"A few weeks back, I pointed out a living, breathing example of a successful cash only pediatric business. I've also added a few posts about concierge pricing and what our customers are doing.Meanwhile, over on her blog, Susanne Madden adds some insightful commentary on the subject, including one point in there which is quite subtle, but incredibly important:
In the case of insurers, some don't want physicians to charge these fees to their members citing contract provisions excluding them from doing so, while others do not have a problem with it.
Sure enough, some of the major payers (Aetna, Cigna, and others, I believe) are "allowing" their patients to work with "concierge" practices. This is the hole in the dam we've been waiting for, imo. You now no longer immediately alienate some of your patients when you begin to provide a concierge solution. You can develop your solution and then grow it. No need for a radical change.
Susanne has gone so far as to find another living, breathing example of a concierge group. Check out this national program: MDVIP. To become an MDVIP provider you must, among other things, limit yourself to 600 patients (an interesting start). What I like about their sales pitch is that "prevention and wellness" appear so close to the top of benefits of working with them. I think it ought to be #1, personally, but it's a good start!Two additional pieces to read:
Every day, I make a little “to do” list next to my mouse pad andabout 1/3 of the time, the word “blog” ends up without a line throughit. Yesterday was one of those days. I have ten minutes to make sureit gets a line.
Dr. Stoller has been particularly helpful lately as she passes me these two unrelated gems.
This is the second year we have charged such a fee, though it is voluntary and much smaller than the ones you cited. We call it our “Added Benefits Plan.” We charge $40 per child/ max $100 per family. We give all new patients/newborns a free one-year membership. Believe me - our patients checked with their insurance companies immediately. Because it is voluntary we had no problem with it. I am not sure that would be the case if we made it mandatory. I have found that many patients, especially with older children have chosen not to join because they are not in that often and don’t feel they benefit as much from our services. If they need a single form we charge $20. We have tried to explain to patients that the fee is for all the extras we do - taking our own call, having nights and weekends, in-house lab, clean, happy surroundings - but for the most part, they just weigh whether or not they need the forms.
There is a practice in Texas that has mandatory charges similar to the link you provided. http://www.pediatricassociates.netI have spoken with them and they are very happy with their choice and have not lost many patients.
A handful of patients left over it. We had patients tell us that at $100 for the family per year,that would be $1000 over 10 years. Some came back quickly. We continue to grow well with new families. We checked with our favorite OB referrals to make sure they had no objection, which they did not. We would be happy to share our introductory letter with you. Be prepared for very strong opinions. Many patients supported us, but many (some doctors’ wives and children) were very angry and not afraid to say so very loudly in our waiting room. Your staff needs to be very well trained and prepared. They will take the brunt of it. But the doctors have to support them.
The first year is the worst because patients will test you. The second year is easier.
I added boldface for emphasis. See, you can train your patients.Here are two practices who did it (and do the math for yourpractices…$100 per family? That’s a lot of money.).
The Fall SOAPM newsletter has been out for a bit and yours truly did a piece on concierge medicine. I have a fun follow-up to it, too! Make sure you join SOAPM - it’s only $30/year - to get the rest of the newsletter…
The State of Pediatric Concierge Medicine
The practice of “concierge medicine” (boutique medicine, direct care, whatever you want to call it) has grown substantially in the last few years. Unsupportable patient volume, managed care payment and administrative challenges, and clinical dissatisfaction have led to literally thousands of physicians getting out of the insurance-dependency loop and into smaller, slower practices. With physician satisfaction at an all-time low, especially in primary care, is it any wonder that pediatricians are looking for better ways to work with their patients? Perhaps the most telling sign of the arrival of concierge medicine is that there are more than a dozen national organizations that exist solely to help doctors through the process of changing practice models (www.choice.md, www.modernmed.com, www.mdvip.com, etc).
Section on Administration and Practice Management (SOAPM) members may not even be aware of how the concept has infiltrated the system. The SOAPM list itself has documented accounts of practices who charge annual “administration fees” to pay for traditionally non-covered services, like school form generation or special phone services. In addition, there are already a handful of successful pediatric concierge practices and they are not limited to affluent suburbs and communities— they exist in places like Pittsburgh and Maine. (See one AAP member’s own account at http://practice.aap.org/content.aspx?aid=2346.)
