Questions About Practice Types?

[AlmostThere2]

Hi,

I'm a 3rd year student interested in psychiatry and I had a couple questions about the field. One of my goals, if I were to do psychiatry, would be to set up my own practice as I'm currently also getting my MBA. In regards to practice models, I'm a bit confused since there's so many different approaches. If someone could maybe elaborate on these different types of practices and how they function/how profitable they are and the potential for earnings/lifestyle in each of these.

Practice types I'm currently aware of:

Cash-only
-Accepting cash only at a specific set rate per visit/minutes
- What types of pts do you generally see in this setting? It seems like it would be difficult to get a strong consistent pt load where you can do this daily 9-5?

Drug check practice
- I have a family friend who has a practice that he started where he accepts nearly all forms of insurance and medicare. At this practice, he employs many psychologists, counselors, therapists, NPs, and employs up to 5 other psychiatrists as well. I believe the psychiatrists spend their time with drug checks seeing many many pts a day, while the psychologists, counselors, therapists spend more time speaking to pts.
- Is this actually profitable? I've read its difficult to get paneled with insurance companies so this must have a taken a long time to do?
- Does the person who started the practice get a cut of each employees salary, for ex. 10 or 20% of each pt visit goes to the practice or practice owner regardless of who is seeing them?
- Would it be an easier business to set up if you went the cash-only route? Is that even possible with this kind practice?

Concierge
-Being on retainer with specific pts 24/7 and accepting a high rate up front. Similar to cash
- Seems even more difficult to get a strong pt load than cash. Don't know much about it?

Regular insurance based practice
- See pts a regular pace, compensation may be lower?
- I read the article suggesting up to 55% of psychiatrists no longer accept insurance, so this seems like a dying breed?


I'm unsure if hospitalists exist for psychiatry or how one even gets affiliated with a hospital or employed by them. How difficult is it to even start a practice from the ground up or employ other people to work with you? Any insight you might have would be greatly appreciated. Thank you kindly

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[happygilmore]

Ugh.

To summarize: How much money can I make in different practice models.

Advice? Don't go into psych trying to make $, go into it if you like it.

The fact that you're trying to analyze business models pre-residency tells us that money is a driving factor. This is something you should do as a 3rd or 4th year resident.

Anything can happen, you could make a plan and earn 1/2 of your plan or double. If that's scary then chose the field you like the most instead of $ making field.

This is like a high school sports star asking about contract bonuses and agent % cuts when he turns pro. But then again, you probably realize this.

 

[notdeadyet]

The fact that you're trying to analyze business models pre-residency tells us that money is a driving factor. This is something you should do as a 3rd or 4th year resident.

Waiting until you're in your last or even second to last year of residency to become curious about how you will actually try to make a living after residency is probably one of the reasons so many doctors are terrible business folks.

I don't think there's anything wrong with asking questions about how you will be earning your money before committing to a specialty. I wish more medical students would show this kind of systems/practice-based curiosity.

If someone is really interested in being their own boss and creating their own business as a doctor, psychiatry is one of the easiest specialties in which to do it. Asking these kind of questions is sensible and part of due diligence before deciding to go down the path.

Advice? Don't go into psych trying to make $, go into it if you like it.

Agree with this. But learning how you make your money isn't a bad thing. If nothing else, it cuts down on explaining for the upteenth time why our outpatient follow-up visits don't run one hour or why we can only keep our inpatients for months even if it would help them.

 

[happygilmore]

Waiting until you're in your last or even second to last year of residency to become curious about how you will actually try to make a living after residency is probably one of the reasons so many doctors are terrible business folks.

I don't think there's anything wrong with asking questions about how you will be earning your money before committing to a specialty. I wish more medical students would show this kind of systems/practice-based curiosity.

If someone is really interested in being their own boss and creating their own business as a doctor, psychiatry is one of the easiest specialties in which to do it. Asking these kind of questions is sensible and part of due diligence before deciding to go down the path.

Agree with this. But learning how you make your money isn't a bad thing. If nothing else, it cuts down on explaining for the upteenth time why our outpatient follow-up visits don't run one hour or why we can only keep our inpatients for months even if it would help them.

Ok, agreed. I was harsh.

It's a good idea to be informed - but I think the scary thing is that money has become the driving factor for medical students.

The most competitive specailties are the highest paying and the least are the lowest.

Btw, I wouldn't say it's lack of prudence to be preparing a business model 2 years before opening the business (i.e. PGY-3). To develop a model 5-6 years in advance is almost useless because the practice environment today vs 6 years from now (when the poster would open a practice) could drastically change how / what psychiatrist are paid.

