By Vasilios J. Kalogredis. J.D.
It comes with many names. Some call it retainer medicine. Others call it boutique medicine. Some call them executive health programs. Others call them platinum practices. Others call it concierge medicine. Whatever name is given to the concept, it is something being given consideration by increasing (albeit small) numbers of physicians. What the concept basically entails is a situation whereby patients pay a set annual fee for “special service.”
In today’s world where physicians’ incomes are being threatened in many ways (lower reimbursements from payors, higher costs – particularly in the area of malpractice premiums, greater administrative burdens, delayed payments and claims processing hassles from payors, and the like), many physicians are scurrying about to find ways to at least maintain their income levels.
Many physicians have felt compelled to put in even more hours and see even more patients in an attempt to “maintain” their practice’s economics. Unfortunately, many of them find that there are not enough hours in the day to do that and that their economic condition is worsening.
A very small percentage of physicians have responded in a different manner. In what many doctors would consider to be a drastic and risky move, that small number of physicians have decided to drop out of all third party payor programs (including Medicare and private insurers). Instead, these practitioners have offered a limited number of patients the opportunity to pay a fixed annual fee in exchange for “premium services and amenities.”
Those who have done this have generally limited by a drastic amount the number of patients which they will service. We have generally seen this concept make the most sense for primary care physicians and those specialists who have ongoing and regular relationships with their patients. Some have seriously questioned the legality of these concierge practices. Various state agencies and the Centers for Medicare and Medicaid Services (CMS) are looking closely at the propriety of these practices. Before entering into any arrangement such as this, it is important to make sure that things are critically reviewed from a legal standpoint.
As a general rule, for a fixed annual fee, these practices offer a limited number of patients special services and amenities that are not now provided by most medical practices. These services may include, among other things, the following:
· Nicer and less crowded reception areas.
· Priority/same day/ guaranteed next day/ extended/ Saturday appointments.
· 24-hour pager, cell phone, home phone access to the physician.
· House calls and out of office care, possibly including accompanying patients to appointments with specialists.
· Preventive care/ weight loss/ nutrition/ wellness advice and programs.
· Telephone and email consultations.
· Spa-like amenities and dE9cor.
· Free check ups.
· Physicals and other normally uncovered services.
The main selling points to patients of these practices are that they get better and more immediate access to, and more undivided attention from, their doctor.
The cost for such memberships could run as low as $1,000 per year on up to $20,000 or more per year. It all depends on what services are actually provided, the age and health of the patient, and the like.
Before launching into such a practice, it is important to look at and carefully evaluate many things. For example, AMA Policy sets forth in its ethical guidelines that those paying such an extra fee and those who are not should get an equal quality of care from that practitioner. It is also important to fully comply with all state and federal laws.
It would be important to send a letter to your patients, (prior to changing over to this concept) explaining what you are doing and directing them to communicate with your office with any questions or concerns. Providing such notice before converting to such a practice will reduce the possibility that some of your patients will be left without a physician. They need to know that they can seek the care of another doctor as an alternative to paying your practice the retainer fee.
An annual fee would need to be established. It would have to be clearly defined as to which medical and non-medical services are provided for the payment of this fee. As a general rule, this annual fee would be payable upon execution of the contract between the patient and the physicians. Some have gone with a “monthly fee” arrangement. Some doctors who have gone this way have decided to no longer contract with Medicare and other third party payors. It is important to clearly explain to the patients what will be provided and what their payment responsibilities will be.
Reimbursement is also an issue. If you continue to participate in any of the third party payor plans, it will be important to assure that what you are doing does not fly in the face of any of their rules or contractual terms. You also need to assure that you are not flying in the face of any federal or state laws regarding these services. The contract should provide termination language. Generally we have seen one-year retainer contracts with automatic one-year renewals, unless either side decides to terminate on at least 30 days prior written notice.
Concierge medicine raises many legal issues, many of which are not “black and white.”
