'Can I Survive Without Payments From Insurers?'

Leigh Page

June 24, 2022

It took Michael Golden, MD, 5 years to decide to switch to a concierge practice, in which patients pay a monthly or annual fee for more personalized care. Golden, an internist in Beverly, Massachusetts, changed course in 2021, during the COVID-19 pandemic.

"I'm not sure why I hesitated for so long," said Golden.

Once they take the plunge into concierge practice or direct primary care (DPC) ― a related form of retainer-based practice ― many doctors are delighted with the change. But taking the plunge is a big step that they sometimes put off for years.

"The main factors for waiting are fear, uncertainty, and doubt," said Leigh "Jack" Forbush, DO, a family physician who runs a DPC practice in Hampden, Maine, and mentors doctors contemplating the switch.

According to Forbush, the critical questions doctors ask themselves are, "Will I be able to find enough paying patients?" and ― in the case of DPC practices, which cancel insurance ― "Can I live without the money I get from insurers?"

Terry Bauer, CEO of Specialdocs Consultants in Highland Park, Illinois, which helps doctors move to a concierge practice, said many of his clients put off the decision for as long as 15 years.

"Clients became progressively worn out ― or even burnt out ― by the demands of fee-for-service medicine," said Bauer. "For women, the tipping point can be when their kids ask, 'Mom, do you like your job better than me?' For men, it may be more about feeling tired and unsatisfied with their work."

But once these doctors make the switch, it's with all their heart. "A client recently told me that if he couldn't open a concierge practice, he might have to quit medicine," Bauer said. "And he's only 51."

Few Doctors Regret Switching

A 2020 survey of DPC physicians for the Society of Actuaries found that 99% reported having better or much better overall personal and professional satisfaction.

Retainer-based physicians report feeling much more relaxed after they start a concierge practice. On many workdays, Golden takes a walk on a trail in the woods behind his office. "That's something I couldn't do before," he said. "And I go to my kids' soccer games. I'm able to be present in their lives now."

Since retainer-based doctors have markedly fewer patients, they can form personal relationships with each one. When Golden switched, "I went from having a couple of thousand patients to a few hundred," he said.

"I know each patient now," said Dorothy Cohen Serna, MD, an internist in Cypress, Texas, who moved to concierge in 2017. "I don't need to look at their chart to know who they are."

Serna said patients' close relationship with her helped them get through the worst months of the pandemic. "They were scared, depressed, and concerned, and they needed a lot of individual attention," she said.

Because they see fewer patients, concierge doctors can lengthen appointment times to about 30 minutes ― or longer, if necessary. They no longer have a problem answering patients' "doorknob questions" ― wholly new concerns brought up at the end of the visit.

"The appointment might be for a sprained ankle, and then the patient might mention they haven't been sleeping well," Golden said. "I have time to talk about that without worrying that my schedule is getting backed up."

Why Patients Sign Up

Retainer-based practices are still an exotic concept in many areas, but patients are beginning to understand the value, said Shalini Kaneriya, MD, an internist in Herndon, Virginia, who switched her practice to concierge in 2018.

Several hundred patients followed her into her new practice because "people realized their care would be better if they had a concierge doctor," she said. Two years ago, partly because of growing demand, she recruited another physician as an associate.

"People want a relationship with their doctor," Serna added. "It's hard to provide that in a regular practice."

Todd Granger, MD, an internist who opened a DPC practice in Chapel Hill, North Carolina, in 2016, said new patients often mention feeling rushed through appointments with their previous doctors. Also, "it's hard to get to see a doctor around here."

Scott Bernstein, MD, an internist who runs a DPC practice in Scottsdale, Arizona, said he can arrange to have patients see specialists much faster than if they try to make appointments on their own. "I personally call specialists and then prep my patients on how to deal with the appointment," he said.

Retainer-based practices tend to have a greater number of older and chronically ill patients, but they also attract patients who need less care. "The healthier patients find value in our proactive approach to prevention and wellness," Serna said.

Some concierge physicians charge higher fees to patients who need more care, but many decide this is too complicated and charge everyone the same fee. Granger said he initially had a variable fee schedule, but when some lower-paying patients began to need more visits, he had to consider charging them extra. "Now I basically have just one fee," he said.

