Housecalls Are Back and Booming. Are They a Threat to PCPs?

Neil Chesanow

Disclosures

July 20, 2016

In This Article

What Do the Housecall Firms Offer?

Housecall startups are tinkering with different market strategies, types of services, clinical staffing mixes, and rates, and have different business goals. Consider five of the fastest-growing firms.

Heal, Serving Los Angeles, Orange County, San Francisco, Silicon Valley, and San Diego

Heal serves five regions of California: Los Angeles, Orange County, San Francisco, Silicon Valley, and San Diego. It employs nearly 100 family doctors, internists, pediatricians, and emergency physicians on a full- or part-time basis. The firm recently raised $5 million in seed money.[1]

Nephrologist Renee Dua, MD, and her husband founded Heal in 2015 after spending half the night in the ER with their sick son, only to be sent home because, they were told, the child's illness wasn't serious enough for him to be admitted. "There has to be a better way to see the doctor," Dr Dua thought.

Heal's smartphone app does not yet offer video chat, but it is on the company's radar. Heal doctors are chauffeured from housecall to housecall by medical assistants in company Priuses and perform basic tasks, such as taking a patient's vital signs, but they do not carry medications.

The company does not dispatch NPs.

"We have a distinct belief, perhaps because I am a doctor, that the relationship between a patient and a healthcare provider should be with a physician," Dr Dua says. "Physicians have the most and best training, and that initial visit, where you're really getting to know your patient in depth, and the patient feels least vulnerable and most able to express themselves, should be with a doctor."

Although Heal's doctors handle the usual urgent-care complaints, they also do well-baby exams, physicals, flu shots, and family health assessments. And for patients who don't have a primary doctor, Heal actively seeks to fill that role. (If a patient does have a primary doctor, Heal will forward housecall visit notes, if asked.)

The cost per patient is a flat fee of $99; there is no surge pricing during rush-hour visits or weekend premiums. Some insurers, but not all, cover the fee. Over 80% of Heal patients use insurance to pay for a housecall, Dr Dua reports.

Heal makes housecalls from 8 AM to 8 PM, 7 days a week. According to Dr Dua, a Heal doctor generally shows up within an hour.

Can sending a doctor on a $99 housecall, less than the cost of many office visits, be profitable? It can, Dr Dua insists. Being in-network with some insurers increases the volume of housecall requests. And 40% of Heal patients are repeat customers, she says.

"We're looking to build a relationship with the family," Dr Dua explains. "While we're taking care of Mrs Smith, she will often say, 'Wow, this is phenomenal. Can you take a look at my husband?' We charge $99 per patient, so that can be a very profitable hour for us."

Because Heal, like other housecall startups, is a virtual business, overhead is low. There is no Heal building, so no monthly rent to pay.

Mend, Serving the Dallas–Fort Worth Area

Emergency physician Jonathan Clarke, MD, started Mend in the Dallas–Fort Worth area in 2015. It has already tripled in size, and now covers an area of 900 square miles.

The company provides urgent care, and patients generally range in age from 1 to 64 years. A Mend housecall can be requested with a smartphone app, by email, or by phone.

Mend employs 15 full- and part-time NPs and physician assistants (PAs), as well as three medical directors (all emergency physicians). All have at least 5 years of experience in urgent care or emergency medicine.

It is primarily NPs and PAs who are dispatched on housecalls. The physicians generally provide medical supervision, although they do field about 10% of the calls themselves, Dr Clarke says.

Mend is open from 8 AM to 8 PM. "We see folks in office buildings, high-rise apartment buildings, and convention centers," says Dr Clarke. "We've even seen people in public parks." Clinicians travel solo in company vehicles, primarily subcompact Honda Fits.

"We have most of what you'd find in an urgent-care setting," Dr Clarke explains. "We have a nebulizer and a cautery machine. We do epistaxis management and laceration repair. We have orthopedic splints, crutches, and slings."

"We carry a number of medications," Dr Clarke continues. "For most medications you would receive as a prescription, we can dispense the first dose in the home setting, whether it's oral, inhaled, or injectable medications. Then we typically arrange to have the prescription sent to the patient's pharmacy of choice, but we also have several delivery options."

"We're not providing any bloodwork or x-rays," Dr Clarke adds. "Within our scope of practice, we don't need to. We use clinical prediction rules—like, for example, the Ottawa Ankle Rules. Our provider may say, 'I believe you may have an ankle fracture. As long as it's not grossly deformed or displaced, we're going to splint that with a posterior splint and give you a set of crutches, which are in the vehicle, and then arrange a follow-up visit with an orthopedist in 5 to 7 days.'"

