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FAQs: How to Become a Concierge Doctor

Posted by Nathaniel Arana

My physician clients hire me as a healthcare business consultant for a various number of reasons. There is one topic, however, that I constantly get asked: How can I practice medicine without the headaches that come from insurance companies?

The answer that I have for them? Switch your practice to a direct medical care or concierge medicine model. Become a concierge doctor.

Concierge and direct medical practices avoid the headache of billing and collecting from insurance – a time-consuming and costly endeavor for every medical practice. I have worked with countless clients who have asked for my help converting their medical practice to a concierge practice.

It’s true that the transition is a huge undertaking. But the results allow many physicians to focus on patient care and lessen their administrative burden. I’ve seen many of my physician clients who’ve made the jump improve their job satisfaction immensely.

The trick to switching to concierge medicine is to convert your practice strategically – a practice can’t just announce a concierge program and automatically expect their existing patients to join. You need to know what to expect and have a solid plan in place.

Here are some of the most common questions my clients have asked when considering becoming a concierge doctor:

  1. Will my costs go down?

    One of the biggest attractions of the concierge model is that concierge physicians don’t need to bill and collect from insurance payers. The amount of time and overhead spent on billing and collecting from insurance companies is enormous. In fact, a study found that physicians spend, on average, 15% of their total revenue on billing and collecting. This figure includes paying staff, billing in-house, using a medical billing company, et cetera.

    In sharp contrast, a concierge practice spends very little time or money on the patient collections process. Most practices keep their patients on recurring credit card charges that automatically charge the patient every month. Additionally, because you aren’t working under contractual rates, physicians are able to charge a nominal amount to patients for better access and can adjust this rate accordingly. Often, a patient pays less out of pocket than they would using insurance – particularly if they were on a high-deductible insurance plan.

    Removing the insurance payer, coupled with lower cost to collect, allows concierge physicians to earn a higher income and give patients better access to care for less money.

  1. Do I need to attract wealthy patients in order to make a decent salary?

    This is a common myth about concierge medicine that needs to be debunked. Inexpensive subscription-based models can be both affordable for a patient and offer a great salary for the physician.

    Let us assume a physician has 1,250 active patients – or about half of the national average of 2,500. Let us also assume that each patient pays a nominal per-month fee of $50 for access to this physician. This would result in $750,000 per year in revenue.

    Then, we can conservatively assume 50% in overhead (but remember, you are eliminating a large portion of your overhead by not billing and collecting from insurance). A primary care physician would have a $375,000 salary – almost twice the average salary of a family practice physician in 2013.

    These calculations show that even a moderately-priced concierge practice will provide a very healthy physician salary – with fewer patients.

  1. Can I convert my Medicare members to concierge?

    This is a tricky question. Medicare allows physicians to privately contract with patients to provide service, but the physician needs to opt-out of Medicare. They may not return to Medicare for a period of two years and cannot bill Medicare for this duration for any Medicare beneficiary.

    I would approach Medicare patients with the understanding that it pays relatively well compared to commercial plans. That certainly isn’t always the case, but many of my clients feel that the current payment rates and the ease of billing Medicare means that they continue to see Medicare patients even with a concierge practice. Many physicians also have an altruistic nature and want to continue treating aging and lower-income populations.

  1. How do my existing insurance plans play a role in implementing a concierge model? Do I need to drop these contracts?

    Converting to a concierge practice is a huge undertaking that must be done strategically. If you have the financial ability to start from scratch and/or drop all your contracts, great. Most physicians don’t have that luxury. The best approach is to convert slowly and strategically.

    The best strategy is to review the lower reimbursing 1/3 or 1/4 of your contracts. Likely, these contracts may be costing you money or barely breaking even. Complete an analysis of your hourly overhead (fixed and variable) to see what you are really earning under your contractual rates. If these contracts aren’t making a profit, consider converting these patients to concierge patients.

    Also review the contractual terms of your payer contracts. Most don’t have stipulations regarding charging patients for non-covered services on a cash basis (except for Medicare and Medicaid contracts, of course). You may be able to implement a trial or pilot concierge program without cancelling your contracts outright.

  1. How can I convince my existing patients to make the jump to concierge?

    Patients have historically considered healthcare a given right that they don’t have to directly pay for. This idea is quickly changing. Patients with high deductibles are starting to understand that more of their healthcare will need to be paid for out-of-pocket. Still, converting patients to concierge medicine takes some patient education. Physicians needs to communicate to their patients the added benefit of paying a little extra for better access, same-day appointments, shorter waiting times, etc.

    If a patient has a low deductible plan, converting to a higher-deductible plan to use in case of catastrophic illness coupled with a concierge physician may be less expensive for the patient! Don’t assume the role of insurance broker, however. Find a trusted broker whom patients can speak to.

    Don’t expect patients to automatically convert to this model, either. When I am working with a client to transition to concierge medicine, I hire people to contact the patients and explain why this is a better model for both parties. You will also need to examine your marketing strategy to promote your new practice and attract new patients in addition to converting existing patients.

  1. Is concierge medicine only for primary care?

    Concierge medicine is not just for primary care. Direct care models are possible with many specialties; particularly for patients with chronic conditions. Many specialties can offer a cash-based or subscription models to patients. A few examples include: endocrinologists for diabetic patients, urologists for erectile dysfunction, OB/GYN for pregnant women, etc. Almost every specialty can adapt to this model.

  1. What training and/or changes do I need to make with my staff when I implement a concierge practice?

    The most important change you’ll need to make is with improving your customer service. Concierge patients will expect extra services such as same-day appointments, shorter waiting times, and better physician communication and accessibility.

    A concierge patient demands a higher level of customer service from your staff. Comprehensive training of your staff is vital. Here are a few basics:

  • Have staff on standby to answer phone calls – don’t let any calls reach a ‘phone tree’ or voicemail.
  • Change the look and feel of your office. Make sure front-office staff dresses professionally.
  • Remove clutter from the office. You must convey organization.
  • Greet each patient in a genuine, friendly way.
  • Remove the glass partition typically found in medical offices.
  • Implement programs for feedback from patients.
  • Have your back-office staff follow-up with patients to see how they are feeling after an appointment or change in medication.

I also recommend that physicians utilize technology to satisfy concierge patients’ expectation of better accessibility to their physician. Allowing a patient to have a telemedicine visit when they aren’t feeling well is a huge convenience – and saves a visit to your office or an unnecessary visit to an urgent care center. Purchase a HIPAA compliant system that allows telemedicine and patient interaction – the ability for a patient to email their physician means less unnecessary visits.

The switch to concierge medicine can be challenging – but can result in a better income, better care for your patients (many times at a lower cost), and the opportunity to practice medicine without the headaches of insurance.

Have other questions about concierge medicine? Submit them in the comments section below!


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