The average primary care physician cares for 2,500 patients, but a select group of physicians are finding success with panel sizes below 600. This is the promise of concierge medicine—sometimes called retainer-based, boutique, or direct primary care medicine—and medical groups around the country are taking notice.
But can it be a sustainable model for your group?
Concierge medicine operates on a subscription model. In exchange for a nominal monthly or annual fee, patients receive personalized service that generally begins with a thorough annual wellness visit and health plan. Additionally, plans include conveniences like same-day access, email and telephone consultations, and priority referrals and lab results. The level of services tends to vary by provider panel size and level of expense.
Primer: What is concierge care?
Let’s take a look at how these models work, and whether or not medical group leaders should explore replicating these offerings.
For annual fees reaching the low-five figures, groups like MD2—pronounced “MD-squared”—provide patients the most tailored care available. In high-fee models, patients pay for immediate in-person consultations, accompanied medical travel, and other lavish VIP convenience offerings. This high-touch, personalized care is appealing to some physicians, but the resource investment required and restrictive price point likely make this an area where a principled decision not to compete is defensible for most groups.
Moving beyond “wealthcare,” some groups are finding a broad patient base is willing to pay extra for convenience and more personalized care. Concierge Medicine Today, a trade publication, notes that the national average annual fee for concierge services is between $1400-1700 per patient and nearly two-thirds of the nation’s 5500 concierge practices charge less than $135 per patient per month.
In these models, patients’ subscription fees get them an annual wellness visit and health plan, plus access to significantly reduced patient panel that enables the kind of responsive, high-touch care they seek. Additional visits are still billed to insurance.
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The financial analysis for these practices can be compelling. For example, a physician with a panel capped at 600, who is 90% full, and taking in $1,850 per patient, a reasonable figure for this market, generates just under $1MM in practice revenues before any fee-for-service income is earned. Even if that provider is compensated well above median, say $300,000 per year, there’s plenty of money left over to pay staff and cover other necessary expenses.
The final model incorporates significantly reduced fees in an attempt to provide premium access in a more traditionally volume-based practice. Groups like One Medical and Qliance have explored this possibility. For more detail, check out our research brief, The Battle for Consumer Preferences in Primary Care.
Which models are right for your group? What operational challenges lie ahead? Don't miss part two of this series on the top FAQs on implementing concierge medicine.
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