Interview: Michael Lubin, VP, Hint Health

September 27, 2017 | Frontline Stories

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Susanne spoke with Michael Lubin, VP of Hint Health, a ‘direct care’ company that helps connect physicians directly to patients and employers. No more middleman insurance companies!

Susanne Madden:

This is Susanne Madden, CEO of The Verden Group, talking to Michael Lubin, Vice President of Hint Health, about direct care solutions. Hint Health helps physicians and other healthcare providers to develop and administer direct to patient and direct to employer offerings. As many of you know, direct to employer is near and dear to my heart. Michael, I’m very happy to have you on our podcast today for this Equinox 2017 issue of Verden ViewPoint.

Michael, tell us a little bit about what is direct care? I know there’s a misunderstanding about what that might mean, so perhaps you can clear that up for us and just tell us exactly what is direct care and what does it look like from your perspective at Hint Health?

Michael Lubin:

Susanne, first of all, thanks for having me on today’s podcast.

Direct care actually is taking a lot of different forms in the marketplace today. I’m sure many of the listeners have heard of concepts like concierge medicine. Maybe some have heard of this emerging concept called direct primary care. Those are manifestations of direct care. In essence, direct care, and what physicians are doing out there with direct care, is essentially a new payment model, an alternative payment model, where they’re delivering healthcare services directly to patients, or increasingly directly to employers, contracting directly with patients and employers and getting paid directly by the patient and/or directly by employers as well.

In essence, that’s really when we refer to direct care, it’s a direct relationship with the patient and/or with an employer, to provide care directly, and where that financial relationship and that clinical relationship is really between those two entities with no third party payer relationship, or any intermediary in between that relationship.

Susanne Madden:

I think that’s what’s so neat about it, right? Is that it’s getting rid of the middle man. This is obviously, hence the name direct care, but it’s also direct payment. I think that’s very exciting for a lot of physicians. I often hear physicians say “Gee, Susanne, but I’d love to do something like that, but I really don’t think that we could survive that in this market. I don’t feel like we can actually have a direct care model. Too many of my patients who are on insurance plans. I need to take insurance plans.” What might you say to physicians? What is driving the growth that you see among physician groups and getting beyond these barriers?

Michael Lubin:

What’s interesting is that, as I mentioned earlier, there’s a lot of different manifestations of direct care across different physician organizations. On one end of the spectrum, the extreme end of the spectrum, we’re seeing a very significant growth in primary care, for example, of primary care physicians, both small as well as large group primary care practices, that essentially can’t survive under the third party payer system.

It’s becoming too complex. It’s very frustrating. They no longer really own the patient relationship. All the administrative cost and hassle of trying to get paid through third party payers. It gets harder every day, and the reimbursement seems to decline every day. On one end of the spectrum, the very far end, there are a lot of physicians that are saying, “you know what, I’m done, and I’m going to convert my practice to a pure direct care model.” Direct primary care is typically the term that’s used. They will exit their payer relationships and they will alert their patients that they want to continue to care for them, but they’re going to do so on a direct patient relationship basis, and typically do so on a membership, and a membership form of payment as well, which is incredibly transformational.

That’s kind of a shift from a fee for service, whether it’s from insurance or cash, to a membership payment model. It is actually stunningly transformational both in terms of both the economic impact on their practice as well as what it can do and allow for in terms of kind of changing patient behavior and changing the whole dynamic of how patients interact with physicians. That’s one manifestation. It’s kind of the extreme manifestation. “Hey, I’m going whole hog into a direct primary care or direct care model.”

On the other end of the spectrum we see a lot of healthcare providers that want to continue with their third-party payer relationships, but they see an opportunity to better serve particular segments of their patient panel. For example, almost all of our clients are kind of, I’ll call these for all intents and purposes, a hybrid direct care model. They continue to have payer relationships, they continue to bill insurance, but they may have a segment of their patient population that historically has paid cash. Practices are more than happy to see patients that don’t have insurance or that are under-insured that want to come in and be seen and pay them in cash.

In essence that is a manifestation of direct care and what a lot of physicians are doing is that they are introducing kind of a first stage in a global direct care strategy–they may introduce a new membership based offering sort of practice for a patient if they have insurance or if they don’t have insurance, but typically it’s designed for those that don’t. It’s a way to engage the practice. It kind of operates like a gym membership, the average place, going in for primary care is about $60-80 per patient, per month and it essentially includes all you can eat primary care. Some practices will just start there. They’ll start their direct care strategy by introducing that membership. It’s available to patients without insurance as step one of that process.