There are some aspects of the concierge model that seem particularly well-suited to pediatrics. A concierge practice, by definition, provides a medical home with a mutual patient-physician focus on preventive care. However, the difference between the demand for pediatric services in the first years of life and the later years is so large that it makes it difficult to price easily. States without universal coverage also add a significant immunization expense for which someone has to pay. Most of all, though, pediatricians would rather deal with the Devil-They-Know (insurance reimbursement) than give it all up to run a practice the way they envisioned on med school graduation day.
What can we do, then, to capture some of the satisfaction that both patients and physicians in the concierge market experience? There are baby steps, appropriately, that may be the answer. More than one of the professional groups working with concierge practices outlines hybrid- or mixed-models that make the transition to or, more importantly, addition of concierge services quite possible. For the purpose of this discussion, there are 2 types of concierge medicine: fees for non-covered services and fees for care. Let’s discuss the fees for non-covered services first as we consider some of the baby steps.
Fees for Non-Covered Services
As I pointed out earlier, SOAPM list members are already familiar with the first model, as a number of you are already doing it. (Did you realize that you are a concierge practice?!) For those of you who do not yet package services like form completion or medication refills—and that number grows smaller daily—why not turn what is commonly treated as an unwelcome addition to your overhead as a revenue center? Imagine the never-ending chore of completing school forms, when your office typically does the least possible work, becoming a true clinical opportunity and chance to market your practice. Your competition, remember, is not simply the other pediatricians in town; it is also FedEx, Netflix, Apple, Nordstrom, and any other service-oriented organization.
What kinds of services are being picked up by these nascent concierge practices? On SOAPM, and online, you can find a relatively common list:
- Medication Refills
- Telephone Advice (before or after Office Hours)
- Insurance Claim Management
- Travel Research
- Forms Galore
- Pre-authorization/Medication Forms
- School Forms
- Home Health/Therapy Forms
- School Excuses
- Sports Forms Disorder Questionnaire Forms
There are other, more substantial non-covered services, from house calls to personalized clinical plans, that are already in use by practices around the country. Note that even incredibly modest fees, such as $25 a year per family, add up to enormous potential gains for the practice, which can be used to develop the quality of the service.
The SOAPM population, in particular, should work to provide policies, practical examples, and standards for these types of services. Even without official endorsement, an understanding among leading pediatric practices about the proper ways to serve the patients is immensely effective.
There are 2 challenges to offering non-covered services to patients. First, you must stay abreast of the status of the services—if a payer changes policies and suddenly “covers” one of your procedures (whether it pays for it or not), you have a problem. Second, patients are used to receiving many of these services for free at present. Not only does your communication with them need to convince them of your position, you need to package the services in such a way that the patients feel like they are getting something new and improved. There has been considerable documentation and discussion online about the lessons learned from developing these services that you should consult.
Fees for Care
The “Fee for Care” concierge model is what most people envision when discussing the subject. We all understand the concept, but take a few minutes to do the math that insurance companies don’t want you to do: Use your practice management system to determine your total revenue last year. Divide that figure by your total number of active patients. That is how much, on average, your patients paid you last year. Divide that by 12, and the resulting monthly rate is usually pretty shocking. I have seen as low as $20 but almost never over $50, depending on how you count “active patients.” Think about that: for $50 per patient per month, almost all of you who are reading this piece would actually make more than you did last year.
Of course, this is not a realistic, but it should give you a better sense of why it has been successful in most of the practices who have tried it. What are the options for those practices that cannot jump into the deep end?
One concept for larger practices to consider is to spin off a small concierge group from within the existing group. This is the medical version of the classic “shelf space” marketing concept from the first days of retail consumerism. Rather than have a local concierge group to open on its own practice down the block, perhaps you should be the ones to do it. Take 1 or 2 of the slowest/most thorough/patient friendly docs you have and put him or her/them in an environment where his or her/their volume is not critical. Share your existing resources to shore up the practice in the crucial early period and treat it as an additional option you can offer to your patients, especially those on plans with which you do not participate. By giving your patients a choice to see your practice in the manner that suits them best, you expand your opportunity to reach into the community and grow your practice in a healthy manner.
Should you consider this hybrid approach (or any of the others, for that matter) make sure you do not give the impression of having 2 “tiers” of care in your practice. One way to avoid this is to not have an individual physician work on “both sides of the fence” and be in a position of having a concierge patient jump to the front of the line, ahead of the non-concierge patients.
