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MODERN HEALTHCARE: Expanding VIP care: New Concierge Doc Models focus on Employers, with some offering Specialists.

Dr. Louis Malinow had become increasingly dissatisfied with the amount of time he had with patients in his family medicine practice in Baltimore. He was rushing through as many as 30 patients a day. “I knew there was a better way to practice,” Malinow said.

Driven by these concerns, Malinow in 2008 shifted his practice from a traditional insurance-based model to one where patients pay him a flat annual fee of $1,500 to $1,800 for primary-care services not typically covered by insurance. For that fee, he offers preventive services, including comprehensive screenings and diagnostic services. He signed up with MDVIP, a Boca Raton, Fla.-based concierge practice firm that provides administrative support to primary-care doctors who work under retainer fee arrangements, in exchange for receiving a third of their retainer fees.

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“I used to worry in the old days when I would come in with a packed schedule how I was going to fit same-day visits in, stay on time, or deal with all of the phone calls,” Malinow said. “That chronic state of worry about being able to keep up with what was just a superhuman amount of work is now gone.”

While the number of mostly primary-care doctors in retainer-based arrangements remains relatively small —about 6,000 across the U.S.—it has grown by as much as 25% over the past few years, according to the American Academy of Private Physicians, which represents concierge practices.Such growth occurs as the demand for primary care is rising, health systems struggle to hire more primary-care doctors and job satisfaction among primary-care specialists is declining. In March, the Association of American Medical Colleges estimated that demand for primary-care physicians would exceed the supply of doctors by 45,000 in 2020.

The first concierge practices in the 1990s targeted high-income patients who paid thousands of dollars a year for a personal physician available any place and any time. But companies such as MDVIP, Paladina in Denver, Qliance in Seattle and MedLion in Nevada have targeted a broader consumer base by reducing the price point.

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These companies, some of which employ staff physicians, offer enhanced preventive and wellness care, same-day or next-day appointments, and longer visits to a middle-income market. Some systems, including Virginia Mason Medical Center, Seattle; Scripps Health, San Diego; and UC San Diego Health have launched their own concierge practices.

In addition, some direct primary-care providers are partnering with employers to improve workforce wellness and reduce healthcare costs. For instance, Paladina Health contracts with employers to offer primary-care services to workers. This model “allows patients at all income levels to have access to such services,” said Jami Doucette, Paladina’s leader for long-term growth.

Other providers, such as Beverly Hills, Calif.-based Lux Health Network, are going beyond primary care, offering access to a broader range of specialists.

cmt concierge physician salary compensation 2015Fees for retainer-based care run from $80 a month to $25,000 a year, with most doctors charging about $100 a month, experts say. A typical concierge physician has about 600 patients compared with the 2,500 or so patients of a typical primary-care physician. Malinow said his typical workday consists of about eight appointments, including two to three longer visits that can run as long as two hours.

But some experts warn that retainer-based practices threaten to exacerbate the primary-care physician squeeze, given that concierge doctors see far fewer patients. Carolyn Engelhard, associate director of the Center for Health Policy at the University of Virginia School of Medicine, said retainer-based medicine creates a two-tiered system of healthcare, where higher-income Americans have better access to care. “What direct primary care does is reduce patient panels a lot,” she said. “Where are those other patients going to go?”

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Some physicians say concierge medicine has reduced the administrative burdens and costs involved in dealing with insurance, increased their ability to serve their patients, and improved their incomes and quality of professional life. Retainer-based physicians often are able to maintain and in some cases boost their income compared with the traditional practice model, said Michael Tetreault, Editor-in-Chief of Concierge Medicine Today, an industry trade publication.

Dr. Lewis Weiner, a Providence, R.I.-based MDVIP-affiliated physician, visits with a patient.PHOTO: Dr. Lewis Weiner, a Providence, R.I.-based MDVIP-affiliated physician, visits with a patient.

There are several types of retainer-based practice, including full concierge medicine for more affluent patients, direct primary care and a hybrid model where doctors offer traditional services and a concierge option for some patients. In some models, the retainer fee covers most or all primary-care services and doctors do not bill insurance. In other models, the fee covers extras such as an annual physical while the patient and insurer continue to pay for other services.

Services generally include enhanced access to physicians, sometimes even 24/7; in-depth, executive-style physical exams; same-day or next-day appointments; ready physician access via e-mail; and longer visits. Some of these practices accept private insurance and Medicare, while others do not.

“Today, there are more doctors and more consumers interested and willing to do this,” said Bret Jorgensen, chairman and CEO of MDVIP. “It’s still a small percentage of the market but it’s growing, and it’s an important alternative for a lot of consumers.”

