The Direct Primary Care (DPC) Alliance serves the DPC community through education and advocacy. Our membership is made up of over 270 primary care physicians and physicians-in-training from across the nation. The majority of them are already practicing in a DPC model; of those, nearly all (over 95%) are owners or part-owners of a small, community-based DPC practice.
The DPC model has proven a practical and functional option for a wide variety of primary care physicians and their patients. However, we do recognize some hurdles for patients wishing to participate in a DPC practice, including the IRS treatment of DPC fees (periodic fees for bundled primary care services) for persons holding a Health Savings Accounts (HSA). Current tax laws have created confusion on this matter and we strongly support legislation that explicitly allows a patient to use an HSA to pay DPC fees.
Our members desire a simple legislative solution that doesn’t introduce unnecessary regulations, confusion, or unduly restrict the scope of primary care or value within a DPC arrangement. The complex nature of the tax code makes this fix less than a straightforward process. The original version of this legislative fix was the Primary Care Enhancement Act (HR 365) which had received broad bipartisan support for a number of years.
The language of the Primary Care Enhancement Act has undergone a number of revisions and is now included in HR 6199 (Section 3) which is pending for a vote in the full House of Representatives. The bill also contains many other HSA reforms. Although our membership is not in full agreement on every aspect of this bill, the Alliance supports passage of HR 6199 through the House.
To strengthen the DPC aspect of this bill, we would suggest Congress consider a few changes and clarifications, including:
State that DPC fees are a "qualified medical expense" under IRC 213(d), and not under a more vague categorization of “service arrangement” under IRC 223(d).
Make it clear that a patient may use an HSA to purchase prescription medications on a fee basis (outside of DPC bundled fees) from a DPC practice.
The bill places a $150 cap of DPC fees under IRC 223(d). We do not believe that price should be a defining feature or legal definition of a DPC practice and suggest removing a price cap altogether. But, if such a cap is required for budgetary reasons, this limit should be an expense cap (maximum deduction) under 213(d).
There will not be a silver bullet to fix all of the problems in the American healthcare system, but maximizing patient-centered options such as HSAs and Direct Primary Care is a big step in the right direction. This bill-- hopefully with suggested changes --will help ensure Americans access to independent, physician-owned DPC practices. We will continue to monitor this legislation as it moves through the Congressional process.
Dr. W. Ryan Neuhofel, DO, MPH
President, DPC Alliance