Then, what we often times see is that is one of several steps towards moving out of paid relationships where it will be kind of a strategic process. Most practices, we’ll work with them to do this, to take a look at their pay relationships, examine their insurance contracts. Inevitability the bottom third of their paid relationships have fee schedules and reimbursements that they’re flat out losing money on. They may exit two, three or four paid relationships that are just not effective for them. They’ll communicate to those patients that have that insurance that they want to continue to care for those patients, but they want to offer those patients a membership based way of engaging the practice.

In a practice like that they’ll kind of start small with those small memberships and they’ll start to move through exiting and retaining those patients in a pure cash membership based model and kind of transition slowly into a direct care model.

Susanne Madden:

Sounds of like a way to try on the model without going full hog into it. You can keep the majority of your plans, do a little bit of research and look at your payer mix, figure out who are sort of the worst paying plans, exit those contracts and then see which of those patients you can retain.

When you’re talking about a membership model, Michael, you’re really talking about monthly payments. You have a patient paying a fixed amount every month to the practice. For that, in the case of direct care or primary care, they really are able to get their well visits, their sick visits, their annual check, those sorts of things, covered for that membership fee. Is that what you’re describing?

Michael Lubin:

That’s exactly what I’m describing. The membership payment model is, as I mentioned earlier, an incredibly transformational payment mechanism. This is essentially what it allows, what it does for both patients and physicians. It’s my point of view that a fee for service payment model, whether that fee for service is being paid by a third party payer, an insurance company, or even if it’s being paid directly by a patient, is not a good payment model for healthcare. It misaligned the incentives.

It actually dis-incents patients from engaging in care because there’s a toll I have to pay every time I want to consume care. It also can, in some cases, unfortunately incent care that may or may not be necessary. It’s not an ideal payment model for healthcare in general, certainly primary care.

A membership payment model is actually incredibly transformational. The first thing that it does is it actually aligns incentives. If you just think about primary care for instance, what’s interesting is that what patients want to be able to do is they want to be able to access their primary care physician whenever and how they want to. On their terms. Kind of like they access or communicate with their friends and family. With a membership recurring or subscription based payment model, now you have a revenue source that consistently comes in to that physician that allows the patient to access them however and whatever way they want to.

One of the first fundamental things that changes in the direct primary care or the direct care model that’s purely membership based is that patient interaction goes from the majority of those interactions being office visits, because that’s kind of what providers have to force into because that’s how they get paid, to non-office visits- text communications, emails, FaceTime, video chats, which is actually significantly more efficient, and much more desirable from patient’s perspective. It also allows patients to engage in healthcare much more significantly and more frequently, so outcomes actually get improved.

Patient’s love it. It provides a payment model for the physician to build up and offer that kind of access to them. It improves outcomes. Then, on the physician side, from a business model standpoint, having a predictable, recurring revenue source every month totally changes the whole economic dynamics of the practice. Now you can actually plan your business in ways, versus hoping that you’re going to have the volume to meet whatever costs and revenue that you need each month.

Susanne Madden:

Absolutely. We often see too that if there’s no flu season for example, it really impacts primary care and pediatric care finances. There’s-

Michael Lubin:


Susanne Madden:

You can’t recoup those sick visits, so having that monthly membership fee and that steady cash flow, I can see it doing marvelous things for practices. I also really liked when you touched upon the interaction with patients and how physicians can better manage patient health. What is so frustrating to so many physicians is the fact that you have telemedicine companies that are inserting themselves in the relationship between physician and patient and insurance companies adds an additional layer too. Where now, if a patient wants to take advantage of telemedicine, now they’re talking to a doctor they don’t even know, a doctor that doesn’t have their history. It just adds another level in there, rather than the insurance companies actually saying, “oh, we should really reimburse physicians that are in our network for managing patient care in these sort of alternative visit arrangements.”

I really like what you’re saying about how to be able to do that. You’re free to do that as a physician if you’re not at the mercy of what an insurance company will pay for and will not pay for. This way you get your monthly payment from the patient and then you can basically manage the care the way you want to manage the care and the way the patient would want their care managed too. I really like that aspect of it.

