Concierge Healthcare Market

Part
01
of two
Part
01

Concierge Healthcare Market: Concept Overview

Concierge medical practice is often referred to as concierge healthcare practice and is predominant in developed economies, especially the United States. It is a form of private practice through which patients get "charged an out-of-pocket retainer fee" for accessing personalized healthcare services. This fee could be on a monthly or annual basis.

Concierge Healthcare Market

  • Several primary care physicians/healthcare service providers are downsizing to the concierge medical practice. This practice often gets referred to as "retainer-based medicine."
  • Concierge physicians tend to have 80 to 90% fewer patients when compared with physicians focused on traditional practices. Consequently, concierge doctors spend more quality time attending to their patients and providing more personalized care. These advantages make the subscription-based private medical practice/service (concierge healthcare) to grow at a rate between 3% to 6% annually.
  • Collectively, physicians offering concierge services earn about $3 billion (calculated) yearly.
  • The market is advancing through the rising utilization of mobile apps by primary care physicians to keep track of their patients' vital health parameters. Some providers such as Alliance Concierge Care, Atlas MD, MDVIP, One Medical Group, Qliance Medical Group of Washington PC, and Lifescape Premier are some key market players in the concierge healthcare market.
  • Several factors, including favorable healthcare policies, are encouraging direct primary care, which is compliant to the Affordable Care Act (ACA). Hassle-free patient care and flexible treatments continue to drive the market growth of concierge healthcare.

Delivery Models

  • Some business/delivery models in concierge healthcare include travel medical assistance, private health advisories, as well as private physician practice. Another model in concierge healthcare is the hybrid concierge practice.
  • The hybrid concierge practice is a practice that gives an alternative to established physicians that want to provide concierge medicine and also retain their current patients or the steady income they generate from insurance payments. Hybrid concierge healthcare offers patients with an option to switch to membership-based concierge medicine, while it also reassures all current patients that they will continue to gain access to their physician irrespective of their payment models.
  • Another healthcare model, similar to the concierge healthcare model is the direct primary care model (DPC model). In concierge healthcare, patients are charged an annual fee that gets paid in full or can be split up, but the contract lasts an entire year. Under DPC, patients typically pay a monthly fee and can opt to "drop out of the program at any time."
  • Under concierge healthcare/medicine, the annual fee provides/covers for an in-depth, comprehensive physical visit arrangement with screenings that extend beyond what traditional insurance programs or a government program usually supports. However, under DPC healthcare, the membership fee covers an unlimited number of patient visits.

Regulatory Considerations

  • Within the United States, several medical practices are determined by the concierge medical companies that operate using a subscription-based model.
  • Several fundamental legal issues that physicians interested in offering concierge healthcare services face include: the extent to which access or retainer fees for concierge medical practice covers services that are already routinely covered by health insurance.
  • Physicians interested in offering concierge healthcare services are concerned about legal laws against illegal kickbacks as well as anti-fee-splitting regulations. In situations where concierge provides "free" services, it raises concerns relevant to the federal anti-kickback statute (AKS) once Medicare is involved. Enforcement authorities can consider such "free" services as constituting an "illegal inducement for clinical services."
  • The access fee charged by concierge health service providers could be seen as an insurance practice. Fee-for-service arrangements could be viewed to be outside insurance regulations, and when they are charged for prepaid services, it raises legal issues.
  • Concierge healthcare services need to conform with other contractual arrangements that an entity or provider already has with private insurance companies as well as third-party payers. Private insurance companies often have a clause that prohibits balance billing (that is, billing the patient for service already covered by an insurance agreement). Thus, concierge contracts need to be carefully reviewed by attorneys familiar with insurance contracts within the medical arena.
  • State laws and ethical rules aim to combat patient abandonment; thus, terminating patients after delivering a set level of services becomes a challenge. Patients require enough time to identify a new and satisfactory physician and must get this ample time from their current physicians.
  • Some advertising laws that apply to physicians and non-physician providers (such as allied health and complementary/alternative medicine practitioners) also affect physicians interested in offering concierge healthcare services. Another potential area where state law may be relevant to concierge healthcare is around the use of gift cards. Legal rules exist regarding the use of discounts and packaged services in healthcare.

