membership-based practice

Ways To Structure a Membership Practice

Previous blog posts focused on membership practices, and you’re convinced! This post will discuss ways to structure a membership practice.

Before we look at the different models, remember that much of your success when transitioning to a membership practice depends on understanding your patient demographic, choosing the right structure to serve them, and educating them on how the new practice model will work. If you’ve selected the right practice structure for your demographic, communicating the benefits to your patients should be easy. Now let’s look at the three most common ways to structure a membership practice.

Hybrid Structure

A hybrid model is ideal if you’re nervous about making the leap into a full concierge practice or think your patients will be resistant to the idea. Many people still have a negative connotation with the word concierge, assuming it’s something they can’t afford.

A hybrid structure charges a membership fee (to cover services that insurance doesn’t) while billing insurance for office visits and other covered services. This allows patients to carry a high-deductible policy for major health issues, while covering select routine and preventative services with the membership fee. This structure can also provide the amenities that make concierge services attractive to patients, such as longer appointments, same day appointments, and telephone and e-mail access to the doctor.

Another way to structure a hybrid practice is to maintain a traditional practice while offering additional services for a membership fee. This type of hybrid structure can be controversial. Some people consider it “two-tiered” care where those willing and able to pay more get better care than those relying only on insurance.

Fee-for-Care

If you’re considering a fee-for-care structure, you first must decide if you want to accept insurance. You’ll also need to decide what services the fees will cover. Typically, patient fees cover most services that are provided in the office. Some services such as vaccinations, lab work, and X-rays may be excluded from the fee and charged separately.

If you choose not to accept insurance, and your fees will not cover out-of-office services, it’s important to develop relationships with local labs and imaging centers. Establish a close relationship with your representative from these providers so they’ll work with you to facilitate same day appointments and discounted services.

Menu of Care

Would you eat in a restaurant that didn’t disclose their prices? Doubtful. This is how many people feel about going to the doctor, whether they have insurance or not. But very few doctors disclose their prices, and some might not even be able to answer if a patient asked how much a visit or procedure would cost.

This can be nerve-wracking for those who have no insurance or who have high-deductible plans. To address these fears, some practices are establishing a “menu of care” structure. All of the pricing is spelled out. There are various categories of memberships and a listing of what’s included in each one. (You’ve probably seen tiered packages such as bronze, silver and gold on non-medical websites…it’s the same idea.) Some practices provide a la carte pricing for every service offered. You can even set up a menu of care practice without a membership component by pricing everything a la carte.

From a marketing standpoint, this is one model that can really benefit from accepting insurance. Patients with high deductible plans love this model because they know exactly how much they have to pay and what’s left to meet their deductible.

Which Structure Is Right For You?

If you want to test the waters before deciding to discontinue taking insurance entirely, the hybrid method is the choice for you. If you know what services you’ll cover for a membership fee and have good relationships with labs and imaging centers, a fee-for-care structure will serve you and your patients. If you like to put your cards on the table and have a lot of patients with high-deductible plans, you’ll both be happy with a menu of care structure. If you’re still uncertain, consider a brief survey of your patients to determine what would best match their needs and comfort levels.

There’s no “one size fits all” approach to moving into a membership practice model. Fortunately, there are many ways to structure your practice so you can get the right fit for you, your staff, and your patients.

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Membership Practices, Concierge Practices, and Direct Primary Care: Similarities and Differences

by Dr. Kelley Mulhern Leave a Comment

The terms “membership practice”,”concierge medicine,” and “direct primary care” are sometimes used interchangeably. While they have similarities, they have distinct differences too. It’s important to be familiar with the differences so you can help your patients understand them and be more comfortable with your new practice model.

If you’re among the many doctors seeking a better way to serve your patients, you may be considering a membership, concierge, or direct primary care practice model. To help you make the best decision for you and your patients, this post will outline what these practice models have in common and how they differ.

Membership Practice Model

A “membership practice” refers to any practice model that charges an annual or monthly fee or retainer to its’ patients. This umbrella term can be used to refer to several different practice models, including direct primary care, concierge, or boutique practices. The membership fee frequently covers a variety of services, procedures, or treatments, delineated by each office. Thus, a membership model is highly flexible and can be structured to suit the needs of the doctor, patients, and community.

Concierge Care Model

concierge medicine dr kelley pendleton The mid-1990’s saw a rise of wealthy patients who wanted VIP care without the interference of insurance companies, and “Concierge Medicine” was born. The defining feature of concierge medicine is that it gives the patient nearly limitless access to the doctor, often including same day appointments, round the clock telephone access, and even house calls in some practices. While many concierge practices do accept insurance to pay for services or procedures not covered by the retainer fee, they’ve often negotiated better pricing, further reducing patient expense.

Direct Primary Care Model

In the mid-2000’s, the frustrations of patients and providers converged to create a “new” model of practice. Direct Primary Care, or DPC, seems to be a throwback to the bygone era of small town doctors who developed direct relationships with their patients without the involvement of a third party. DPC practices offer primary, preventative, urgent, and wellness care in addition to disease management. The defining feature of the DPC model is that the provider does not accept nor bill insurance. Payment is arranged solely between the doctor and his or her patient. Eliminating insurance allows doctors to spend more time caring for patients, and less time dealing with the hassles of insurance.

The Similarities

Both concierge and direct primary care practices charge a membership or retainer fee.

Each practice model has much smaller patient loads than a traditional practice, thus allowing for longer patient visits and a higher level of care. These types of practices typically limit their patient panel to several hundred while a traditional practice can have as many as 2,500 patients.

