Building a Cash Only Practice final

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Building a Cash Only Practice David Albenberg, MD
Access Healthcare 2 Todays Objectives Convey our experiences and the experiences of others transitioning to a cash-based practice Highlight the steps in transitioning to a cash-only practice
Itemize successes and pitfalls along the way
Outcomes compare practice management metrics
Demystify some current beliefs regarding the workings of a retainer-based practice Identify resources for transitioning your practice
Allow ample time for discussion 3 Not Covered Current state of traditional Primary Care
Ethics of cash-based practices
Step-by-step approach to setting up a practice 4 Ground Rules No Whining You are here 5 Natural History of Your Future Resentment Burnout Early Retirement Dear Dave,
Glad to see you're succeeding in the boutique practice business. I'm in solo practice, Carson City, NV. I see pts 5 days/week, 1/2 Sat each month, having about 15 patients I still do house calls on (mainly bed-ridden). However, the financial rewards have really not been there. My practice is about 50-60% Medicare. The overhead, even employing 2 people, is killing me. We grossed $250k last year, I took home $44k after taxes. So, I'm really considering calling it quits. Dear Dave,
One of my colleagues who had 4000 active charts, went out of business last year, saw at least 25 pts/day, couldn't make ends meet. Another one had to sell his practice to an urgent care set-up to avoid going under. Another closed and went to work in Reno. No one is buying primary care practices anymore. When practices go under around here, the patients vanish, since all docs are busy. No new PCP's are moving into the area. Most internists don't earn $120k around here either. Not worth continuing as far as I'm concerned. Ethics Question How ethical is it for an overworked, burnt-out provider to spend 7 minutes with a patient in their time of need? 6 Your Options See more patients?
Tweak the system?
Go to work for the insurance companies?
Retire?
Academic medicine?
Laser hair removal?
Cash-only practice? 7 Cash-Only Practices a misnomer? Three models:
Fee-for-Service Retainer-Based Practice Fee for Non-Covered Services AKA Double Dippers
Fee for Covered Services Pure Retainer Hybrids Survey of SIMPD Member Websites 08/06 www.SIMPD.org B reakdow n of C ash B ased Practice Styles 25% 6% 17% 41% 11% Fee for N on-C overed Services
Fee for Service
H ybrid
Fee For C overed S ervices
U nclear 8 The Cash Practice: AMA Survey Motivation - ethics possible decreased in physician charity care risk of patient abandonment exacerbation of existing health care inequities based on rationing by ability to pay Methods - survey of 144 retainer physicians standardized to randomized control physicans Findings much smaller panels 900 v 2300 pts retainer physicians treat fewer minority and Medicaid patients Retainer physicians are more likely to: accompany patients to specialists do house calls have 24 / 7 access do more charity work (non-statistical) Additional stats: 85% converted from non-retainer practices 94% perform charity care 12% retention of patients through transition Conclusions - Despite differences between retainer and nonretainer practices, there is also substantial overlap in services provided. These findings, in conjunction with the scope of patient discontinuity when physicians transition to retainer practice, suggest that ethical and legal debates about the standing of these practices will endure. Outcome AMA Ethics Position Statement` J Gen Intern Med. 2005;20(12):1079-1083. 9 The Cash Practice: GAO Report Motivation - The recent emergence of concierge care has prompted federal concern about how the approach might affect beneficiaries of Medicare, the federal health insurance program for the aged and some disabled individuals. Concerns include the potential that membership fees may constitute additional charges for services that Medicare already pays physicians for and that concierge care may affect Medicare beneficiaries access to physician services. Identification - 147 Concierge Physicians 112 responded to survey, almost all practicing primary care Fees - ranged from $60-$15,000 / year averages $1,500 - $1,999 Most often reported features - same- or next-day appointments for non-urgent care, 24-hour telephone access, and periodic preventive care examinations Insurance - About three-fourths of respondents reported billing patient health insurance for covered services and, among those, almost all reported billing Medicare for covered services Resolutions HHS has determined that concierge care arrangements are allowed as long as they do not violate any Medicare requirements. The small number of concierge physicians makes it unlikely that the approach has contributed to widespread access problems GAO's review of available information on beneficiaries' overall access to physician services suggests that concierge care does not present a systemic access problem among Medicare beneficiaries at this time 8/05 - http://www.gao.gov/new.items/d05929.pdf 