Finally, as with any endeavor of this nature, you need to consider the legal ramifications. Pediatricians in California, for example, have to contend with the Knox-Keene Act (which is designed to protect patients from ill-designed insurance coverage). Start with the national concierge medicine organizations and listen to what they say distinguishes them. Speak to your peers, locally and on the SOAPM e-mail list, and, if nothing else, strongly consider what you need to do to provide the convenience that your patients demand.
As I mention above, I have an extension to this piece from Physician’s Practice magazine.
Buried, which seems to be my status since August. Some interesting items:
Finally, here's the big one today. What is the purpose of the new Swine Flu admin code? It makes no sense to me. Pediatricians are finally getting their heads around admin codes vs. product codes and the AMA races in to create a new product-specific admin code?
It used to be important to distinguish how the vaccine was given - oral/intranasal vs. injection. Now, all that is tossed out just for this one strain of the flu. What's going to happen when some avian strain hits? Or Swine Flu II? Keep adding new admin codes?
I am upset about this because we have two new sets of codes, admin and product, to record the swine flu, doubling the number of codes that will be rejected by the payers when the time comes. Note that I said, "will." But we gain nothing, as far as I can tell, in terms of data tracking...I can't tell how the immunization is given (fat luck comparing efficacies). I don't know if counseling was given or if the recipient us under 9yo.
Someone smarter than I am, and that's most of you, tell me what I'm missing.
San Francisco, here we come. If you're going to the NCE and would like to say hello, I'd be honored! It's going to be crazy, but that just gives us more opportunities to get together.
Stop by our booth (#1827) or the Office of the Future exhibit. We'll also be first on the docket at the Pediatric Documentation Challenge on Saturday, speaking and facilitating at the PPMA/SOAPM meeting on Friday, and c0-hosting the SOAPM dinnerish event at Maya's on Saturday night with The Verden Group. Whew.
If you need details about any of these times or places, just ask.
One group has asked to put together an informal meeting to discuss "alternative" practice models, such as concierge medicine, cash-only practices, annual fees, etc. I'm trying to coordinate both the place and the time, so if you are interested, give me an indication of your availability here:
...and we'll let folks know where and when it will be.
See you there.
[Most of this blog was originally 'penned' live from the NCE, but a conspiracy of time-consuming events - namely, dining out with Friends of PCC - kept me from completing it on time.]
I'm seated at our booth (1827 I think), debriefing myself about yesterday's events. Whew, busy time. We must have 2x more staff here than at any show I can remember, but it's not enough to get to it all. I missed the Offitt talk!
- Dr. Zarin wins the Buzzy award, excellent choice. Proud to support the award.
- The PPMA meeting seemed to come off well. Amazing how many non-American docs were in the room (Syria, Kenya, etc.). Can't figure that out. We need to get more office managers to that meeting, though. There were more docs than managers.
My talk about vaccine financing was OK. It was hard to stuff that talk into the time frame, but I did my best and, considering the "dryness" of the subject, I can't complain. I hope they invite me back to do more.
- A doctor who will remain nameless dropped the f-bomb during one of the early SOAPM sessions. However, it was as appropriate and well timed as anything and I applaud the effort. I missed most of the SOAPM day in general due to other commitments, but I got the feeling that the best practice management sessions happened outside the SOAPM track itself.
I was disappointed in the SOAPM turnout. Too many of the same faces. Yes, they are pretty, friendly faces of people I like, but we're not attracting new attendees as well as I would like. Good idea to combine the meeting with the senior section, but SOAPM really needs to get more butts in the seats.
- Our first stab at the Documentation Challenge was fun. We didn't get to show off 1/2 of what we can do because we ran out of time (20 min just isn't enough), but I was stunned to have so many people stop by our booth or at our spot in the Pediatric Office of the Future after seeing
it. I didn't even think there were that many people in the audience! The refrain we heard over and over was that people like how the EHR looks - it's clean, it's simple.
There were two notable absences at the Challenge. One of the vendors on the list didn't show up, which is too bad (PCC has more than a dozen mutual clients). Another major EHR vendor hasn't been in two years because, and I apparently quote, "...they don't need to participate in the challenge any more," which is interpreted to mean that they don't target individual practices, but know they are going to pick up more than they can handle from their big health system/hospital/IPA work. Sadly, I believe them.
- Speaking of our booth, we debuted a new booth on this event. I'd love to hear from anyone what they thought of it. Again, simplicity is the goal...for the first time in 20 years, I don't think we had anyone come up to us and ask, "So, what do you do?"
