"Concierge medical practice is spreading in our nation.
For physicians who are overworked, have burnout, or
overstressed by all of the egregious factors that
incessantly need to be attended to, a change to
cash only medical practice may be far better
than becoming employed at an HMO where practice
may be restricted or parts of your training forbidden."
(The best offense for physicians fighting government control and restrictions on healthcare)
Brian Forrest, M.D. from a town in N. Carolina has set a good example for all doctors in private medical practice to give serious consideration to. It may also be something that physicians and other
professional healthcare providers who are not entirely satisfied with their employed status may also
find quite appetizing.
I figure if there's any way that doctors can beat the government at it's own game, we need to grab the opportunity today. Dr. Forrest, like so many other physicians across the country are feeling the impact of, just got sick and tired of fighting the complexities of the current healthcare system, billing complexities, constant battle with the health insurance carriers over fees and claims, and government fee restrictions and mandates.
Dr. Forrest quit accepting any form of healthcare insurance in his practice. He decided to move into a cash only practice. Such a move always involves losing patients who are unwilling to pay cash for medical care or are locked into a healthcare contract they are unable to break for various reasons.To make it possible to retain a good number of patients that he would have otherwise lost, he formulated a system for medical care, which required an annual fee of $399 per year per patient for all office medical care.
That happens to be almost exactly what the Concierge practices around the country are charging their patients and doing quite well financially. Concierge practices normally funnel down their practice to around 300 to 400 patients. Physicians are then able to spend much more time with patients and practice better medicine at the same time. It reduces frustration so common among doctors who choose to use patient volume increases to compensate for maintaining a reasonable practice income.
Even more profitable is the fact that collection costs go to zero dollars and the office overhead is reduced about 66%. Now, if you multiply 400 patients by $400 you get an annual gross income of $160,000 and get to keep a large portion of that to take home. Add to that the extra cash charges Dr. Forrest imposes on lab work and office supplies used for the patient's care, and the charges made for hospital rounds or hospital consults on a patient--not a bad deal at all!
It gets even better if two or three doctors form a group and share overhead expenses. Dr. Forrest along with two other doctors created their own "direct-buy" health plan that businesses can purchase for their employees instead of the traditional health insurance.
Amazingly, under the "Obamacare" rules, providing this care method exempts employers both from requirement to provide insurance and the fines/tax for not doing so. It's a win-win. But these doctors aren't done yet.
The are now franchising their system out to other interested physicians while making a few more bucks in their side business. Dr. Chris Tomshack has done the same thing with chiropractic doctors.
What's the motivation to do this transition to a cash only practice? To start with, the 2,200 page Obamacare Bill passed by congress a few years ago has 1,700 different directives to existent and new federal agencies, boards, committees, and czars to establish complex rules and regulations that, when done, will require at least 100,000 pages to catalog, plus footnotes and references to over 25,000 other documents, rules, and regulations.
It seems quite probable that the traditional private medical practice to adapt to all these rules and regulations will require full time employees just to handle these complexities regarding medical practice, which will increase the overhead costs even more.
It's a picture that gives me a headache just thinking about it all. In case you haven't noticed, hospitals and other healthcare provider groups are dramatically increasing their recruiting efforts for physicians and their medical practices. Why? Because large numbers of physicians are losing their medical practices for financial reasons--they lack the business and marketing education that prevents that from happening. Remember, medical schools refuse to offer or provide a business education to medical students.
Another physician group created a concierge medical practice and charge $1500 to $1800 per year per family for office-only medical care. If you have 400 families, that gross cash income is $720,000. And if there are 4 physicians in the group practice, it would be a gross income of $180,000 for each
physician annually.
If you are practicing solo and you contract with 4 members of each family and recruit 200 families, or 800 people and charge $400 per person, it would be a gross income of about $320,000 annually.
A few nagging shortcomings to this "cash" practice method...
- Many patients are too skeptical to accept such a contract.
- Some families think that even those costs are too expensive.
- Solo physicians seldom can tolerate a 24/7 on-call schedule obligation.
- For medical doctors who are escaping government controlled fee restrictions
there will remain the medical licensure, and medical board actions to tolerate. - Because patients move in or out of the practice, there has to be a medical
office staff member to handle those financial things. - Patients/families lose jobs and can't pay.
- Concierge practices don't cover hospital care--a separate cost to patients
- Referral of patients to regular specialist doctors--another added cost to patients
- Some concierge practices accept health insurance payments, some don't
- Finding a place to practice where there are adequate numbers of potential patients
available to you, commonly a city over a million population and minimal competition. - Medical specialists have more difficulty in concierge practice because referrals of
patients to them requires cash payments of consults and lower numbers of patients
who are willing to sign into a contract and be seen only a few times a year or less. - Recruiting of new patients is a full time job for someone on staff
A few advantages concierge practice offers...
- You can control the way you want to practice medicine and adjust the contract
to match your desires. - Physicians are in total control of their practice and their future.
- In groups, free time is more available than in standard medical practice, especially
because there are far fewer patients to deal with in concierge practice. - The situation is available in private medical practice to evolve into a concierge
practice slowly, or to treat both categories of patients. - Some concierge physicians do accept health insurance payments and improves
their recruiting efforts.
Requirements for maximizing your medical practice income…
- Good knowledge of medical practice management
- Having the energy for medical practice marketing
- Medical practice business planning is important.
- Marketing for physicians and their office staff is a winning set up.
- Learn what makes a medical practice business successful
- Your medical practice business system is essential.
- Both practice marketing and physician marketing is rewarding.
- Business success is the objective of all physicians in practice.
- My teaching website—www.marketingamedicalpractice.com
----Professional Probe----
"No one expects you to cure every patient, nor
face distress with a smile, nor suffer ordeals that
that have no resolution, but there is always a way
to make your medical practice management and
career one that you can mold to your skills and
feed your ambition to succeed."
Articles©2013-2022/CGG INVESTMENTS LLC. All rights reserved. #147, 3-16-22
