Concierge Medicine: Doing It Right Can Boost Practice Income

Do you charge your patients extra fees for completing medical forms or obtaining next-day appointments? If so, you are not alone, as physicians search for ways in which to increase their income and to capture fees for non-reimbursed tasks that can drain a practice’s resources.

It has become extremely common for practices to use an “a la carte” approach, where patients opt to pay for a variety of services, such as completion of medical forms ($50 per year unlimited or $15 per form), access to physician e-mail ($10 per month), etc. As long as the practice confirms it is not charging for services already covered by a payer (whether Medicare or private), there should be no violation of the law. While this can be frustrating to patients, it has become so commonplace that it is rarely questioned. I do recommend these additional fees be waived for financial hardship which can be documented. I also discourage physicians from charging for items that might impact patient care decisions. For example, when patients are told they will be charged $25 for after-hour patient calls unless there is a true “emergency,” this can dissuade them from calling, which creates potential liability.

A more aggressive form of concierge medicine is where practices charge patients a significant annual fee (e.g. $2,500) for certain privileges which include standard a la carte items, but also add cell phone access to physicians, same day visits, prescription delivery, and wellness planning. For groups that choose to take this approach, it’s important to regularly confirm that the promoted services are not covered by private insurance and/or Medicare. For example, many practices used to include an “annual wellness visit” in their annual fee. When Medicare started covering an annual wellness visit in January 2011, these practices were forced to refund a portion of the annual fee to patients or find substitute services to offer.

The most extreme form of “concierge medicine” involves physicians who opt out completely from all insurance coverage and charge a hefty annual fee ($15,000+ annually). This approach includes the services described above, but also adds unlimited access to physicians, house calls, and other amenities. There are clearly a limited number of patients affluent enough to afford this model, but there is a market for such an approach. Patients of these practices typically still maintain insurance to cover specialty physician services and hospital-related stays.

When developing a concierge approach for your practice, I recommend the following:

1. Make sure everyone in the practice is on board. It’s difficult and can create insurance issues if only some physicians in the practice want to participate in a concierge practice. It’s not uncommon for a physician to leave a group to pursue a concierge practice.

2. Give patients plenty of notice about your new policies and do it repeatedly and in a variety of ways. Set a deadline for patients to elect whether to remain in the practice and make the change easy for patients who do leave by streamlining record transfers and recommending other local physicians.

3. Explain to patients the reason for the change and the perceived improvements that will directly impact patient care. Provide as much information as possible, such as a Q&A sheet or chart explaining the differences between the current practice and the new one. Provide a telephone number they can call to discuss it directly (other than the group’s main number!)

4. Make the payment of fees easy for patients. Provide some choices in terms of payment and don’t modify fees mid-year or more frequently than necessary.

5. If you intend to offer services to patients covered by Medicare, always make sure you have checked the legal requirements and completed any necessary paperwork to opt out of Medicare or to be able to provide Medicare covered services.

6. Review your payer contracts so you know what is/is not covered by each payer. Some categories for which physicians like to charge are sometimes challenged by payers, such as prescription refills and patient telephone conferences.

As always, there are many more considerations which should be discussed with legal counsel in order to best protect the practice. Properly structured, however, a concierge approach to medicine may work for you.

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