Twelve Practice Models for 2016 Mary Pat Whaley, FACMPE, CPC

ManageMyPractice.com

Physicians are rejecting government mandates (Meaningful Use, PQRS), hospital employment (dwindling compensation contracts), continually-declining reimbursement and burnout - by choosing to start a new practice with one of these 12 practice models that puts the physician back in the driver’s seat!

Why Physicians are Starting New Practices It’s a New Opportunity to “Start Over”

Model 1: Direct Primary Care

In DPC the patient pays a standard monthly fee that covers most primary care needs. No insurance is involved so overhead is significantly decreased. This is an excellent model for the physician who already has a loyal patient base to transition to DPC. Contracting directly with employers is the other practice builder. Patient panels number 300 to 400, and patients pay between $59 and $129 per month, depending on their age and which services are included. Patients still need insurance for ancillary services (lab, imaging, drugs), specialist and catastrophic care.

Direct Primary Care (DPC) Ideal for established primary care providers

Model 2: House Call Practice

A House Call practice makes a lot of sense economically because no physical office is needed. Depending on the physician’s concern about billing overhead, this type of practice may or may not participate with insurance plans. With lower gas prices, healthcare apps for the smartphone, remote diagnostics and self-scheduling, any physician can afford to start this type of practice. Many think of house calls as a geriatric service, but pediatrics is a good fit and occupational health (visiting the workplace) is as well. Don’t underestimate the consumer’s willingness to pay for convenience!

House Call Practice A good fit for both the rural and urban setting

Model 3: Micropractice

Another low-overhead practice model is the Micropractice, which is just one physician and one computer. Leasing space from another practice, the physician uses a virtual assistant or does all the administrative work him/herself – answering the phone, scheduling appointments, and taking payments. The overhead is primarily comprised of malpractice cost, software cost and the cost for subleasing space. Most micropractices are cash-based, maximizing the physician’s profit after expenses and minimizing the hassle. Often micropractices focus on a very specific specialty niche that patients are looking for.

Micropractice Ideal for the most autonomous of physicians

Model 4: Membership Practice

The membership model means that only patients who pay an annual membership fee are seen in the practice. The membership fee is income to the practice in addition to insurance reimbursement. Depending on the specialty, membership fees cover services that insurance plans do not, for instance:

•  Annual Physicals (Medicare only) •  Enhanced patient access (emails, telephone calls,

attendance at hospital admissions) •  Enhanced educational opportunities •  Patient Portal enrollment •  Telemedicine

Membership Practice A popular insurance/cash hybrid

Model 5: Concierge Practice

The concierge model is similar to the membership model in that an annual fee is required of the patient, however, many concierge practices do not participate with insurance plans. A concierge practice can charge as much as $7,500 per patient per year and have a panel of 300 or less patients. The hallmarks of a pure concierge program can include personalized services such as:

q  24/7 direct access to the physician via email, text or cell phone q  Appointments on demand q  Personalized referral management q  Unlimited office visits of unlimited length q  House calls

Concierge Practice Concierge means different things to different people

Model 6: Traveling Practice

Instead of going from house to house as a house call physician does, the traveling physician goes from practice to practice to see patients. Typically a specialist traveling from one primary care office to another, the traveling physician offers on-site care to referred patients. Not unlike large hospital systems that have outreach specialty clinics, this model has great potential in underserved communities. The traveling practice may utilize more innovative hand-held technology to evaluate patients for the need for further testing, procedures or surgery. The traveling physician needs to be sure to pay fair market value for the use of the space and have all locations registered with payers.

Traveling Practice A practice without (its own) walls

Model 7: Hybrid Practice

For some practices, a combination of taking some insurance plans and requiring cash payments for all other plans is the right choice. Many primary care practices want to serve Medicare patients, but do not want to be in-network for any other payers to reduce the significant overhead that participating with commercial insurance entails.

