What is concierge care?

See how the retainer-based care model is filling care gaps and driving new revenue

Concierge care, once viewed as a luxury care model reserved for wealthy patients who could afford to pay out of pocket for on-demand care, has diversified to serve a wider group of patients and has the potential to play a role in expanding care access.

So what is concierge care? Why and how is it expanding? What models are gaining traction? This primer will answer these questions and make you a five-minute expert in this important care model.

How concierge care works

Concierge care—also known as retainer-based medicine, boutique medicine, or direct primary care—originally emerged in the 1990s as a model that allowed patients and providers a way to opt out of managed primary care.

By paying an annual fee, patients could receive on-demand care from their primary care physicians of choice; meanwhile, providers could avoid the administrative and financial hassles of working with insurance companies and reduce the size of their patient panels without sacrificing revenue.

A typical employed primary care provider might have 2,500 patients, while a "medium-fee" concierge practice could have 400 to 600 patients. Today, some practices still follow the 100% out-of-pocket model, while other providers bill insurance companies for covered services and charge a retainer fee for services outside patient plans.

Concierge care practices generally offer patients some combination of:

• Same-day appointments
• More time with providers during the actual appointment
• Email and telephone consultations
• Personal health coaches
• Guidance from nurses
• Patient portals allowing access to electronic medical records and lab results

Which services are included depend largely on the fee structure. Once the province of wealthy patients, concierge care has evolved to include models for patients with moderate and even low incomes. Some practices charge patients as little as $15 a month, or a few hundred dollars across a year, for basic care, compared with five-figure fees in the highest-cost concierge practices. The reduced-fee model sometimes allows providers to convert entire practices to the concierge model by making it affordable enough for all patients.

How does the concierge model apply to health systems?

Given reimbursement uncertainty—particularly in Medicare, with increasing scrutiny on the sustainable growth rate—concierge medicine's reliable fee structure can offer physicians stability, along with a smaller and more manageable patient panel. But for health systems, smaller patient panels mean reduced downstream revenue and the need to recoup that revenue through the concierge care fee structure.

In PCP-rich regions, a moderate-fee concierge model can help build a new revenue stream for physicians and help meet patient demand. But in areas with PCP shortages the concierge model, with its smaller patient panels, might not be feasible.

The hybrid model splits the difference

Providers who aren't ready to convert their practices fully to the concierge model have another option. In a hybrid concierge practice, a subset of patients—perhaps 10%—pay a retainer for more high-touch care, while the remainder of patients remain in the traditional practice model. Non-concierge patients always have the option to upgrade to the more-premium service.

The hybrid approach generates additional revenue while allowing physicians to keep all of their patients; it also simplifies patient recruitment—rather than start fresh, physicians can look for interest in the concierge model in their existing patient bases.

At Tufts Medical Center, which has operated a hybrid concierge practice for nearly a decade, $2,000 retainer fees from concierge patients cross-subsidize care for the practice's larger pool of traditional patients. Physician panels average 1,200 patients, about 25% of whom participate in the concierge service. The same physicians see both types of patients and provide the same level of care, although the two groups of patients visit different offices; single-office hybrid concierge practices models typically set aside specific time slots for concierge patients.

Is concierge care here to stay?

The number of physicians practicing some form of concierge medicine increased from 2,400 in 2010 to 3,500 in 2011, according to the American Academy of Private Physicians. The Concierge Medicine Research Collective estimates that 5,000 physicians are now involved in concierge care, and in a 2012 Merritt Hawkins survey, 10% of medical practice owners predicted they would convert to a concierge practice within three years.

What will continue to drive growth?

Financial pressures, combined with the need to compete in a more consumer-oriented health care marketplace, are clearly pushing more providers to explore the concierge model. Meanwhile, employers are offering employees access to concierge practices like One Medical alongside conventional health insurance. And finally, patient demand for a more personalized approach is pushing providers to re-examine their care models.

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