How Concierge Physicians Keep Costs Simple

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From new resolutions to new insurance plans, choices abound for the medical community when it comes to determining how to best serve their patients. Some physicians, however, eschew traditional insurance-based billing and opt for simplified concierge/direct primary care models. By eliminating the heavy administrative support insurance billing requires, concierge physicians may be able to provide a higher level of care.

Simple Costs, a Simple Goal

Dr. Alex Lickerman spent 21 years as a primary care physician before switching to a membership-based, concierge model. While his three-year-old concierge practice doesn’t accept insurance, it provides care the same way through a membership fee-based model. “We bill patients directly via a monthly membership fee,” says Lickerman. “All our services are covered by this fee. Meaning, whether a patient sees us only once a year for an annual exam or once a week for an acute medical issue, our fee is the same.”

Through this simplified billing model, Lickerman achieved a simple goal: To provide a higher level of care for a concentrated patient base.

“Our electronic medical records have transformed from insurance billing documents back into electronic medical records,” Lickerman says. “We’re no longer incentivized to bring patients in for visits they don’t need because we don’t get paid per visit. Our incentives are finally what they should be: take great care of patients, so they remain healthy and happy and want to stay with us.”

As a result, Lickerman’s practice can now schedule two-hour new patient appointments within a week of a patient joining. And they are able to schedule one-hour return visits the same-day or next-day. This generous approach to time-per-patient wasn’t an option under his previous insurance-centric practice.

Small Patient Loads, Big Benefits

Dr. Jennifer Gaudiani, the founder of the Denver-based Gaudiani Clinic, also chose a simplified, membership-based billing model for her eating disorder clinic. “Where most traditional medical offices have thousands of patients, each of our physicians carries a patient load of only about 70 patients,” says Gaudiani. “This simplified billing model allows our physicians to have space. They now have the ability to better coordinate care with other professionals, such as therapists, dietitians, and other physicians.  And finally, they’re able communicate directly with their patients via email, phone, and appointments.”

Practice, Perfected

With their concierge-model practices, both Gaudiani and Lickerman say they have seen a substantial transformation in costs and overall practice overhead.

“We don’t have to hire staff to ensure that insurance companies are paying us for our services. This has enabled us to reduce our expenses by 30-40% below traditional fee-for-service practices,” says Lickerman. In addition to similar overhead reductions, Gaudiani’s clinic has been able to make significant staffing and environmental reinvestments with the resources saved by bypassing insurance billing. “We’re able to use funds to pay for expert physicians, nurses, and operational staff.  In the past we had to hire multiple individuals to handle insurance billing, collections, and more,” Gaudiani says. “We’ve utilized funds to ensure that our office space is warm and welcoming for anyone who comes through our door.  Whereas before we didn’t have the ability to be thoughtful about our surroundings.”

Tips for Making the Simplicity Shift

For other physicians curious about making the shift to simplified, no-insurance billing models, both Gaudiani and Lickerman have some advice. Lickerman emphasizes setting an appropriate membership fee from the get-go, and not selling your services short. Gaudiani recommends establishing a business plan, detailing the number of staff and patients needed to make the practice a success. Potential direct primary care/concierge practices may also want to explore automated billing software.  This software provides ways to reduce billing friction and increase overall patient satisfaction.

For both professionals, however, the patient is at the center of the membership model decision.  Simple billing, more focused care, and a smaller practice size allows each to deliver a personalized level of care for each patient at every visit, every time.


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