Even the most “affordable” DPC models struggle in lower-income markets because the behavioral economics of these populations create high churn and unstable revenue. Practices that succeed in underserved areas nearly always diversify into employer partnerships, institutional contracts, or expansion into higher-income neighborhoods. Without understanding these behavioral and economic realities, physicians risk building a model the community cannot sustain long-term.

I previously argued that physicians must answer five market questions before launching DPC, questions that could have saved the University of Houston’s $1 million DPC clinic from closing after 13 months.

Today I’m examining a harder truth: even “affordable” DPC at $50–75/month faces hidden economics in lower-income markets. And the practices that succeed in these communities do so because they fundamentally change their business model, not because individual-pay membership magically works at scale.

Recently, when questioned about DPC scalability, a prominent physician responded: “DPC was never meant to scale.” If that’s true (and I believe it is in certain demographics) then we need to stop insisting that membership fees alone can sustain practices in lower-income populations. The economics simply don’t support it.

When government tries DPC

In 2018, Michigan launched an ambitious Medicaid DPC pilot known as MiPureCare.

• Official announcement: Michigan Medicaid launches pilot program with direct primary care

The goal was bold: target 2,400 Medicaid enrollees and, if successful, expand to all 2.4 million Michigan Medicaid beneficiaries, potentially saving the state $3.4 billion.

By June 2018, about 100 members had expressed interest. And then, silence.

Despite FOIA requests and searches through 2024, publicly available outcomes never surfaced. In 2021, Total Health Care transferred its Medicaid business to Priority Health Choice, and MiPureCare quietly disappeared.

• Organizational transition: Priority Health completes acquisition of Total Health Care

When publicly funded pilots don’t produce clear results, that silence is itself data. As with the University of Houston’s clinic, this wasn’t a failure of physician commitment, it was a failure to align the model with the market.

The “Medicaid cliff” niche exists, but it’s narrow

Some DPC practices have demonstrated that the “Medicaid cliff” population, earning too much for Medicaid but not enough for commercial insurance, can sustain $50–75/month memberships.

But the practices that thrive long-term did not stay solely in this lane.

One urban practice originally serving an underserved neighborhood eventually added:

• Multiple employer groups
• School district contracts
• Suburban expansion

The founder later said they became “more strategic about where we open locations.” This is the real-world ceiling on individual memberships in low-income areas.

The behavioral economics nobody discusses

The income band just above Medicaid eligibility has highly variable financial behavior.

When someone earning $75,000 pays $90/month for DPC, it becomes routine background spending. When someone earning $32,000 pays $60/month, that payment competes with every financial decision of that month.

Key characteristics of these households include:

• Irregular or hourly income
• Competing urgent expenses (car repair, rent, food)
• Limited savings or financial cushion

This means membership isn’t “set it and forget it.” It becomes a recurring decision, not a fixed expense.

The churn problem

Based on two decades in health care finance, operations, and network strategy and conversations with practice operators, churn rates differ dramatically by payment source:

• Employer-sponsored members: Low churn (10-15 percent).
• Institutional contracts: Minimal churn.
• Individual low-income members: Significantly higher churn (30-40 percent+).

These patterns align with subscription economics in similar income segments. More published DPC-specific churn data would benefit the field.

Let’s apply this to a common scenario: A practice needs 400 members at $60/month to sustain one physician. With a 35 percent churn rate in low-income populations, you must replace 140 members annually, about 12 new sign-ups every month just to maintain breakeven.

This increases:

• Customer acquisition costs
• Administrative workload
• Marketing expenditures
• Operational strain

Compare that with employer-sponsored members with 10 percent churn: only 40 replacements annually.

The absence of publicly shared churn data from low-income-focused DPC practices is telling. When a practice has exceptional retention, they publish it.

Why successful practices diversify

Practices that sustainably serve lower-income areas do not rely solely on individual memberships. They diversify into:

• Employer partnerships: Eliminate the affordability barrier
• Institutional or community contracts: Stable, predictable revenue
• Geographic expansion: Higher-income markets that stabilize the panel

This isn’t a compromise. This is business fundamentals.

The DPC movement has unintentionally created a false purity standard: If you serve employers, school districts, or institutions, you’re somehow “less” DPC. That ideology has contributed to more practice failures than it has prevented.

The physicians who build durable practices align their revenue model with community economics, not with ideological purity.

What this means for your market analysis

If you want to serve lower-income populations using individual memberships:

• Budget for high churn (30-40 percent+).
• Build a diversification strategy from day one.
• Recognize that employer or community sponsorship may be your primary stabilizer.

Market analysis cannot stop at “can they afford $60/month?”

The real questions are:

• What is my expected churn?
• What does it cost to acquire one new member?
• Can I sustain ongoing recruitment?
• When should I pivot to employer or institutional partnerships?

The uncomfortable reality

DPC has an income floor, even at “affordable” pricing.

If you want to serve lower-income areas, you need alternative payment streams, not just good intentions. The most successful practice is the one that is still open in five years, not the one that launches with the purest ideology.

Sustainability requires understanding not only whether your market can afford you, but whether you can afford your market’s behavioral economics.

Dana Y. Lujan is a health care strategist and operator with more than twenty years of experience across payers, providers, and health systems. She is the founder of Wellthlinks, a consulting firm that helps employers and providers redesign care models through concierge and direct primary care, and author of The CEO Physician: Strategic Blueprint for Independent Medicine. Dana has led multi-state network development, payer contracting, financial modeling, and compliance initiatives that strengthen provider sustainability and employer value. She previously served as president of the Nevada chapter of HFMA and is pursuing a JD to expand her expertise in health care law and compliance. She has been featured in Authority Magazine and publishes on KevinMD, MedCity News, and  Medium, where she writes on health care innovation, direct primary care, concierge medicine, employer contracting, and compliance. She has forthcoming BenefitsPRO. Additional professional updates can be found on LinkedIn and Instagram.