“The consumer audience for private medicine is beginning to expand fairly dramatically where once this was sort of a service category that was most appealing to wealthier seniors,” said Tom Blue, chief strategy officer for the American Academy of Private Physicians. “Legislatively, the climate for private medicine is only getting more friendly,” he added.

In August, Sen. Bill Cassidy (R-La.), a physician, introduced legislation to allow people to pay fees for direct primary-care services through tax-advantaged health savings accounts. His bill would also allow Medicare to pay retainer-based practices a flat fee for primary-care services and let Medicare Advantage plans contract with direct primary-care practices.

But Engelhard questions whether services such as executive-style physical exams with a battery of testing really improve quality of care, and whether concierge-style practice reduces care coordination. “Sure, it would be wonderful to know you could get in and see your physician the same day you wake up and have the flu,” Engelhard said. “But on the other hand, you’re out of a coordinated network. You can’t rely on that physician to have admitting privileges in the hospital, or to even talk to people in the hospital on your behalf.”

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There also are legal and regulatory challenges for concierge physicians. They face limits on the services they can provide if they want to receive private insurance or Medicare payments. More than 60% of concierge providers receive such insurance payments. Federal rules bar doctors from charging Medicare beneficiaries for the same services that are covered by the program.

In some states, there are questions about whether direct primary-care practices function as health insurers and should be regulated as insurers. But Blue said more state regulators have decided not to define direct primary-care arrangements as insurance products.

Another issue is that direct primary-care plans are not deemed qualified health plans under the Affordable Care Act provision requiring nearly all Americans to obtain comprehensive insurance. The law allows direct primary-care services to be offered through the ACA insurance exchanges only in conjunction with qualified high-deductible health plans.

But Engelhard said buying both direct primary-care services and a high-deductible plan can be expensive. That’s why Cassidy is pushing to let people pay for their primary-care plan through an HSA. Engelhard said insurers would prefer to see limits on retainer-based medicine because they see such arrangements as competition for customers.

Still, some retainer-based practices want to contract with insurers, arguing their focus on wellness and prevention helps patients better manage their health conditions, reducing emergency room visits and hospitalizations. MDVIP’s Jorgensen said consumers benefit in terms of health while insurers benefit in terms of cost savings.

When Malinow transitioned into his concierge practice, Baltimore attorney Howard Kurman, now 64, was one of his patients who agreed to pay the annual membership fee of $1,500 to keep seeing him. “If you have a 9 a.m. appointment, you’re going to be seen at 9 a.m. You’re not in a waiting room for an hour or two,” Kurman said. “It’s a very efficient practice, it’s very responsive, and from a patient’s standpoint, it’s very user-friendly.”

Supporters say retainer-based models allow practitioners to better engage with patients and counsel them on lifestyle issues such as obesity and smoking. Having those often-lengthy talks was difficult under the traditional fee-for-service model, which required them to see as many patients as possible.

Paladina was started in 2012 by DaVita HealthCare Partners after DaVita acquired direct primary-care practice ModernMed, which provided on-site and near-site clinics for employers. Paladina claims a patient-satisfaction rate of more than 90%, with 77% of patients surveyed reporting they felt their health had improved after seeing a direct primary-care physician.

In August, Lux Health Network launched the first multispecialty concierge physician practice, which offers care coordination through its network of 40 physicians. For an annual fee of $7,500, Lux patients can get same-day appointments to see a primary-care physician, who can refer them to a specialist in the network for a next-day appointment. “A lot of patients are signing up for concierge medicine just for primary care,” said Lux CEO Akiva Greenfield. “We thought there would be a market for the same level of VIP care across every specialty.”

The potential impact of retainer-based medicine on the broader U.S. healthcare system depends on how much the sector grows. Despite increased interest, Wayne Lipton, managing partner and founder of Concierge Choice Physicians, a New York-based concierge firm, said the percentage of doctors entering concierge-style practice remains relatively small. But it’s provided competition to the traditional practice model rather than disrupting the system, he said.

“I’m a realist,” said Lipton, whose company offers a hybrid model in which its doctors see both concierge and non-concierge patients. “If we took all of the best doctors and turned them into full concierge doctors, it would create an economic barrier to (excellent care). But in fact that is just not the case.”

Written By Steven Ross Johnson

Steven Ross Johnson joined Modern Healthcare’s reporting staff in 2013 and covers the pharmaceutical and medical device industries and physician issues. Johnson has been a freelance reporter for the Chicago Tribune, Progress Illinois, the Chicago Reporter and the Times of Northwest Indiana and a government affairs reporter for the Courier-News in Elgin, Ill. He received a bachelor’s degree in communications from Columbia College in Chicago and a master’s degree in journalism from the Medill School of Journalism at Northwestern University.

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