Concierge Medicine and Direct Primary Care, Explained for Employers
Two membership-based care models get lumped under one name. Here is what actually separates them, what changed for HSAs in 2026, and where Michigan law lands on both.
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Concierge medicine bills insurance on top of the membership fee. Direct primary care does not.
Both models charge a recurring fee for closer access to a primary care physician, but they operate differently, and the two terms get used interchangeably in the market.
Direct Primary Care (DPC)
Patients pay a flat monthly, quarterly, or annual fee directly to the physician, and the practice does not bill insurance for anything the membership covers. DPC typically runs alongside a separate major medical plan for what the membership does not reach, specialists, hospital care, and prescriptions.
Concierge Medicine
Concierge practices charge a similar membership fee, but they also bill the patient’s insurance for covered visits. That dual revenue model tends to make concierge medicine considerably more expensive than DPC, often running well into four figures a year. Ask what the fee covers and what gets billed on top.
The membership buys a different shape of primary care — not just a different bill.
Same doctor, same exam room, but a smaller patient panel changes what a visit is actually like.
What a Visit Actually Looks Like
A DPC or concierge physician typically carries 300 to 600 patients, against roughly 2,500 or more in a traditional practice. That difference is what pays for a 30 to 60 minute visit instead of the usual 10 to 15, plus same-day or next-day scheduling and, at most practices, direct text, call, or email access to the physician between visits.
What the Membership Fee Bundles In
The fee typically covers extended office visits, an in-depth annual physical and standard screenings, chronic-condition management, and care coordination, someone on the medical side tracking referrals and follow-up rather than leaving it to the employee. Specialist care, imaging, hospital admissions, and emergency treatment fall outside the membership under either model, which is why it sits next to a health plan rather than replacing one.
Neither model replaces a health plan.
A DPC or concierge membership buys better access to a primary care relationship — not coverage for a hospital stay, a specialist referral, or a prescription.
The Coverage Gap
Employees on either model still need major medical coverage for anything beyond primary care. Employers who add a DPC or concierge option are layering it onto the group health plan, not substituting for it. Budget for both lines, and price them separately.
Where an Advisor Fits In
The useful question is not whether a DPC or concierge option sounds appealing, it is whether it makes sense next to the group plan already in place, and whether it is structured to avoid the compliance issues covered next.
As of January 1, 2026, a qualifying DPC membership no longer disqualifies an HSA.
The rule that blocked HSA contributions for anyone enrolled in a direct primary care arrangement has changed under new federal guidance.
The New Caps
A DPC arrangement stays HSA-compatible up to $150 a month for individual coverage or $300 a month for family coverage. A plan billed quarterly or annually just needs to average out under that monthly line. A fee above those limits falls outside the rule, and the HSA problem comes back.
What Still Has to Be True
The fee has to be the provider’s sole compensation (no separate insurance billing) from a primary care physician, internist, geriatrician, pediatrician, nurse practitioner, or PA. The arrangement can’t include anesthesia, prescription drugs beyond vaccines, or lab work outside a typical office visit.
Michigan treats a DPC or concierge agreement as a retainer, not an insurance contract.
State law gives Michigan physicians running either model room to operate without tripping insurance regulation — though it does not draw a line between the two.
MCL 500.129
A 2015 Michigan law exempts a medical retainer agreement (the category state law uses for both DPC and concierge arrangements) from being regulated as an insurance contract. That keeps the practice out of insurance regulation, but it does not change how an employer plan has to treat the fee.
What It Doesn’t Do
The exemption doesn’t make a DPC or concierge fee compliant with ERISA, HSA, or ACA rules on its own. Those are separate questions, worth checking before a plan design goes final. We check them with your CPA or counsel before launch.
Quick Answers.
Short answers to what employers ask most. This is general information, not legal or tax advice.
What is concierge medicine?
A membership model where patients pay a periodic fee for expanded access to a physician. It is separate from, and does not replace, health insurance.
What is direct primary care?
A membership arrangement for primary care services, usually with a flat monthly fee. Whether it fits with an HSA depends on current federal rules, so confirm before relying on it.
Can an employer offer these as a benefit?
Often yes, but design matters for tax and plan-compliance treatment. Review the structure with your attorney or tax advisor before launching.
Does it replace group health coverage?
No. These arrangements generally sit alongside a medical plan rather than replacing it.
Where the Rules Come From.
The laws and rules named on this page link to the statute or regulation they come from. This is general information, not legal or tax advice, and rules change, so check the current text.
ERISA (29 U.S.C. Chapter 18)
The federal law that sets reporting, disclosure and fiduciary rules for employer-sponsored benefit plans.
Affordable Care Act (Public Law 111-148)
The 2010 health reform law, with later amendments, behind employer coverage, reporting and market rules.
Health Savings Accounts (26 U.S.C. 223)
Tax rules for health savings accounts paired with qualifying high-deductible health plans.
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