Keeping it ethical: Retainer practices have rules and restrictions

For physicians tired of limits on reimbursements and the time they spend with patients, the idea of a retainer practice can seem quite appealing.

In such a setting -- also referred to as a boutique or concierge practice -- physicians charge patients an annual or monthly fee that not only covers office visits, but also gives patients perks such as a direct, 24-hour phone line to a physician or guaranteed same-day appointments. Physicians are charging anywhere from $500 to $20,000 a year, and some are converting their practices to nothing but retainer fee-paying patients.

However, there are serious ethical and legal considerations that come along with a retainer practice. They revolve largely around the principle that quality care is not something that should come only with a premium price tag. While a retainer practice can be a viable opportunity for physicians and patients, anyone thinking of using it merely for financial gain should think twice.

When it appeared that there was growing physician interest in retainer medicine, the AMA addressed the issue by crafting ethical guidelines to give physicians standards for working in such a setting. The guidelines, approved by the AMA House of Delegates at its 2003 Annual Meeting, were based on in-depth analysis of the patient-physician relationship and the implications of offering special additional services. They were presented to delegates by the Council on Ethical and Judicial Affairs and were based on work by the Council on Medical Service.

The guidelines emphasize the freedom patients and physicians should have in establishing -- and breaking off -- both a clinical and financial relationship, and the necessity for physicians to ensure that retainer patients aren't promised better care than any non-boutique counterparts. The report and guidelines are available in a pdf file on the AMA's Web site (link).

The AMA isn't the only one weighing in on retainer medicine. The Dept. of Health and Human Services on March 31 issued a warning to physicians that they are subject to fines or expulsion from Medicare if they charge patients extra for providing services the program already covers.

The announcement came as HHS announced it had settled charges against a Minneapolis internist related to extra fees. According to HHS, patients could pay the doctor a $600 annual fee for services such as 24-hour access through his personal phone number, a comprehensive health assessment, coordination of care with physicians and other clinicians, preventive services and annual screening tests, and "extra time." The contract said these services were not covered by Medicare, but the government said that at least some were.

The physician did not admit wrongdoing, but he did agree to a $53,400 fine and said he would not ask Medicare beneficiaries to pay an extra fee for the services he described in the contract.

The AMA, responding to the HHS' warning, rightly reminded physicians that they are free to set up a retainer practice but not if it entails double-billing a patient and another party for services rendered.

Private insurers raise the same concern and are beginning to respond with their own sanctions. Some, such as Anthem Inc. and CareFirst Inc., have cracked down on physicians they say are charging extra fees for services that are covered under managed care contracts. They, like Medicare, say doctors face expulsion if they charge a yearly retainer, or charge individual fees for paperwork or certain transactions -- services already promised in their contract.

So if you're thinking of opening a retainer practice because it seems like a simple answer to the needs of both your patients and your practice, remember this: It's not as easy as it looks. Ethical, and now, legal guidelines have to be followed to make sure you're doing the right thing for yourself and your patients.