By Michael Tetreault, Editor
DECEMBER 18, 2013 — Lock-in your doc now … if you can find one, say sources close to Concierge Medicine Today.
The Concierge Medicine Research Collective (The Collective), the research arm of trade publication, Concierge Medicine Today, released a statement earlier this week stating that they’ve found that the number of patients who are seeking these types of “concierge” and “direct-pay” healthcare practitioners is far greater than the actual number of “concierge” primary care and “direct-pay” family practice doctors available to serve them across the entire U.S.
“Despite what we hear in the media about the increase in concierge and private-pay physicians growing across America, there are simply not enough of these [concierge-style, direct care or membership medicine-style] physicians in the U.S. to meet the current demand,” says Joseph, an HR Manager based in Atlanta, Georgia.
Furthermore, The Collective reports that it’s extremely difficult to find a concierge or cash-only physician in rural areas such as: Idaho; North Dakota; South Dakota; Louisiana; Mississippi and others. Often times, less than half-a-dozen practitioners to serve an entire state.
What About This Doctor Shortage We Keep Hearing About … Will Concierge Medicine Really Make It Worse?
Simply answered, no.
For two reasons. The numbers don’t match-up to media touted reports and second, the patient care, patient satisfaction and decrease in hospitalization data is positive.
First, earlier this year  a national survey of physicians that Merritt Hawkins recently completed on behalf of The Physicians Foundation sheds some light on this question. The survey garnered responses from some 14,000 physicians, who revealed a wide range of information regarding their morale, practice metrics and practice plans. Physicians were asked what changes they plan to make in their practices over the next one to three years. Close to seven percent of all physicians indicated they plan to switch to a concierge practice.
Now, let’s look at the math. Most people don’t understand or are aware that 85% of the concierge and private-pay doctors offices operating today across the U.S. treat 600 “concierge” patients but that they also have an insurance side [approx. 1,900 patients on avg.] to their practice as well. Meaning, most concierge doctors accept and continue to participate in their HMO, PPO and managed care insurance contracts long after they’ve announced to a local community that they now offer a concierge medicine membership program to allow “more access to your doctor” in a practice.
Where patient abandonment discussions along with moral and ethical issues typically arise is when the doctor discontinues all insurance relationships in his/her practice and simply charges a cash fee for his/her services, thereby releasing 1,900 patients from the practice.
Understanding the insured component of a true concierge medicine practice, 2,500 patients don’t typically leave the practice because a doctor isn’t able to treat them or keep them as part of his/her panel. Conservatively estimating that most traditional [non-concierge] primary care and family physicians have a patient panel of 2,500 patients. Let’s say 6.9% of 13,575 doctors convert to concierge medicine. This equates to about 950 doctors out of 13,575 transitioning their business model inside their medical office to concierge medicine. Thereby leaving 13,050 doctors to serve a population of roughly the same amount of insured patients. Where’s the shortage? If research says only 15% of concierge doctors do not participate in insurance, that means that 15% of 950 doctors will provide cash-only services to a patient base of roughly 600 patients each. Backing into the math, that means 143 [15% of 950 doctors] doctors will treat about 600 patients each equating to a serviced patient population of 85,800 [143 x 600]. If each of the 143 doctors had 2,500 patients, that means 271,700 patients no longer have a doctor that will accept insurance. Divide this patient population number [271,700] by the amount of doctors left who are still accepting insurance and choose to not participate in a concierge medicine practice whatsoever [13,050], that means each of the 13,050 doctors offices have the opportunity to welcome about 20 new patients into their practice. (Source: Concierge Medicine Today, 2013, Michael Tetreault, Editor)
What the Merritt Hawkin data also states is … it’s interesting to note here that physician practice “owners” are more likely to embrace concierge medicine than other types of physicians, presumably because they have an entrepreneurial mindset.
It’s also important to mention here that there are a lot of conflicting numbers about the growth each year of concierge medicine and private-pay healthcare offices touted by industry sources and media outlets. To date, key physician leaders in the industry tell CMT that most crucial data compiled about this industry’s growth has come from The Merritt Hawkins Study, MDVIP and The Concierge Medicine Research Collective.
The Collective reported early in 2013 that there are currently four states that have a huge lead in the amount of active concierge or private-pay physicians in practice and consumers seeking their care. Florida, California, Pennsylvania and Virginia each have a significant number of people [most over age 50] seeking out concierge doctors and there is, fortunately, a sizeable number of concierge physicians to serve them.
The second reason concierge medicine and cash-only, private-pay healthcare practitioners will likely not create a shortage of doctors is due to the fact that patient care, patient satisfaction and the hospitalisation data is positive.
