Two direct primary care providers have shut down this year, with the latest, Qliance, planning to close its doors on June 15th. Turntable Health shut down in January. A piece in Medical Economics points out that Qliance was one of the pioneers in the field of direct primary care, and quotes experts wondering whether its demise paints a larger picture of the viability of the business model.
"As you may know, this is an incredibly difficult and unanticipated way to end Qliance, a company that most of you know we started to prove that humane, high-quality primary care can change not only individual lives but also transform our very troubled healthcare system," Qliance CEO Dr. Erika Bliss wrote in a letter to patients. "Despite all our efforts, we have found that the more we grew and proved that this really works, the more the system resisted us and made it harder and harder to survive. It’s not surprising, given that the healthcare industry represents 19 percent of the GDP of this country – that represents entities with a lot of money and power that are not about to give those up without a fight."
The company ultimately shut down because it was unable to find bridge funding to stay open. Turntable Health, which operated in partnership with Iora Health, also couldn't continue to finance its operation.
"Unfortunately, the economic realities of the Las Vegas market meant we could no longer sustainably offer care in our downtown location, so doing the right thing for our patients meant transitioning their care to other local providers by January 31st, 2017," CEO Dr. Zubin Damania wrote on his personal website. "We flatly refused to compromise when pressured by payers to offer fee-for-service options, or to begin charging a co-pay. We firmly believe that healthcare is a relationship, not a transaction."
DIrect primary care is a controversial movement where physicians start membership-based practices and charge patients directly, eschewing third party payers. Many of these practices use telemedicine, behavior change, and other digital technologies to increase efficiencies and drive down costs so they can keep the business sustainable. Earlier this year, a splashy DPC clinic called Forward opened in San Francisco with a strong emphasis on data and artificial intelligence.
Dr. Samir Qamar, CEO of MedLion, another Las Vegas-based DPC business, said that he believes the movement itself is not in danger.
"In an industry as nascent as Direct Primary Care, still finding its roots, relying exclusively on venture capital from day one is risky," he told MobiHealthNews in an email. "MedLion has found great success in slowly peeling away layers of various markets over several years, markets still settling from changing healthcare laws. At the end of the day it's about the team, business strategy, and execution, not just the vision. Direct Primary Care as an industry shall continue to grow -- there are more success stories than failures."