How doctors can help low-income patients (and still make a profit)

Modern American health care is defined by its high costs, high overhead and inaccessibility -- especially for low-income patients. What if we could redesign the system to serve the poor and still have doctors make money? In an eye-opening (and surprisingly funny) talk, physician P.J. Parmar shares the story of the clinic he founded in Colorado, where he serves only resettled refugees who mostly use Medicaid, and makes the business case for a fresh take on medical service.

Colfax Avenue, here in Denver, Colorado,

was once called the longest,
wickedest street in America.

My office is there in the same place --
it's a medical desert.

There are government clinics
and hospitals nearby,

but they're not enough to handle
the poor who live in the area.

By poor, I mean those who are on Medicaid.

Not just for the homeless;
20 percent of this country is on Medicaid.

If your neighbors have a family of four
and make less than $33,000 a year,

then they can get Medicaid.

But they can't find a doctor to see them.

A study by Merritt Hawkins

found that only 20 percent
of the family doctors in Denver

take any Medicaid patients.

And of those 20 percent, some have caps,
like five Medicaid patients a month.

Others make Medicaid patients
wait months to be seen,

but will see you today,
if you have Blue Cross.

This form of classist
discrimination is legal

and is not just a problem in Denver.

Almost half the family
doctors in the country

refuse to see Medicaid patients.

Why?

Well, because Medicaid pays less
than private insurance

and because Medicaid patients
are seen as more challenging.

Some show up late for appointments,
some don't speak English

and some have trouble
following instructions.

I thought about this
while in medical school.

If I could design a practice
that caters to low-income folks

instead of avoiding them,

then I would have guaranteed customers
and very little competition.

(Laughter)

So after residency, I opened up shop,
doing underserved medicine.

Not as a nonprofit,
but as a private practice.

A small business
seeing only resettled refugees.

That was six years ago,

and since then, we've served
50,000 refugee medical visits.

(Applause)

Ninety percent of our patients
have Medicaid,

and most of the rest, we see for free.

Most doctors say you can't
make money on Medicaid,

but we're doing it just fine.

How?

Well, if this were real capitalism,
then I wouldn't tell you,

because you'd become my competition.

(Laughter)

But I call this
"bleeding-heart" capitalism.

(Laughter)

And we need more people doing this,
not less, so here's how.

We break down the walls
of our medical maze

by taking the challenges
of Medicaid patients,

turning them into opportunities,
and pocketing the difference.

The nuts and bolts
may seem simple, but they add up.

For example, we have no appointments.

We're walk-in only.

Of course, that's how it works
at the emergency room,

at urgent cares and at Taco Bell.

(Laughter)

But not usually
at family doctor's offices.

Why do we do it?

Because Nasra can't call
for an appointment.

She has a phone, but she
doesn't have phone minutes.

She can't speak English,
and she can't navigate a phone tree.

And she can't show up on time
for an appointment

because she doesn't have a car,
she takes the bus,

and she takes care of three kids
plus her disabled father.

So we have no appointments;

she shows up when she wants,

but usually waits less
than 15 minutes to be seen.

She then spends as much time
with us as she needs.

Sometimes that's 40 minutes,
usually it's less than five.

She loves this flexibility.

It's how she saw doctors in Somalia.

And I love it, because I don't pay
staff to do scheduling,

and we have a zero no-show rate
and a zero late-show rate.

(Laughter)

(Applause)

It makes business sense.

Another difference is our office layout.

Our exam rooms open
right to the waiting room,

our medical providers
room their own patients,

and our providers stay in one room
instead of alternating between rooms.

Cutting steps cuts costs
and increases customer satisfaction.

We also hand out free medicines,
right from our exam room:

over-the-counter ones
and some prescription ones, too.

If Nasra's baby is sick,

we put a bottle of children's Tylenol
or amoxicillin right in her hand.

She can take that baby straight back home
instead of stopping at the pharmacy.

I don't know about you, but I get sick
just looking at all those choices.

