Doctor expands his fixed-price model
Employers in Blair and Westmoreland counties enroll in plan
A Blair County doctor is getting some traction on his efforts to marry medicine to Netflix’s fixedprice business model for movie rentals as a way to provide unlimited access to basic medical care for a flat rate.
Internist Zane Gates, co-founder of Empower3 Center for Health in Altoona, has begun marketing two plans for medical care in Blair and Westmoreland counties that offer most primary care services for as little as $90 a month for an individual and $270 for a family, without copays or deductibles.
His program offers a wide range of routine medical services, including physicals, blood work, vaccinations, chronic disease management and nutritional counseling, to low- and middle-income people who would have trouble meeting high plan deductibles.
The Altoona Area School District and Greensburg-based senior care provider Redstone Highlands are the first employers to enroll for coverage, with a May 1 start for Altoona employees and Jan. 1, 2018, for Redstone Highlands. The plan will also be available to individuals.
“It gives more affordability for employees to see physicians to get primary care needs addressed,” Redstone President and CEO John Dickson said. “We’re very excited about this.”
Empower3 is patterned after direct primary care, a model that offers basic medical care at low monthly rates — about one-third the cost of individual coverage for people with group health insurance, according to a benefit survey by the Henry J. Kaiser Foundation. The model works because participating doctors, pharmacists and other medical professionals set rates low enough to encourage enrollment but not so low as to risk losses.
The paradigm has been used in Altoona for 18 years, where it reduced costs among Medicaid recipients while enhancing the quality of care provided, Dr. Gates said. He credited UPMC Chief Medical and Scientific Officer Steven Shapiro and UPMC Health Plan for helping
Empower3 get rolling.
“We feel very comfortable that we can lower your costs and give your people better coverage with embedded wellness programs,” Dr. Gates said. “It’s in our partners’ interests, in everybody’s interest, that our patients get healthier.”
Freed from the burden of filing health insurance claims and the need to pump up the number of procedures performed to maximize income under common fee-for-service payment arrangements, doctors can spend more time with patients while offering such services as free generic medications and video consults with specialists.
Empower3’s premium plan, with monthly fees of $175 for an individual and $525 for a family, gives members physical therapy, medical imaging, cardiac testing, home health and other services in addition to basic medical care.
Altoona school district directors voted April 3 to offer the coverage starting next year, in addition to conventional UPMC Health Plan insurance, according to superintendent Charles Prijatelj.
“The limitation is you can’t go wherever you want to go” for care, Mr. Prijatelj said. “But for a flat fee, you get unlimited visits, prescriptions and certain tiers of health care. It’s all covered.”
The school district employs 1,200 people, about half of whom, including janitors and part-time special education aides, are expected to take advantage of the basic medical care, Mr. Prijatelj said. Empower3 tries to reduce health care costs by heading off costly trips to the emergency room and hospital admissions with preventive services.
The trade-off for consumers is network size. Most insurers offer a network of doctors where members can be treated at a lower rate; Empower3 will rely on far fewer clinics where care is rendered, including one planned for Route 22 in Murrysville to serve Westmoreland County, Empower3 cofounder Patrick Reilly said.
“This is a whole new chassis we’re talking about, so it’s very disruptive in the existing market,” Mr. Reilly said.
Self-insured employer groups should be able to cut medical expenditures 15 to 20 percent over three years using the program, Mr. Reilly said.
Empower3 uses an approach that’s similar to direct primary care, which offers basic medical care at a subscription rate. Although only a small number of doctors offer direct primary care, the proportion grew to 3 percent last year from 2 percent, according to the American Academy of Family Physicians, a Leawood, Kan., education and advocacy group.
Like other direct primary care plans, Empower3 membership requires separate, catastrophic coverage to meet the essential coverage requirements of the Affordable Care Act.
Also, for tax purposes, the Internal Revenue Service doesn’t recognize direct primary care as an approved medical expenditure for people with health savings accounts tied to high-deductible health insurance plans. That is something that advocates are trying to change.
This approach to basic medical care has been getting attention elsewhere in Pennsylvania, where direct primary care provider R-Health, based in Elkins Park, Pa., has more than 60 clinics and 160 doctors in the greater Philadelphia and southern New Jersey region.
The 4-year-old company promises savings of 12 to 15 percent on medical expenses and targets self-insured employer groups reluctant to continue passing along premium increases to members.
R-Health CEO Mason Reiner said, “It really liberates primary care from the perverse incentives of fee-for-service medicine.”