Part of a series.

Primary care need not be expensive and until the past few decades it was paid for out of pocket. Heretical perhaps, but it would be very useful to go back again to paying the PCP out of pocket directly by the patient, preferably with a tax-advantaged health savings account (HSA).

A County Doctor wrote on his blog:

I can freeze a couple of warts in less than a minute and send a bill to a patient’s commercial insurance for much more money than for a fifteen minute visit to change their blood pressure medication.

I can chat briefly with a patient who comes in for a dressing change done by my nurse, quickly make sure the wound and the dressing look okay and charge for an office visit. But I cannot bill anything for spending a half hour on the phone with a distraught patient who just developed terrible side effects from his new medication and whose X-ray results suggest he needs more testing.

In a later blog he wrote:

Health insurance is not like anything else we call insurance; all other insurance products cover the unexpected and not the expected. Most people never collect on their homeowners’ insurance, and most people never total their car. Health insurance, on the other hand, is expected by many to be like a bumper-to-bumper warranty that insulates us from every misfortune or inconvenience by covering everything from the smallest and most mundane to the most catastrophic or esoteric.

What would it look like if Johnny or Fido puts mud prints on the living room wallpaper and Dad makes a claim on his homeowner’s policy? Or if Sally spills chocolate ice cream on the beige upholstery of Mommy’s new car and the auto insurance has to pay to have the seats recovered?

How did we get here? Going back about a hundred years, there was limited call for health insurance. Medical care was relatively inexpensive; hospitalizations were uncommon and it was simply expected that the individual was responsible. Life insurance and especially disability insurance were considered much more valuable and important in the rapidly developing industrial world. Wage and price controls came into effect during World War II. This led unions to push for non-wage benefits such as health insurance and business reciprocated. It was an inexpensive way to be more competitive in the job market. The idea was to insure for the high cost, unexpected health event such as major surgery or hospitalization. The individual still paid for routine care, vaccination, family doctor visits and medications. He was still very much the customer of the primary care physician.

But over time employers (including government employers) — often at the urging of unions and legislators — began to expand coverage to include most of those elements previously paid for directly by the individual. Concurrently, state legislatures established mandates — requirements that had to be covered by any policy sold in that state. Slowly but surely, insurance has morphed from being “insurance” to essentially being pre-paid medical care. Of course premiums had to increase to pay for all for the added benefits. And now employers expect their employees to cover 25 to 33% of the premiums and pay significant deductibles and co-pays.

A decade or more ago, insurers instituted price controls on primary care physicians with the assumption that would help manage rising costs. Wrong.  Price controls meant the PCP had to see increasing numbers of patients to make ends meet as his or her office costs rose. So now the patient gets precious little face time with the PCP — the loss of relationship medicine. And many patients get referred to specialists when the PCP could have handled the issues if there was more time. This has driven up costs dramatically; just the opposite of what the insurer planned.

Think of health care as a one foot long ruler. 75% or the first nine inches represents primary care — which is the care of complex chronic illnesses just as it is care of acute issues and the common and anticipated needs of most of us. The other 25% or the last three inches represents the unexpected, very serious problems — what we might call “major medical” and in a minority of cases the “catastrophic.”

Today insurance purports to pay for all of this when in reality insurance should only be for the major medical and the catastrophic; the last three inches. That’s the whole point of insurance, to deal with the unexpected highly expensive events in life like a car crash or a house fire. Since today’s health insurance covers essentially everything, it is very expensive. A major medical/catastrophic policy on the other hand is not cheap but is much, much less expensive.

Consider a bronze plan with a $6,000 deductible. In Maryland it would cost a 55-year-old $3,660. The platinum plan with no deductible costs $7,728 — more than twice as much. What is the $4,060 difference paying for? Primary care. But primary care never needs to cost that much. It will cost even a lot, lot less than now if the system is turned upside down so that the PCP is paid to deliver high quality in a caring, relationship-based model.  When the PCP has enough time with each patient, he or she can give excellent care, avoid unnecessary referrals to specialists and unneeded prescriptions and do so at a reasonable cost.

Said somewhat differently, it is time to stop tinkering around the edges of the current payment system. It needs to change conceptually and completely to a new paradigm where that the PCP is paid directly by the patient. Direct primary care (membership, retainer, and concierge) is one such new paradigm. The cost is reasonable, the care is better, doctor frustrations come down, patient satisfaction goes up and total health care costs come down. It is time for a change.

Stephen C. Schimpff is a quasi-retired internist, professor of medicine and public policy, former CEO of the University of Maryland Medical Center, senior advisor to Sage Growth Partners and is the author of The Future of Health-Care Delivery: Why It Must Change and How It Will Affect You.