How To Prepare Your Practice For Survival As The Health Insurance Model and Referrals Start To Dry Up
The following recent reports related to healthcare and insurance coverage have been more frequent and are negatively affecting insurance-based practice groups and their staff.
The Coronavirus Economy Is Coming For Your Family Doctor: https://www.huffpost.com/entry/coronavirus-familydoctors_n_5ebb264ac5b6bf83abba954b
Recent headlines: Health workers are facing layoffs, furloughs, and cuts to salaries and schedules in response to declines in revenue.
Healthcare is a trillion-dollar industry in the US, where hospitals and clinics are overwhelmingly run as businesses, and patients are the core of their revenue cycle. Americans are expected to have the means to pay for their treatment, this means it is usually covered through expensive insurance linked to their jobs, although about 28 million people were uninsured in 2018, according to Kaiser Family Foundation.
So with 28 million uninsured and another 27 million Americans losing their health insurance due to layoffs and business closures as a result of the coronavirus pandemic. What should a practice do to survive?
Before we can figure this out, we need to find out: What it means to your practice and What to do about it?
What does this mean to your practice?
It means that your referral base from practices like Family Doctors or Primary Care physicians and other referring practices will no longer be able to provide your practice the necessary volume of patients to sustain your practice facility and specialty. As a result, more and more practice groups will have to reduce their staff because of what we noted above, meanwhile, insurance cases have begun drying up.
Some practices may be able to avert this upcoming disaster by requesting deferred payments from their vendors, asking their staff to take a pay cut, (we spoke about this in an earlier issue ), or with help from the PPP program they just barely hang on. However, the majority of practice groups are being forced to layoff staff or close their offices entirely. This, in turn, is creating a negative and spiraling impact throughout local communities and the country at large which depends on insurance-related healthcare coverage. Many medical practices, staff, and patients alike are feeling the impact.
Now that we have the facts, what can you do to save your practice? What can you do to help your practice survive?
The truth is a lot of practice groups in the last ten years have made a successful and profitable transition to the Direct Primary Care, or Concierge or Retainer model.
This model of medicine keeps a limited number of insurance pay patients on their books but more than 75% of the practice is Concierge and 25% is insurance. With this model doctors and practice groups, can insulate their practice from the pitfalls of the oncoming insurance decline.
What is a DPC or Concierge model, you ask?
Put simply, the prospective patient pays an annual fee once a year upfront, and maybe a minimum monthly fee like a deductible is paid for at office visits. In return, patients get, treatments, written prescriptions, and referrals throughout the year.
The Concierge model provides similar or like-kind coverage but is a stripped-down model of health insurance without the many complications of insurance coding, regulatory issues, and billing chaos. It’s comparable to what Urgent Care Centers are versus Hospitals. You can get many of the same services, but avoid the wait times and insurance approvals which are often required before a patient can be seen.
With Concierge practices, patients get to keep the same doctor if they pay the annual fee and monthly membership fee. This gives a patient the security of having the doctor who knows their medical history and what health issues you may already have.
Many of these practices are thriving in what could be described as the worse financial decline since the great depression.
How do you start the transition to a DPC or Concierge model, you ask?
You’ll need to notify your staff of your goals, intentions, and expectations, help them to understand that the quality of patient care will not diminish, but will likely improve as there will be fewer patients to see and the doctor will be able to provide more time and attention to the individual needs of every patient.
Comparative data shows that many who have insurance coverage pay a significantly higher deductible even before any insurance will be paid for coverage costs. Whereas concierge medicine charges a one-time annual fee with a monthly membership fee. This can be less than the required deductibles over time.
Additionally, doctors now become more focused on Wellcare versus Healthcare. With the concierge model, it opens the door for more freedom and flexibility when treating certain chronic conditions that traditional medicine doesn’t seem to help.
Doctors can then become innovative in their treatment processes. And as a result, patients tend to have much better treatment outcomes. Again, because the doctor can now focus on preventive measures that relate to patient issues, in the end better outcomes with happier patients.
Most patient evaluations, treatments, and recommendations in a concierge medicine practice are steeped in foundational principles of medicine. Yet are flexible enough to help patients reduce the dependency on medications that so often are prescribed and can rob the patient of their physical and financial vitality.
The Concierge doctor can focus on his or her patients eating habits, exercise, hormone balancing, and lifestyle changes which include nutrition and supplements that can be privately labeled and create a passive income stream with wonderful benefits that patients gain when taking Vitamin B, C, D, Zinc, Magnesium, and others.
