Fuzzy math in concierge medicine

In MDs offer new services, for $3,600 yearly fee, the Boston Globe tells us about a few doctors who are switching to “concierge” practices by ejecting the majority of their patients and charging the rest an annual fee. Their objective is to improve their lifestyles and pay, and provide better service to patients along the way.

I really don’t like the concept, as I’ve written before. My primary care physician and many others like him –driven primarily by a love of what they do and dedication to their patients– work their tails off to provide excellent service to a large number of patients. Some also employ tools to improve workflow so they can achieve more with less.

I prefer things that way, and not just with physicians. I also like working with lawyers, accountants, consultants, engineers and other professionals who love to work like crazy.

I do want to point out something a little bit funky about this article: the number of patients these physicians claim to have. One doctor:

…recently mailed a letter to most of his 5,000 patients asking them to voluntarily switch to another doctor in the practice.

Another duo says they have 7500 patients between them, or 3750 each.

I think these numbers are an exaggeration, especially the first. Most primary care physicians have 1500 to 2500 patients and somehow seem to survive. To have even 3750, never mind 5000 would require never seeing most of them or making heavy use of nurse practitioners and other “physician extenders.”

If these doctors are struggling under such heavy loads, why don’t they just scale back to a typical number of patients rather than going berserk and dropping to only several hundred?

If concierge medicine becomes a serious trend, a lot of non-concierge patients are going to get squeezed. I have an idea about how to deal with that, which involves leveraging primary care resources abroad. I’ll write more on that when I have the chance.

0 thoughts on “Fuzzy math in concierge medicine

  1. AnnR

    I think having a practice like that would be dull. I’m a programmer and I get bored programming in the same thing all the time.

    It seems to me that people with an extra $3,600 to spare, ’cause you’d have to keep your major medical insurance anyway, would be those who were either really demanding and well-to-do, or really sick and well-to-do.

    So the Physician would be likely to see the same sorts of illnesses over and over.

    Maybe I’ve missed it and they love what they do so well they want to just do that, but to me it seems like a real rut where you’d be trapped by a bunch of sick people who felt they’d paid for extra care and should get it now.

    Reply
  2. Andreas

    I’m a doctor in Europe. Working in a clinic I can’t get a salary enough for me and my family so I have to give some extra paid consultations as well as to run an extra (my own) business to sell medications. Don’t know anything about America but here in Europe many of my colleagues have to do that! American doctors do the same, by the way?

    Reply
  3. Benjamin Atkinson

    You briefly mentioned physician extenders. What do you think of the physician extender model?

    I’m trying to implement this model at a small outpatient clinic. I find there are many tasks/modalities that can be performed by non-physician clinicians. I’m utilizing NPs and PAs and medical assistants to their fullest scope of practice, in order to lower costs and provide more patient-clinician time.

    A unique platform for physicians to build evaluation/treatment protocols is helping manage the oversight and quality issues.

    Your thoughts on the extender model?

    Thanks,

    Ben

    Reply
  4. Dr. Mac

    I am a concierge physician and I am concerned after reading youe blog that you need to educate yourself more thoroughly on the subject matter.
    I was formerly a midwest trained FP (still am I guess) practicing in a clinic in Iowa providing inpatient and outpatient medicine, OB, Pediatric and Er medicine to my 5455 patients. That number is correct…it was inventoried at the time I left the practice. I was seeing 45 to 55 patients daily (again actual number…not fluffed).
    As you might imagine, the actual time that I got to spend with my patients averaged around 6 minutes. I began to have serious conscience issues with the quailty of care and service that I was providing for my patients.
    Why didn’t I just stop taking patients or limit my practice size? Well as you may or may not know, physician reimbursement continues to fall such that the nationwide response of doctors has been to increase the number of patients seen daily to compensate. Some physicians are utilizing more and more PA’s and NP’s to allow even greater volumes of patient’s seen. It may surprise you to know that often physicians are reimbursed at around 40% of their charged fees. If you ran a company selling widgits, and took out a loan to go to college for 11 years to learn all about widgets and the government supported a program to only allow you to be reimbursed for 40% of your asking price for the widgits…..what would you do? You have college loans to pay back. Would you try and sell more widgits to compensate? Would you get an additional job? Would you advise yor kids to go into the widget business some day? Or would you try and change the system. An odd but effective analogy.
    Good doctors are becoming more and more unable to provide good care in the current system because they can’t keep their clinics open if they see a reasonable number of patients. I implore you to google the average salary of an FP. Compare my salary, therefore to any medical insurance company’s CEO. Not even close Bud.
    In the concierge model, we encourage our patients to modify their insurance to a high-deductible, lower-premium HSA plan. This allows the patient to use their monthly concierge retainer fee ($150 in my office) as the workhorse for their healthcare. I have had many patients that actually save money by switching their insurance as above and joining my practice. I have single moms, professional people, two income families, seniors in nursing homes (I do home visits) and everything in between. The number of well-to-do patients in my practice is a small minority.
    Every single patient that has joined my practice has commented that they wouldn’t have believed that sameday appointments, nonrushed visits, homevisits and extended time with the doctor was still possible.
    Please do some research on this subject and perhaps you’ll have a more complete understanding of its pros and cons. I would be happy to discuss them with you at length.

