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Academic Retainer Medicine: An Innovative Business Model for Cross-Subsidizing Primary Care | AAMC

By the Association of American Medical Colleges

Lucier, David J.; Frisch, Nicholas B.; Cohen, Brian J. MD, SM; Wagner, Michael MD; Salem, Deeb MD; Fairchild, David G. MD, MPH

doi: 10.1097/ACM.0b013e3181dbe19e

Retainer-medicine primary care practices, commonly referred to as “luxury” or “concierge” practices, provide enhanced services to patients beyond those available in traditional practices for a yearly retainer fee. Adoption of retainer practices has been largely absent in academic health centers (AHCs). Reasons for this trend stem primarily from ethical concerns, such as the potential for patient abandonment when physicians downsize from larger, traditional practices to smaller, retainer-medicine practices.


EXAMPLES: Hospital Institutions Offering Concierge Medicine plus, Exec. Health Membership Programs [REVISED 2018]

In 2004, the Department of Medicine at Tufts Medical Center developed an academic retainer-medicine primary care practice within the Division of General Medicine that not only generates financial support for the division but also incorporates a clinical and business model that is aligned with the mission and ethics of an academic institution.


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In contrast to private retainer-medicine practices, this unique business model addresses several of the ethical issues associated with traditional retainer practices—it does not restrict net access to care and it neutralizes concerns about patient abandonment. Addressing the growing primary care shortage, the model also presents the opportunity for a retainer practice to cross-subsidize the expansion of general medicine in an academic medical setting. The authors elucidate the benefits, as well as the inherent challenges, of embedding an academic retainer-medicine practice within an AHC.

Market forces have spurred the development of retainer primary care practices, sometimes called “luxury” or “concierge” practices.1 Patients pay a yearly retainer fee to their primary care physician (PCP), and, in return, the PCP provides nonmedical services not normally extended to other patients. Longer visits, enhanced access to care, and PCP accompaniment to specialist visits exemplify some of the typical services offered to patients in such practices.2 To accommodate these changes in practice, concierge physicians reduce the size of their patient panels to approximately one-fourth the size of a conventional PCP’s panel. Provider dissatisfaction about work conditions, such as having a burdensome amount of administrative paperwork, as well as a desire to find an antidote to the “hamster on a treadmill” character of primary care, have driven physician interest in retainer-medicine practices.3–5

Since its inception, patients, payers, and physicians alike have voiced concerns about the ethical foundation of retainer medicine.6–8 These concerns generally fit within one of the three themes outlined by Brennan1: (1) patients who cannot afford or do not wish to pay the retainer fee when their physician transitions to a retainer practice are forced to find a new PCP, (2) the smaller panel size of retainer-medicine physicians effectively reduces access to health care, and (3) it undermines the cross-subsidization “system” where patients with good insurance help defray the cost of care to the uninsured. Further, it is generally held that the profit motive in retainer medicine is a significant enticement for physicians, as those in private retainer-medicine practices can expect to substantially increase their gross revenue.9,10 Not surprising, given these ethical concerns, academic medical institutions have eschewed retainer medicine.


ADVISORY BOARD | Why not-for-profit hospitals, from Mayo Clinic to Duke Health, are hopping on the concierge bandwagon

With retainer-medicine practices generally considered “off limits” because of ethical concerns, making primary care financially viable at academic health centers (AHCs) remains a challenge. Although hospital-run primary care practices create indirect positive downstream revenue for the hospital through referrals and ancillary services, many of these primary care practices generate direct negative net margins on each patient provided care. Consequently, many academic primary care practices require financial support. Under this current paradigm, hospital-run primary care practices can only be expanded to the extent that the hospital or the physician practice plan is willing to invest financially. This business model inherently limits the expansion of primary care.

Like most AHCs, Tufts Medical Center emphasizes three main mission objectives: (1) excellence in clinical care, (2) research, and (3) the teaching of residents and medical students. The Division of General Medicine maintains these tenets and further incorporates the following operating objectives: (1) to provide high-value care, (2) to maintain economic viability, and (3) to have a long-term primary care delivery model that is sustainable. With these objectives in mind, a retainer-medicine primary care practice within Tufts Medical Center was created as an entity that could provide additional revenue to help support the mission of the primary care division. The practice was also developed to create an environment within which relationships with potential hospital donors could be cultivated by providing them with a unique atmosphere that conveniently addresses medical needs.

With the goal of developing an innovative retainer-medicine practice that addressed the ethical concerns seemingly inherent in retainer medicine but which retained its profit potential, Tufts Medical Center opened its Academic Retainer Practice (ARP) in 2004 within the Division of General Medicine. This unique business model was developed to respond to several of the ethical issues associated with traditional retainer practices: (1) it does not restrict net access to care, (2) it ensures that participating physicians maintain a socioeconomically diverse practice, and (3) it neutralizes concerns about patient abandonment. To the authors’ knowledge, the ARP at Tufts Medical Center is the first and only general internal medicine retainer practice embedded within the structure of an AHC.



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