The Direct Care Way

How To Fix Healthcare with DSC Rhematologist Dr. Lou Flaspohler

• Tea Nguyen, DPM • Season 2 • Episode 137

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Key Takeaways

  • How Dr. Flaspohler helps connect small business employers with Direct Care doctors
  • Employers looking for higher quality care at a lower cost can be a resource for direct care, including those who use Health Shares
  • How Direct Care is the solution for our current healthcare crises with higher quality, lower cost, and shorter delivery time
  • We need a guide, like other Direct Care doctors, to help educate consumers that this is a viable option for medical and surgical care


Dr. Tea  0:00  

Owners of a direct care practice are more likely to experience higher job satisfaction than the insurance based practice, and it's no wonder why direct care is independent of insurance. Patients pay the doctor directly for their expertise. The doctor gets full autonomy in how they care for patients and how they get paid. We've chosen this path for the love of medicine, this is The Direct Care Way.


Dr. Tea  0:24  

By listening to this podcast, you may even start to believe that you too can have a successful direct care practice. Come listen with an open mind as I share my personal journey on how I pivoted from an insurance based practice to direct care right in the middle of the pandemic and the valuable lessons along the way. This podcast may be the very thing you need to revitalize your medical practice. I'm your host, owner of the direct care podiatry practice, Dr Tea Nguyen. 


Dr. Tea  0:52  

I have such a fun guest today, Dr Lou Flaspohler. He is a established Rheumatologist in Ohio, and you know, I talk a lot about direct care on this podcast, for the individual physician who's looking to leave a really messed up insurance based system, and we really want to recreate a business that we love that doesn't destroy our spirit as to why we went into medicine in the first place. But Lou has a very different perspective as to this entire ecosystem of what direct care really can do for the nation. We're going to talk about the big picture in this episode today, because there is a problem in healthcare, right? We know that there's an issue, but how do we as individuals create a change that's meaningful? We can all do this on our separate little island, and then we can come together on the Direct Specialty Care Alliance, collectively as doctors who we put our information onto this mapper system where doctors and patients can find out more doctors like us, right? But what else? How can we influence change on a bigger scale? That's what we're here to talk about today. So I want to welcome you to the podcast Lou.


Dr. Flaspohler  1:59  

Thank you so much. T, it's an honor to be here, and it's been an honor to get to know you over the last year or two. I guess.


Dr. Tea  2:08  

You were early on in the conversations I had about direct care. I was just like a kindergartner. I was curious. I was like, I want to come and play along. But you have really revolutionized the way that I see how direct care can truly fix the healthcare system on a bigger scale. And you had mentioned that you were focused on small employers who are paying into health insurance, providing employees healthcare, and how direct care can fix how we're taking care of people. So if you want to start where you would like, where you came from and where you are now in your direct care practice.


