Advanced Practice Provider-Led, Insurance-Free Practices Exist Everywhere
Authors:
Danielle Clanaman, Co-Founder & CEO, Otto Health
Maxine Whitely, Co-Founder & COO, Otto Health
Introduction
We compiled data on 557 direct primary care (DPC) and functional medicine practices [1] led by Nurse Practitioners (NP) and Physician Assistants (PA) by scraping publicly available practice directories (more details in Methodology). Our goal was to better understand the rise of advanced practice provider (APP)-led primary and preventive healthcare. We found that APP-led, self-pay practices exist across all geographies, demographics, and regulatory contexts.
We believe DPC and functional medicine practices, along with other similar types of insurance-free practices, will continue to proliferate in the coming years. Today we’re sharing some of the data underpinning this belief, as well our findings on APP-led DPC and functional medicine practices specifically.
Our hope is that clinicians who are considering practicing in these models might be emboldened to take the leap.
Key findings
APP-led, cash-pay practices are thriving everywhere.
These practices exist in 47/50 states.
These practices exist even in states without legislation enabling APPs to practice independently.
These practices exist in rural, suburban, and urban areas.
These practices exist across low, medium, and high income zip codes.
Key patient trends driving adoption
On the consumer side, we see three trends pushing patients outside the traditional healthcare system:
Increased consideration of personal health
Increased frustration towards the traditional healthcare system
Increased access to health information online
Consideration of personal health
It’s more common for a US adult to have a chronic disease than not (CDC). Possibly as a result of the growing burden of illness, a vast majority of consumers are placing a deliberate focus on wellness and preventive care. Eighty-two percent (82%) consider wellness a “top” or “important” priority in their everyday lives, and almost 50% say this priority has increased compared to two or three years ago (McKinsey).
Frustration towards the traditional healthcare system
Three quarters (75%) of US adults report leaving doctors’ visits feeling negatively about the interaction (AHIMA Foundation). Long wait times and short visits cause further patient pain. The average wait time to see a family medicine doctor is 21 days, and once at the visit, most patients only get between 13 and 24 minutes of face time with the doctor (AAFP, Elation, AMN).
Beyond access, patients also struggle with excessive and opaque billing in fee-for-service environments, particularly with the growth in high deductible health plans (KFF, KFF). Even though fewer people are uninsured, rising deductibles have translated into many being functionally uninsured and responsible for significant costs (KFF, Commonwealth Fund). This presents an opportunity for clinicians to provide cash-based, high-quality services that cost less than in-network care otherwise would.
Democratized access to health and wellness information
Patients are not getting the information they need in medical settings, so they are seeking it elsewhere: 93% have searched for health answers online (AHIMA, Kilo). Still, it can be challenging to know what information to trust given the volume and variety in quality of health-related content. As a result, consumers are craving clinical guidance—they rank clinician recommendations as a top-three factor influencing health and wellness purchase decisions (McKinsey).
Key clinician trends driving adoption
On the clinician side, we see two additional trends that help explain growth in APP-led practices in primary and preventive care. These trends are probably very familiar for our clinician readers.
Increased dissatisfaction with employment in the traditional healthcare system
Increased opportunity and autonomy for APPs
Dissatisfaction with employment in the traditional healthcare system
While methods for calculating vary, there have been over 34,000 studies published on clinician burnout. Burnout causes clinicians to leave traditional healthcare and seek alternative opportunities.
Opportunity and autonomy for APPs
Patients are increasingly receiving care from APPs. Although the percentage is difficult to determine precisely given billing patterns, it is estimated that the proportion of visits delivered by NPs or PAs nearly doubled between 2013 and 2019 (BMJ).
This trend is expected to accelerate as the number of APPs grows. The NP and PA professions are among the fastest growing professions according to the Bureau of Labor Statistics. Over the next 10 years, the number of NPs is expected to grow by 38% and the number of PAs is expected to grow by 27%, compared to 3% for other occupations, including physicians (BLS, BLS).
There are a few dynamics specific to NPs worth calling out.
