Demystifying Medicine One Month at a Time

Concierge v. Direct Practice [UPDATED]

Dr. Rob Lamberts appeared on NPR’s “Talk of the Nation: Science Friday” just after this post came out. You can hear audio of the show here.

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By now you’ve probably heard of the concept of “Concierge Medicine.”

To me, it’s an idea that’s Win-Win-LOSE:

Win–Doctors. Those in “Concierge” practices have chosen to forgo the traditional business model in favor of  charging annual fees that range from $1500 to $15,000 per patient. How much you pay depends on the market, exclusivity factors, and amenities, like comprehensive annual physicals with add-ons like a dermatology appraisal and nutrition consultation. Concierge docs see many fewer patients in their practices than regular primary care doctors. As such, they can spend more time with each patient, and practice medicine in a more deliberate, thoughtful fashion. They are freed from the hassles of complying with and filing insurance claims. MUCH more money flows into the practice, since it’s paid in full on a monthly basis. Summary: fewer patients, more money. (Concierge practices are also known as “Retainer” practices, as in “I have my doctor on retainer. Pass the caviar, Thurston.”)

Dr. Rob has decided to go it alone.

Win–Patients that desire this model and can afford to opt in. They get the satisfaction of having a doctor at their beck and call (cell phone access), services like comprehensive annual checkups with amenities, and if anything goes wrong, their concierge doctor can use his network to get streamlined, coordinated specialty care.

LOSE–the rest of us. Very few people can or will opt in to this model. And that’s by design. By limiting himself to the market’s high end, the doctor raises the exclusivity (and revenue) bar. Moreover, with every doctor that opts in to a concierge model, we need someone else to serve the rest of us.

Now come the docs who don’t have a taste for the high end. They struggle with the exclusivity of the concierge model but aren’t happy with the status quo–feeling like hamsters on a wheel and having to always go faster. More patients, shorter visit times, more administrative regulations to cope with.

Hence the advent of the ‘Direct Practice’ model. Direct, because you pay your doctor on a monthly basis to belong to the practice, but at a more affordable price point-a maxium of $100/month, but usually more around $60. No amenities here, other than access and evaluation by a doctor who knows you well.

There’s a guy I admire named Dr. Rob Lamberts who’s in the throes of making such a conversion. Dr. Rob is boarded in Internal Medicine and Pediatrics, and works in Augusta, Georgia. He’s practiced office-based primary care for adults and children for sixteen years. Rob admits to being kind of a nerd; he started using computers in his medical practice way before it was cool, incentivized, or required. As such, he feels that in that regard he was ahead of the curve.

Rob is also a terrific and funny writer and blogger, and he’s been incredibly transparent about his decision-making process as he’s decided to leave his group practice and switch to a direct practice model.

When good guys like Rob start to feel that working ‘outside’ the system will be more fruitful and productive than making change inside the system, I worry that the transformation of health care will be slower and more painful for all of us.

10 Comments

  1. Wayne T. Johnson

    Try imagining a TV series featuring a doctor practicing concierge medicine. Not Dr. Kildare by a long way, and who would the sponsors be? And will certification require an MBA + MD? WTJ

  2. Rob

    Thanks, John. Leaving my traditional practice was (is) a scary thing. I don’t actually feel like I am “leaving the system” per se, as I am only leaving how it’s paid. I see concierge as an “escape hatch” for docs (getting out of the system), while what I am doing will hopefully end up being a legitimate alternative path. If I can get the patient numbers close to where it was, keep the cost down, and demonstrate both quality improvements and cost savings, then it may be bigger than just me making my own little corner of the universe better. I’ve got a lot more to write about, to be sure.

    • glasshospital

      Thanks for reading and clarifying, Dr. Rob.
      Much appreciated and best of luck…

      -JS

  3. Gary Price MD FACP

    I enjoyed your article, but would like to correct your use of the terms “concierge” and “direct” practice. They are interchangeable.

    As one of the pioneers of this movement (in my 15th year of direct practice) and current President of the American Academy of Private Physicians (AAPP.org), I can give you the history of this terminology.

    Early on, about 12 years ago, a newspaper gave us the name “boutique” practice (I think it was the NY Times, but I’m not sure). Shortly thereafter, we were labeled “concierge” by another paper (probably WSJ). We formed a national society a couple of years after these terms were introduced, and we all agreed we didn’t like the terms, but had trouble coming up with a better moniker that the media would pick up and that described what we do. “innovative practice” and others came and went. Lately, we have decided to adopt “direct practice”, which reflects our direct financial relationship with our patients. Thus, to qualify for this term, a practice simply needs to have a direct financial arrangement with its patients. The model (retainer, a-la-carte, fee for noncovered services, etc) and price point do not matter.