There are pros and cons to the concierge medicine transition, but overall, people need a healthcare system that is more responsive to their health and financial needs. It’s my contention that Concierge medicine is a wonderful low-cost way to meet a doctor’s economic needs and yet meet patient needs. WellCare’s focus is based on future health.
Because this is a cash-based model, staff will absolutely need to be more responsive to patient needs. Why? Because no one wants to wait if they’ve paid hard-earned cash for access to their doctor.
Team or Staff members who can’t or won’t make the needed transition to the fee for service model but prefer to treat patients based on the insurance model, these staff members will not likely be happy or suited for this new way of managing patients. It is very probable, that these employees will seek employment with other insurance-based practices that stick to the old healthcare insurance model.
DPC or Concierge patients require and demand Timeliness, Great Customer Service, Friendliness, Responsiveness, and a Smile when greeting them and should be a requirement.
Once these steps are put in place, you will then need to communicate with your patient population. This can be done via newsletter, written notification, social media post, text, or one on one conversation. Again, be prepared to explain how this will impact the patient’s care and access to your practice and their treatment. Explain to them that the fees will provide you as a doctor and the staff a way to provide more personalized unhurried visits and care.
For those patients who don’t want this plan, let them know they can browse their insurance directory for a new doctor. This will be the most difficult part of the process but will give you and them the best chance of survival. Otherwise, you could continue to have financial instability or be forced to close your practice all together due to low patient volume and lack of insurance patients and referrals from other doctors.
To be sure, the number of insurance patients within your office will very likely go down and need to go down. Your mission is to ensure that your patients choose other options if you’re going to reach 75% cash-based and 25% insurance. In a concierge practice, where let’s say 500 patients pay an annual fee of anywhere from $1000 to $1500 per year and maybe a maintenance fee of say $100.00 per month for unlimited office visits or telemedicine visits. Who wouldn’t want that kind of access to their Doctor and his or her P.A?
Considering the revenues from this type of program will more than cover the operational costs and expenses but also provide financial stability for a doctor and his team unless they are overextended financially. The practice would fare much better if they no longer have to wait on delayed insurance payments to cover their practice expenses and while helping their patients to get better care!
Speaking of telemedicine, the doctor and his team will also need to be properly trained on telemedicine techniques and regulatory requirements when communicating with patients over the phone. But telemedicine will be a great way to manage your new patient volume in a concierge practice. In fact, many will not want to come to the office especially due to the coronavirus. Providing an online face to face option is a great way to maximize your time and volume of patients. Additionally, the insurance patients who have coverage will pay for telemedicine. Just make sure your practice has the correct billing code for this format of patient care. And please be sure to document, document, document all patient interactions.
Marketings Big Role In Your Transition To A Concierge Practice!!!
Building your audience is critical to your success. As you begin the transition to a fee for service practice model, you’ll most certainly lose a number of insurance-based patients. This is to be expected and actually a necessary part of your transition. Marketing will help alert and galvanize those new patient prospects who are willing to pay for your time, years of medical school, and experience in treating patients that you’ve spent many years perfecting.
The concierge practice model is not designed to be heartless toward insurance patients, but to help your practice to survive. Understanding this is critical to your survival. As a doctor, you’re also a businessman, which is why you’ve got to improve your balance sheet to cover your personal and business expenses along with other practice-related costs.
Social Media has become one of the most effective tools to connect with and find people who are looking for your practice and your kind of concierge services… Most growth occurs from Likes, Sharing, or Messaging about what consumers found online about your practice.
Social Media consumers give you the best chance to grow your concierge practice organically and through targeting and retargeting. Social Media also has a viral impact that allows it to create a word of mouth impact that will surely be needed.
We recommend many of the most popular social media channels: Instagram, Facebook, Twitter, Linkedin, and Google My Business.
Why do we recommend these channels? Because each channel provides a mix and match of potential patients. And each social channel has its own audience that could potentially your type of client!
You will need an expert marketing organization that understands the proper mix and match of ad copy and wordsmithing when it comes to creating ads. These experts will know the guidelines that are required to get your message out properly. Then as you generate new prospects it is critical that you use consistent and real-time follow-up as social media prospects require speed to lead followup to be truly effective. And add them to your monthly newsletter to stay top of mind.
Click Here: https://www.youtube.com/watch?v=FuV9BKmYFCg&t=4s
All that being said you’re on your way.
Now is the time to get started, even if the insurance model holds on for a few more years. You should not delay too much longer for the transition, as you’re most likely to eventually succumb to the insurance drain. The successful practices have already transitioned to concierge medicine format. What are you waiting for?