Recent News

  • According to Doc Wire News, out of about one million licensed physicians within the United States, about 12,000 currently practice concierge medicine. The subscription-based private medical practice/service continues to grow at rates estimated between 3% to 6% annually.
  • Estimates credited to Tom Blue, the executive director of the American Academy of Private Physicians (AAPP), reveals that concierge healthcare fee ranges from about $50 per month to $25,000 per annum, and the national average ranges between $135 to $150 per month. Although revenue is dependent on the number of patients that sign up, concierge healthcare guarantees practicing physicians a minimum income and predictable revenue.
  • The current average salary earned by a primary care physician is about $294,000, while that of a concierge physician is about $300,000. Concierge physicians earn salaries that are on par with regular physicians without facing the numerous overhead associated with a brick and mortar office.
  • Concierge healthcare may not be for everyone, and there is a need for patients to understand "what they're signing up for." According to experts, diabetic patients and people with high blood pressure and other health concerns can leverage concierge to help in better management of those chronic conditions as it has proven in some cases to lower cases of hospital admissions.
  • Patients that subscribe to personalized healthcare models such as MDVIP-affiliated practices (a model that resembles models used in concierge healthcare) have 72- to 79% fewer hospitalizations when compared to patients who received care through traditional primary care practices.
  • A majority of the physicians offering concierge services in the United States are general internists, about 20% are medical sub-specialists, while about 20% are family practitioners. Most concierge practices occur in large urban areas across both sides of the coast (west and east).

Consumer Perception

  • Patients/consumers benefiting from a concierge practice often appreciate their immediate access to physicians via cell phone, e-mail, as well as same-day appointments. The service grants them minimal waiting times in private, pleasant waiting rooms. Patient visits tend to be 30 minutes or longer, allowing patients to present all their concerns.
  • Consumers have a better experience with concierge healthcare as their physicians also coordinate patient care with other providers and often place follow-up calls following specialist visits or hospitalizations. Their physician often accompanies them during specialist visits, engaging them through their hospital as well as home visits when indicated. Specific laboratory tests and procedures also get provided for concierge healthcare consumers at the physician's office.

Industry Expert Perception

  • Experts believe that the primary advantage of a concierge practice to physicians is the total number of patients, which is smaller, typically between 400 to 600, when compared to the panel size of about 2000 to 3000 for primary care practice. This lower frequency of engagement reduces wear out in attending physician since with the smaller panel size; a concierge physician attends to about 6 to 8 patients daily compared with 20 to 24 patients witnessed by typical primary care physicians.
  • Experts reveal that there is far less time spent on or dedicated to billing and paperwork through concierge healthcare. Decreased billing processes result in lower overhead for practitioners as a majority of concierge practices have only one or two employees. Reimbursement from concierge healthcare is more assured, and the income is often equal to or surpasses that of typical primary care physicians.
  • Some physicians report greater work satisfaction as well as "less burnout in concierge practices."
  • Experts believe that due to the apparent advantages that concierge medicine portrays to physicians and their patients, the practice "will continue to grow." They (experts) also think that concierge healthcare is not for everyone, and patients should try to understand what services they are signing up.
  • By establishing concierge practices, Physicians believe they have found sufficient time to make sure all their patients get the "best medical care available." The above insight is credited to Jeffrey Friedman, the M.D./director of medicine at the Community Health Associates. Jeffrey Friedman is also a member of MDVIP.

Research Strategy

The research investigated the state of the concierge healthcare market within the United States. Resources reviewed included market research databases such as the Grand View Research web. An investigation for the market analysis revealed the average cost spent by individual consumers of concierge healthcare in the United States. There were no insights specific to the revenue of the concierge healthcare sector.

The study also reviewed medical journals such as the American Journal of Medicine, among other resources. An investigation was conducted to uncover the perception of patients and experts regarding concierge healthcare and the market size. Insights revealed that patients patronizing concierge practice often appreciate their immediate access to physicians via cell phone, e-mail, as well as the possibility of same-day appointments. There were no insights related to the total size (in revenue) of the concierge healthcare market.

