By Krista Teske, Physician Practice Roundtable
July 18, 2013 – A little-known clause in the Affordable Care Act allows retainer practices to participate in health insurance exchanges if paired with a wraparound insurance policy and many, including Nobel-prize winning microeconomist Muhammad Yunus, are poised to expand this model.
But how common are retainer-based physician practices today? In the past few years, numerous articles have suggested a surge of retainer-based practices across the nation.
According to The American Academy of Private Physicians, there were 2,400 physicians practicing some form of retainer-based medicine nationwide in 2010 and 3,500 in 2011. Today, the Concierge Medicine Research Collective estimates this number to be over 5,000—an increase of nearly 100% in just 3 years.
Additionally, in a 2012 Merritt Hawkins Survey, roughly 10% of practice owners said that they would embrace a retainer model in the next three years. In fact, Concierge Medicine Today recently released a new mobile app to help price-savvy health consumers locate retainer-based practices in any U.S. city.
How it works
Retainer-based care is known under many names, including concierge medicine, direct primary care, and boutique medicine. However, there are essentially two retainer-based payment models. Some physicians charge a retainer fee for services not covered by the patient’s insurance plan, while continuing to bill their insurance company for covered services. Others charge a retainer fee that covers all services provided, eliminating insurance company billing altogether.
Breaking down false assumptions about retainer-based medicine
Retainer-based models cater only to upper class consumers
Many associate retainer-based medicine with higher-end “concierge” medicine models, known for charging high fees for lengthy appointments with top-tier physicians. In reality, many retainer-based practices offer affordable payment options that attract non-wealthy populations (including the uninsured and underinsured) with plans as low as $15/month.
Retainer-based models are only for primary care physicians
As the model has gained traction among primary care physicians, specialists too see the added benefits of retainer-based care. Some specialists can also develop hybrid retainer models that accommodate repeat chronic care patients (endocrinologists managing diabetes patients, for example).
Three key reasons why physicians choose retainer-based models
Opportunity to tap into the new health consumer market
Today’s patients seek on-demand care access and price transparency. Retainer-based models cater to this consumer constituency by providing same-day appointments, longer appointment times, and consistent monthly rates comparable to gym memberships.
Overhead cost reduction
As reported recently in Health Affairs, the average physician in the United States spends $82,975 per year interacting with insurance companies about claims, coverage, and billing concerns. Practices that have replaced insurance billing with retainer fees even for a portion of their patient panels benefit from reduced overhead costs.
Ability to strike a healthy work-life balance
As physician shortages (especially in primary care) persist, and more patients receive health insurance coverage through the exchange market, patient panels will continue to grow, further straining physician schedules. Retainer-based models typically restrict panel volumes to 300-600 patients, cutting the total hours physicians spend at work.