I was very pleasantly surprised by the volume of traffic at the POF (good work, Dr. Alexander).
- Some of the sessions generated a lot of conversation. Herschel Lessin's piece with Donelle Holle was standing room only. Three people told me that Dr. Oken's plenary about the endangerment of private pediatric offices ranged from excellent to "the best plenary ever."
- Spent some good time with Andrew Johnson of Pediafed and got to meet Jeff Winokur of Atlantic Health Partners in person. Of course, I spent a lot of time with the founders of National Discount Vaccine Alliance.
- I'm particularly grateful for some introductions...Kathy Cain delivering us to the AAP media crew, Todd Wolynn making the AHP connection above, Dr. Oken giving me a great reference to a practice in CA who really needs our help. Really, it's those interactions that make the week away from home worth it.
- I think we were able to take out 30 of our friends every single night! Crazy! There's nothing like not knowing if you're going to get 15 or 20 or 25 or 35 of your clients and should-be clients to the restaurant on time. John Canning did a lot of work managing it all, fortunately.
- As always, it's always nice to coordinate some time with Susanne Madden.
- The last-second informal "Alternative Practice Discsussion" was great. Although it got quite heated in the room during the discussion, there is no question that there is great interested and demand for more information in this issue. The AAP needs 2-3 sessions about this subject - concierge pediatrics? microcapitation? hybrid models? - next year. One or two "How To's", one about the philosophy, etc. You may enjoy these two shots I took during the discussion- can you ID your favorite SOAPM posters below? Some of the most prolific among us are there!
|Click on either for a close up. Can you spot Igor?
I would really like to thank the VA AAP Chapter for their generosity in letting us use the room...and enjoy some of their refreshments. Thanks Dr. Kraft!
- We bid a fond farewell to Dr. Lander's tenure as SOAPM chair, but not to Dr. Lander himself. I look forward to Dr. Stoller's reign...
I was recently introduced to Diane Lipton Dennis, the CEO at Lipton Health. Someone thought that I might appreciate her approach to pediatric medical care, which has been to put together a concierge program not for herself, but as a replicable model to be delivered anywhere in the country.
In other words, if you're thinking about 'going concierge' (whatever that even means), it might be worth a phone call to Diane. Check out their brochure.
When I started to look into the concierge model a few years ago, I have to admit being surprised how well the commercial programs out there (like MDVIP) actually understood how different pediatrics is. I am used to most organizations giving little thought to how medicine for kids is different, but they got it. From what I can tell, Diane really gets it.
I started taking notes during our conversation and captured some of the better moment. These may not be exact, but they sure capture the spirit of the conversation:
"We give them a choice in the way they practice medicine by offering their patients an opportunity to participate in a memberhip program. The program gives them access to service available to them beyond insurance, like 24/7 access to the doctor. Skype, for example - good for rashes, a good way to see if they should bring the kid in. Next day well visits. Extended visits, no more 'door knob medicine.' The doctors get a chance to really observe, to sit and talk, make recommendations. Better hand offs to specialists, better communication. Better interpretation about what the hospital says, better help during most stressful times."
What made my internal beeper go off was that she finds the "fees" necessary for this kind of work are in the neighborhood of "$15-20-25 a month" which is right in line with some of the data I have presented here in the past.
As I understand it, the practices pay Lipton health a portion of their revenue - which is normal among the concierge business consultants, and in return, "We provide all of the marketing, which is perhaps the most important factor to the success of the practices. Stark laws limit the amount of marketing they can do for themselves. We want them to stick with what they are good at: practicing medicine. We do a lot of patient surveying and don't stop with the signup period. We do customer-service followup, in-office marketing, social networking. We do a lot of hand holding throughout the entire process. One of the biggest pieces we deliver is the legal work...this type of medicine differs from state to state, and we do that work."
So, what happens if a practice just uses Lipton Health to get started? Diane says that she has no problem with someone using their services for a year and, if they are not satisfied, going on their own. "If we're not delivering the value, we can't ask them to pay us."
Right now, Lipton Health is focused on the DC metro area but are moving into Connecticut, Philadelphia, Richmond, Charlotte...the entire north-east corridor.
Diane spends a lot of her time in the practices, so she encourages anyone interested in even a brief chat to reach her on her cell phone: 202-441-0444.
Good luck to all!