Going Boutique

Concierge practices gain the attention of many physicians

As the United States continues to move toward a three-tiered health care system, much attention has been directed at the top tier of concierge medicine, a generally more personalized and convenient form of care provided in exchange for an annual fee.

Many physicians, increasingly disenchanted with filing claims and wresting reimbursements from public and private payors, are now considering whether to go boutique.

How It Works

In a concierge practice, patients pay an annual retainer or subscription fee of between $1,500 to $5,000 (for an individual) and $3,500 to $8,000 (for a couple), depending on the services received. Those services include:

• Immediate and 24/7 access to physicians via phone, e-mail or personal visits,
• Same- or next-day appointments, and
• An emphasis on wellness, prevention and health counseling.

Beyond that, the practice can offer whatever premium services its patients desire and are willing to pay for: spa-like amenities and décor, house calls and out-of-office care, and telephone or e-mail consultations, for example.

A caveat: The concierge fee doesn't and can't apply to clinical services for which third-party reimbursement may be sought from Medicare or private payors. The practice can either: 1) continue to perform the third-party billing function for its patients, or 2) forgo that responsibility entirely, leaving it up to patients to deal with their insurers.

A substantial investment may be necessary to get started. You'll likely want a redesigned office space, for instance, along with staff retraining for greater customer sensitivity and new EMR capabilities for enhanced follow-up.

Because your practice will want to get the word out about its concierge services, you'll also incur some marketing expenses. It can take one or two years to build up the patient volume to turn a significant profit.

Say Goodbye to Stress

Once a concierge practice becomes fully operational with satisfactory patient flow, several benefits could begin to emerge. First, if you choose to eliminate third-party coding and billing from your practice entirely, you'll remove the stress and distraction of this difficult function. You also may be able to downsize your existing coding and billing staff, potentially cutting payroll expenses. And with a smaller daily patient volume, you may need fewer front desk staff. Plus, moving to the concierge model often lets physicians focus on areas of medicine about which they're truly passionate.

Of course, there are risks to the concierge model. Once patients remit their annual fees, you'll be the only manager of how they use your services. Be aware that patients will have virtually unlimited access to you and your physicians at any time. Above all, you'll be solely accountable for the fiscal welfare of the practice.

10 Steps To A Safe Transition

If the notion of a concierge practice interests you, do your homework before you make the switch. Here are 10 steps that can help you transition to this new practice model:

1. Ask your physicians whether they're willing to adapt to a more interactive relationship with patients.
2. Decide whether the new practice format will continue to bill third-party payors or operate as a totally direct-pay operation.
3. Research patient demographics and the local market to see if there is sufficient demand with the necessary financial resources to participate.
4. Determine which noninsured services and amenities you'll offer.
5. Decide whether you'll need additional training for staff and physicians.
6. Calculate the monthly or annual fee/retainer that you'll charge patients to cover costs for the new services.
7. Set a timetable for initiation and phase-in of the new format.
8. Communicate with patients about the transition via letters, e-mails, or phone calls, or during office visits or in focus groups.
9. Ascertain how to handle existing patients who won't convert to the new practice model.
10. Create marketing materials and launch a campaign.

If the transition process seems overwhelming, ask your health care advisor for help or look into franchise opportunities.

Know What You're Getting Into

Under the right circumstances, morphing into a concierge practice could be a good decision, perhaps even the best you've ever made. Just be sure to know what you're getting into.