Two Docs Stop Taking Insurance and Try New Model

Could this be the start of a trend? That would be great news for patients.

In the battle about Obamacare, the topic for discussion has been primarily about insurance rather than treatment itself.  Meanwhile, insurance rates continue to climb despite the promises for the opposite.  In Lancaster, Pennsylvania, two doctors are trying a different business model that might just solve some problems.

From Lancaster Online:

Two frustrated Lancaster County doctors are separately launching new family practices with an old-fashioned twist.

Instead of accepting insurance, they’re going to charge patients a monthly fee. In return, they promise unlimited visits with no copays.

“We’re looking for a way to kind of make medicine the way we envisioned it when we went to med school,” said Dr. Patrick Rohal.

So in January, he’s planning to open CovenantMD in East Hempfield Township with monthly fees ranging from $10 for children to $80 for seniors.

He anticipates offering: same or next-day visits of 30 to 60 minutes, in the office or at the patient’s home or work site; after-hours care for urgent and emergency issues; and 24/7 access via cell phone, text, email, or Skype.

He also plans “substantial cash pay discounts” on medications, lab work, and radiology.

Considering what many are paying for insurance, this might make a bit more sense if coupled with a medical savings account for specialty care and hospitalization that may or may not be required.

If this business model succeeds, an overhaul of the ACA might be needed, but that overhaul would actually cost consumers less money and require less government involvement in the market.  Medicare and Medicaid could simply pay the fee for the preferred doctor and act like typical health insurance for any additional care required.

One thing Congress should consider changing, however, is the quirk of medical savings accounts that make money forfeit money over $500 not spent from these accounts.  Give the Affordable Care Act credit for one thing though.  Before the ACA, all money was forfeit.  ACA made it so up to $500 could be transferred into the next year.

However, changing it so any contents can be forwarded would encourage savings and help many people cover increased costs.

None of which matters if this business model doesn’t work, unfortunately, so we wish them the best.

Photo Credit: CovenantMD/facebook
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1 comment

  1. Thomas W Reply

    I’ve been hearing of doctors doing this for many years. Reactions split between those who like it and those who pity the poor suckers paying for lousy care.

    The problem today is this should be coupled with catastrophic care insurance (to cover hospitalization or similar) but I don’t think catastrophic care insurance can be purchased anymore (won’t meet Obamacare standards). A medical savings account really doesn’t deal with this — the contribution limit is too low to deal with really catastrophic illness.

    I do agree this is a good health care model. Routine medical costs are paid out of pocket with catastrophic care insurance (actual insurance, to pay an unexpected cost) to cover high cost items like injury or hospitalization.

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