Large Medical Groups and Hybrid Concierge Care

For a decade, the full concierge model has been the thorn in the side of large groups and institutions. They recognized the potential benefits of membership models for individual physicians, but for a variety of reasons, couldn't make the program fit within their business model. However recently, that has been changing. More and more large groups have realized there is an opportunity in concierge care that they have been missing. That opportunity is "hybrid concierge." As more private practices with blended programs have been acquired, larger groups are awakening to the benefits of hybrid concierge practice and are moving aggressively into the sector.

Why has it taken so long?

Full-model concierge programs have become popular in the marketplace, but they can present some problems for larger groups. First, full-models empower individual providers. This empowerment can be threatening to a practice where a physician has the ability to leave and work either for themselves or for someone else. In some situations, non-competes are not enforceable by law or by practicality, so it is difficult to get around this.

Second, full-models are often in conflict with the philosophy of a large, vertically integrated system that is dependent on capturing the entire "medical business" of a patient. Their business model is based on productivity measures, with a strong focus on volume. A full-model program means fewer patients. And lower volumes mean fewer referrals. Lower volumes are in conflict with large-group productivity models.

But larger groups and institutions still need to find ways to improve economically. Most have already implemented cost-containment initiatives. One example is the broad use of physician extenders. But now revenue is under attack. No matter what a group will get in the short term from "quality measures," the bar will continue to move higher and higher to save money globally. As such, alternative sources of revenue are needed.

Any group that is able to tap into donations will tell you that this approach to funding is a blessing. Hospitals, institutions, and large not-for-profit groups all benefit by donations. However, not every group can tap into this funding source. What is left? Groups need to look toward a private source of available funding that does not interfere with the professional and business philosophy of groups.

So here comes the hybrid approach to concierge care.

In a typical medical group, there are often a variety of services offered - some more profitable than others. The more profitable services support the less profitable services, and therefore exist together harmoniously. Hybrid concierge is just like that. It doesn't take over the practice; it simply becomes one of the more profitable services the practice offers. In a hybrid program, a small portion of the physician's practice time is devoted to a group of patients who want additional services that they are willing to pay for out of pocket. Dedicating a portion of the practice day that is less than 20 percent of a physician's time and generates up to 50 percent of his revenue is an opportunity that larger groups cannot ignore. Through practice acquisitions, many larger groups were introduced to the benefits of the hybrid model. They realized that, unlike full-model concierge care, hybrid programs actually support their existing business models. They don't pose a risk - they provide a new financial opportunity. Almost all of the large groups realize there is significant value in not only keeping these programs, but expanding them into more and more sectors of their groups. The hybrid concierge model is an opportunity to tap into the most available and willing source of revenue - the patients who want a more physician-centric experience.