The Pros and Cons of Concierge Medicine

More medical practices are catering to the middle class, with the goal of providing affordable care

Concierge medicine is booming in Naples Florida, the final resting spot of America's one-tenth-of-one percent. With nice big former CEO pensions and golden age parachutes, the residents in Naples, FL want the very best medical care - and local physicians are happy to give it - at a price. According to a 2012 Medicare Payment Advisory Commission report on retainer-based physicians, Naples has more concierge physicians per capita than any other place in the country.

Concierge medicine is an alternative medical model in which doctors see a reduced panel of patients, each of whom pays a monthly or annual retainer. Patients are granted more (sometimes even unlimited) access to the doctor. Weekends and evening phone consults and same-day appointments are the norm. So are expanded medical tests. Annual fees for this service run from $1,000 to $20,000.

Here’s the problem: The typical American family physician working on a fee-for-service model carries between 2,000 and 3,000 patients on his or her roster. A concierge physician however, has just 400 to 1,000 patients (and 1,000 is very rare). As the trend toward concierge medicine grows, more and more people will find themselves unable to find care.

There is however, a new and growing generation of concierge doctors who, in this era of health reform, see more opportunity in the middle class than they do in the jet set. The trend has separated the retainer medicine industry: On one end, patients pay thousands of dollars a month for lavish celebrity-type treatment at traditional concierge practices. On the other, pared-down clinics charge roughly $50 to $100 a month for basic primary-care medicine, more accessible doctors, and yes, money savings for those looking to reduce their health spending.

Of the estimated 5,500 concierge practices nationwide, about two-thirds charge less than $135 a month on average, up from 49% three years ago, according to Concierge Medicine Today, a trade publication that also runs a research collective for the industry. Inexpensive practices are driving growth in concierge medicine, which is adding offices at a rate of about 25% a year, says the American Academy of Private Physicians.

Unlike high-end concierge practices, which typically bill insurers for medical services on top of collecting retainer fees, the lower-end outfits usually don't accept insurance. Instead, they charge patients directly for treatment along with membership, often posting menu-style prices for services and requiring payment up front, which is why it is called "direct primary care." Eliminating insurance billing cuts 40% of the practices' overhead expenses, enabling them to keep fees low, doctors say.

On the cusp of the Affordable Care Act mandating most Americans have health insurance, a rise in doctors who don't take insurance might seem paradoxical. But health-care experts say the two forces go hand in hand, as patients may find concierge doctors more accessible, especially if traditional doctors get flooded with more patients. Also fueling the trend is a little-known clause tucked into the health-care law that allows direct primary-care to count as ACA-compliant insurance, as long as it is bundled with a "wraparound" catastrophic medical policy to cover emergencies.

The ACA already requires me to buy health insurance. Why would I need this, too?

While some insurers are developing special health plans around concierge practices, most patients who see concierge doctors pay for it on top of their regular insurance. The rationale: Many of the new health plans have high deductibles that most members will never hit, meaning patients will still be paying thousands of dollars out-of-pocket anyway—possibly even more than what they'd spend on concierge medicine. People with deductibles of $5,000 or more should think about how many times a year they typically see the doctor and for what, keeping in mind that annual checkups are free under the ACA. If doctor visits typically cost $150 and the patient has six appointments a year, a concierge practice offering the same services for $40 or $50 a month might be cheaper.

What if my insurance doesn't have a concierge option?

Since most large insurers have yet to build plans around concierge practices, people might feel that the retainers are redundant next to their insurance plan, says Erika Bliss, CEO of Qliance, which received funding from Inc. CEO Jeff Bezos and whose 8,500 patients pay between $54 and $94 a month depending on age. Dr. Bliss, who championed the concierge clause in the ACA, says it's "a shame" more insurance companies haven't embraced it yet, because people compelled by law to buy traditional coverage might find concierge unaffordable now.

Direct primary-care doctors say that a patient's best bet is to select a high-deductible policy with minimal premiums for emergencies, and put the money they save up front toward the concierge retainer. High-deductible plans are often paired with health savings account. The IRS, however, doesn't recognize direct primary-care fees as eligible HSA expenses, so patients might not be able to spend pretax dollars at the clinics.

How can this save me money?

While traditional doctors charge for each treatment and test—which can add up to hundreds of dollars per visit—concierge clinics charge flat fees that generally include basic checkups, treatment of minor ailments and electrocardiograms, or EKGs. Services like blood work, X-rays and vaccines can cost extra, but concierge doctors often negotiate with specialists and labs to secure discounts for patients who would otherwise pay out-of-pocket.

If the concierge medicine is cheaper, do I still get VIP treatment?

Because concierge doctors aren't at the mercy of insurance companies, they say they take on fewer patients and spend more time with each, often guaranteeing appointments within 24 hours. They also don't need patients to come into the office to get paid, so they can provide care via video, email and phone. One of the great conveniences that private physicians offer is virtual conversations, as in "text me a photo of your tick bite."

But the lower-cost concierge practices keep their rates low by focusing on simple services—you won't find advanced medical technology, and you'll have to go elsewhere (and pay extra) for screenings like MRIs.