Direct Primary Care (DPC): Employer Guide to On-Demand Primary Care

What Is Direct Primary Care?

Direct Primary Care is a primary care delivery model in which patients — or their employers — pay a flat monthly membership fee directly to a primary care physician or practice. In exchange, members receive unlimited primary care visits, same-day or next-day appointments, extended appointment times, direct physician access via phone and text, and often basic labs and generic medications at cost.

DPC practices opt out of insurance billing entirely. They do not bill insurance for office visits, which eliminates the administrative overhead that consumes roughly 30 cents of every dollar in traditional primary care. That savings is passed to the patient — and to the employer — in the form of lower fees and better access.

How DPC Works for Employers

Employers sponsor DPC by paying the monthly membership fee on behalf of employees and their dependents. The fee typically ranges from $50 to $100 per adult per month, depending on the market and the practice. Dependents are usually priced lower.

1. 1The employer contracts with a DPC practice or a DPC aggregator that manages multiple practices across a geographic area.
2. 2Employees and their dependents enroll in the DPC practice and are assigned a primary care physician.
3. 3The employer pays the monthly membership fee — typically $50 to $100 per adult — directly to the DPC practice.
4. 4Employees access primary care at no additional cost: no copays, no deductibles, no claims.
5. 5The DPC physician coordinates specialist referrals, manages chronic conditions, and serves as the employee's healthcare advocate.

The Financial Case for DPC

DPC reduces employer health plan costs through three mechanisms: reducing downstream utilization, improving chronic disease management, and keeping employees out of high-cost settings for primary care needs.

Studies of employer DPC programs consistently show a return on investment of $2 to $4 for every $1 spent on DPC membership fees, driven primarily by reductions in ER visits, specialist referrals, and unnecessary imaging.

DPC and HSA Compatibility

One important compliance consideration: DPC membership fees are not eligible expenses under an HSA if the DPC practice provides services that would otherwise be covered by the HDHP before the deductible is met. The IRS has issued guidance indicating that DPC arrangements may disqualify employees from contributing to an HSA.

• If you pair DPC with an HDHP and want employees to contribute to HSAs, structure the DPC arrangement carefully.
• Some DPC practices offer a "limited scope" arrangement that restricts covered services to those not covered by the HDHP — preserving HSA eligibility.
• Consult a benefits attorney or tax advisor before launching a DPC + HDHP + HSA combination.
• Alternatively, pair DPC with an HDHP without an HSA component — the DPC savings often exceed the HSA tax benefit for most employees.

Evaluating DPC Providers

Not all DPC practices are equal. When evaluating DPC providers for an employer program, assess the following:

• Geographic coverage: Does the practice have locations accessible to your employee population? For distributed workforces, a DPC aggregator with multiple practice locations may be necessary.
• Panel capacity: Does the practice have capacity to take on your employee population without compromising access?
• Employer experience: Has the practice worked with employer groups before? Do they have reporting capabilities for utilization and outcomes?
• Scope of services: What is included in the membership fee? Labs, generic medications, procedures, telehealth?
• Specialist relationships: Does the practice have established referral relationships with high-quality specialists at negotiated rates?
• Technology: Does the practice offer a patient portal, secure messaging, and telehealth for employees who cannot visit in person?