"This is exactly the standard of care you'd receive in an emergency room," Dr Clarke reflects, "except that you'd get an x-ray, they'd say, 'I think your ankle may still be broken,' and you'd get a $2000 to $3000 bill."

Mend charges $50 for the first visit and $199 for subsequent visits.

"The price is all-inclusive," Dr Clarke says. "It covers your first dose of most medications, any supplies needed onsite, and prescription delivery. Subsequent visits are comparable to what an ER copay would be, or an urgent-care visit if you had a high-deductible plan or were paying cash."

There is a $50 charge per additional patient per visit, a $25 charge for a flu shot, and a $50 charge for a physical. Mend does not yet accept insurance, but that will soon change, Dr Clarke says.

Last year, Children's Health, an integrated delivery system that includes three pediatric hospitals in North Texas, became a majority stakeholder in Mend.[2]

"We are integrating with their health system, with things like a nurse advice line and 24-hour customer support with insurance integration," Dr Clarke says, "so we should be in-network with several major insurers by the end of the year."

Pager, Serving Manhattan and Brooklyn

Pager, the brainchild of former Uber chief technology officer Oscar Salazar, began operation in 2015. It employs 35 full- and part-time clinicians (10 of whom are physicians), who typically moonlight from their regular hospital jobs; they are paid market rates. They primarily offer urgent care to adults and children.

A first-time in-person visit costs $50; subsequent visits cost $200. Housecalls, made using Pager's smartphone app, are triaged by a registered nurse who conducts a video chat to determine whether an in-person visit is needed. A patient can also opt for a $25 phone or video session.

Clinicians travel by Uber-dispatched cars or public transportation, whichever makes sense at the time. Currently, housecalls are limited to Manhattan and Brooklyn, but Pager has expansion plans in the Tri-State area.

Doctors, NPs, and PAs travel solo, with backpacks equipped with an injectables kit, suturing kit, otoscope, stethoscope, other equipment, bandages, and 20 commonly prescribed urgent-care medications, says executive vice president Andrew Chomer.

If a patient requires additional doses of medication or different drugs, the Pager clinician, using a company-issued tablet, sends an e-script to partner ZipDrug, an on-demand prescription medication service; delivery takes about an hour.

Housecalls are offered from 8 AM to 8 PM 365 days a year. A physician is always on duty, so NPs or PAs on a housecall can consult by text, phone, or video chat. A tablet is used to enter visit notes into the firm's EHR, and the notes can be shared with a patient's primary doctor, if requested.

Corporate clients are key to Pager's growth; 25 firms are already on board, Chomer says. Pager clinicians will come to a patient's office not only for urgent care, but also for physicals, wellness exams, and flu shots. For companies seeking to reduce employee absenteeism, paying $100 for a physical or $25 for a flu shot is cost-effective.

Pager does not currently accept insurance, but hopes to be an in-network provider with several carriers before the year is out, Chomer reports.

This month, Pager will become a provider for a physician group in Florida that has risk-bearing contracts with Medicare Advantage plans, underwritten by commercial insurers, seeking to reduce urgent-care and ER visits for "unplanned or urgent-care needs in a chronic-care population," Chomer says.

It remains to be seen whether Medicare beneficiaries will be comfortable with Pager's smartphone app and video triaging prior to a housecall. But if the experiment works, accountable care organizations and patient-centered medical homes will become prime prospects.

As of March, Pager had raised $10.4 million in venture capital funding.[3]

PediaQ, Serving the Dallas–Fort Worth Area

PediaQ, which has been operating since 2015, offers urgent care to children, "because adults don't have the immediacy of needs and they don't get sick quite as frequently as kids do," says CEO Jon O'Sullivan. "Once we're established and we've generated the awareness and acceptance of our model and it becomes more mainstream, that will afford us the ability to expand to adults."

"We offer access to primary care when you can't get into your pediatrician's office," Sullivan says. Housecall hours are 2 PM to 10 PM on weekdays and 8 AM to 10 PM on weekends, when pediatric offices aren't open or when getting a timely appointment is difficult.

"It's very important for us to develop good relationships within the pediatric community, to gain their support, and to make them understand that we are not competing with them," O'Sullivan stresses. "We only offer services for episodic or urgent care. We don't do well visits, immunizations, or things like that."