Physicians and practice managers alike are surprised to hear that as of September 2013*, patients can legally waive their insurance benefits and pay cash for services. Patients with high deductibles may find it more affordable to pay lower cash prices instead of plan allowables. * HIPAA Omnibus Final Rule

Hybrid Practice What are the needs of your target population?

Model 8: Nursing Home Practice

There are two ways to deal with insurance – don’t take it at all or be the very best at it. For practices that focus primarily on Medicare and Medicaid patients, physicians and their billers need to be the very best at navigating government plans so as to recoup every penny available. This type of practice needs only a solid billing system/biller and an EHR – no clinic, no staff. Keep in mind the narrow focus of the practice, which can be difficult. This is also an excellent way to jumpstart a new practice due to the typically limited time needed to credential with Medicare and Medicaid and hit the ground running.

Nursing Home Practice Low overhead if you can make the billing work

Model 9: Traditional Insurance Practice

You may think the all-insurance practice is the safest bet; many more patients are now insured and patients want and expect to use the benefits they’ve paid their premiums to receive. What you might not know, however, is that the all-insurance practice is the single most expensive model going. Not only are insurance plans decreasing the rates they’ll pay physicians, they are continuously requiring more of the practice e.g. pre-authorizations for medications and tests and overwhelming requests for medical records. The traditional insurance practice is still viable with very careful management, but it will take more patients per day to maintain the same income. Most new all-insurance practices have some type of cash component to help support the cost of taking insurance.

Traditional Insurance Practice More work than ever

Model 10: Telemedicine Practice

Previously telemedicine (two-way video, specifically) was reserved for rural and underserved communities. Secure technology has become widely available, allowing physicians to cost-effectively provide the convenience and value patients demand. Note that 29 states and the District of Columbia require that private insurers cover telemedicine the same as they cover in-person services and the American Telemedicine Association (ATA) has made great progress in smoothing the way for physicians to become licensed in other states. The American Telemedicine Association (ATA) is also pushing the Centers for Medicare and Medicaid (CMS), and Congress to remove the arbitrary restrictions that limit telemedicine coverage, so all Medicare patients can receive this benefit.

Telemedicine Practice The future is here

Model 11: Integrative and Functional Medicine Practice

These practices are more akin to specialties than models, but I include them here because they are attuned to insurance/cash hybrid or cash practice models. Not all alternative medicines, therapies or tests are covered by insurance plans so some, if not all, care is out-of-pocket to the patient. Physicians starting integrative and/or functional medicine practices seem to have found their second wind, regardless of their age.

Integrative medicine is healing-oriented medicine that takes account of the whole person (body, mind, and spirit), including all aspects of lifestyle. It emphasizes the therapeutic relationship and makes use of all appropriate therapies, both conventional and alternative. The Functional Medicine model considers the diagnosis, but also seeks to answer the question, “Why does this person have this illness?” The answer to this question is revealed by discovering the antecedents, triggers, and mediators that underlie symptoms, signs, illness behaviors, and demonstrable pathology.

Integrative & Functional Medicine You’ll be hearing much more about these

Model 12: Cash Practice (a la Carte)

What could be easier than publishing your prices and having patients pay you the asking rate at time of service? The cash model does not require a Practice Management/Billing system – most practices use a free EHR, Credit Card On File software and QuickBooks Online to run their entire practice. The EHR creates a superbill that many patients can submit to insurance for reimbursement.

The challenge of a cash practice is defining and marketing to your target demographic. Do you have a devoted patient base? Most estimates are that no more than 30% of existing insured patients will follow you to a cash practice. That however, might be enough with a very low overhead.

Cash Practice (a la Carte) As straightforward as it gets

Manage My Practice “We help solo and small practices turn vision into reality”

marypat@managemypractice.com (919) 370-0504

What We Do -

q  New Practice Start-up q  Practice Model Transition q  Credentialing q  Credit Card on File Implementation q  ICD-10 Assessment & Training q  HIPAA & OSHA Training q  Billing/Coding Auditing and Training q  Profitability Assessment & Strategy q  Contract Coding & Contract Billing Services