Cash Only!

[directdoc]

How common is it for primary care physicians to have cash only practices? Are there a lot of practices set up this way and do people other than the filthy rich actually visit doctors like this? I had never heard of any cash only practices until very recently.

How would doctors benefit from this practice?...because it seems to me that patients probably wouldn't benefit from it. They are dishing out more money and getting less back from insurance. And if they don't benefit...wouldn't they change doctors?

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[deleted87716]

How common is it for primary care physicians to have cash only practices?

I haven't seen any hard numbers, but it's becoming more common. Lots of people are interested in it, anyway.

Are there a lot of practices set up this way and do people other than the filthy rich actually visit doctors like this?

Some doctors, and the two notable "franchise" concierge medicine companies, MD2 and MDVIP, charge a large annual retainer, and cater to the well-heeled with "executive-style" practices. However, that's not always the case. Many cash-only practices are aimed at people who work and support their families, but don't have enough left over to afford health insurance. Typically, these don't involve a large retainer, but rather an affordable fee schedule.

How would doctors benefit from this practice?

If done right, less paperwork, lower overhead, more time to spend with patients, etc. In a word, freedom.

it seems to me that patients probably wouldn't benefit from it. They are dishing out more money and getting less back from insurance. And if they don't benefit...wouldn't they change doctors?

In a retainer practice, people are paying for time and access. If they value it, then it's worth it to them.

If you have no health insurance, the prospect of being able to see a doctor affordably has great appeal.

 

[group_theory]

because it seems to me that patients probably wouldn't benefit from it. They are dishing out more money and getting less back from insurance. And if they don't benefit...wouldn't they change doctors?

Some patients do benefit from it, and not just the affluent patients.

A working class family can either pay $1k+ per month towards a HMO (and more if they want PPO) or they can pay the same amount (or in some cases, even less) towards a cash-only practice (whether it's a set fee-schedule, or a monthly fee or yearly fee, etc).

Remember, a healthy working class family with little healthcare utlitization is paying such a high monthly premium to help the insurance company pay for care of the infirm elderly (those that are polypharmacy and require multiple specialties and multiple hospitalizations), those in the ICU, etc. They also pay the insurance company to hire the many middle-people whose sole responsibility is to make sure there is "proper utlization" of healthcare resources (and also to pay the CEO and Board of Directors).

Instead, the same working class family can take their monthly premiums and apply it towards a concierge practice ... where doctors don't have to deal with paperwork and requirements of various insurance companies, a 5-15% rejection of payment rate, getting paid 6-9 months later for service rendered, etc. No need to hire medical claims specialists just to fill out forms to bill (at an already pre-negotiated discounted rate). The immediate savings can be passed along to their patients, to allow for a competitive rate.

Market forces at work. The insurance companies now must find ways to attractive healthy patients back into their fold (increase services or benefits, lower premiums, increase customer satisfaction, etc)


Addenum: The patient also benefit in other ways. Because the physician is no longer taking insurance patients, there is no longer that financial pressure to see a patient every 15 minutes to pay the bills, staff, malpractice insurance, and one's income. With lower overhead cost (and likely the physician will be paid more per patient that under the old insurance plan), the physician can take a longer time to talk to the patient, listen to their concerns, maybe counsel them, etc.

 

[directdoc]

^^ But do patients REALIZE all these benefits to keep these cash only practices going?

 

[spumoni620]

Some patients do benefit from it, and not just the affluent patients.

A working class family can either pay $1k+ per month towards a HMO (and more if they want PPO) or they can pay the same amount (or in some cases, even less) towards a cash-only practice (whether it's a set fee-schedule, or a monthly fee or yearly fee, etc).

Remember, a healthy working class family with little healthcare utlitization is paying such a high monthly premium to help the insurance company pay for care of the infirm elderly (those that are polypharmacy and require multiple specialties and multiple hospitalizations), those in the ICU, etc. They also pay the insurance company to hire the many middle-people whose sole responsibility is to make sure there is "proper utlization" of healthcare resources (and also to pay the CEO and Board of Directors).

Instead, the same working class family can take their monthly premiums and apply it towards a concierge practice ... where doctors don't have to deal with paperwork and requirements of various insurance companies, a 5-15% rejection of payment rate, getting paid 6-9 months later for service rendered, etc. No need to hire medical claims specialists just to fill out forms to bill (at an already pre-negotiated discounted rate). The immediate savings can be passed along to their patients, to allow for a competitive rate.

Market forces at work. The insurance companies now must find ways to attractive healthy patients back into their fold (increase services or benefits, lower premiums, increase customer satisfaction, etc)


Addenum: The patient also benefit in other ways. Because the physician is no longer taking insurance patients, there is no longer that financial pressure to see a patient every 15 minutes to pay the bills, staff, malpractice insurance, and one's income. With lower overhead cost (and likely the physician will be paid more per patient that under the old insurance plan), the physician can take a longer time to talk to the patient, listen to their concerns, maybe counsel them, etc.

But what do these patients do if they need lab work, x-rays, joint aspirations, steroid injections, biopsies, excisions...it seems to me that while it's nice to pay a set fee for an office visit, it's harder to control the other costs of a medical workup when someone's sick.

 

[deleted87716]

But what do these patients do if they need lab work, x-rays, joint aspirations, steroid injections, biopsies, excisions...it seems to me that while it's nice to pay a set fee for an office visit, it's harder to control the other costs of a medical workup when someone's sick.

Some physicians have worked out special deals with a local laboratory or imaging provider in order to make these services more affordable to their patients. In-office tests and procedures like those you mentioned can easily be performed on a cash basis much more affordably than they're reimbursed under most insurance plans. Specialty consultations can be arranged as well, provided the specialist can offer affordable fees for cash-paying patients. Many doctors do this already.

There are limits, of course, to how much of a patient's medical needs can be met by a single primary care physician. Cash-only practices will never be the single answer to any problem. Ideally, patients would have some form of catastrophic medical insurance to cover hospitalization or major illness, but even if they don't, the system will be no worse off for them having had some affordable primary care in advance of their catastrophic illness. Arguably, affordable primary care will make it less likely that these folks will need to utilize hospital emergency rooms, etc., which would alleviate some of the burden currently placed on the system.

 

[group_theory]

Hopefully they will have "medical insurance" for such emergencies.

Think of it this way ... you have auto insurance. Does your auto insurance pay for yearly state inspection? What about oil change? What about new tires, or rotation of the tires? Even if you have no deductibles, will they pay for any of this? When will auto insurance coverage kick in? (assuming you have comprehensive coverage, zero deductible, and a decent insurance rep).

If you have home owners insurance, do they pay for routine maintenance or care?

Why is it that people expect health insurance to pay for everything? Yes, things are expensive. But an annual physical cost the same amount as an annual state inspection for your car (at least around here). A sick visit might cost the same as a sick visit for your car (or more likely, your car sick visit will cost more). A good amount of people spend more on gas per month than they do on medication. Yes, some would argue that they need their car/gas to live, but some would also say that you need your health/drugs to live. Why be willing to pay for one and not the other?


*Not advocating for any policy or position. It might not even represent my views. Just some questions to think about (and either reject, or go "hmmm, good point")