Can Concierge Medicine Improve Physician Satisfaction and Patient Care?
Overworked and underpaid. That is the plight of many of us, including some physicians. As physician reimbursement continues to decrease while regulatory requirements mount, some doctors are turning toward an alternative business model to maintain current practice income levels while ensuring quality care: Concierge medicine. Otherwise known as ‘boutique,’ ‘personalized,’ or ‘private’ medicine, this model allows physicians to limit the number of patients they see and spend more time providing in-depth care. In some cases, they bill patients directly or work with insurers to cover all or a portion of the services rendered.
Although the concept of concierge medicine has been around for a while, it seems to be gaining traction with physicians (and patients) since the Affordable Care Act (ACA) took effect.
The ACA, which mandates insurance for most patients, has resulted in an influx of new patients into the healthcare marketplace. The appeal of concierge physicians is that they’re often more available, and they provide the individualized care that patients seek. According to the Physicians Practice 2014 Great American Physician Survey, sponsored by Kareo, nearly 5% of physicians are currently in a practice and 30% are or have considered the change.
Concierge models vary and will likely continue to evolve.
Some concierge physicians choose to opt out of Medicare, Medicaid, and private insurance completely. These physicians typically charge patients directly for treatment and/or a membership that provides access to a menu of services all of which are paid for directly by the patient. Doing so eliminates costly overhead expenses related to billing.
However, other concierge physicians bill insurers for covered services while collecting fees directly from patients for an additional level of service that goes beyond what their insurer would cover. Fees are paid annually, quarterly, or monthly, and can range from as low $600 to as much as $15,000 or more per year, according to the American Academy of Private Physicians (AAPP), a non-profit organization that seeks to spur the growth of practices that provide concierge, personalized, or value-based medical care.
The AAPP estimates that there are currently more than 3,500 concierge physicians and that this number will only continue to grow. According to the physician staffing firm Merritt Hawkins, 9.6% of practice owners plan to convert to concierge practices in the next one to three years. This statistic is based on a national survey of nearly 14,000 physicians that analyzed 2012 practice patterns. According to a Merritt Hawkins analysis, certain states, such as Texas, Florida, and New York, appear to have either a proportionally higher number of entrepreneurial physicians or practice environments likely to motivate doctors to switch to concierge medicine.
“There is a lot of uncertainty in health care now, and the only certainty is there is a lot of talk about cutting physician fees,” Mark Smith, president of Merritt Hawkins told Forbes Magazine. “One way to get out of it is to go off the grid.”
Physicians like going ‘off the grid’ because they don’t need to deal with complicated insurance requirements when they accept cash payments only. For patients, concierge medicine means they’ll often pay a fraction of the cost associated with extremely high deductibles.
Primary care physicians are frequently moving into the concierge realm. Consider Dr. David J. Jones, an internist in McLean, VA. Jones told the Fairfax Times that he transitioned his practice in April so he could spend more time with patients and get to know them better. He charges patients a one-time annual membership fee paid out of pocket in return for more individualized care. Dr. Mark Niedfelt, a family physician in a Milwaukee suburb, told American Medical News that the ACA will help build his already thriving concierge practice.
The New York Times reported that direct primary care is also beneficial for employers looking to cut costs. Direct primary care physicians generally charge $50-$60 per month for adults with lower fees for children. This fee typically covers routine primary care services and certain lab tests, basic x-rays, and minor procedures. Employers combine direct primary care with high-deductible plans that cover more extensive services, such as hospitalizations and specialty care.
MDVIP, a network of private physicians who focus on personal wellness and disease prevention, reports that the interest in concierge medicine continues to grow. MDVIP affiliates with more than 700 physicians in 41 states and the District of Columbia and caters to more than 200,000 patients.
David Barrie, vice president of MDVIP, says physicians enjoy being able to spend more time with patients while also seeking a work-life balance. “You’re more focused on the clinical side of what you want to do as a physician rather than on the transactional side.” he says.
Approximately 75%-85% of an MDVIP’s income comes directly from a $1,500-$1,800 out-of-pocket fee that patients pay in exchange for a comprehensive annual wellness exam that focuses on important health and wellness areas including heart health, emotional well-being, diabetes risk, respiratory health, quality of sleep, hearing and vision, sexual health, nutritional assessment, weight management, bone health, comprehensive risk factor analysis, and face-to-face counseling.
“If patients would go to the open market, it would cost them significantly more,” says Barrie.
All other covered services are billed to the patient’s insurance. Patients also enjoy other benefits, such as 24/7 availability to physicians via email and cell phone, a “no waiting” waiting room, and more. Patient yearly renewal rate is 94%.
MDVIP has evidence that concierge medicine actually does make a difference in patient care. According to a study published in the American Journal of Managed Care, the MDVIP personalized healthcare model resulted in a 79% reduction in hospital admissions for Medicare patients and a reduction in readmission rates for certain diagnoses as compared to the national average.
“This shows that when physicians have the time and can use the tools available to them, patients get better care,” says Barrie.
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