California, Maryland, Oregon, Utah, and Washington have proposed, passed, and provided regulatory guidance on direct primary care medical practices. As the other 45 states in the country have yet to move on this issue, these states have decided to be proactive and take matters into their own hands. More states will eventually jump on board.
In 2012, California introduced SB 1320. SB 1320 exempts direct primary care from state insurance regulations. The bill also states “The Legislature hereby finds and declares that California needs a multipronged approach to make health care services more readily available and affordable to the many residents of the state who lack adequate access to those services. Retainer practices, in which a patient enters into a direct relationship with a physician and pays a fixed amount directly to the physician for primary care services, represent an innovative, affordable option that could improve access to medical care, reduce the number of people who lack this access, reduce emergency room use for primary care purposes, and make emergency rooms more available to treat actual emergencies.” SB 1320 is currently stuck in the Senate Health Committee. Medical Access USA is currently working with state officials in developing a direct primary care program in the state.
In 2009, the Maryland Insurance Administration issued a six page statement on how it plans to regulate direct primary care practices. According to the document, Maryland objects to quite a bit of direct primary care model. For instance, the primary indicators that a retainer practice may constitute the unauthorized business of insurance in Maryland include the following:
- Annual retainer fee covers unlimited office visits or a limited number of services that the physician cannot reasonably provide to each patient in his or her panel;
- No limitations on the number of patients accepted into the practice
- Annual retainer fee does not represent the fair market value of the promised services;
- Physician has substantial financial risk for the cost of services rendered by other providers
- The retainer agreement is non-terminable during the contract year and/or does not provide for refunds.
In order to stay lawful, the Maryland Insurance Administration recommended:
- Limiting the services provided in the year for an annual fee to an annual physical exam, a follow-up office visit and a limited number of other office visits;
- Establishing the annual fee by reviewing the market value of the annual physical exam and a follow-up office visit as well as each office visit, with the annual fee equal to sum of the market value for each specified service
- Defining the services to be provided in a written agreement;
- Allowing a consumer or the physician to terminate the retainer agreement for any reason and provide for the pro rata reimbursement of the retainer fee if the written agreement is terminated; and
- Placing a cap on the number of patients based on the physician’s ability to provide all the services specified in the written agreement to each patient on the panel.
In 2011, Oregon passed SB 86 and signed it into law. This law exempts direct primary care practices (aka retainer medical practices) from insurance regulations as long as each direct primary health care medical practice (concierge included) is certified by Oregon’s Department of Consumer and Business Services and meets specified criteria.