Dr. Flaspohler  2:46  

So going back about 15 years, I had an incredible mentor who kept pushing me on what's the problem you're trying to fix? Because what I love, what I love is what you and I and Laura and Diana, the founders of the direct Specialty Care Alliance, were doing down in Dallas at the DPC Conference, which is teams of teams, coming together and working to solve problems. Nothing gives me more joy in life and collectively coming together and creating Stone soup, where we've all added our piece and come up with something much better. So that's where I find joy in life. And as I started to see all the problems in healthcare, and said, Man, I really want to be a part of making this better. In the current system, doors were constantly shutting in my face, and this mentor of mine said, Lou, what are you trying to fix? And he kept pushing me on why the root cause of the problem? So it's taken me years looking at this, but my hypothesis is that we've got two healthcare systems in the US. One looks more like socialized medicine, so that's Medicare and Medicaid, and socialized medicine has its advantages. The other, which is on the free market side, is neither a free market nor a fair market. It is a horrible distortion which has allowed less than scrupulous players to get in there and really profit off of misery, off of disease in this system, so in this drive to get to the root cause of it, I went digging and digging and digging. And ultimately, what I've seen is that back in the 1960s if you look at the cost of health care, and you look at the cost of inflation. So those two ran in parallel until the mid 1960s then in the mid 1960s you see healthcare starting to take off in this hyperinflation. So the question was, what happened in the 1960s that caused it? And if you go back and look until the mid 1960s we had flu insurance. So why do we have insurance? Financial insurance? We have financial insurance on our homes and on our cars and that to keep us out of financial ruin. So, God forbid, lightning strikes, our house catches on fire. Most of us don't have the financial wherewithal to have lost everything and start over. And so insurance is there for high cost, rare, unpredictable events. And it works very well for those things in and it worked very well in the United States until the 1960s and for a reason, I don't completely understand, somehow in the 1960s we were sold that the insurance companies would become a buyer's club for us. So we're not just going to ensure your catastrophic events. We're going to do the equivalent of buying your bread. Your will get you better prices for your bread, your couches, only, your cleaning needs for your it can't be done when you stick a middle person in between our everyday needs, you and I to become accountable to that middle person. It's a variation of the Golden, the cynical golden rule, right? Whoever holds the goal makes the rules, and in this case, whoever is paying us is who we're accountable to. So we become accountable to the insurance companies, not the patients, for everyday needs, and that allows bad actors to act badly on a never ending basis. So as I started to see that, I said, Okay, where are the positive deviance? Where that is not happening, and what's been around for 40 years or longer, or something called Health shares. And many people and to you probably have heard of health shares, health shares, 40 years ago, came out of churches where a large congregation, let's say you belong to a church that had 1000 employee, or, I'm sorry, 1000 parishioners, and let's say some percentage of them, 10% of them, run mom and pop shops, or mom and pop businesses, they're getting priced out of health care. So that 10% got together and said, Look, why don't we just contribute to a pool for the catastrophic needs and we'll become cash pay patients for everything else. And that worked incredibly well. Those were written as an exception in the Affordable Care Act. And so lots of people and individuals and I have a Health Share now. My Health Share is costing me about a third of what I was paying for insurance when I was an employed worker. As you know, I left and started a direct care rheumatology practice last October, so all I have thought about is catastrophic coverage. I am a cash paid patient for everything else, which means when I go to my doctor, which I did, they tell me the price for your annual visit is $120 and then they charge me $150. I'm saying, wait a minute, and I'm holding them accountable. In any place in healthcare where you have seen where you haven't had insurance in the middle of it, what we've seen is costs go down, quality goes up, and barriers to access disappear. The biggest place that it's easy for anybody to look and see is within cosmetic surgery. So if you look at the tummy tucks, the face lifts, over the years, those have gotten cheaper and cheaper and cheaper and better and better and better. Some of my patients with very limited means are now getting tummy tucks and face lifts where 2030, years ago, they couldn't. So when I look at what you and I are trying to do, and what our colleagues in direct primary care are trying to do, which is to get out. This broken system, what I see is that we have to have we, in this case, are the sellers of a service, but we also have to have buyers that want to lean into the way we're operating. And when you bring health shares in, and especially to small employers, you now create more and more people that want to buy what you and I have and are set up to do that, and when that happens, it's win, win, win for everybody. So employers that embrace these type of plans are paying pennies on the dollars, much lower costs. Oftentimes, the best employers are, in one way or another, contributing that back to the employees and to the community. You and I are driven to get better and better at what we're doing, and everyone is lifted as that occurs.


Dr. Tea  10:58  

I think it's no accident that there are those of us who call ourselves direct care doctors versus I have a cash practice. Essentially, they're the same right, the economics of the dollar being exchanged. But I've spoken about this before. I chose to be a direct care doctor because we are part of a mission to help other doctors recognize our power and to also empower our patients to know that they can choose with their dollars, that yes, insurance is expensive, but if you're not getting what you're paying for, here's the alternative, and here's how we fight back. So I know all of us who are here, we want to solve bigger problems. We can see the problem right in front of us. It's hard to run a small business right with insurance, but we also want to create bigger change, and I think that's why we became doctors. We didn't just want to have a transactional relationship with people, where we're seeing people seven minutes at a time. We build a code we may or may not get paid. That's not what we wanted to do when we got our degree. That took us over a decade to get myself. I'm very driven to create meaningful change. I just didn't know how to do that by myself, and so that's why the Alliance played a huge role as to why I have this podcast and all of the free resources available to doctors who do want to have meaningful change, and I, myself, am a small employer, right? Every time I have to hire a staff member, the question is, Will I have health benefits? And I don't know if you have employees who ask the same thing. I know in our practice, it's very micro. It's very small. We can run it by ourselves, if we really want to, or we can have a couple of members to be part of this team. So I find that this conversation is incredibly relevant for those of us who want a more cost effective way to provide health care to our employees, to improve the quality, because if I'm going to pay money for that, I want to make sure my employee can continue to work to the fullest capacity without hindrance in their health, but also the Security that I'm providing them with a work that is worth staying at, and the only way to do that is to make sure that I'm financially viable and that I have the tools to help me help others move in this direction too. So in your experience, how are you seeing small employers utilize direct care doctors? 


