Interview with Daniel Goldberg,  Founder of Free Market Health Group**

Daniel Goldberg,  a 29 year old entrepreneur who has worked in the health care field for 6 years,  believes the time has come in which self-funded corporations,  ordinary citizens, and physicians are seeking a  transparent and affordable alternative to government and insurer  care.

Q:  What is your position?

A: I am founder and president of the Free Market Health Group.  I am an outspoken advocate  of free market principles and transparency.  We also serve as consultants for physicians who are  entering cash-based practices in a free market system. We deal mostly with specialists – orthopedists, spine surgeons, and other  specialists who perform procedures not requiring hospital care.

Q:  What motivated you to form this group?

A:  With the new regulations with ObamaCare,  we started to see a lot of physicians becoming disenchanted with the current medical system and further disenchanted with  ObamaCare regulations.   Many of them, primary care doctors and specialists alike,  have  expressed a desire to leave the insurance-based system and to enter a more fee-for-service or cash-based practices .  They just weren’t sure how to make this a viable business model, after having been in the insurance system for 20 or 30 years. 

Q: What prepares you to provide this vision of how this might be done?

A: Our vision is  that the more physicians leave  the system, the better we could   serve the people in the market for cash-based surgery,  the uninsured, and those  who did not want to use their insurance network.  

We realize a lot of patients, despite the ObamaCare enrollment numbers, are still uninsured and  need to be served,  as well as those with high deductibles plans.  

Also there is a  proliferating trend towards direct pay  by  employers who self-fund  medical claims of their employees. Typically,  these employers are used to paying hospital-based managed care fees. With physicians entering the free market and competing on price and quality, self-funded  employers want  contracts with high quality  physicians  at significantly reduced rates.

Q: Do you think  there’s a significant hunger among self-funded employers for this new model?

A: Absolutely.  What  we saw that made us sure this new model was viable was when  Walmart and GE, who together have one and a half million employees,   created direct global fee contracts for hip and knee replacements  with four hospitals across the country.  Walmart and GE  told their employees if they chose to go to one of these pre-determined centers, the employer would absorb the entire cost.  For employers, the rates were low even with the employer paying the full amount.

Q: And this was outside the realm of current 3^rd party reimbursement?

A: Right, this was a direct contract between employers and  medical providers.   This skirted the insurers.  Employers  were funding the claims directly themselves. This did not necessitate insurer  involvement.  There was no need for the insurance bureaucracy.

Q:   There are a couple of slogans or buzz phrases you use repeatedly.  One of them is you are creating “A transparent system of medicine.”  Amplify on that please.

A:  In America, everybody shops for everything from cars, computers, toasters, and housing based on price and quality. You cannot judge price and quality in a heavily guarded, secretive  health care  pre-arranged system based on a price system between insurers and larger hospital systems.  

Both sides don’t want patients to know what medical care actually costs.  When the patient sees a  bill saying the hospital charged you $25,000 for a knee replacement, but you only paid them $8000, people say,”Oh, Thank God, I have insurance because I could never have afforded that.”  

The reality is that rate was agreed upon well before you entered the operating room and well before you were even a patient.   The  financial system you  see in medicine as the average patient isn’t real if you want to know what the insurance system’s role or the costs actually are. And you  cannot predict beforehand what  costs will eventually be.

Q:  Another phrase you use is “ A physician mass exodus.” Explain please.

A:  The policy of  Association of American Physicians and Surgeons (AAPS), that patients should  pay directly when care is provided,  is a perfect example.  In the last decade, many  AAPS-affiliated primary care physicians have left the insurance-based system  to form concierge practices.  Primary care physician have spearheaded this movement.  It’s been a very successful model.   

Specialists took that mindset.  When patients need surgery,  specialists have  created a  global fee-for-service model.   With that in mind and with  fee-for-service reimbursement going down,  specialists are leaving the insurance system and entering the free market, and not allowing themselves to be paid less.   They are choosing to opt out or disassociate themselves from insurance, and that’s become a trend with the best physicians in the country. 

Eventually, patients are going to walk into the physician’s office, and the doctor is going to say, “I don’t take your insurance.  This is my cash-rate for medical care.” 

Our job is drive down that cash-rate  by making the physicians compete against each other.

Q: There are models out there showing this does work.  The Surgery Center in Oklahoma, now in existence for 17 years,  is a prime example.

A: Yes, Doctor Keith Smith, founder of that center, is a pioneer in this field.

Q;  One of the things I ran across in doing interviews with direct pay physicians was that they are contracting with specialists for direct-pay discounts, and that is bringing their mutual interests together.  This is a powerful incentive in bringing specialists into the free market.

A:  Absolutely.  For primary care direct pay physicians, certain things are going to be outside their scope of practice, like rotator cuff surgery.   Typically, the only alternative was to go to a hospital.  If the primary care physician affiliate with specialists,  it gives their patients a larger care path and another option.  That’s a great thing.  Direct-pay care is no longer relegated to primary care.  Now both primary care and specialists are operating under the same model.

Q: Do you think this transition to free market care is concentrated in certain affluent markets, like New York City?

A: No, the traditional mindset was always that if you’re going to charge a cash-fee, only 1% to 2% of people could  afford that fee, and that can only occur in places with a high concentration of the wealthy. That has proven to be untrue, because as the price goes down more and more people can afford cash care. This  includes  those who are uninsured, either electively or because of financial circumstances.   Those people are in  all parts of the country. 

Opening up cash-only facilities is not  something that needs to be demographically targeted. 

In New York City, there a lot of concierge physicians and a lot of concierge surgeons, but that’s true of all markets.

Q: What I found in my interviews with direct-pay independent physicians,  is that they were surprised, even stunned, by the mix of patients availing themselves of their services. It turns out direct-pay medicine isn’t just for the affluent.  Direct pay doctors are receiving  calls from the uninsured, who are looking for rapid uncomplicated unbureaucratic access  and  the insured, who are motivated by the fact their new premiums and deductibles are not out of reach.

A;  Yes,  candidates for cash-only care are people who want a high quality of care and who don’t want to be directed based on insurance.  The greatest insurance policy  in the world is not worth it if your doctor are not  spending enough time with you, or are not answering all your questions,  or is not available when you need them.   

 These people are seeking out direct/concierge physicians who have the time and resources and  who have enough time to spend with them to answer their  questions and who know them  as persons and not just  numbers in line, with  transparent pricing up front.   People want a high level of care are not restricted to those with high incomes   People want to be treated as best as possible by  a physician who knows them and who spends  time with them.

Tweet:   Free market health care in the form of direct-pay independent primary and specialty care is growing rapidly in the United States.


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