Initially, PediaQ offered housecalls until midnight, but no longer. Finding clinicians who would work after 10 PM proved difficult, and the firm discovered that when parents put a child to bed later in the evening, "as long as they can get that child to sleep, even though the child may be sick, they want that child to rest and sleep," O'Sullivan says. "Even if a child wakes up at 2 or 3 in the morning, a parent will typically try to get them to go back to sleep and take them to the doctor the next day, or, if it's really bad, they'll take them to the ER right away. We found that only 5% of our visits were occurring after 10 PM."

A standard visit costs $150, about what local pediatricians charge. A visit to a local urgent-care center averages $250 to $300, O'Sullivan says, and an ER visit typically costs more than $1500 if a patient is paying out of pocket.

Other PediaQ rates include $50 for each additional patient per housecall, $25 for onsite tests, $35 for inhalants, $50 for lab work, $40 for medical adhesives for wound repair, $40 for injections, and $35 for prescription pickup. Housecalls made on holidays carry a $50 surcharge.

PediaQ takes insurance from several major carriers, whose members pay an office copay for the basic fee plus a $25 "convenience fee" to cover clinician travel time. Discussions with other insurers are in progress. "We need to demonstrate to them that people want this and that it can be cost-effective" in reducing preventable ER and urgent-care visits, O'Sullivan says.

To remain cost-effective, PediaQ uses NPs rather than physicians for housecall visits, he says. The company employs seven full-time and 15 part-time NPs. Most have at least 5 years' experience treating pediatric patients.

"If we were to find a pediatrician who was really good and was in practice for 5 years, they'd probably have a pretty busy practice and be making $250,000 to $300,000 a year," O'Sullivan says. "We don't want to be a concierge model and charge someone $300 to $400 for a housecall."

A typical housecall lasts 20 to 30 minutes, which is "two to three times longer than you would get in an exam room," O'Sullivan says. Total time, including travel, is about an hour.

Since September 2015, PediaQ clinicians have seen more than 2500 patients, O'Sullivan says. "We started in one North Texas community and we grew to five others. In April, we expanded into North Houston. We will continue that expansion in the fall."

PediaQ had raised $1.2 million in venture capital funding as of November 2015.[4]

RetraceHealth, Serving Minneapolis

When his 1-year-old son was seriously ill, health economist Thompson Aderinkomi took him to a clinic four times over several weeks before pneumonia was finally diagnosed; the visits cost him $7500 out of pocket.

RetraceHealth was born in 2013 out of the frustrations of that experience. It primarily provides urgent care to patients of all ages, says Aderinkomi, who is the company's CEO.

Patients are socioeconomically diverse. "We have people who live in the wealthy part of the city; we have people who live in the not-so-wealthy part of the city," he says. "We have people who are very tech-savvy and people who are not."

Visit volume has quintupled since 2015, Aderinkomi reports.

RetraceHealth primarily employs NPs, most of whom work full time.

"Nurse practitioners are part of what makes this model economically feasible," Aderinkomi explains. "Their salary is much lower than a physician's and their malpractice insurance costs less than a physician's. When you're in a state where they can operate independently, you're essentially buying the same insurance a doctor gets for a fraction of the price."

"Studies show that nurse practitioners have the same outcomes as medical doctors, or better, and nurse practitioners have higher levels of patient satisfaction," Aderinkomi continues. "Add it up and it just makes sense."

To request a housecall, a patient looks at the smart calendar on the firm's website and clicks on an open time slot, which brings up an online form. After the patient provides name, phone number, and email address, he or she downloads a video chat app. A video session with a RetraceHealth NP precedes all housecalls to determine whether an at-home visit is necessary.

Sometimes a videoconference with an NP is preferred or all that is required; if so, the fee is $60 if a patient is paying out of pocket. A home visit costs $150, but if the visit includes lab work, the price is $190. An in-home x-ray, conducted by a technician with a portable x-ray machine, costs $160. An ultrasound also costs $160, and vaccinations are at cost.

About 50% of RetraceHealth patients already have a primary doctor, and the firm will forward visit notes if the patient asks. But many of those patients "are switching to us," Aderinkomi says. For $300 a year, a family can receive unlimited primary care—which is less than what concierge doctors typically charge but akin to the rates charged at some direct primary care practices.

RetraceHealth accepts some insurance, including Blue Cross and Blue Shield of Minnesota, which is also an investor in the firm. Insured patients pay only a copay for services.

Earlier this year, RetraceHealth received a $1 million cash infusion from Blue Cross; Health East, a four-hospital system based in St. Paul; and health services giant McKesson.[5] In June, the firm secured another $7 million in venture-capital funding.[5]

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