Dr. Flaspohler  13:20  

So I've got a number of colleagues who run direct primary care practices here, and these small employers buying direct primary care, they become very, very sticky patients for direct primary care, because the costs, as you know, it might be $1,000 a year for an adult. And I think across the country, the numbers that we have here in Cincinnati aren't too far off. For $3,000 a year, a family of five in Cincinnati can get unlimited concierge level care through direct primary care. And those small employers that find out about this both offer it to their employees, but they also go out and won't shut up about it to other small employers, right? Because not only are they able to care for their employees, but they're able to help others, take care of their employees and embrace the community, if that makes sense, and give help. 


Dr. Tea  14:32  

Yeah, I had learned about DPC being the direct resource for employers like in Michigan, a real estate company who has hundreds of employees who need to pay for health insurance one way or another. They had the choice. They had the opportunity to choose a DPC option who can provide all of their health care services in house, all of the labs, all of the order. Dollars, and it's cost containing. The interface is direct. The employers pay the doctors. The doctors has that autonomy to take care of their employees. Everybody in that ecosystem is happy, whereas right now, what we're having is we're going through this mystery face of a third party. They live somewhere on the internet of the universe. You know, there's no face to third parties, and so the care that the doctor provides is disconnected. When the care is not delivered to the highest quality, the insurance doesn't take the heat for that. It's the doctors who contract with the insurance. And so in that transaction, it's increasingly less personal, because you said earlier, the person who pays you is who you work for. So doctors are being paid by insurance. We work for insurance, not the patient. So I see in our conversations where employers are looking for a more economical solution for their employees, and because we are specialists, there are a few things that we can do that's very different from primary care doctors. And we can partner in that, where maybe the patient just needs this one surgery, but they don't want to use their insurance option because their deductible is $5,000 whereas they can get a surgery of equal or higher quality for much less so I can envision at least a surgical practice, because that's my point of view as to how we can be that arm of value for employers. But the question for all of us is, how do we actually reach that population of people? How do we connect the employers to know that we are of service? And how can we who are thinking about direct care feel that we're creating change within this, this very important problem we have in healthcare, where it's expensive, it's disconnected, it's burning out doctors, fewer doctors are going to medicine for it. How do we create purpose for each individual so that we don't feel like we're on an island on ourselves, but we were actually creating change and movement in the right direction to fix healthcare in the United States. What you had mentioned a lot of very important things in our previous conversations about how you connect small employers with direct care doctors, is that something that you're currently actively doing and participating in? 


