With a palpable squeeze on the reimbursement levels for physicians after the establishment of “Obamacare”, doctors are eyeing the possibility of changing the practice model for themselves.
See the article written by Alan S. Horowitz, a contributor to The Profitable Practice, a company dedicated to helping practices become more efficient and profitable
Pros and Cons of Switching to Concierge Medical Practice
The most common medical practice size is 2,000 to 3,000 patients. With so many patients to see, a doctor has limited time to spend on each person, making it difficult to establish a strong doctor-patient relationship. This is why concierge medicine is gaining popularity. With the concierge model, doctors are able to provide more attentive care while maintaining the same revenue flow.
There are many factors to consider before a traditional medical practice can make the switch over to concierge medicine. Software Advice, a website that reviews medical software, recently wrote an article that weighed a few of the pros and cons of this approach. You can check out their suggestions below.
1. A different model, less patients
Concierge practices require patients to pay a retainer fee. Therefore, the number of patients in a concierge practice drops significantly depending on what type of payment model the practice uses. This allows for concierge doctors to spend more time with patients and accommodate last minute appointments.
2. Equal pay, more satisfying work
Since patients in a concierge practices pay an annual, monthly or quarterly retainer fee, doctors are able to see less patients and still make the same amount of money. For instance, if each patient is charged $1,500 a year, then a concierge practice with 1,000 patients can bring in 1.5 million a year. Additionally, with a lower patient count, there is less staff needed which also lowers administrative costs.
3. Not ideal for all practices
A major downside of this model is that it doesn’t work in all types of healthcare. According to Dan Behroozi, EVP of business development and operations at MDVIP, the physician needs to be a general practitioner for the model to be successful. Unless there is a primary care relationship, this model is not an ideal fit.
4. Requires more marketing
The single biggest challenge of concierge medicine is marketing. Since concierge medicine is still gaining popularity, doctors have to invest more time and money into attracting new patients and raising awareness about the business model. Some doctors have found success with ads in a country club newsletter while others seek speaking engagements with men’s group. The method is all dependent on the target patient audience. But anyone who wants to do well in the concierge medical field has prepare for the marketing commitment.
The relentless financial squeeze on providers from the government and insurance companies has made the personal doctor-patient relationship almost an endangered specie. A physician with 2,000 or 3,000 patients, a common practice size, has limited time to listen to each patient, making it difficult to establish a strong personal bond.
The desire to cut down on the number of patients a doctor sees and provide more personal service and better care is driving a growing trend in the medical marketplace, namely concierge medicine. The American Academy of Private Physicians (AAPP) reports that in 2012, there were 4,400 concierge doctors in the U.S., up 30 percent from the previous year. In January 2013, Forbes reported on a study done by Merritt Hawkins for The Physicians Foundation that “found that 9.6 percent of ‘practice owners’ were planning to convert to concierge practices in the next one to three years.”
- Concierge medicine is more about improving your relationships with patients, limiting distractions from your practice of medicine such as insurance hassles and simplifying your medical practice than it is about money.