    FYI, the inventor of the model you’re describing (low monthly fees for direct care) is Garrison Bliss from Seattle. If you’re interested, look up his practice, named “Qliance”, which is growing rapidly because, like most direct practice models, it works!

    • glasshospital

      Glad you saw the post–and thanks for the comment and clarification. Do you think there should be a different term for those in direct practice at an affordable price vs. those in DP who offer amenities at higher price points? I feel that in his writings Dr. Rob has been very clear that he intends to distinguish his brand of DP on quality and price from those at the higher end who seem to favor offering amenities and perks like ‘executive physicals.’

  4. Matthew Weidman

    Based on the amount of flak our facility has received since Illinois Medicaid instituted a $3.65 copay for some services, I don’t see how any direct care practice isn’t concierge on some level. It may not be executive, but it still excludes a hell of a lot of people. Many of the patients I deal with every day in our rural health clinic are desperately poor. There is no way that they could manage even the “affordable” rates direct care practices charge.

    It’s a wonderfully appealing idea to cut out the insurance companies (whose core business model is to profit by denying payment for essential services), and I frequently swear at some of the silly hoops Medicaid makes me jump through. However, our country is facing a shortage of primary care practitioners. Conversion to direct care practice with smaller patient panels exacerbates that problem, and I wonder about the consequences for the poorest among us.

    • glasshospital

      Thanks for your comment. Well said. I think you’re correct in your assessments: For many, any co-pay or deductible is too much. And the impact on physician work force will continue to be felt more acutely.

  5. Janice smith

    My doctor has a concierge practice. I think one of the first. At the end of the day consumers are getting smarter. The Internet has given clients access to solutions that were not available years ago. My experience has been that my doctor wanted to take care of his patients and to get away from all the insurance regulations that confined him to practice or not to practice on the behalf of the patient. In this case, my family. As an internal specialist he was even open to new science and technology for prevention for his practice! That is someone I would want to have a doctor.

  6. Allison Blazek

    First, a question: how do you find out if there are legal restrictions to direct pay practice in your state?

    Second, a few comments:
    1. Direct pay is a good choice for people with “catastrophic coverage” or high deductible insurance plans. If a doctor is contracted with the insurance company, the patient has to pay the contracted rate. The doctor cannot discount the cost or it is considered fraud by the peeps who be. This is crazy, I know, yet true.
    2. For truly indigent patients, there are clinics that are geared toward this patient population. For example in Houston, you can have Medicaid or if you don’t qualify for that you get a “Gold Card” and are seen in the Harris County Hospital District system.
    3. Doctors in private practice often provide services at a loss. For example, there are several vaccines I carry for my patients even though some insurance companies will reimburse me LESS than I paid for them. I do this because it is important to me and to my patients.
    4. Doctors in private practice give up the security of a monthly check and benefits. One of the paybacks is the freedom to see less patients in a day, even if that means less income. Some physicians leave the big employers because they have to have balance in their lives, for example taking care of kids with special needs. These doctors should not be expected to work for free. They have employees to pay, not to mention rent, malpractice and 5 other kinds of insurance.
    5. Lastly, insurance companies have SO MUCH POWER and NEVER LOSE MONEY. They are always profitable, and yet always seem to be asking for more money. I estimate that at least 40 % of my overhead is spent on manpower to deal with insurance companies. Think about that. So even if I didn’t charge so much for patients to see me, I am saving 40% off the top.

    Hmmm, looks like I went on a little diatribe there. I guess I feel strongly about some of this. The truth is, I love my patients. I will continue to take care of some patients for free because it is the right thing to do. I just have to make sure I am taking care of my fiduciary duty as a business owner.

    • glasshospital

      Thanks for commenting (and tweeting!).

      You raise important points–and have my sympathy. Honestly, I don’t know in the present climate how anyone in GIM or FP (let’s just say office-based primary care) can stay in private practice in a ‘traditional’ model. It seems like an upstream swim–your expenses climb and outpace your revenues at every turn.

      As far as the legality of direct practice in your state, talk to your state medical society–they have a vested interest in helping (and keeping happy) their constituents–and that’s the kind of advice they’re usually happy to give. Also, check with other people in your state that are in direct practice–and learn how they went about starting and finding out about the laws, etc.

      Keep up the good work, and please keep on reading, tweeting, and commenting!

      -JS

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