Dr. Flaspohler  17:21  

Yes, yeah. So there's multiple ways for that to happen, and there's challenges there as well. And I'm going to step back, and then I'll come to that with a couple things that you said. One is getting small employers in the hazards challenges for direct primary care and for us as specialist care, but for direct primary care, one of the issues is that if you get you know as direct primary care will handle an Individual doctor might have between four to 600 patients if you had an employer that says, We will, we're going to have 300 patients for you, you become vulnerable. Should that employer leave you? Does that make sense? So it's something that direct primary care doctors, especially young, direct primary care doctors, don't fully grasp early on, and they do a lot of work trying to get all of these employees from one place, but then you've got all of your eggs in one basket. So it's just something, I think, that people have to be careful of the similarly on the from the standpoint of an employer. So here in Cincinnati, if an employer was based in the center of Cincinnati, their employee may live anywhere from a mile away to 1520 miles away, and one particular direct primary care isn't ideal for everybody. So the one of the struggles for the employers is, how do we work with the system where we've got, in Cincinnati, I think we've got about 15 direct primary care practices. How do we as an employer, how do I handle that lift so t if you think about it for yourself, let's say, if you had four employees plus yourself, are you cutting a check every month to five different DPCs? Are you it becoming a slightly heavier lift, but what I call recovering brokers have been working on, how do we fix that? And there are, there are ways to lighten the lift. And when it's done really well, all the pieces start to work together. So as you know, there are direct surgery centers here in the country. There's two of them, one in Indianapolis. This one in Oklahoma, Oklahoma, yeah, and when you've got shepherds, and I'm going to step back here, because in my head, the critical we are all being paid. We're paying at least twice as much for care in the United States as on average, about twice as much as the average industrialized country. So we are paying for a Bentley, and we are getting at best, and you may not remember the Hugos, but you go, I mean, we are getting a really crappy product for twice, and where, what can crush an individual, and you probably know the primary cause of bankruptcy in the United States is health care, and 70% of those that are going bankrupt in the United States have what we're calling insurance. 


Dr. Flaspohler  21:10  

So insurance is failing miserably. It is not insurance. It's not working as insurance. What takes families under. What takes individuals under, families under, and can crush the big and this the employers, the small employers, is the catastrophic event. So when you look at what the best of the best are doing when a catastrophic event comes up, we have to have shepherds, and you and I have worked in this broken system, and we know without a navigator, it's very easy to get the wrong care at the wrong place at a much, much higher cost. Which are the things that will take an individual or family and can bring the employers under when it's done well, if that higher quality, lower cost, the family, the individual is much safer, the family safer and the employer safer. So along those lines, in those surgery centers, when employees, when the ecosystem is working well, an employee needs a hernia replant pair in Indianapolis, the price of a hernia repair may be about $7,000 a sticker price for a hernia repair from a hospital system may be well over $20,000 as the employers are working within these ecosystems, they can go to the employees and say, Look, if you go to the surgery center of Indianapolis, we're going to waive your deductible altogether. It won't cost you anything. Here's the quality measurements, and they can pair those quality measurements in the other hospital systems, and always they blow away the quality measurements. So you can go there, we'll waive your deductible. It's going to be better for you body wise. It's going to be better for you financially, and it's going to be better for us financially. So and then you and as we get better and better at this team, you and I get pulled in and on these things because we're driving higher quality, lower cost, shorter delivery time, if that makes sense. And I'm not sure if that gets to your question or not, but when the ecosystem is working well, we have to have shepherds to get to the right place. But when it is done, well, that happens, and it is happening across the country. 


Dr. Tea  23:46  

What you've alluded to is that we are basically at the forefront, because this is such a new concept to employers, to directly contract with doctors, versus the system, the third party, the corporation of medicine, that it's we can design this to go in our favor. We can start connecting to small business owners and say, Look, I have this particular service. My metrics are this. It does prove to be higher quality and it's more cost efficient, because you're not having to pay into a pot. You're paying me directly. With that, comes a higher level of accountability. With that, if there is a mishap in the service I provided, I will take care of it, instead of some random person who may not be the primary doctor, the primary surgeon, the primary specialist. So there's a higher level of accountability in this model, which ensures a higher level of quality. Because if we're just saying, Oh, we're going to pay somebody something, and somebody is just going to show up, then yeah, the quality is going to degrade. Who knows? Who knows who's going to show up? It's probably not even a doctor. It's probably not even a specialist at the. Point we're having, like, these really short interactions between patients and their medical providers, professionals, however you want to call it, it's not always the doctor. So we have to, like you said, Be the shepherds, essentially be the noise maker, and say, look, I can do this better. You know, give me the opportunity to show you how. Give me the opportunity to give you the data that my quality is indeed higher and that if we want things to sustain itself, it requires a relationship. It requires a human and a human. It's not a human and a company. You know, it's not the industry. It's not Corporation. We already see that being a problem like here in California, people are mostly employed. Doctors are mostly employed in the system, and there's no penetrating that wall. They have created their own little ecosystem where some things work really well, but the things that don't work well is actually the need that direct care doctors are fulfilling. So in my example, I do a lot of preventive, palliative foot care, but the system's not going to waste our time on that. They're like, Oh, that's not going to generate money that doesn't have a CPT code that will make us, you know, more money. So those doctors funnel those patients to me, and for me, I thrive on that. I love that. I love that level of care. And symbiotically, if there are major reconstructive surgeries that are consuming resources. I can send them back to the corporations, because they want to do that kind of stuff. So we don't exist on our own. We have a place. We have a voice to fulfill. And I feel like as long as we know that's what we offer, then we can create these relationships with systems in which they're doing things that they don't want to do, vice versa. And then small employers within our communities who are not even covering their employees with good coverage, and say, Look, if you just show up at my office, I can provide you with this care. This is the flat fee. There's no surprises. You're not going to get an enormous bill. It's not even the hyperinflated cost. 


