Connecticut Health Law

Our recent article in Physicians Practice outlines 10 Dos and Don’ts for physicians and other practitioners to take into account when deciding whether to establish a direct primary care (DPC) practice. This blog focuses on particular regulatory matters that practitioners interested in converting to a DPC model should consider in Connecticut and adjoining states.

In a DPC practice, the provider does not participate in Medicare, Medicaid, or any private insurance plans. Instead, the provider charges a fee (often monthly or yearly), and patients receive a suite of services for no charge or a minimal charge. DPC practices often offer services not typically available in a traditional medical practice, such as same or next-day appointments; home and/or hospital visits; and direct access to the provider outside of normal office hours. DPC practitioners avoid the administrative time related to billing and collecting from third party payors and typically maintain a smaller patient panel, which gives them an opportunity to provide more personalized care to their patients.

One of the first orders of business for providers contemplating a shift to DPC should be to consult with an attorney to ensure that they do not run afoul of state law. In particular, since patients pay a fixed fee in advance for medical services, some states have warned that the DPC model might constitute the practice of insurance, which would require the provider to obtain an insurance license and comply with state insurance laws. Other states have explicitly carved out the DPC model from their insurance laws, while still other states have no statutes on their books that directly govern DPC practices.

Here's how Connecticut and neighboring states have addressed this issue:

• In Connecticut, there are no statutes addressing DPC practices directly, but the definition of “insurance” in Connecticut General Statutes §38a-1 is broad, and so it is unclear whether it could be interpreted to apply to the DPC model. At present, we have not seen any attempt on the part of the Connecticut Insurance Department to regulate DPC practices in this way, nor have any bills been introduced in the current legislative session that directly relate to DPC practices despite their growing prevalence.
• There are no statutes in Massachusetts that explicitly govern DPC practices, but bills have been introduced in the Massachusetts legislature over the past few years that would enhance the ability of a patient to obtain care from a DPC practice. Notable bills in the current legislative session include: (1) H.2458, which would establish a commission to study the benefits of DPC practices and how the services provided by DPC practices could be promoted to ease the burden on the state's health care system and promote access to care; (2) H.1120, which would define “direct primary care provider” and set forth required provisions to be included in a direct primary care membership agreement between the DPC practice and the patient; and (3) H.1343 which would, among other things, prohibit health insurance carriers from denying payment for certain specialist services simply because the referring provider was not in-network with the carrier.
• New Jersey has no statutes regulating DPC practices, and no bills addressing DPC practices are currently pending in the New Jersey legislature. Notably, certain state and local government employees have the opportunity to join a DPC doctor's office as part of their health benefits, so New Jersey appears to be supportive of the DPC model.
• There are no statutes in New York that govern DPC practices, and the New York State legislature is not currently considering any bills that would affect the DPC model for 2025. However, the New York Office of the General Counsel (NYOGC) has issued opinions finding some DPC practices in violation of the state’s insurance laws.  In one such opinion, a medical practice offered a significant discount on health care services for “fortuitous” events (such as sick visits or the need for a tetanus shot) to patients who paid a membership fee. The NYOGC found that it was unlikely that the discounted fee covered the cost of the physician’s services; for this reason, the practice bore the risk of incurring a loss and was deemed an insurer. To avoid this result, the NYOGC advises DPC practices that discounted fees for fortuitous health care services must cover the practitioner’s cost of rendering the services, including reasonable overhead.
• Rhode Island has enacted no statutes regulating DPC practices, and there are no pending bills in the legislature addressing the DPC model at the time of publication. As of now, there also appear to be no efforts by the Rhode Island Insurance Division to treat DPC practices as insurance.

The above summaries are not comprehensive statements of the law in this developing area. Please contact one of our health care attorneys if you would like more in-depth and state-specific guidance about the DPC model or if you have other questions regarding your health care practice.