    Reply
  5. Ddx:dx

    I got directed to this from Kevin MD and haven’t read your whole blog so I don’t know your bent. But the above post by Dr. Mac I agree with. I was a small town family doc and as my income dropped consistently into the $80-90K range for the last 5 years I had to take a hard look at what I was going to do and wheather the business is sustainable. I was unwilling to push the numbers and stayed at 20-30 patients a day, thus the income drop.
    We HAVE a health care system. Is this the direction you want it to go? Your post of today says you don’t like concierge medicine. I too am opposed to this class structure in the Market approach, but how can I recruit docs to a prcatice with shrinking revenues? Something’s gotta give.
    You’ve all heard this before.
    This is a classic economic situation of an underpaid guild. http://poemd.blogspot.com/2007/02/free-costs.html

    So, do you want to pay good primary care docs what they are worth? Or do you think they ought to just do it for the love of it?
    I think it breeds a sense of hopelessness, cynicism when our system should be inspirational. It’s been a while since I talked with an inspired family doc.

    Reply
  6. David E. Williams of the Health business blog Post author

    Dr. Mac,

    Thanks for your comment.

    According to the Medical Group Management Association’s Physician Compensation and Production Survey (2005 edition), the mean number of ambulatory encounters for a Family Practice Physician (w/o OB) is 4287 per year with a standard deviation of 1,568. The 75th percentile was 5,088 and 90th percentile 6,167. (The # of encounters for FPs who do OB is lower.)

    If you were seeing 50 patients per day, working 48 5-day weeks per year, you were having 12,000 encounters per year, almost double the 90th percentile figure. (I do note that you were doing inpatient and outpatient, so these numbers may not be directly comparable.)

    According to the same source, mean compensation for FPs w/o OB was $170,059 with a standard deviation of $64,046. FPs in the 25th percentile made $129,662, those in the 75th made $196,645 and those in the 90th made $250,741. Those who did OB made a little more.

    Your concierge practice sounds interesting and I’d welcome the opportunity to learn more about it.

    David

    Reply
  7. Elaine

    I am a 68 yr old female whose primary physician married and moved out of the area right about the time I was going onto Medicare. When I searched at length for a replacement physician, no one would take me because Medicare was my primary insurer; they didn’t hesitate to tell me their practice was closed to any new Medicare patients. I even called the last doctor I whose patient I had been before the one that married and left. His response was that he would take no Medicare patients but I could see the Osteopath he was sharing office space with.

    I do understand why MD’s feel that way and I sympathize with them – but where am I to turn?

    There is only one geriatric/elder care practice in my large, metropolitan city of about 2 million, and I have not heard good things about them, plus each seems to be foreign born. I’ve been that route before, with bad outcomes both times.

    In a medical event, I can get on the lengthy list to see the MD at a nearby nursing home. He is only there one afternoon a week and is very rushed, but he will fit me in as his last appt. He does no follow-up, no physical, etc. – just takes my temperature & blood pressure, deals with my immediate need, gives me a prescription, and I’m gone.

    My preference would be for boutique care. I don’t need a doctor very often (perhaps three times a year) but when I do I need an appt. today or tomorrow, not next Tuesday afternoon.

    There is a need for boutique medicine, as far as I’m concerned, and I’m willing to pay the price to get it.

    Reply
  8. Elaine

    I am a 68 yr old female whose primary physician married and moved out of the area right about the time I was going onto Medicare. When I searched at length for a replacement physician, no one would take me because Medicare was my primary insurer; they didn’t hesitate to tell me their practice was closed to any new Medicare patients. I even called the last doctor whose patient I had been before the one that married and left. His response was that he would take no Medicare patients but I could see the Osteopath he was sharing office space with.

    I do understand why MD’s feel that way and I sympathize with them – but where am I to turn?

    There is only one geriatric/elder care practice in my large, metropolitan city of about 2 million, and I have not heard good things about them, plus each seems to be foreign born. I’ve been that route before, with bad outcomes both times.