Dr. Tea  27:03  

It is what it is. It allows me to sustain myself as a business and employ people within the community, and the community benefits because I'm paying taxes within that community. So it's a win-win for small businesses to contract with small businesses. And I really like how you mentioned within the DPC model, it's that you don't want to put all your eggs in one basket. You don't want to rely on one employer to use you as a service line. This for us is just another stream. We want to think about different arms that provide us with patients, that provide us with revenue, and then we in turn provide them with the quality of care. So I don't see, at least right now, direct specialty care, being the sole specialty care provider for one employee or employer, it's just a branch of opportunity for us. So if you're a doctor listening, you're a director specialist, you're like, how, how can I make this work for me? Think about your specialty and the different branches of people who may need your service, which is going to include small businesses. So for podiatry, for example, I help people who have foot pain, right, which means I can service people who have jobs that require them to be on their feet and say, Look, this much more economical if you went to me instead of, you know, whatever options you have, and that could be a way to start the relationship. And I think in rheumatology as well, you might be, you might have a branch of people who need your service exclusively, and then you can say, I am the expert at this specialty. I can provide more economical care at a higher level, at a higher quality. And I think at this point in time, in 2024 we're really just opening the conversation, there hasn't been a clear pathway for direct specialty care, which I think is exciting but also scary and probably unclear for those of us who are more protocol driven, we like checklists, we like a pathway. We like a clear prerequisite of courses that we need to get to the end destination. But right now, it's a little bit hazy, because we are actively creating that for us. Right now, for me, that's exciting. I don't know how you feel about that? Lou, you're in the midst of it.


Dr. Flaspohler  29:04  

Oh, I'm right there. It's both terrifying and thrilling, right? And going back, you got me thinking I've mentioned to you my friend Joel Allumbaugh. So Joel is what I call a recovering broker. So across the country, there are brokers who have been morally beat down by a system that the costs just keep going up and up and up and a product that people hate. And many of these people have been looking for the exit ramp. Joel was. Joel's been at it for 30 years running an insurance company. He has been using the health shares in combination with the DPCs to create much, much better. Benefits. Now, one of the things that I'll talk to Joel about, and you and I talked about Joel speaking with you, and I'll get that lined up. Joel is very interested in within communities, finding the direct care providers and creating the resources so that when the need comes up, as we've got diabetics with foot issues out where you are in California, your name is right there, and we know you're delivering that so that the larger ecosystem has it a bit the information available kind of like going to not have Well, I mean, if we go to Amazon, we can find just about any product, right? So it's kind of that clearing house where we can go in and see all of that. So it's incredibly exciting. And then when you and I start figuring out where's the overlap that we can do better for patients together, and we start learning together, that's the kind of stuff that just builds my soul on, contributing, lifting, keeping people healthy and thriving. So hopefully that makes sense. 


Dr. Tea  31:07  

Before I let you go, I want you to convince the listener directly. It's the way to restore the health of our community, of everybody nationwide. So I guess it would help to hear why you decided to go direct care. 