Medicare requires physicians to submit claims for all procedures performed on Medicare patients. Some have argued that these membership fees violate Medicare rules because Medicare beneficiaries cannot receive covered services from such a concierge practice without first paying a fee above and beyond the Medicare fee schedule amount. It will be important to clearly define what services are included within the concierge fee and which are not. If it is clear that the concierge fees charged by the practice were for non-covered services, then such fees would not violate the Medicare rules. It is clear to me that the government will continue to monitor such practices for evidence of wrong doing or “coercive” activity. CMS is continuing the review concierge care.
In situations where concierge practices are charging a fixed amount for a package of prepaid services, said practices could be deemed to be providing insurance in violation of state law. For example, if the practice were to go bankrupt, who would bear the responsibility for providing these services?
Abandonment is another issue. Physicians who go from a full patient load to a more limited one could be deemed to be abandoning their patients. That is why it is important for the doctor to take steps to help the patient find subsequent care. The important thing is for the doctor to provide adequate notice and appropriate referrals and to not leave any patients in a non-stable condition. If that happens, the risk of a viable abandonment claim would be greatly diminished.
There are many ethical issues that also need to be addressed.
Some fear that concierge care will result in a two-tiered medical system based upon economics. Concierge physicians would not be satisfying their ethical duties to provide some indigent care. The AMA’s counsel on medical service issued a report in June, 2002 on Special Physician-Patient contracts. It concluded that retainer medicine was a very small phenomenon with a very limited number of physicians and patients. It did not believe that this concept would expand significantly. It indicated that the concept was consistent with the AMA’s policies in support of pluralism in the delivery and financing of healthcare.
In June, 2003 at its annual meeting, the AMA Council on Ethical and Judicial Affairs outlined the following guidelines for “contracted medical services.” The AMA House of Delegates approved these guidelines:
· The patient has the freedom to select and supplement insurance for their health care on the basis of what appears to them to be an acceptable tradeoff between quality and cost.
· When entering into a retainer contract, both parties must be clear about the terms of the relationship and must agree to them. Patients must be able to opt out of a retainer contract without undue inconveniences or financial penalties.
· Physicians must always ensure that medical care is provided only on the basis of scientific evidence, sound medical judgment, relevant professional guidelines and concern for economic prudence. A retainer contract is not to be promoted as a promise for more or better diagnostic and therapeutic services.
· Physicians converting their traditional practices into retainer practice must facilitate the transfer of their non-participating patients to other physicians, with no extra fee for transmission of their medical records. If no other physicians are available to care for non-retainer patients in the local community, the physician may be ethically obligated to continue caring for such patients.
· Physicians who enter into retainer contract will usually receive reimbursement from their patients’ health care plans for medical services. Physicians are ethically required to be honest in billing for reimbursement.
· Physicians have a professional obligation to provide care to those in need, particularly those in need of urgent care. Physicians who engage in retainer practices should seek specific opportunities to fulfill this obligation.
It is true that concierge medicine is a relatively new phenomenon. It has received a lot of publicity, both positive and negative. Some physicians may view this approach as a panacea and as a way of returning to the past when medical care was more personalized, without income being constrained. The reality is, this practice model will really only work for a small number of medical practices. For those who do decide to go this route, it will be safest to only charge extra fees for non-covered medical services. It will be important to be sure that the non-participating patients are transferred to other competent medical practitioners. Patients need to be fully educated as to what services are covered and which are not. Practices need to be sure to follow carefully any and all rules and regulations for opting out of Medicare and/or any other third party payors, if that is what they decide to do.
Some practices may not go “all the way” to a full concierge practice approach.
For example, some practices may not set up a specific retainer fee arrangement, but may decide to charge their patients on an a la carte basis for services not otherwise covered by Medicare, or that patient’s third party insurance program. This might include things such as charging fees for telephone time, responding to emails, record transferring and copying, insurance form completion and the like. There are some potential legal risks in charging for these administrative services. Medicare and many third party payors preclude the charging of a fee for covered services. Medicare does not allow the charging of patients for the submission of claims. Medicare and other payors may argue that these administrative services are deemed to be part of what they are paying for.
In closing, let me say that concierge medicine is not for all practitioners, but may make sense for a limited few, for the reasons and with the caveats set forth in this article.
Vasilios J. Kalogredis, J.D., is Founder and President of Kalogredis, Sansweet, Dearden and Burke, Ltd., a boutique health care law firm in Wayne, Pa.