Pros and Cons of Converting to a Hybrid/Segmented Concierge Medicine Business Model

The business and day-to-day operation of any medical practice is challenging. Concierge and Direct Practice physicians will tell you the same challenges exist in their business model as well. In Part 2 of our series entitled “Concierge/DPC Practice Models: What Model Is Best For Me?” we are going to look at how some physicians are operating their medical practices in what is called a “Hybrid” or “Segmented” business model. “Hybrid” concierge medicine practice is where physicians charge a monthly, quarterly or annual retainer or membership fee for services that Medicare and insurers don’t pay for.

Under this model, practices and physicians will bill Medicare and insurance companies for patient visits and services covered by the plans. They also offer a traditional model of healthcare which is generally staffed by a Nurse Practitioner (NP) or a Physicians’ Assistant

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What Does This Look Like Practically?

Simply stated, the medical practice has two businesses under one roof, Business ‘A’ and Business ‘B.’ Under Business ‘A’ those patients wishing to be treated by the physician will likely pay a monthly, quarterly or annual fee to the practice and receive services such as: quick appointments; email access; phone consultations; newsletters; an annual physical, prolonged visits and comprehensive wellness and evaluations plans. Business ‘A’ will bill Medicare and the patients’ insurance company for visits and services covered by the plans and services not listed in the Membership Service Agreement (MSA). Business ‘B’ however, is where the patients schedule an appointment to see a Nurse Practitioner or a PA and that care is overseen by the Physician in the practice. Business ‘B’ will bill Medicare and the patients insurance company for visits and services covered by the plan, accept co-pays, deductibles, etc. If patients on Side ‘B’ must see the overseeing doctor, it’s very likely they will see him.