Joel Warshaw, MD on Jun 11, 2015 9:24:15 AM
Over the years, rising costs of insurance premiums have driven many businesses to take on risk to cover health care expenditures provided to their employees. Groups are attracted to cost savings, the added flexibility in plan design, exemptions from state-mandates, and the increased control that comes with owning all claims data and reporting.
Self-insurance offers employers more flexibility than does commercial insurance while providing practical and economic advantages to curb costs, such as:
- Helping employers tailor plans to the health needs of a workforce, especially if guided by the right healthcare management firm
- Maximizing cash flow since claims are funded as they are paid, rather than functioning based on prepayment
- Generating as much as 3% in immediate savings because state taxes are eliminated on most self-insured plans
- Eliminating carrier profit margins and risk charges
With a self-funded plan, fixed costs represent 10% of health insurance benefit spending. The key is to have variable cost saving initiatives for utilization, quality of care, network discounts, and accessibility.
While many businesses adopt the self-funded approach, there is another thing to consider: a dedicated concierge physician. By encouraging and covering the costs of their employees to be enrolled with a Concierge Physician, a business will obtain a significant reduction in total healthcare expenditures while offering a more accessible and higher level of primary care medical service, especially preventative care. This will in turn result in an improved work culture and increase yearly revenue year after year.
In this post, we’ll explore the benefits of this partnership to both the business and to the physician.
How Concierge Medicine Benefits Self-Funded Employers
Businesses that provide self-funded health insurance have an opportunity to positively affect their cost, primarily due to 90% being variable. There are both soft cost and hard cost savings to this approach.
The key benefits to self-funded employers of enrolling with a concierge physician are as follows:
- Employees will have access to a Primary Care Physician who provides a higher level of personal care. They will be able to contact that physician at the office, cell phone, or email.
- Employees will be able to utilize Telemedicine and the growing advances in technology to improve patient monitoring and care. They will also have access to specialists (near and far) via telemedicine at a much-reduced price than seeing the physician in person. This will also reduce time away from work, as these visits can take place at work, eliminating travel time and waiting room experiences.
- Businesses will be able to promote these benefits to prospective employees and employees currently in their business who are considering making changes
- Increase in productivity with a reduction in illness, sick days, and doctor visits
- Decrease in health care expenditures, including immediate relief in primary care doctor fees and common tests and procedures. Decrease in Emergency Room/Urgent Care visits and hospital admissions that typically charge enormous fees.
- Maximizing cash flow since claims are funded as they are paid, rather than functioning based on prepayment.
- Generate as much as 3% in immediate savings because state taxes are eliminated on most self-insured plans.
- Eliminating carrier profit margins and risk charges.
- Anticipated savings to self-funded health costs are estimated to be between 10% to 25%, not including increase in revenue.
Many physicians practicing in today’s “hamster wheel” working environment are frustrated by regulations being imposed on them, along with all the paperwork and insurance roadblocks that take time away from their patient care, not to mention their personal/family life. Health Insurance reimbursements have also decreased to the point that physicians do not feel they are being compensated well enough for their hard work. Many are still paying off hefty medical school loans, while also paying for high malpractice premiums and rising office expenses.
The Concierge model offers a physician an option to practice medicine the way it’s supposed to be practiced. It allows for a personal relationship between a Physician and a patient, with the insurance company largely out of the way. Practices such as these are growing all around the country. However, the challenge facing an interested Physician is to enroll enough members to sustain this type of practice. Businesses that offer self-funded health insurance are able and willing to provide for these members and this allows for a synergistic relationship.
The benefits to the Concierge Physician of partnering with a self-funded employer are the following:
- Assistance in getting members to enroll in their practice by funneling employees from local businesses that offer self-funded health insurance.
- A Concierge Physician may take on just a few members or hundreds of members if the match fits, especially for those physicians starting a new concierge practice.
- Physicians are given the opportunity to practice medicine the way they want to practice medicine, without relying on insurance reimbursement. There would be 100% financial support by members of the practice.
- Maintain individual control of all aspects of their practice and not be an employee of any hospital or insurance agency.
- Promote a high level of preventative care, utilizing Telemedicine and all the technology coming down the pike in the near future.
As you can see, the relationship between concierge physicians and self-funded employers is mutually beneficial. Are you a concierge physician that has worked with self-funded employers? Share your experience in the comments section below.