Dr. Flaspohler  31:26  

Well, I should have done it long ago, but ultimately, what helped me get out of the broken system, I started a practice. And I'll go a little bit deeper, just because I think it brings up some good information, I should say I but it was really my wife, who's a teacher. Unfortunately, when she and I in 2003 decided I was going to go independent, he was an unpaid employee and spent the summer getting insurance contracts, getting those in place. I had to hire two employees to open the doors back in 2003 and it cost about I borrowed $60,000 for my dad at the time to get those doors open. And it was probably two to three months before the revenue started. The dollars started to trickle in that I was making anything. I had my first partner join me in 2005 and second, in 2009 both incredible people that care for their patients the way we want all of our loved ones cared for. In 2011 we were getting concerned about the way the wind was shifting so we were in independent practice. Everybody's getting bought up. And they were concerned that if we don't sell to one of the systems, we may go under and but we got to be honest with you, our appointment times are longer. We spend a lot of time and get a lot of joy out of taking time with patients. So we are the poorest rheumatologists in Cincinnati, not poor by any means, but the poorest rheumatologist, no question. So you got to know you're not going to make any money off of it. And at that point, this administrator said, Absolutely, we want to buy you. We know who you are. Fast forward, and in that I was on a journey and knew the system was broken. I saw colleagues in primary care getting out and having their lives given back to them, and being able to care for every patient the way they want their loved ones cared for.  I knew at some point I needed to get out. But I love my partners. I love my team. 2022, new administrations in, and they came to me and said, Lou, you've got to see more patients. We want you jacking up the bill on every patient that you see, and you're going to have to take a cut in benefits. And I remember sitting with this person and saying, Look, I love what I do. I love what I do. If you turn this into an assembly line, there's no joy in it for and ultimately, they said, Take it or leave it. And to me, that was I'm grateful that it happened. It was not easy, and I've mourned the loss of my partners and lots of my team. But I'm where I'm supposed to be, and this system is doing what I love doing, which is constantly driving to do more for those we serve and constantly driving and doing it for less and doing it better, if that makes sense. So that's probably longer than you want it, but that's the story in my life that has been given back to me the way my colleagues in direct primary care have had their lives given back to them.


Dr. Tea  34:59  

Yeah, that's the story we want to hear. Is that, despite all that, it's been worth it. You had mentioned assembly line medicine, and that's exactly what it feels like. There's such a misalignment with what we thought medicine was supposed to be, and then we're being asked to do more with less. It's soul crushing. No wonder doctors are leaving medicine, but it's my intention to bring them back in, to reel them back in, at least through direct care. 


Dr. Flaspohler  35:29  

Yeah, and you brought that up earlier, T and unfortunately, the system does better when we do poor care, the system makes more money off of that, so there is no incentive for the system to get better, if that makes sense, where you and I and who's got an incentive to do better than all of the employers you and I have direct incentive, because we have directly accountable and we want to, and I think all of our Brothers and sisters, whether they're primary care or specialist. There's very few in there that want to make money off of people's misery. Nearly everybody wants to do more. Wants to give


Dr. Tea  36:14  

Well, thank you so much for sharing your knowledge and opening up what direct care can actually do for the ecosystem of our very broken healthcare system. Are there any last words that you would like to give to the listeners today?


Dr. Flaspohler  36:28  

When it's done right? Everyone gets the care that you and I would want for our loved ones, and all of the pieces are there. We've got to figure it out, but we're figuring it out. So I deeply appreciate you for having me on today, and I deeply appreciate the work that you, Lara, Dianna, are doing within the Direct Specialty Care Alliance and allowing me to be a part of that. So thank you so much.


Dr. Tea  36:28  

Thank you for being the voice of reason, Lou. I appreciate you being here and to everyone who's listening, I'll catch you next week. Thanks so much. Take care. 


Dr. Tea  37:07  

Thank you so much for being here with me. If you enjoyed this episode and want to hear more, please like, share and subscribe, so more people like you can have access to another way of practicing medicine, the direct care way. Let's connect. Find my info in the show notes, and send me your questions. It might be the topic for future episodes. 


Dr. Tea  37:26  

And lastly, if you remember nothing else, remember this be the energy you want to attract. See you next time you.