We talked a lot about primary care and this being a good fit for primary care. Is it really only primary care that this works for, or is there other specialties that this can do sort of equally well in.

Michael Lubin:

That’s a great question. It’s interesting, my hypothesis five or six years ago prior to starting Hint, was that this was primarily a primary care phenomenon or a peanut model for primary care. It certainly fits exceptionally well in primary care. What we’ve discovered over the last five years is that our client base today is probably about 50-60% primary care, then the balance of it is actually other specialties.

The commonality that we’re seeing is this-we’re seeing physicians out there across specialties,quite frankly in any specialty that is in the business, and/or desires, to build an enduring relationship with a patient, a membership or direct care model will be ideal for themfor all the reasons we’ve previously talked about. We have clients today that are non-intervention cardiologists, internal medicine, cardiologists, we have mental health, we have some orthopedic clients, we have GYN clients who care for women on an ongoing basis. Any provider that wants to and/or cares for patients on an enduring basis, and wants to build an enduring relationship, finds that a membership based payment model is highly advantageous, so no, it’s not just limited to primary care.

Susanne Madden:

That’s terrific because you can see how this would apply outside of primary care, but by the same token you sort of wonder if it this going to be sort of piecemeal outside of that primary care direct relationship.

Now let’s just touch on employer direct care for a minute. What I sort of see there is, are there difficulties in sort of billing employers for that care? It’s one thing to have the patient say, “here’s my credit card, just bill it monthly.” How does it work with the employer groups? Is that something that the patient has to work with their own employer for?

Michael Lubin:

The dynamic that is there is as follows. When I say self-funded, to be very clear, what I mean by that is the majority of employers are self-funded. What that means is that the employers actually are at financial risk for their healthcare costs. Self-funded does not equal they have an insurance plan from a third-party insurance company. Self-funded means that they have actually taken on the financial risk for their healthcare benefits. Most of the innovation in healthcare, quite frankly, is being driven today by self-funded employers who are now starting to increasingly manage their healthcare spend as a business. They’re looking for innovations to help them reduce costs and quality of outcomes and experiences for their patients.

Employers in this country and self-funded employers are really starting to catch on to the direct care model and the concept of contracting directly with the physicians and physician organizations to work directly with them to meet their goals. In just primary care, direct care, membership based primary care, direct primary care with employers, there’s a very powerful, very obvious value proposition there. If an employer can put a relationship in place with a direct primary care organization, or maybe it’s a collective of direct care practices, primary care practices in their community, they know that’s probably one of the most powerful things that they can put in place today to, at the very least, significantly reduce downstream cost.

The principle is very simple. There is billions and billions of dollars spent on our healthcare system today outside of primary care that doesn’t need to be outside of primary care. It’s forced outside of primary care because of how the third-party payer system has essentially driven increasingly difficult access to primary care, as well as how the payment model works. So, silly example: if my son has a fever of 104 and it’s 9:30 at night on a Friday, can I call my primary care to have a conversation and make sure he’s going to be okay? The answer is no. I might get the answering service and they’ll encourage me to schedule an appointment or try to squeeze me in on Monday, but at that point I’m in the urgent care with my son, incurring a $400-500 cost for a quick appointment to make sure he’s going to be okay. That could have been solved in a text exchange with my primary care physician whom I trust or a quick phone call.

Employers are recognizing that putting employees strategically aligned into membership based primary care thus allows the access that’s not there today in primary care. Let alone having providers that take the time and improve outcomes properly. It’s game changing. Self-funded employers are really looking to this model as becoming a part of their whole fundamental structure to be able to achieve those kinds of goals.

From an administrative and a billing standpoint, this is a big part of what our company helps with, with technology is it simplifying contracting methods with them and they have to work with a provider organization contractually. There’s a monthly or a membership amount they’re going to pay for each one of their employees, and they obviously have the system and the process in place in order to administer that and be able to go forward on that basis.

Susanne Madden:

Fantastic, and I think you’re absolutely right when it comes to employers, they’re looking for better solutions than the traditional self-funded, work through an insurance company, that’s how the claims get paid, sort of solution. They want to be able to do precisely what you’ve said, which is what makes the most sense, what is going to actually decrease our costs as opposed to just have a system for putting these claims through.