Not a Good Fit for Many Physicians

Bauer said a lot of physicians are interested in retainer-based practice, but many of them might not make the income they had hoped for. Specialdocs interviews physicians who inquire about the model and ultimately doesn't contract with 80% of them, Bauer said.

To be able to sign up and retain enough patients, the doctor's attitude is important. "You have to be driven by the desire to go deep with patients ― to work hard with them and deal with their issues," said Erika Bliss, MD, who runs a DPC practice in Seattle, Washington.

Bernstein said retainer-based physicians have to be interested in lifestyle issues, such as diet, exercise, and sleep. "I spend a lot of time dealing with issues like how to incorporate physical activity into daily routines," he said. "Some doctors wouldn't enjoy doing that."

Also, concierge physicians have to be available all the time. "Patients have my cell phone number," Granger said. "They could call in the middle of the night, but they usually don't."

To ensure that they get some time off, many concierge physicians have partners. Bernstein and another DPC doctor maintain separate practices but cover for each other. Each takes every other weekend off plus 6 weeks every year.

Can You Attract Enough Patients?

A key challenge is finding enough patients to sustain a concierge practice. Planning the switch involves setting a target number of patients needed for the doctor to make a decent income after paying practice expenses. For example, a doctor charging $300 a month to 250 patients would gross $900,000 per year, and then pay practice expenses from that.

Attracting the target number of patients can take months or even years. After almost 6 years, Granger said, he has around 240 patients ― well below his target number of 440.

Partly because the practice model is not well known in North Carolina, Granger set his fee very low, at $60 a month, then raised it to $75. That means his practice has been grossing just $216,000 a year. But he is not about to give up. He plans to raise his fee in July and hopes that word of mouth will add more patients.

If physicians cannot earn enough in their concierge practice, Bauer said, they may moonlight at a local hospital or work for a telemedicine company. He hasn't heard of physicians closing their concierge practice and returning to their previous practice model. "They didn't like what they were doing before," he said.

Opening Up to Lower-Income Patients

Granger's $75 monthly fee is an example of how retainer-based medicine has transformed itself from a gold-plated service for rich people to a service that middle-class and even lower-income people can afford. DPC practices like Granger's have dramatically lowered expenses by cutting out the need to bill insurance companies. Some DPC practices further reduce expenses by not having any staff and by renting out office space.

Forbush's Pine Tree State patients are mostly blue-collar workers ― electricians, plumbers, people who work in small businesses. He charges them $150 a month, which most patients who don't have health insurance can afford. He said three quarters of his patients lack health insurance, although some have back-up finances, such as health savings accounts.

Since his patients have to pay out of pocket for tests and specialists, Forbush keeps referrals in check by handling many problems himself. "Since I have more time to spend with the patient, I can often work out issues that other doctors might ask specialists to deal with," he said.

He has learned some dermatologic procedures. "There are plenty of things I can handle on my own," he said.

Granger adds that by examining patients during longer appointments, expensive diagnostic exams are not always necessary.

The Challenges for This Model

Many experts warn that retainer-based practices won't work for doctors who want to leave employment or for doctors fresh out of residency. Not having your own patients to bring into the new practice is a big minus, because this is the best way to start the new practice.

Still, there are other ways to find patients. Bauer said physicians can advertise online, make themselves known by giving speeches in the community, or contract with small employers to treat their workers.

Bauer said some of his clients were employed physicians, and he thinks they will become a bigger factor now that fewer doctors remain in private practice. The chief barrier for employed physicians is the restrictive covenant that prevents them from setting up a practice nearby. But Bauer said some employers are willing to waive restrictive covenants for retainer-based doctors.

New physicians are also adopting the concierge model. Forbush said physicians straight out of residency have set up DPC practices in Maine. They signed up patients for their new practices even before they graduated, he said.

Retainer-based medicine is still mainly limited to primary care physicians, but according to Bauer, it can also work for specialists who have long-term relationships with patients, such as cardiologists, ob-gyns, rheumatologists, neurologists, and endocrinologists.

No Going Back

Most doctors who make the switch to retainer-based practice understand that there's likely no going back. When Bernstein switched, he announced the change to patients and canceled insurance contracts. "It was make or break," he said. "I had no parachute."

Leigh Page is a freelance writer living in Raleigh, North Carolina.

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