    In a medical event, I can get on the lengthy list to see the MD at a nearby nursing home. He is only there one afternoon a week and is very rushed, but he will fit me in as his last appt. He does no follow-up, no physical, etc. – just takes my temperature & blood pressure, deals with my immediate need, gives me a prescription, and I’m gone.

    My preference would be for boutique care. I don’t need a doctor very often (perhaps three times a year) but when I do I need an appt. today or tomorrow, not next Tuesday afternoon.

    There is a need for boutique medicine, as far as I’m concerned, and I’m willing to pay the price to get it.

    Reply
  9. Dr. Moose

    While I do sympathize with Dr. Mac, I will say that the model of high-deductible, low-premium health care is the wave of the future and it’s a floundering one. The shift of economic risk to the patient is not a tenable solution for the long term. I would point you to the podcast of NPR’s “Fresh Air” at http://www.npr.org/templates/story/story.php?storyId=11826524

    I won’t comment any further on “concierge medicine” since the only two in my area were the absolute worst residents. Furthermore, I don’t need to be a concierge doc…I am already at their beckon call.

    Reply
  10. Not a doctor, a patient.

    It seems to me this whole idea is crap. I have healthcare background, I’m currently working for a hospital and have been researching this new “trend.” For the one doctor above, do you think that patients can really be compared to widgets? Do you think a patient really wants to know that you don’t feel you are making enough money anymore and need to compromise their care, which is exactly what you are doing. God forbid you don’t drive a fancy car anymore, I would hope to think the real reason for becoming a physician is to help your patients. Maybe I’m just a lucky person to have such an amazing doctor that manages to be there for me 24/7 w/o the extra charge…

    Reply
  11. Kate w/ModernMed

    After exhibiting at the recent SIMPD (Society for Innovative Medical Practice Design) conference in Washington D.C. we have found that many physicians are frustrated with current state of primary care. As of Jan. 1st Medicare will be cut another 10%. Where does this leave physicians that are already on roller skates with their patients?

    With not many options for PC physicians we are proud to be an educator and facilitator for the movement of “retainer” or “concierge” practice models.

    ModernMed is a forward-thinking health care service firm designed to create a better primary health care experience for patients, physicians, and businesses.

    Unlike the competition’s models, we offer two extremely flexible practice solutions for the physician. While working with the physician to design the new practice ModernMed can assist in pre-conversion, during conversion, and post-conversion processes.

    Reply
  12. Wayne M. Burr, MD

    Wayne M. Burr, MD
    239-333-DR4U(3748)
    http://www.concierge-physician.com
    9407 Cypress Lake Dr. Ste. C
    Fort Myers, FL 33919

    Concierge medicine is another choice for patients seeking medical care. The patients that are attracted to this type of practice model have needs that do not fit the current care system, are frustrated over the lack of attention that their physician can give them, or wish to exercise a more personal approach to medicine. Contrary to most beliefs, concierge medicine is attractive to all income levels, not just the super wealthy. Our practice is moderately priced and offers a substantial value for the patient’s healthcare dollar. We have a wellness approach that incorporates personal fitness trainers, a registered dietitian and massage therapy in the concierge fee to promote a healthier lifestyle. When has this been seen in the typical primary care practice?

    As for utilizing a company to help with setting up a concierge practice, it all depends on how much the physician would want to do. I set up my own practice from scatch (no conversion of existing patients) without the help of a “healthcare company” and we have been quite successful. This is not a necessity, but it does involve many hours of self directed work, and you have to do your homework in regards to your local market area. To any physician that would like to open their own concierge practice, give this some thought before hiring a company to do this for you or partnering with a franchise.

    Reply
  13. Dr Andy

    I left a busy group practice in Fort Myers, Florida in 2005 to start my house-call based concierge practice. Originally I tried to deal with insurances but since none pay for house-calls, and Medicare only reimburses minimally, I couldn’t make it viable. In our area it’s not uncommon for me to drive 30-45min between visits and I typically spend 45-60min with a patient. Hence I was drawn to the concierge business model. I am still the ONLY concierge physician in South-West Florida exclusively making house-calls in Lee and Collier counties.

    No mistake, my services are a luxury item and convenience for most of my patients. I charge $2000-$6000 a year per person, depending on age, size of family, and location.

    I know it’s not the answer to our health care crisis, but I certainly love my job again! Besides I get to see my kids more.

