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You’ve taken an important first step into learning about an industry that is a career lifeline for many Physicians and healthcare professionals across the U.S. and abroad.
Regardless of whether or not you choose a Concierge Medicine business model, a hybrid subscription-based healthcare delivery model or a leaner Direct Primary Care (DPC) style model, please do as much research and homework as possible. The insights below will help get you started but it is best you do your homework first.
As a reader of CMT you have access here at our publication, through our books, our weekly podcast, exclusive interviews, annual conference and even our daily courses via The DocPreneur Leadership Academy to some of the most helpful industry voices and educational resources available. We are a community of Physicians, fellow small business owners, consultants and entrepreneurial Physicians that you can talk to, learn from and grow with. But that’s just the start. You’ve started your own educational journey into this industry at the right time.
We like to say that the Physicians who have blazed the trail years ahead of you have often sent back road maps for YOU to follow!
Please be sure to read this entire page (below) as it has access to additional educational articles, downloads, links and educational resources that may be applicable to help you learn more about this industry. Before You Take The Next Step To Pursue A “Membership Medicine Model” In Your Local Area, We’ve Put Together the Following categories to help you Self-Evaluate Yourself and Your Practice Before You Take The Next Steps.
“Please do not go it alone….seek advice/guidance with those of us that have experience. Make sure you understand the medical legal aspects of this that might be very specific for your state.” ~ Dr. J.B., MD, FACP, Omaha, NE | Concierge Doctor & DPC CEO
Fifteen (15) Self-Assessment Criteria:
- YEARS IN PRACTICE: Experts within the concierge medicine industry suggest that physicians (of any specialty) should have a minimum of 6 years in private medical practice. However, 10 or more years is preferable. In Direct Primary Care (DPC), opinions vary widely.
- YOUR PATIENT PANEL NUMBER & HOW MANY PATIENTS YOU TYPICALLY SEE PER DAY: According to Concierge Medicine Today, Physicians considering a successful move into a concierge medicine practice should have a patient panel of at least 1,800 -2,500 patients that they’ve seen within the last 18-24 months. Experts, consultants and Physicians who’ve transitioned prior to you now would also tell you that a minimum of 15 patients per day are seen across a 4-day period — as the current number that your practice is routinely seeing prior to making a transition into concierge medicine. Just food for thought!
- LEGAL ASPECTS to CONSIDER: According to Dr. Samir Qamar, CEO, MedLion, a Direct Primary Care practice with multiple locations across the U.S., he notes “Besides the usual business barriers, the most important factor to navigate is compliance with the law. Not structuring the practice properly can lead to drastic consequences if the model is perceived to be insurance.”“The next issue would be to consider how to either terminate or not renew third party contracts and how long each choice would take,” said Joy Twesigye, a Nurse Practitioner and Health Policy Analyst (www.hopestreetgroup.org). “It is a breach of contract under Medicare to charge Medicare beneficiaries for services covered by Medicare. The last and most important issue is regulatory. Each state has different statutes and a retainer-based/Concierge practice must be careful in contract wording to not have patients paying prior to care is provided (otherwise you may accidentally be construed as starting an insurance company). This is why most of these models use “membership fees” that are separate from charges for services rendered at time of visit. The GAO report may be accessed here: http://www.gao.gov/new.items/d05929.pdf“
- MARRIED or UNMARRIED? Many physicians and their spouses work together in the same office. Experts have also found in the practices surveyed and interviewed that changing your business model requires the agreement of both parties, whether they work together or not. If your spouse is not in agreement with the change, a transition to a concierge medical practice is not recommended until both parties are satisfied with all the particulars.
- SOCIO-ECONOMIC PROFILE of YOUR CURRENT PATIENTS: According to Concierge Medicine Today, while over 63% of current concierge medical programs cost between than $135-$265 per month, the socio-economic profile of patients in successful concierge medicine practices typically consists of middle class / affluent individuals and families. In a DPC practice however, patient demography is typically much younger (eg 20’s-40’s). A good metric to consider is the Physician’s own age. For example, if a Physician is 52 years, it’s presumed that 80% of that Doctors patients will be 10+/- years of their Doctors age.
- AGE RANGE of CURRENT PATIENTS: According to industry consultants, more than 50% of your current patient-base (last 24 months) should be 40+ in order to start, sustain and grow a successful concierge medicine practice in the future (Source: Concierge Medicine Today). Technology, Marketing and Collection Barriers.A physician and thought leader recently said “There are a number of barriers to implementing direct [or Concierge] practice. In short, they are technology barriers, and these are multiple, so one must have an integrated platform of health IT.” She adds “The second major barrier is marketing, customer discovery and validation of pricing. The Third is collections, as you will need some methodology to create streamlined money flow from patients into your bank account. The list of Health IT platforms that also enable streamlined direct practice collections is very short. The Fourth is legal, as physicians are making the transition from a variety of third party contracts. Direct collection of money from patients violates these contracts, in particular Medicare is a felony offense.”