Both models provide greater access to doctors, including telephone and e-mail consultations.

Concierge and DPC practices provide much faster access to the doctor including same or next day appointments, and little to no wait time upon arriving for an appointment.

In a traditional model, doctors are only paid for office visits. Because membership practices don’t rely entirely (or at all) on insurance payments, follow up care can often be handled via telephone or e-mail. (How convenient is that?)

Another thing both models have in common is how little they are understood by patients. That’s why patient education is so vital to making either model a success.

The Differences

The major difference is that while direct primary care practices don’t bill insurance at all, many concierge practices do.

Direct primary care practices tend to attract younger patients, those in their 20’s-40’s who are middle class. Concierge practices attract an older and wealthier clientele, those in their 50’s-80’s who are considered upper middle class.

Overhead between the two models is another key difference. Because DPC cuts out insurance companies, there’s less need for billing staff, software, EMR, and the other expenses typically incurred when a practice accepts insurance. Concierge practices often have higher overhead because they still bill insurance and because the patients may expect fancy extras for their annual fee like plush offices and private waiting rooms.

DPC’s charge a lower fee, on average, $50-150 per month. While the average concierge practice’s monthly fee is higher, it’s surprisingly not that much higher, at $200 per month.

While DPC offers faster access to doctors than traditional practices, many concierge practices offer 24/7 access every day of the year via the doctor’s personal cell phone number.

Which Model Is Best?

The answer will heavily rely on your patient demographic. Younger, middle-class, Gen X and millennials will favor the DPC model. Even with the advent of the Affordable Care Act, many people’s medical coverage is still tied to their employer, and it’s comforting for patients to know they can remain under your care with or without insurance.

If your patients are older and more affluent, they may be willing and able to pay for concierge medicine. For those in this demographic, health has become a matter of prime importance and they want to build a close relationship with a doctor they can trust.

Whichever model you choose, you can look forward to better serving your patients, improving their quality of life and your own, while reducing your own insurance-related frustrations.

Marketing a Membership, Direct Primary Care (DPC), or Concierge Practice

by Dr. Kelley Mulhern Leave a Comment

More and more physicians are transitioning from a traditional practice to a membership, DPC, or concierge practice. The three terms are often (mistakenly) used interchangeably. (The various ways to structure this type of practice will be discussed in future blogs, so stay tuned!)

If you’re thinking about making the leap, you’ve probably done enough research to know that one of the biggest issues for these practices is marketing.

Perhaps “marketing” is the wrong thing to focus on. Focus, instead, on patient education to help your current patients become comfortable and excited about the new practice model. This can smooth the transition and alleviate some of your patient-retention fears. (Plus it can also save you time and money since you won’t have to focus so much effort on constantly attracting new patients.)

Advantage #1: Affordability

When your patients hear the terms “membership, DPC, or concierge practice,” often the first thing they think is that it’ll be expensive.

For example, concierge medicine didn’t start in small towns populated by middle-class people; it started in large urban areas populated by high earners who were willing and able to pay top dollar for private medical care. That’s the way many people still view it.

Help your patients to understand they won’t be paying hundreds of dollars more for visits with you than they pay now. A membership, DPC, or concierge practice can be an especially great deal for patients who have HSA and FSA programs through their insurance providers.

Patient education and clarity are the best ways to overcome this misconception. Communicate to your patients that your transition has nothing to do with money, but a desire to deliver a higher quality of care. (Research has shown that traditional providers make about the same as concierge providers1.) For clarity, show them your new fee structure, as well as their potential financial obligations under a few common scenarios.

Advantage #2: Time

Patients are tired of waiting hours for an appointment or being told to schedule different appointments for every health concern. And they don’t appreciate being rushed through an office visit any more than you like being rushed.

1 Pearson, D. 2015. ‘Direct primary care’ shown to please patients and reduce costs, including for imaging. Available at: http://www.imagingbiz.com/topics/healthcare-economics/‘direct- primary-care’-shown-please-patients-and-reduce-costs-including-imaging.

The average medical appointment lasts just over 15 minutes. Describe how an office visit under the new model is different than what they’re used to. The reality is that by transitioning to a membership, DPC, or concierge practice, you’ll be able to devote much more time and attention to their care.

Advantage #3: Service

Membership, DPC, and concierge practices can provide better service than the traditional model. It’s frustrating for patients when they have to wait days or weeks for an appointment or when they arrive on time for an appointment only to be kept waiting because you’re running behind.

Outline the new customer service patients can expect from your office. Will they have access to the doctor via E-mail or cell phone? Will they be guaranteed same-day appointments? What tests, procedures, or services are included in their monthly or annual fee?

Don’t Forget:

You and your patients often share the same frustrations. Things like long wait times, short or rushed appointment times, and insurance companies refusing to pay for needed care top the list. Those aggravations may be due to the “middle-man” (insurance companies) standing between the doctor and patient. By removing this obstacle, you’ll be removing these frustrations. For more information on how to explain the membership, DPC, or concierge model to patients, watch this brief video of me in a recent panel discussion! (See my entire DPC Panel discussion here.)

One Last Tip:

Take the time to ask patients what they want (and don’t want) from a membership, DPC, or concierge practice before making the change. For example, do they expect unlimited phone access, same day appointments, house calls, or a fancy waiting area that serves tea? This way, when you make the transition, you’ll know where to spend time and money so you can provide the services people want and are willing to pay for.

Educating patients about what your membership, DPC, or concierge practice will and won’t be can help you retain patients so your primary focus remains providing high-quality care. This is a key reason you want to become a membership, DPC, or concierge provider!