Testimony before the South Dakota Senate Committee on Health and Human Services on HB 1131 Regarding Direct Primary Care

Published March 4, 2021

Testimony before the South Dakota Senate Committee on Health and Human Services on HB 1131 Regarding Direct Primary Care
The Heartland Institute
March 2021

Chairman Steinhauer and members of the committee, thank you for giving me the opportunity to contribute to the discussion regarding HB 1131. The Heartland Institute is an independent, national, nonprofit organization whose mission is to discover, develop, and promote free-market solutions to social and economic problems. Heartland is headquartered in Illinois and focuses on providing national, state, and local elected officials with reliable and timely research and analyses on important policy issues. Heartland would like to submit the following testimony on HB1131 and how Direct Primary Care (DPC) agreements can expand access to health care.

Direct Primary Care is a new innovative process that provides accessible and lower cost care to patients. Over a quarter of a million patients in America have received care through DPC. According to the Direct Primary Care Frontier the number of DPC practices has increased from only a handful in the early 2000s to more than 900 as of 2018.

DPC cuts costs by offering an alternative to the current debacle that is the health care insurance system by providing a fee-based membership plan usually costing anywhere from $50 to $100 dollars per month. DPC is a viable alternative to the current third-party health insurance system that is extremely complex, bureaucratic, and expensive. By cutting out the middleman, DPC offers health care in an innovative way that is better for everyone. Typically, DPC clinics also have more flexible hours than traditional health care facilities, making it much easier to schedule timely appointments.

Today, South Dakota is one of the few states that does not have DPC laws on the books, even though DPC could increase health care access and lower costs. One of the most notable benefits of DPC is the time doctors are able to spend with patients, instead of filling out piles of paperwork. By removing third-party payers that come in the form of health insurance companies, DPC offers patients and practitioners a simple alternative to the complex world of health insurance reimbursement.

As I stated above, DPC is a patient-centered approach that allows patients more freedom when it comes to selecting a doctor at a convenient time for them. The cost benefits of DPC are also substantial. According to a study in the American Journal of Managed Care, DPC patients are 52 percent less likely to use services at an expensive hospital than those at a traditional private practice. This is a win-win for all South Dakota residents and health care providers.

Direct primary care removes layers of red tape that have contributed to the nation’s primary care physician shortage. According to the American Journal of Medicine, the percentage of primary care doctors decreased from 50 percent in 1961 to 33 percent in 2015. Research shows that this shortage is partially caused by new physicians entering the medical industry seeking specialized fields that pay more than general physicians. DPC, along with lowering costs, would also likely reverse the disturbing trend of primary care shortages throughout the United States.

A 2018 United Health Group report found that 13 percent of Americans live in a county with a primary care physician shortage. South Dakota’s rural populations are the most vulnerable to this problem, being five times more likely to live in a county with a primary care physician shortage than urban and suburban areas.

Americans need more health care choices, lower cost options, and flexible plans that meet their needs. DPC offers a world of possibility and best serves doctors and patients. If DPC were available in the Mount Rushmore State, South Dakotans (especially those in rural areas) would gain greater access to better quality health care at lower costs. In South Dakota, and every state, it is crucial that patient centered care is promoted. Allowing individuals to engage in DPC agreements, would allow more health care choices and offer care at lower costs.

Thank you for your time today.


For more information about The Heartland Institute’s work, please visit our websites at www.heartland.org or http:/news.heartland.org, or call Christina Herrin at 312/377-4000. You can reach Christina Herrin by email at [email protected].