10 Milestones in Retainer Medicine: The Pendulum Swings Pre 1939 Age of fee-for service medicine 1939 Blue Cross founded as a not-for profit by AHA Post WW II Wage & Price Freeze regulations limiting wages encourages employers to compete for employees by offering healthcare benefits to employees triangulation begins 1965 More government intervention tax codes favoring employer- sponsored insurance 1965 - Medicare / Medicaid enacted 1996 MD Squared founded by Howard Marion, NYT coins movement boutique 3/2002 Waxman Letter Questioning double-dipping / MDVIP 10/2003 AMA forms Ethical Guidelines re transition 12/2003 George Bush furthers ownership society Establishment of HSAs promotes Consumer Directed Medicine 3/2004 OIG Alert double-dippers beware 8/2005 GAO report on Concierge Medicine 2/2006 Washington is the first state ruling on retainer practices 3/2006 West Virginia insurance commissioner ruling 11 The Cash Practice:
Retainer Amenities Access same day visits, 24/7 access, minimal wait times, cell phone access, e-mail, telephone consults, house / office calls Amenities more pleasant surroundings, coordination of care Attention longer visits, accompaniment to specialists Focus on Prevention Annual Executive PEs 12 Our Story
Year Zero: 2002 March 2003 May to December 2002 12 Steps to Freedom
December 2002 The Letter
December 6, 2002 No Looking Back
December 2002 to March 2003 The Rebirth
March 2003 Shouting from the Rooftops 13 The Transition Letter November 15, 2002 Dear ____________, After five years at James Island Medical Care, I am excited to inform you of plans to establish my new practice at a downtown location. In my time here, I have been grateful for the relationships that I have established with my partners, Drs. Costa and Scott, my loyal and hard-working staff, and most of all, my valued patients. While I am fortunate to have been given the opportunity to nurture honesty, trust and respect within those relationships, my one regret is that our current high-paced and volume-driven practice environment has not allowed me the time during daily encounters to further those relationships. Not only will my new model reflect a move towards a retrospective era of traditional family medicine with the patient at its heart, but it will help me launch Charlestons first example of a national model of Retail Medicine characterized by reduced time in the waiting room, increased amount of physician attention, more access to the physician in the way of evening and weekend hours, e-mail contacts, cell-phone after hours access and even house calls for emergencies. I intend to provide the same base of continuity care, mixed with same-day availability for walk-in urgent care, but at a reduced cost to you. In exchange, I will ask that patients make payment at the time of service. For those that have insurance plans, we will provide you with the documentation necessary for you to directly receive out-of-network reimbursement from your insurance carrier. A lower daily patient volume will allow me the ability to spend more time with each patient to provide the type of individualized attention that I believe you are looking for and deserve. Your help in this respect will allow me to turn my focus away from the daily frustrations of practice management, in which I have no formal training, back to the patient where my attention belongs. After completion of my duties at JIMC over the next few weeks, I will be pursuing the full-time task of setting up the practice in anticipation of a March 1st opening. In the meantime, please read the enclosed article entitled, Pay as you go, which highlights the nationwide growing trend towards this type of patient-focused practice. If you are interested in making the transition to the new practice, please sign the below transfer of records request and fax it or mail it to us at the above address so that copies of your record will be available to us on your first visit. Those of you who fax records requests will be kept up to date on our progress with future mailings. For those of you who wish to remain with James Island Medical permanently or in transition towards our opening, you will be seen by Dr. Robinson who will be taking my place in the practice. I welcome any questions that you may have in the interim. Looking forward to simplifying,
David L. Albenberg, MD 14 Our Story
Year One: March 2003 March 2004 March 17, Opening saw 20 patients that week, 11 the following week; 04/03 Income: $7,085 Expenses $42,751 Branding The doctors that dont accept insurance Hybrid Model contra-insurance model tested Personal Financial Status savings dwindling July First Paycheck! Identity Crisis - Struggling to find our Niche / Branding Confusion Healthcare Spa
Concierge / Boutique
Consumer-directed friendly
Doctor in the House 15 T HERES A D OCTOR I N T HE H OUSE . ITS ABOUT TIME. Lowcountrys premier family practice offering easier access to your personal physician in a comfortable, relaxed atmosphere with minimal wait times. SO, HOW DO YOU WANT TO SPEND YOURS?

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