- LOCATION. A lot of Doctors in this Concierge Medicine field practice in metropolitan and suburban areas. Some, though few, open and make a practice model like this work in a rural environment (eg. DPC). Remember, different locations represent different patient demographics and economics — which all have their own set of advantages and challenges to running and operating a subscription-based healthcare medical practice, regardless of the moniker you choose in the end.According to a GAO report, annual patient membership fees in concierge practices ranged from $60 to $15,000 a year, with about half of respondents reporting fees of $1,500 to $1,999. Further analysis from Concierge Medicine Today and our sister publication, The Direct Primary Care Journal, trade publications and interviews over the years with multiple thought leaders in this space note that fees average $1,800- $2,500 per year and … most Doctors have an average of 400 to 600 patients in their subscribing patient panel.
- Medically Underserved Areas In My State: Another consideration for some Doctors who want to operate and run a practice in a rural environment is to find and identify healthcare access and shortage areas or ‘medical underserved’ areas. While not common, this is a rather new strategy some DPC Doctors whom are considering how to best help their community and practice within a subscription-based healthcare delivery environment. You can use this HRSA tool located here HPSA Geographic, HPSA Geographic High Needs, or Population Group HPSA or an MUA/P. (Source: Health Resources & Services Administration/The Health Professional Shortage Area (HPSA) Find tool displays data on the geographic, population, and facility HPSA designations throughout the U.S. To determine National Health Service Corps (NHSC) site eligibility please contact HRSA at http://www.hrsa.gov/about/contact/bhwhelp.aspx or call 1-800-221-9393.)
- Don’t Jump Into A Lease. Many Physicians over the years would tell their colleagues learning about this space to consider reducing your real estate footprint and evaluate all of your service and space options carefully. A major investment and cost is obviously the purchase of and build out of any leased office space along with equipment. Do your homework.
- Find Your Own Unique Value To Your Community: This is the part of your educational journey and planning that will probably take the most time. Or, it should. What do you want to offer that’s something completely unique and new for your patients and local community? Do Patients need a place to sit down and take some time rest when they first enter your practice? Afterall, they’re used to customer no service in healthcare. How are you going to be different? This requires a lot of thought and personal reflection and a good bit of outside input. Just because this is a so-called concierge medicine or direct primary care operation does not mean you have to forget adding value to patients. Renewal rates at concierge medical clinics nationwide are in the 92-98% percentile because physicians are delivering on the promises and services they first talked to their patients about. What strategies, details and services are you going to implement that will help differentiate you from the rest of the competition. And yes, you have competition. Albeit from your local hospital, urgent care centers, retail healthcare clinics and even from your colleagues. So, in putting legs to this reflective aspect of your educational and planned entry into this space, make sure you understand the services you plan to offer right down to the greatest local community healthcare need(s) before making large investments into things you may or may not need. This is an emotional charged and critically important and ‘planned’ part of your journey that cannot be understated. The type of services you will be offering and eventually selling will determine the type of office and pricing you are going to need to plan for. What we’ve learned from countless interviews with Physicians over the years is that one of the first things doctors do when they start a concierge medicine or direct primary care practice is reduce the amount of leased office space they use and the amount of employees they have. So, plan and plan and plan … and don’t make a move into something you are unsure about until you’ve wrestled with your questions thoroughly and completely.
- Employee Needs: Most clinics average between 1-2 employees according to Concierge Medicine Today. Even less so in many DPC practice. So, research what type of staff and services you may need before you make big, important and emotional decisions. The wrong staff person in the wrong place will sink your practice before you even begin. Consider your staffing needs carefully.
- What’s Going To Be Your Patient Subscriber/Membership Number In 2-4 Years? Another question we hear Physicians wrestle with is the volume of subscribing patients they want in the first few years. Most concierge medicine clinics see an average of 5 to 10 patients per day, according to Concierge Medicine Today. In DPC about the same. A lot of factors are at play here. Membership will affect how many staff/employees you are going to hire inside your practice to assist you with administrative support, sales, blood pressure checks, etc. This in turn will affect how many patients you can attract each week and handle each year. If it is too big, you may lose member-patients. It’s it is too small, you may waste valuable investment dollars in human capital by over-hiring. Work out your numbers with a professional legal, accounting and business expert or consultant. Get clear on what you may and want to expect.
- Technology: Consider how you will incorporate technology, cell phone visits, secure HIPAA compliant text messaging, appointment reminders and/or local home visits. What about EMR/EHR? There are a lot of options and some specifically created for these models. We’ve put many of those resources below. What about tracking and accepting credit card statements? Between acquiring the basic operational technology for your new membership model, take the time to acquire the knowledge before the first new patient walks in the door.
- Remember, failure to plan is planning to fail in this business: The more planning you place on your practice right now, before you begin, the greater your success will be in the very near future.
- Parting Thoughts: The most important thing to remember is many physicians have already traveled down the road you are going. As one of my personal favorite authors says ‘There are only two paths in life: average and awesome. The average path is easy because all you have to do is nothing.’ We want to encourage you to get educated, get involved, get motivated and use the educational resources here to help you in your discovery of the right path for you.
Additional Educational Resources
- LIVE EVENT(S) & WORKSHOPS: The Industry’s Annual Conference, the Concierge Medicine Forum
- BOOK (Hardcover & Paperback): The Doctor’s Guide Guide to Concierge Medicine & Private Direct Medicine
- On-Demand, Online Courses & Classes: Concierge Medicine Today’s On-Demand Learning, The FOR Doctors Forum
- PODCAST: Industry Podcast & Exclusive Interviews With Physicians and Consultants
- Industry Experts, Insights & Consultant Contacts