Could Doctors Find Success Switching to Concierge Medicine and a Cash-Only Model?June 19th, 2013 | Posted by in Baby Boomers | Medicare News
A small percentage of family practice doctors have opted out of the traditional healthcare model, switching to “concierge medicine” and adopting a “cash-only” approach that enables them to provide more attentive care to their clients.
In this age of swollen healthcare costs, doctors are searching for cost-effective ways to treat patients while reducing overhead expenses. As a result, a small number of doctors across the country have removed their practices from the insurance system entirely, switching to a “cash-only” arrangement that charges patients a monthly fee for any number of their services and treatments.
Imagine, instead of accepting health insurance plans, your doctor charged you a monthly fee for all services. This membership plan (known also as “concierge medicine”) effectively replaces the need to have a costly health plan through a private provider. Instead, you pay the practice a membership fee for access to their doctors and their provided services, like EKGs and stitches.
This is how Atlas M.D., a practice in Wichita, Kansas, operates. Family physician Doug Nunamaker switched to a “cash-only” foundation in 2010 after complaining of overbearing insurance companies and high overhead costs. The “cash-only” membership structure doesn’t specifically refer to hard currency, as the practice also accepts credit and debit card payments. What it doesn’t accept, however, is insurance providers.
Atlas M.D. determines the membership fee by age, charging $10 a month for children, a monthly payment of $50 for adults up to age 44 and $100 for ages 45 and up. The plan also includes additional cost-effective services outside of Nunamaker’s office. The physician says that a cholesterol test can be done for $3, as opposed to the normal billing rate of $90. Likewise, the total cost of an MRI tops out at $400 compared to $2,000 when the insurance companies are involved.
The “cash-only” subscription plan covers check-ups, services, and smaller procedures. But Nunamaker encourages his patients to carry a high-deductible health insurance plan in the event of serious illness or emergency. His clients are mainly self-employed, small business owners, or small firm employees who prefer the monthly fee and high-deductible plan combination as a cheaper option than traditional insurance.
Before enacting this policy, Nunamaker claims he required a large staff in order to contend with the bureaucratic practices of the traditional health insurance system. In order to cover overhead expenses, Nunamaker was forced to take on more patients, effectively reducing the amount of time he could dedicate to an individual. Today, his patient list hovers around 400-600 individuals, and he is happy with the quality of the care he is able to provide. Comparatively, Nunamaker says a typical family physician working in the insurance-based healthcare system sees between 2,500-4,000 patients.
According to a story published in Forbes earlier this year, approximately 9.6 percent of the 14,000 practice owners polled said they were planning to convert to concierge practices in the next one to three years.
Is it affordable?
While this method has it supporters, experts suggest that this kind of practice is out of reach for many middle and lower income families.
Kathleen Stoll, director of health policy at the consumer advocacy group Families U.S.A., expressed concern for those who can’t afford to pay out a monthly subscription fees. “They cherry-pick among their patient population to serve only the wealthier ones,” Stoll said. “It certainly creates a barrier to care.”
Stoll also questions the scope of services covered outside of these practices, suggesting the “cash-only” model may lose its luster in the light of serious or prolonged illnesses. “I’m always cautious when it’s a cash basis,” she said. “Are you somehow being put at risk? I’d have a list of questions.”
CNN Money also covered this story.
What do you think of the “cash-only” model, which removes insurance companies from the process? Could concierge medicine be right for you?