Nasra doesn't stand a chance in there.

We also text patients.

We're open evenings and weekends.

We do home visits.

We've jumped dead car batteries.

(Laughter)

With customer satisfaction so high,
we've never had to advertise,

yet are growing at 25 percent a year.

And we've become real good
at working with Medicaid,

since it's pretty much the only
insurance company we deal with.

Other doctor's offices
chase 10 insurance companies

just to make ends meet.

That's just draining.

A single-payer system is like monogamy:
it just works better.

(Laughter)

(Applause)

Of course, Medicaid is funded
by tax payers like you,

so you might be wondering,
"How much does this cost the system?"

Well, we're cheaper than the alternatives.

Some of our patients
might go to the emergency room,

which can cost thousands,
just for a simple cold.

Some may stay home
and let their problems get worse.

But most would try to make an appointment
at a clinic that's part of the system

called the Federally
Qualified Health Centers.

This is a nationwide network
of safety-net clinics

that receive twice as much
government funding per visit

than private doctors like me.

Not only they get more money,

but by law, there can only be
one in each area.

That means they have a monopoly
on special funding for the poor.

And like any monopoly,

there's a tendency for cost to go up
and quality to go down.

I'm not a government entity;
I'm not a nonprofit.

I'm a private practice.

I have a capitalist drive to innovate.

I have to be fast and friendly.

I have to be cost-effective
and culturally sensitive.

I have to be tall, dark and handsome.

(Laughter)

(Applause)

And if I'm not, I'm going out of business.

I can innovate faster than a nonprofit,

because I don't need a meeting
to move a stapler.

(Applause)

Really, none of our innovations
are new or unique --

we just put them together in a unique way

to help low-income folks
while making money.

And then, instead of taking
that money home,

I put it back into the refugee community
as a business expense.

This is Mango House.

My version of a medical home.

In it, we have programs
to feed and clothe the poor,

an after-school program, English classes,

churches, dentist, legal help,
mental health and the scout groups.

These programs are run
by tenant organizations

and amazing staff,

but all receive some amount of funding
form profits from my clinic.

Some call this social entrepreneurship.

I call it social-service arbitrage.

Exploiting inefficiencies in our
health care system to serve the poor.

We're serving 15,000 refugees a year

at less cost than where else
they would be going.

Of course, there's downsides
to doing this as a private business,

rather than as a nonprofit
or a government entity.

There's taxes and legal exposures.

There's changing Medicaid rates
and specialists who don't take Medicaid.

And there's bomb threats.

Notice there's no apostrophes, it's like,

"We were going to blow up
all you refugees!"

(Laughter)

"We were going to blow up
all you refugees,

but then we went
to your English class, instead."

(Laughter)

(Applause)

Now, you might be thinking,
"This guy's a bit different."

(Laughter)

Uncommon.

(Laughter)

A communal narcissist?

(Laughter)

A unicorn, maybe,

because if this was so easy,
then other doctors would be doing it.

Well, based on Medicaid rates,
you can do this in most of the country.

You can be your own boss,

help the poor and make
good money doing it.

Medical folks,

you wrote on your school
application essays

that you wanted to help
those less fortunate.

But then you had your idealism
beaten out of you in training.

Your creativity bred out of you.

It doesn't have to be that way.

You can choose underserved medicine
as a lifestyle specialty.

Or you can be a specialist

who cuts cost in order to see
low-income folks.

And for the rest of you,
who don't work in health care,

what did you write on your applications?

Most of us wanted to save the world,
to make a difference.

Maybe you've been
successful in your career

but are now looking for that meaning?

How can you get there?

I don't just mean giving
a few dollars or a few hours;

I mean how can you use your expertise
to innovate new ways of serving others.

It might be easier than you think.

The only way we're going to bridge
the underserved medicine gap

is by seeing it as a business opportunity.

The only way we're going to bridge
the inequality gap

is by recognizing our privileges
and using them to help others.

(Applause)