Could Direct Primary Care’s Popularity Be on the Rise?

Recent budget reconciliation legislation allows health savings accounts (HSAs) to cover Direct Primary Care (DPC) services. Here are the pros and cons.

1. DPC Basics

   Unlike the setup of a traditional medical practice, DPCs provide services by charging membership fees. Historically, if an individual chose to be a DCP patient, they would pay membership fees on their own, with membership skewing towards those with the financial means to join.

2. DPC Upsides for Providers and Patients

   DCP patient loads are smaller, allowing more timely, personalized care for patients. Those factors, along with unlimited access to their provider and the coverage of routine medical needs, are big upsides for members. A DCP practice enables providers to move away from the challenges associated with traditional healthcare models.

3. DCP and HSA

   The new budget reconciliation law, in accordance with IRS guidelines, recognizes DCP memberships as a medical expense that HSA funds can pay for.

4. Will DCP Become More Popular?

   Individuals previously unable to afford DPC memberships may now find value in utilizing their HSA funds for a more customized healthcare experience, especially if dissatisfied with their current care.

5. Effects on the Traditional Healthcare System

   Shifts toward DCPs could increase the expenses involved in traditional practice, resulting in higher financial burdens for remaining patients who do not have an HSA, and therefore do not have the option to switch. The new law may also entice physicians to leave their current situation, which would leave practices with fewer providers.

Bottom line: Now that HSA funds can be used for DCP memberships, a shift away from traditional practices is possible. The impact could be negative for some and beneficial for others.