An additional investigation covered medical news and media publications such as Doc Wire News. This strategy reviewed the latest news within the concierge healthcare market, including the market size. This strategy revealed that about 12,000 physicians currently practice concierge medicine in the United States. There were no insights relevant to the market value of this market. Doc Wire News revealed that there is "no federal registry or official database" collecting information pertinent to the size of the concierge healthcare market.

Calculation

  • About 12,000 physicians currently offer concierge healthcare services within the United States.
  • A physician offering concierge services earn about $300,000 yearly.
  • Thus, physicians offering concierge services earn a total of (12,000 * $300,000) = $3.6 billion.
Part
02
of two
Part
02

Concierge Healthcare Trends

The growth in the number of physicians, specialties, charges incurred in the concierge healthcare model and advanced patient care are trends in the concierge healthcare sector.

Growth of Physicians in the Concierge Healthcare Sector

  • According to studies by Concierge Medicine Today, surveys, industry consultants' observations, and many industry-thought leaders as, there is a moderate and gradual growth of physicians in Concierge Medicine.
  • Polling figures from 2014-2018 indicate a 6% increase in the number of physicians in the Concierge healthcare sector.

Driver of the Trend

  • Terry Bauer, the CEO of concierge medicine transition firm Specialdocs, stated that, "After years of shrinking reimbursements, truncated office visits and mounting regulations, physicians have been left with few satisfying choices to pursue their calling."
  • The sheer impossibility of being able to offer quality care in a volume-driven environment is the reason behind the increasing numbers of physicians who view concierge medicine as a career- and life-saving measure."
  • The concierge healthcare sector allows the growing number of primary care physicians to be able to practice the highest quality medical care, which intensifies the trend.

Top Specialties in Concierge Healthcare Sector

  • The top five specialty areas for Concierge Medicine include family medicine (32%), internal medicine (23%), osteopathic (11%), pediatric (8%), and dentist (5%).
  • It is estimated that the growth rate of concierge healthcare is between 3% and 6% annually, primarily in internal medicine and family medicine.
  • According to The American Journal of Medicine, majority of concierge physicians are general internists with 20% medical sub specialists and 20% family practitioners.

Driver of the Trend

  • This is due to the emergence of organizations that recruit concierge physicians and manage concierge practices.

Charges

  • The practices charge an average of $1500 to $1700 per year, and approximately $135 monthly.
  • Some concierge physicians offer reduced retainers of $200 per year for less-extensive access.

Driver of the Trend

  • The expense that often compares to other household expenses, and health insurance is needed only for more expensive treatment such as hospitalization or specialty care.

Advanced Patient Care

  • 18% of patients join the concierge medicine program due to convenience as 66% join the program because of finding a doctor that they like and trust, and 10% due to cost factors.
  • Patients of concierge services get more face-time with doctors, receive annual physicals that last for hours, and focus on preventive medicine.
  • Patients in a concierge practice appreciate the immediate access to their physician by cell phone, e-mail, same-day appointments, minimal waiting time in private, and pleasant waiting rooms.
  • The visits are 30 minutes or longer and allow patients to present all their concerns.

Driver of the Trend:

  • Concierge physicians usually have 80% to 90% fewer patients as compared to traditional practice, which allows doctors to spend quality time with their patients and provide more personalized care.

Research Strategy

To give an overview of trends in the concierge healthcare sector, we commenced with looking for statistics, studies, reports, and surveys published in sources such as American College of Private Physicians, Concierge Medicine Today, Healthcare Drive, docwirenews.com and Healthcare Finance.

We also took a deep dive into news and media coverage about the concierge healthcare industry in sources such as Forbes, The Guardian, NY Times, CNBC, CNN, along with research papers such as the American Journal of Medicine, Grand View Research, IBIS World and NCBI.

After thoroughly studying the insights on the concierge healthcare sector, we identified the trends in the concierge healthcare sector.
Sources
Sources