By Phil Galewitz, KFF Health News
Nonprofit hospitals, which were originally meant to serve the poor, are now offering specialized doctor services for an annual fee of $2,000 or more to make it easier for patients to see their doctors.
This trend started a long time ago with doctor practices. Many doctors have switched to the specialized model, allowing them to earn more while seeing fewer patients.
Large hospital systems like Northwestern Medicine in Chicago, Penn Medicine in Philadelphia, University Hospitals in the Cleveland area, and Baptist Health in Miami are providing specialized doctor services. The annual fees, which can go over $4,000, are in addition to copayments, deductibles, and other costs not covered by patients’ insurance plans.
Critics of specialized medicine argue that it worsens the shortage of primary care doctors, making it accessible only to the wealthy and increasing healthcare costs. However, for hospitals that are exempt from taxes, the financial advantage is two-fold. The fees for specialized services generate new income and also help in recruiting and retaining physicians. These doctors then refer their wealthier patients to the hospitals they work for.
“ “Hospitals are interested in doctors who offer specialized services because their patients do not leave debts or require charity care, and most of them have private insurance, which pays the hospital well,” explained Gerard Anderson, an expert in hospital finance at Johns Hopkins University.
“They are the perfect patients, from the hospitals’ perspective.”
Specialized doctors usually have only a few hundred patients, unlike traditional primary care doctors who have a couple of thousand, so they can guarantee quick access and longer appointments.
“Every time we see these models expand, we are reducing the availability of primary care doctors for the general population,” said Jewel Mullen, associate dean for health equity at the University of Texas-Austin’s Dell Medical School. The former Connecticut health commissioner said specialized doctors join large hospital systems because of the institutions’ reputations, while hospitals sign up specialized physicians to ensure referrals to specialists and inpatient care. “It helps hospitals secure a bigger piece of their market,” she said.
Specialized doctors usually offer same-day or next-day appointments and many give their patients their mobile phone number.
Aaron Klein, who supervises the specialized doctor practices at Baptist Health, said the program was initially meant for donors.
“Wealthy donors wanted to make sure they have doctors to care for them,” he said.
Baptist started its specialized program in 2019 and now has three practices across South Florida, where patients pay $2,500 a year.
“My belief is: It’s better to provide top-notch care to a few hundred patients rather than give subpar care to a few thousand patients,” Klein said.
Specialized doctor practices began over 20 years ago, mainly in wealthy areas such as Boca Raton, Florida, and La Jolla, California. They mainly catered to affluent retirees who were willing to pay more for better access to physicians. Some of the first physician practices to enter the business were supported by private equity firms.
MDVIP, based in Boca Raton, is one of the largest concierge medicine companies, with over 1,100 doctors and more than 390,000 patients. It was established in 2000, and since 2014, private equity firms have held a majority stake in the company.
According to some concierge physicians, their more attentive care leads to healthier patients. However, a study released last year by researchers at the University of California-Berkeley and University of Pennsylvania found no impact on mortality rates. What the study did find was higher costs.
The researchers used Medicare claims data and discovered that concierge medicine enrollment was linked to a 30%-50% increase in total health care spending by patients.
Adam Leive, a study co-author and an assistant professor of public policy at UC Berkeley, stated that for hospitals, this represents an extension of their market consolidation. Inova Health Care Services in Fairfax, Virginia, which is one of the state’s largest tax-exempt hospital chains, has 18 concierge doctors. Each doctor handles no more than 400 patients, who pay $2,200 annually.
George Salem, 70, of McLean, Virginia, has been a patient in Inova’s concierge practice for several years along with his wife. Earlier this year, he injured his finger in a hotel door. Upon returning home, he immediately contacted his physician, who promptly saw him and stitched up the wound. Salem visits his doctor about 10 to 12 times a year.
Salem expressed, “I adored my internist before, but it was impossible to see him.” He finds immediate access to his doctor as a source of great peace of mind.
Craig Cheifetz, a vice president at Inova who oversees the concierge program, mentioned that the hospital system became interested in the model after MDVIP began aggressively expanding into the Washington, D.C., suburbs around ten years ago. Presently, Inova’s program serves 6,000 patients.
Cheifetz rejects the claim that concierge physician programs worsen primary care shortages. He stated that the model keeps doctors who were considering early retirement in the business with a lighter workload. Additionally, he pointed out that the fees amount to no more than a few dollars a day — approximately equivalent to what some people spend on coffee.
“Inova has an outstanding primary care network for those unable to afford the concierge care,” he said. “We are still offering all the necessary primary care for those in need.”
Some hospitals are establishing concierge physician practices far from their original locations. For instance, Tampa General Hospital in Florida launched a concierge practice in the upper-middle-class area of Palm Beach Gardens, which is about a three-hour drive from Tampa. Mount Sinai Health System in New York operates a concierge physician practice in West Palm Beach.
NCH Healthcare System in Naples, Florida, has 12 concierge physicians who collectively treat about 3,000 patients. James Brinkert, regional administrator for the system, stated, “We identified a demand in this community for a more personalized health care experience.” Members pay an annual fee of at least $3,500.
NCH patients whose doctors switch to concierge and do not wish to pay the membership fee are referred to other primary care practices or urgent care, Brinkert noted.
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