Michael Lubin:


Susanne Madden:

What we also have sort of found empirically here at The Verden Group is that every time that we do go out and knock on an employer’s door, they are more than happy to sit and have a conversation with us about what is possible, what the medical practice can offer and really want to actively work towards better solutions. The self-funded market is 62% nationally now. In certain urban areas that’s a lot higher now that employers with 50 employees and above can actually be self-funded, so we’re really seeing a lot of that take off. The employers want to be able to control their costs in a way that make sense for them, but it’s taking a while for the solutions to catch up. For most of them, they still have to do this dance with the insurance companies. This seems like a really great solution to insert in between there so that there does not have to be this continuation of just doing what the insurance companies typically and historically do.

Michael Lubin:


Susanne Madden:

If someone wanted to get started tomorrow on direct care, what would they do? Do they just go to your website, get some information that way, what is sort of the immediate next steps for a physician that wants to explore this?

Michael Lubin:

Everything that we’ve talked about, Susanne, sounds very easy in theory. The reality is there is a fair amount of education and strategy development that has to happen with each provider that we work with to understand what their unique approach is or what their unique direct care or direct primary care offering is going to be.

It usually starts, with step one, being just education. Again, it’s easy for us to have this conversation on this podcast, but inevitably we know all the questions. There’s some basic education about this model. How does it work? What are the legal and regulatory components, things that we need to be sensitive to? How does one exit a pay relationship? Based on my practice, our goals, and our market, and my current patient population, what is the right approach for us? Do we have the tolerance and interest to go whole hog and completely go pure direct care or should we transition into it. Then, how do we do that?

Phase one is typically just education. What is direct care? What does it look like out there? What are the legal dynamics I need to be aware of, the regulatory dynamics I need to be aware of, the fundamental understanding of how this model works, how it’s manifesting out there and what are some models out there that I could potentially mirror?

Step two is really developing the custom strategy for the physician organization. We touched on that a little bit today. Do we want to go all in? Do we want kind of a hybrid practice? A lot of that can be determined pretty quickly through analysis of the practice to understand what that really looks like.

Step three is really a kind of developing operational and limitations map. How is this going to affect staff? If I’m hybrid practice, how do I deal with my direct care patients versus my non-direct care patients? Thinking through, understanding and developing a plan on how it’s actually going to operationalize within my practice and my patients really is that last step. Then, you start to go.

Susanne Madden:

That’s fantastic. I think your point is well taken, this isn’t a simple thing, but it’s also not a very difficult thing either. It’s a matter of setting up your business operations. It’s a matter of figuring out where do you want to start, how do you want to do this, and then how do you want to develop it over time.

I really love that you’re able to work with practices. It’s not a cookie cutter approach it sounds like. It seems like while you have a lot of technology and a lot of systems and things in place, you are very much tailoring all of that technology and tailoring of that acumen to really understanding each practice, practice by practice, to develop and tailor a unique program for them so that they can be as successful as possible.

Michael Lubin:

That’s correct. The only thing that I’d point out is that we spend an enormous amount of time as a company just educating the provider market about what we’re talking about in this call today. What is direct care? How does it manifest? Does it make sense for my practice? What are the pros and cons of it? As part of that educational effort, we certainly have tons of education on our website. We have a very extensive blog that is kind of designed to continually and objectively answer many of the questions that providers that are just learning about this alternative payment model are interested in understanding to get the basics down.

Number two, we have a national community, kind of an online community of direct care providers, hundreds of them in a community that is accessible through our website that we designed to create a forum where providers all across the country can talk to other providers regardless of where they are in the journey. Whether they’re just starting to understand what it is, all the way to operating a large direct care, multi-position, multi-location entity where they can network and share questions and connect with each other.

Number three, we’re actually launching a mentorship program, a direct care mentorship program next month, where we can pair up physicians or physician organizations with other organizations that are a year, two, three, four, down the road and being very successful with their direct care strategy, and they can mentor specific organizations based on the model that they’re trying to achieve.

Those types of, I’ll call them educational assets and outlets, is a big part of what we do just to be able to kind of cross-pollinate physicians to be able to share best practices as they start to walk down this transformative journey

Susanne Madden:

That sounds like a fantastic resource. I have no doubt, Michael that we will be hearing more and more about Hint Health as time goes on. Thank you very much for your time today, we appreciate you sharing your insights into this. We’ll make this podcast available on

Thanks, Michael.

Michael Lubin: My pleasure, speak to you soon.