NPs are uniquely well-positioned to deliver primary and preventive care. 88% of NPs are trained in primary care and 70% currently deliver primary care (AANP).
NPs are experts in building relationships with patients, as their clinical education always includes a patient-centered registered nursing certification (AANP).
States are increasingly allowing NPs to practice fully autonomously. Today, 27 states in the US provide full practice authority, meaning NPs can treat patients independent of a physician (AANP). Four states enacted this legislative change in the past few years (Nursing Outlook). There are several states with proposed and pending legislation, such as Wisconsin, Pennsylvania, Indiana, and Michigan.
NPs are increasingly entrepreneurial. As shown in the Nurse Practitioner Entrepreneurship Report, it’s becoming more socially common and regulatorily straightforward for NPs to consider starting their own clinical businesses.
The perfect storm
Consumers are prioritizing personal health, frustrated by the traditional healthcare system, and in need of personalized, professional clinical guidance. Clinicians are growing dissatisfied with employment in the traditional healthcare system and APPs are delivering a mounting proportion of primary care.
This combination of factors creates a unique environment for APP-led primary and preventive practices to flourish. For patients, these practices offer extended visits, same-day or same-week appointments, root-cause & wellness focused clinical care, same-day asynchronous communication for health questions, transparent and often discounted pricing, and much more. For clinicians, they offer the ability to have flexible work schedules, deliver a higher quality of care, practice autonomously, run a financially viable private practice, and much more.
At the highest level, our research indicates APP-led DPC and functional medicine practices exist everywhere: in nearly every state (47/50), every socioeconomic area (low, middle, high income), and every type of community (urban, suburban, rural). Below we dive into the details.
Data Deep Dive
APP-led practices exist in 47/50 states.
As you can see in the map below, APP-led practices exist in almost every state in the country. By sheer volume, Florida (n=67) and Texas (n=43) have the highest number of practices in our dataset. Hawaii, Rhode Island, and West Virginia have zero practices in our dataset.
NP-led practices exist even in states without legislation enabling NPs to practice fully autonomously. Adjusting for population, there are more practices per capita in states that support NP independence.
NP-led practices exist in full, reduced, and restricted practice authority states [2]. When looking at practices per capita, there are relatively more practices in full practice authority states. There are over two practices per million people in full practice authority states, while just over one practice per million people in reduced or restricted authority states. Either way, both of these numbers are quite low, which suggests significant opportunity for growth.
One example of a flourishing direct primary care practice in a restricted practice authority state is Impact Family Wellness in Texas, led by Monica McKitterick. Impact has grown its patient base so substantially that it now employs seven full-time NPs across three locations.
Impact Family Wellness is a Texas-based, NP-led DPC practice.
APP-led practices exist in all types of geographies. Adjusted per capita, they are most likely to exist in suburban areas.
APP-led practices exist in urban, suburban, and rural areas [3], though these practices are slightly more common in suburban or urban areas than in rural areas. This is somewhat surprising given the perception of APP-led care as being more common in rural areas, where APPs often fill gaps in care created by a lack of healthcare infrastructure or professionals.
We’ve had a chance to learn about many practices across the US delivering exceptional patient care. Below are a few examples of APP-run practices in different geographies:
Urban: Peak Health DPC is a practice in Denver, Colorado. Peter Yu, NP; Becca Kirian, MFN, RD, LD, CNSC; and Victoria Dardov, PhD combine direct primary care with functional medicine, dietetics, and lifestyle counseling.
Suburban: BlueWater Family Wellness in Clermont, FL is run by husband-wife duo Jason and Christina Meyer. This NP pair offers DPC for patients from cradle to grave through Christina’s specialization in pediatrics and Jason’s focus on adults.
Rural: Claire Reynolds, FNP has been running Illuminate Wellness, a functional medicine practice in a town with 3,000 residents in Montana, since 2021.
Although some may think cash-pay practices can only flourish in high-income areas, the data shows this is not the case.
APP-led cash-pay practices exist in low, middle, and high income zip codes.