In late 2012, Concierge Medicine Today published a report from MDVIP and the peer-reviewed, American Journal of Managed Care. They stated that patients under the care of MDVIP-affiliated primary care physicians experience a dramatic decrease in hospitalizations versus comparable non-MDVIP patients, according to a study profiled in an article published in the peer-reviewed The American Journal of Managed Care (December 2012). This first-ever, published study done on hospital utilization in the MDVIP personalized healthcare model found a 79% reduction in hospital admissions for Medicare patients, and a 72% decrease for those with commercial insurance between the ages of 35-64 in MDVIP-affiliated practices. As a result, MDVIP, the premier national network of primary care physicians, delivered to the healthcare system a one-year savings in excess of $300 million.
The study also found decreased MDVIP hospital readmission rates for Medicare members when compared to the 2009 readmission rates for non-MDVIP Medicare patients, for such conditions as acute MI (heart attack), CHF (congestive heart failure) and pneumonia. MDVIP readmission rates are below 2% for these conditions compared to the national averages that range from a low of 16% to a high of 24%.
While the argument that concierge medicine will exacerbate the doctor shortage, we can now see that there is actually a proven, viable history that these types of healthcare practitioners are showing a doubting and dismissive population that primary care can be saved. Last, this arugement will keep the media and nay-sayers busy for the next couple of years but the marketplace consumer is the one who is showing all of us that we’re a long way from seeing a concierge doctor in every neighborhood but we need them and we need more of them.
1) Los Angeles, CA
2) San Fransisco, CA
3) New York, NY
4) Palm Beach, FL
5) Baltimore, MD
6) Washington, DC
7) Philadelphia, PA
8) Seattle, WA
9) Chicago, IL
10) San Diego, CA
Merritt Hawkins released similar data from their survey among physicians considering opening a concierge medical practice stating the following:
Texas: 10.6 percent
Florida: 9.1 percent
New York: 8 percent
California: 6.7 percent
North Carolina: 5.6 percent
Illinois: 5.3 percent
Washington State: 4.8 percent
Pennsylvania: 4.5 percent
Increasing the Number of Concierge Physicians Across The U.S.
There are three ways you can instantly increase the number of physicians stated above.
First, understand that the terminology being used in the concierge medicine or direct care marketplace describes many types of business models where doctors have some form of non-insurance or direct financial relationship with their patients. While all concierge medicine practices share similarities, they may vary widely in their structure, payment requirements, and form of operation. But at the end of the day, price transparency, access, affordable rates and the personal level of service provided to each patient is what they all have in common.
Second, understand that the term concierge medicine describes more specialties than just primary care, internal medicine and family medicine. Some dermatology, pediatric, cardiology and even dental practitioners are now providing a level of concierge medical care.
Third, education. Most people understand that concierge medicine has had somewhat of a “brand/identity” issue. It’s been referred to as: membership medicine; boutique medicine; retainer-based medicine; concierge health care; cash only practice; direct care; direct primary care, personalized healthcare, direct practice medicine and, most recently, contract carrying healthcare. Because at its inception, it appeared costly, elitist and controversial, many people associated a “rich man’s” stigma to it. However, the consumer, the physician community and even some legislators are realizing that this form of healthcare delivery, when free-market driven, is saving money and providing “better care,” according to MDVIP hospitalization studies conducted in the past two years (See:www.ConciergeMedicineToday.com/hosp.html).
WHEN PATIENTS of CONCIERGE MEDICAL CARE WERE ASKED TO WEIGH-IN ON WHY THEY CHOOSE CONCIERGE MEDICAL CARE, THEY SAID…
Source: Concierge Medicine Today and The Concierge Medicine Research Collective © 2012
• 34% said price was the main reason they chose concierge medical care
• 17% said Medicare acceptance/participation was the main reason they chose concierge medical care
• 6% said more time with my doctor was the main reason they chose concierge medical care
• 29% said insurance compatibility was the main reason they chose concierge medical care
• 6% said less office staff to deal with was the main reason they chose concierge medical care
• 2% said limited/no waiting was the main reason they chose concierge medical care
The takeaway here is that while price is important, it’s the additional selling features that help build your brand and make you more attractive to patients. The second takeaway here and important to note is that a lot of concierge practices focus on limited or no waiting at their office. While this is a nice feature of the practice, it was the least important aspect as to why patients choose concierge care for them and their family.
Regardless of how you describe it or the term you associate with concierge medicine, the public’s perception of these healthcare delivery models is changing for the better. Patient retention among concierge medical physicians is 7 to 9 years, two years longer than traditional, insurance based primary care practices. We expect this number to increase as time passes and more data becomes available. When a physician is free to create pricing structures that meet their local demographic demands without the intrusion from insurance and avoid providing “hamster healthcare,” which only allows doctors to spend 6 to 9 minutes with their patients, you make a happier patient, healthier family and less frustrated and fatigued doctor who is able to care for their patients more thoroughly and comprehensively.