Physicians see chance for riches in concierge medicine, but few follow through
■ Despite more doctors signing on, boutique practices remain a small part of the health care system.
By Victoria Stagg Elliott — Posted Jan. 2, 2012
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A significant percentage of physicians surveyed believe a concierge practice that does not take insurance has the greatest chance of financial success.
However, even though the number of concierge physicians is growing, it remains small, and most of growth is in practices that accept insurance.
A survey of 501 doctors released Dec. 13, 2011, by the Deloitte Center for Health Solutions found that 64% believe the concierge medicine practice, also called a retainer or boutique practice, that does not take insurance had the greatest chance of financial success in the age of health system reform.
That ranked second behind having an administrative role in a large health care delivery system, which 70% said would lead to physicians doing well economically. Only 39% said this of a small single specialty group that contracts with multiple plans and hospitals. Physicians could choose more than one answer.
However, various estimates show that fewer than 1,000 physicians have a full concierge practice, meaning they take annual fees from patients for care and do not accept insurance. Acknowledged barriers to entry include physicians needing to market themselves to attract patients and putting themselves on 24-hour call to serve their needs, as the model promises.
Even at a common annual fee of about $1,500 a year, physicians might not make up the revenue their practice loses once its drops insurance.
"This is not an opportunity that makes millionaire doctors," said Wayne Lipton, managing partner and founder of Concierge Choice Physicians, based in Rockville Centre, N.Y. "This is a way to stabilize the shrinking pool of revenue."
Some independent concierge practices do not accept insurance, but those affiliated with concierge medical practice companies, which are signing on more practices, generally do. Participating physicians need to make sure additional fees are not used for services covered by Medicare and private insurers.
According to a statement issued Dec. 12, 2011, Concierge Choice Physicians signed on its 200th practice. The company had 172 practices in October 2010.
"It has been a very good year for us, the best in our company's history," Lipton said.
Concierge Choice helps practices establish a hybrid system where some patients pay a membership fee for additional services such as 24-hour direct phone and email access to their physician, but others do not. Fifty to 150 patients per practice usually sign on. Practices continue taking insurance and caring for most patients in the usual way.
MDVIP, based in Boca Raton, Fla., and owned by Procter & Gamble, announced Nov. 16, 2011, that the company has signed on a total of 500 affiliated physicians for its full concierge model. The company had 430 practices in October 2010. Member practices care for a patient population no larger than 600. All patients with the practice pay fees for additional services.
Neither company owns practices. Physicians stay independent. MDVIP collects a portion of membership fees paid by patients. Concierge Choice collects a fee per member from practices. The charge declines over time as physicians and office staff need less support from the company.
Company officials said the economic downturn has had little impact on the percent of patients who renew memberships. For instance, MDVIP said the patient membership renewal rate has held at 92%.
Representatives of these companies also said the model may have some role in health system reform.
"We are fully compatible with all the changes, and we expect the strong growth that we have had to continue," said Mark Murrison, president of MDVIP.