money annually and yet has multiple, thriving competitors (Fed Ex, UPS, etc.) because of its inability to meet market needs. I could go on, but I think I’ve made my point. We could vote to reduce and/or eliminate some of these entitlements. No doubt they’d be better handled in the private sector on the local level.

While I can dream of a lower tax burden for my children and grandchild, let’s consider some commonsense Medicaid and Medicare reforms that would be a win for DPC and these program recipients. Cleaning up the roles so that only those truly in need is a great start. Check – the current administration is on that. But specifically for DPC, why not have some of the dollars follow the recipients, just like SNAP? The DPC “SNAP” account card gets loaded monthly and used monthly for a DPC benefit at the DPC of the recipient’s choice. No DPC-government contract needed. No other strings. The Medicare and Medicaid watchdogs just need to be sure that the DPC is a real clinic staffed by a licensed physician and not a shell building that houses 700 “DPC practices” with empty suites. That would be an important change of policy, but doesn’t require individual contracts with individual DPCs.

A “dollars follow the patient” approach would let Medicaid and Medicare beneficiaries use program funds for an accredited DPC membership—meaning the patient can choose a participating DPC clinic and the funding follows that choice. The core promise is straightforward: strengthen access to continuous primary care and reduce expensive downstream utilization (avoidable emergency visits, hospitalizations, and readmissions), while cutting administrative waste that comes with traditional billing-heavy primary care.

In practice, the savings mechanisms are familiar to anyone who has watched primary care work well: earlier intervention prevents high-cost events; better chronic-disease management improves control of conditions like diabetes, hypertension, and COPD; and direct payment reduces claims and prior-authorization overhead, encouraging more DPC growth. When the primary care physician is easy to reach, patients also tend to get fewer redundant tests and unnecessary specialist visits. Finally, when funding travels with the patient, smaller practices can become financially viable in rural and underserved areas that large systems often avoid. Win-win sans contract.

Employers don’t need individual DPC contracts

Employers who want to help employees access Direct Primary Care (DPC) generally have two paths: keep it simple with cash or build a more structured benefit that may offer tax advantages but brings additional compliance work, for the business. None require a DPC-employer contract.

Option 1: Taxable cash stipend (added to payroll). The most straightforward way to support DPC is to give employees a monthly stipend that is treated as regular wages. Employees can then use that money to join any DPC practice they choose. For employers, the appeal is speed and simplicity—payroll can handle it with normal withholding, and it typically avoids the complexity that can come with ERISA, ACA, HSA, or insurer rules. The downside is that employees don’t receive a tax break, so the same dollar amount may feel less generous than a tax-free benefit. From the DPC physician’s perspective, this approach expands potential membership because employees can pick any clinic, and it requires no contracts or billing changes.

Option 2: Employer HSA contributions (when employees remain HSA-eligible). Another approach is for the employer to contribute to employees’ Health Savings Accounts (HSAs). Done correctly, this can be tax-advantaged for employees and can pair well with a qualifying high-deductible health plan (HDHP). Employers often like HSAs because contributions are generally deductible and the benefit can be attractive for retention. For DPC practices, HSA-funded dollars can make membership more affordable.

As my colleague Vance Lassey argued for, these options all give the patient the leverage: they can choose which DPC practice they use the funds provided to pay for their medical care. DPC will be most successful when the patient has the most leverage. Government especially, and to a lesser degree business, will always want greater control with contracts, although neither really need them to offer great DPC care to their beneficiaries, employees and their families. The DPC wins are well documented. Government and employers need us, especially as more of us choose to leave the broken fee-for-service system. We need to mercilessly Get Rid Of Stupid Stuff and Keep It Simple Stupid. Complicated is not better for DPC, individually or collectively.