    2 other key points for the lay-person to understand. Just because I charge above what insurance pays, doesn’t make me rich. I actually made less than our city pays buss drivers for the past 2 years, although admitedly the future potential is significant. Also, even though most of my patients are the “rich and famous” of our area, doesn’t absolve me or any concierge phsycian of our responsibility to the community. In fact this is a responsibility of each of my patients as well.

    I continue to be an active office in the US Army Reserve, chair the Health Advisory Committee of the Lee County School District, volunteer as a Guardian ad Litem serving abused and neglected kids, teach Head Start program moms about child care, etc…

    No, concierge medicine isn’t for everyone, but it certainly has worked for me and my patients.

    Andrew Oakes-Lottridge, MD
    Personalized Health Care, Inc.
    (239)694-6246
    http://www.DrAndy.us

    Reply
  14. DrNan

    My practice is currently going through a big transition, as one of our partners is leaving the practice, and opening his own MDVIP practice, so I’ve been learning a lot about this business, and hopefully will capture the patients not electing to sign up with him. I am wondering if anyone has any experience out there with any type of hybrid practices, where you offer a higher level of service for a fee, to some patients who desire this??

    Reply
  15. Bruce

    Private Health MD

    I had a visit to Dr. Ivan Castro’s new practice, other wise known as Private Health MD.
    Me being not really a doctor person was a bit hesitant to pay for additional medical costs for a “concierge” service!
    I have noticed recently that there are many other Physicians that are turning to this boutique style medicine, so I did my research.
    I called, browsed the internet, read up on Doctor history compared all my options and I came to the conclusion that if I was going to pay for additional costs it would be with Dr. Castro…his office was very helpful in answering all my questions, even offering to have me come in and talk directly with Dr. Castro for however long I needed to, very accomidating! I weighed my options on the different prices that all these new Boutique Practices are charging and came to the conclusion that I would much rather pay for a doctor that is not only available all the time to me but will see me in the hospital or at my home if I can’t make it to his office.

    I found that other Physicians operaring these VIP practices were not as accomidating for the amount of money they wanted, some did not want to see me in the hospital..or should I say couldn’t…they did not even have hospital privelages! Some wanted me to pay a yearly fee and my copays for each office visit and some wanted to restrict the amount. Be VERY careful before signing on to any of these practices. I found that some had so many additional costs that the intial fee was minute compared to the costs I would incur during the year for copays, blood work etc.
    Dr. Castro’s office was clean cut and dry…one yearly fee, unlimited office visits, no copays and they use your insurance to bill your blood work to and any MRI’s CT’s etc. EASY!
    I barely sat in the waiting room for 3 minutes before I was greeted by Dr. Castro’s nurse Marla…she is wonderful. I was able to speak with her and the Doctor with out feeling rushed at all..I checked out and had to do nothing…my blood was drawn there (none of this going to an outside lab) and me referral was scheduled with in minutes right in front of me , it was worth my dollar, for sure. Has anyone else had this experience with Dr. Castro or any other boutique/concierge office before?

    Reply
  16. A "maybe" future doctor.

    William,

    I suggest you read Steven Knope’s book, Concierge Medicine: A New System To Get the Best Healthcare and also look into Hello Health, a company founded by Jay Parkinson.

    I myself am debating whether I want to follow through with attending medical school this fall due to the current situation of medicine and the threat of ObamaCare. If I do ultimately commit, I already know I will practice boutique medicine instead of wearing myself out and enslaving myself on the medical treadmill to pay back my 1/4 million med school debt and giving mediocre care from being stressed and overburdened by the current system.

    I have also worked in very busy clinics so I know exactly what goes on – and patients need better care, more time, and better relationships with their doc. They need to learn health is an investment just like anything else they deem worthy of having. Nobody has time to teach patients the ropes because it is not allowed by our current system- hence chronic illness prevails despite the multitude of drugs and treatments.

    Obama and government needs to get their dirty hands out of health care and let the private sector do its job, just like with everything else if America is to retain its greatness.

    I just ask you do your research and consult with people in-the-know on all sides of a situation before spreading blogs based on misinformation, personal pre-conceptions, and partial data. That is professionally irresponsible and only feeds more misinformation to the public.

    Reply
  17. Stacy Simons, RN CN CH

    I left bedside nursing for much the same reasons that I see MD’s leaving traditional private practice–the ratio of number of patients to time available is terribly skewed. And one of the issues obvious in the above debate is that many, at least the dissenters, seems to view this as a “wrong or right” choice. This Aristolean way of thinking is quite narrow as there is clearly room for all. There will continue to be traditional MD practices and there will be new and different models of practice and this is a good thing. Those who are so emotional about the possiblility of change may consider taking a deep breath and just relaxing!

    Reply

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