Membership Medicine on the Rise in Post-ACA Environment

Today’s physicians face many challenges: The costly transition to ICD-10, the complex attestation process for Meaningful Use, the adoption of e-prescribing and portal technologies, the challenges of collecting from patients with high-deductible insurance plans, the barriers of costly overhead, and more.

Enter the world of private pay or membership medicine also referred to as concierge and direct primary care.

Concierge and direct pay models continue to grow in popularity among physicians who are frustrated by today’s complicated regulatory-driven healthcare environment. 

According to the 2015 Great American Physician Survey, sponsored by Kareo, the number of physicians participating in a concierge practice stayed relatively the same at just over four percent, but the number in direct pay jumped more than two percent from 2014 to 2015. Overall interest in these models remained strong over the past two years with more than one-third of respondents saying they are considering a concierge or direct pay model.

"Concierge medicine allows me to practice a model of medicine that is currently not widespread called P4 Medicine: Personalized, Predictive, Preventive, and Participatory," says Dr. Molly Maloof, a practicing physician and Medical Advisor at Kareo. "I wanted an old-fashioned doctor patient relationship with a futuristic technological orientation of care. P4 medicine allows me to do this and concierge medicine allows me to be paid for it."

With concierge medicine, insurers may pay for certain covered services; however, patients generally pay a monthly or annual fee/retainer in exchange for certain non-covered clinical services and improved access. In direct primary care, patients pay for services out of pocket and receive more personalized care and access. Patients often get benefits such as same-day access to the physician (including the ability to reach his or her cell phone as well as engage in text messaging), unlimited office visits with no co-payment, online consultations, fast prescription refills, convenient appointment scheduling, and more.

The idea is to establish a direct financial relationship with patients, thereby removing or reducing the time- and resource-intensive process of billing insurance companies. This is particularly true for direct primary care, where practices bypass insurance companies entirely when providing comprehensive preventive care. The appeal for physicians is that they’re often able to earn more money while seeing fewer patients with whom they spend more quality time. "Concierge also allows me to add additional wellness programs to my practice offerings and my maintain independence," adds Dr. Maloof.

Although joining an Accountable Care Organization, merging one’s practice with others, or working in a hospital setting are options, these membership medicine models seem to be the best of all worlds. "I think that with declining reimbursements, primary care providers are starting to realize that they have an opportunity to either join hospital groups or maintain autonomy through adding an extra fee to their practice," explains Dr. Maloof. "Most doctors don't want to just receive cash for their practice. They want to enable patients to get some value from their insurance."

Interest appears stronger among younger providers who are looking at the long term. According to a 2014 survey conducted by the physician staffing firm Merritt Hawkins, 17 percent of physicians ages 45 or younger indicate they will transition to a direct-pay or concierge practice. The survey also supports an overall increase in the interest in these models with 13 percent of all physicians saying they plan to transition in whole or in part to this type of practice. This is a substantial increase from the 2012 study where only 7 percent were considering this as a future move.

There are definite benefits for patients, too. Say goodbye to long wait times in the office or having to wait for weeks or months to make an appointment. "Patients can expect longer visits with their doctor and usually better access to their physician when they need it," Dr. Maloof says. "Patients can purchase high deductible plans and use their HSAs to pay for the additional costs of joining a concierge practice." Using HSAs does have some restrictions though so it's important to know the rules in your state and help patients understand what is and what is not covered with an HSA. States are slowly changing their rules to support these options for patients.

The upward trend of these models will likely continue as physicians—and patients—search for alternatives in this complex and increasingly costly healthcare marketplace.