Cash-Only Practice: What You Need to Do to Succeed

Neil Chesanow

Disclosures

July 24, 2013

In This Article

Nonstop Marketing

It's good that concierge doctors get to keep their own hours. Few realize beforehand just how much of their spare time they will need to devote to marketing the practice to attract more patients.

In traditional medicine, few doctors are involved in practice marketing. In concierge medicine, marketing never stops. Even when a doctor is willing to put in the time and effort, it can still be an uphill battle. Marketing, after all, isn't a medical school subject, and doctors-to-be aren't tweezed out of the general population for their salesmanship skills.

"The concept of value to the people who will be paying for your services is pretty foreign to the average doctor," Albenberg reflects. "Concierge physicians need to continually reevaluate what it is that we're doing from a value proposition standpoint. This is not well understood by the typical physician, who traditionally believes that healthcare is a right, who has been indoctrinated into the third-party payer environment, and who has a lot of trouble unraveling himself from that culturally in order to create a viable product in a marketplace."

"Some doctors fail because they never really profile what they need to know to make a concierge practice successful," Greenspan says. "They have no idea of what their messaging should be to existing patients. That doesn't encourage patients to sign up. Messaging is important."

Professional Help Is Available

A practice management consultant could handle many marketing chores. Specialdocs, for example, scripts client doctors on what to tell their patients. "We train their staff," Greenspan says. "We create a 'visibility brochure,' which is a global overview of their practice, so they have a talking tool about what they will be doing so that patients have a heads-up about what's coming down the pike."

Doctors transitioning to concierge medicine are often reluctant to have this delicate conversation with patients in person -- not an auspicious sign, since personalized medicine is what is on offer.

"One of the worst things that can happen to you as a patient is that you're in the office and you spend 10 minutes with the doctor and then a week later, you get a packet of sign-up materials for a concierge practice," Greenspan says. "You're going to feel blindsided and say, 'I just saw Dr. Smith last week. Why didn't he say something to me?' That's a big no-no."

But expertise like this costs money. Because it's common for direct-pay practices to hemorrhage cash -- at least until they attract enough patients to pay the bills -- practice managers, accountants, attorneys who actually know healthcare law, marketing consultants, and the like may be considered unaffordable luxuries. As a result, and also sometimes by temperament, many concierge physicians become do-it-yourselfers, often with less than optimal results.

"We're tucked away in the back of a single house in a small town in South Carolina," Albenberg says. "You have to find us somewhere. We have a pretty decent Internet presence and a good panel of patients who spread news of our work. But short of that, we have nothing. There's no way to find us. Every effort we've put into marketing or advertising or personally spreading the word has been met with almost no response."

Albenberg has taken out ads in local newspapers and magazines. He has accepted charity cases gratis to build goodwill. He's published newsletters. He's offered free cholesterol screenings and check-ups for new mothers. He's even offered free massages. The practice is actively promoted on social networking sites, mostly to no avail.

"We continue to try to be the best medical practice in Charleston," Albenberg says. "But our other efforts have been pretty much either ignored or washed-up failures."

He is not an anomaly. There's an informal grapevine of concierge physicians, Albenberg says. His is a common predicament. "Nobody really knows how to solve this puzzle," he says. "It's a big challenge in concierge medicine: How do you actually spread the word beyond just being good at what you do? We know how to lose money doing that, but we don't really know how to gain patients."

Round-the-Clock Call

The subject of call is where a tantalizing trend collides with an unpleasant fact: If large numbers of doctors are about to "go concierge," as surveys and media pundits suggest, why is it so difficult for concierge physicians to find doctors to partner with in order to share call, which Albenberg and others say is a common problem? There should be loads of traditional doctors out there looking to put down new roots. There don't appear to be.

"There are some downsides for the physician who enters into this model without having coverage, and many don't," Hadley concedes. "A key element of the model is that you're providing almost unlimited access to your patients. So if you have no backup, as you would if you were in a standard practice, you're essentially giving up your life."

"A huge area of disappointment has been the selection of other primary care physicians with whom I might partner in this, so much so that I've stopped looking," Albenberg says. "Initially, I expected more interest in joining the practice."

It's not just that doctors to partner with in a direct-pay practice are scarce, Albenberg found, but those he did interview were, to be kind, not the cream of the crop.

"We're 24/7, and I will and have and do come in in the middle of the night to see people even if I don't know them," Albenberg says. "So 10 years into this, I'm still putting in a good amount of effort, spreading the word and goodwill, and I'm happy to do that, because my work days are so much more pleasant than in my previous life. It seems that working extra hours isn't nearly what it used to be."

When you think of switching to concierge medicine, is this what you had in mind?

A Mass Movement Gathering Steam?

Like many doctors, you may feel enormously frustrated with the healthcare situation as it exists today. The thought of unplugging yourself from the system and practicing off the grid may have a romantic appeal. If you're truly of a libertarian bent, maybe you should follow your heart.

But despite what you may read in the newspaper, view online, or overhear in the doctors' lounge of your local hospital, don't leap without looking because this is where medicine is headed, thousands of doctors are poised to do the same thing, and you don't want the train to leave the station without you. There is no evidence of this actually happening yet. But there is evidence to the contrary.

In Medscape's 2012 Compensation Report, which surveyed over 24,000 doctors in 25 specialties, 6% of family doctors, 4% of internists, and 2% of pediatricians said that they were in concierge or cash-only practices. In our 2013 Compensation Report, which surveyed over 22,000 doctors in 25 specialties, 7% of family doctors, 7% of internists, and 4% of pediatricians reported being in concierge or cash-only practices. For other specialists, the percentages were similar.

Medscape's Compensation Report is the nation's largest self-reported physician survey. It consistently shows that concierge medicine is experiencing incremental growth from one year to the next -- but only by a mean of 1%-2%. That isn't surprising. Transitioning to concierge medicine is neither easy nor cheap.

To succeed, being a good doctor isn't enough. You need a personality that patients don't just like but absolutely adore. It isn't just 24/7 cellphone access that they are paying for; it's the delighted-to-hear-from-you sound in your voice when you answer the phone at 3 AM.

If you're not a true believer -- and many doctors conclude that they're not -- you may decide that other ways to improve your practice situation are a better fit.

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