The chart below shows the distribution of household income in the zip codes that have an APP-led practice. Each bar represents the number of practices that are in a zip code with a median household income within the stated range.
Seventy-five percent (75%) of practices are in zip codes with a median annual household income of $105,000 or below. The median household income for zip codes that have at least one APP-led practice is $80,000. In other words, 50% of APP-led practices are in zip codes with a median household income of less than $80,000 (low-to-middle income). For reference, US median household income is around $75K (2020 Census).
There are practices in zip codes with a median household income as low as $27K.
Still, high-income zip codes are more likely to have at least one practice.
The chart below shows various economic indicators for zip codes with at least one practice versus zip codes without. The probability of a practice existing does not meaningfully vary with most economic indicators.
For example, there is no significant difference in unemployment rate or self-employment rate when comparing zip codes with practices versus zip codes without. This is surprising, given patients who are unemployed or who do not have insurance through their employer are anecdotally overrepresented on DPC patient panels.
One trend that did stand out is that high-income zip codes are statistically significantly more likely to have at least one practice. While it intuitively makes sense that areas with a higher median household income are more likely to be able to sustain a cash-based practice, accessibility remains important for direct primary care clinicians.
Two examples of practices that are approaching accessibility in particularly thoughtful ways are physician-led Evergreen Primary Care in Minneapolis and Community Love in North Carolina. Evergreen has established a Patient Assistance Fund where members can contribute to cover the costs of those who otherwise could not afford care. Community Love offers sliding scale pricing where members pay according to their economic status.
Conclusion
As consumers prioritize their health and feel frustrated by conventional medical channels, healthcare professionals grow increasingly disenchanted in traditional healthcare roles, and APPs continue to gain autonomy and responsibility, the stage has been set for the proliferation of APP-led primary and preventive practices.
Our data shows this trend is already in progress. APP-led DPC and functional medicine practices are not confined to specific regions or demographics; they exist across diverse economic and geographic areas. Still, there is still ample opportunity for more.
If you are a clinician who is excited about delivering patient-centric primary and preventive care and want to find out if this model may work for you and your community, we’d love to connect. Reach out to us at info@ottohealth.io.
Thanks to the following people for reviewing drafts of this document: Amanda Guarniere, Chris Turitzin, Jake Fishbein, Matt Wachter, Russell Pekala.
Methodology
We used data from a combination of sources, including DPC Frontier, The Institute for Functional Medicine, and practice websites. We defined an APP-led practice as one where the leader and owner of the practice is an NP or a PA. It is likely we are missing some APP-led practices, and it is possible some of the practices we included have since closed, changed their service mix, or adjusted their pricing. We manually verified a small sample to confirm that the data was directionally accurate and reliable overall.
Footnotes
[1] Direct Primary Care (DPC) is a healthcare model where patients pay a monthly or annual membership fee directly to their primary care provider in exchange for comprehensive primary care services. This model bypasses traditional fee-for-service insurance billing, allowing patients to have more direct access to their healthcare provider without involving insurance companies in routine primary care services.
Functional medicine is an approach to healthcare that focuses on identifying and addressing the underlying root causes of illness and disease rather than just treating symptoms. Functional medicine practitioners take a holistic approach, considering a patient's genetics, environment, lifestyle, and individual health history to develop personalized treatment plans. Given challenges with reimbursement, functional medicine practitioners rarely accept insurance. Return to section
[2] Precise definitions of full, reduced, and restricted authority are set by the American Association of Nurse Practitioners (AANP). In brief:
Full practice authority states permit NPs to independently treat patients without a physician involved.
Reduced practice authority states require a career-long collaborative agreement with a physician or limit one or more elements of NP practice.
Restricted practice authority states limit the ability of NPs to engage in at least one element of practice and require career-long supervision, delegation, or team management by a physician.
[3] Data on area classification comes from a model built by Jed Kolko considering three data inputs:
2,008 responses to an online survey, conducted by Trulia, asking people to describe the area where they live as urban, suburban, or rural;
The ZIP code of those respondents;
Census and other government data on ZCTAs.
Full details here. Return to section