Insurance vs Cash Practice Pros & Cons

Quite frequently in the public Facebook NP business group, the question comes up about starting a cash practice vs an insurance-based practice.

Unfortunately, there is a lot of misinformation and myths around one or the other. Neither is perfect and neither is bad. They are different animals if you will that practices need to learn to navigate and tame. Your choice will depend on a number of factors.

The purpose of this podcast episode is to give an overview of some pros and cons and discuss items for consideration before you make a choice.

Before you make a choice for the type of practice you wish to start, or if you are making a transition in your business model, you’ll want to take this and other factors into consideration, do some research and make a plan.

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Your Turn

Do you have a preference? Which of these practice models has worked out best for you? What problems have you found with one or the other? I look forward to hearing your thoughts and questions about this episode in the comments below.

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  1. How do you separate the insurance from the cash pay membership model- or do you? I’ve heard people
    Say that you need to do under 2 different business names, etc. or are you able to do under one business when you only take cash from those with no insurance? Versus those with high deductible insurance plans.

  2. This can be a bit complicated, as there are many variables.

    If you have patients who have no insurance, you can of course accept cash payment. The issue comes into play if you have an insurance contract with Payer A and I come in to see you for an issue that would otherwise be covered by insurance (Payer A). Then it may be, according to your contract, that you cannot accept payment from me, but must bill Payer A first.

    In this case, you’d want a completely separate business that does cash only.

    I hope that makes sense.


  3. Hello Barbara!

    I currently bill for Medicare patients in my part time position.

    Never giving up on my passion to provide primary care to health conscious women ages 18-54. With a strong focus on wellness, health screening, disease prevention and counseling. I established my LLC in 2013 but never opened Primary HealthCare STL. This will be a DPC model. Will I be incompliance with Medicare due to my targeted population are working women “untapped” by the medical profession?

  4. Arneatrice, good to hear from you!

    The answer, if I’m understanding you correctly, is it depends. Not Medicare is not limited to just those over 65. Other individuals can be on for various reasons. If you are still opted-in, you’ll not be able to accept cash from those individuals for covered services. I hope that helps.

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