 

[DJspreadsheet]

Ok, agreed. I was harsh.

It's a good idea to be informed - but I think the scary thing is that money has become the driving factor for medical students.

The most competitive specailties are the highest paying and the least are the lowest.

Btw, I wouldn't say it's lack of prudence to be preparing a business model 2 years before opening the business (i.e. PGY-3). To develop a model 5-6 years in advance is almost useless because the practice environment today vs 6 years from now (when the poster would open a practice) could drastically change how / what psychiatrist are paid.

Ummm, I hate to rain on your parade, but money is the driving factor for everything. Medicine isn't competitive because people enjoy sacrificing their youth and performing rectals.

 

[happygilmore]

Ummm, I hate to rain on your parade, but money is the driving factor for everything. Medicine isn't competitive because people enjoy sacrificing their youth and performing rectals.

My statement was the competitiveness of specialties is directly related to how much money they earn in the amount of time they work, i.e. money/lifestyle.

My statement wasn't "money is the driving factor for everything". Welcome to the internet, where people alter your statements and then argue with the false extremist they've created. Kind of like Fox News. WINNING!

Anyway, good luck to OP and thanks for grounding everyone DJspreadsheet. Medicine is a life of sacrifice.

 

[DJspreadsheet]

My statement was the competitiveness of specialties is directly related to how much money they earn in the amount of time they work, i.e. money/lifestyle.

My statement wasn't "money is the driving factor for everything". Welcome to the internet, where people alter your statements and then argue with the false extremist they've created. Kind of like Fox News. WINNING!

Anyway, good luck to OP and thanks for grounding everyone DJspreadsheet. Medicine is a life of sacrifice.

I realize that Captain Reading Comprehension. That was a statement I made. You might want to revisit the conversation chain before you pat yourself too hard on the back.

 

[happygilmore]

I realize that Captain Reading Comprehension. That was a statement I made. You might want to revisit the conversation chain before you pat yourself too hard on the back.

Sounds good. Good luck in your career.

 

[MDchouette]

I haven't heard of concierge practices in psychiatry. Internal medicine, yes. Are others aware of this model being used at all in psychiatry?

Here is what I know, from the perspective of a PGY4 living in Boston at a program where they work hard to educate us on these sorts of important practical matters:

Cash-only practices do fill, even in Boston, although not as quickly as insurance-based practices. Keep in mind that even if you have a cash-based practice, your patients can still use their insurance and file an out of network claim. I have met psychiatrists who choose a middle ground between cash and insurance-based by paying someone to submit out of network claims on their patients' behalf.

Depending on the practice where you work, you may be able to pick what kind of patient visits you want to do. If it's your own practice, you do whatever you want, although keep in mind that the more therapy patients you see and the fewer med checks that you do, the less you will make billing through insurance. You can also have a sliding fee scale. Medically complex patients will also increase your reimbursement, thanks to the coding changes that took effect in January 2010.

You will want to know what the rules are for cash-only practices and Medicare patients in your area. In Massachusetts, providers aren't allowed to charge rates higher than Medicare for anyone who is eligible (notice "eligible" and not "signed up for") for Medicare. I have seen cash-only practices who for this reason do not accept patients 63 years and older. I wouldn't take this route myself but I have seen it done. I believe that in other states, there are laws that prevent you from charging a certain percentage above Medicare rates.

Also, for insurance-based practices, you don't have to be paneled on every insurance. There is considerable variability in pay rates and annoying paperwork/bureaucracy among insurers. You should be able to find this out easily by asking around. Hopefully mental health parity and the new guidelines for this will help on this front, but I'm not overly optimistic as I still haven't seen how these rules will be enforced reliably.

If you join a group practice, you may also be able to choose your mix of therapy and psychopharm. A common model at a group practice is for the practice to take a certain percentage of your earnings (I have heard 30-35% is common) for overhead.

Other options, which I know less about, are (1) serving as a consultant to a medical practice (primary care clinic) or specialty practice (neurology) and (2) being integrated into a primary care practice / accountable care organization. We are going to see more and more of the latter in the coming years, I think.

I hope this is helpful to the OP, or at the very least, leads to some interesting dialogue about how this varies in different regions.

 

[BobA]

There are many many options for a psychiatrist - it's easy to be creative.

Personally, if I ever went the private practice route I'd probably do 50% of my time as a contractor at a facility (like a group home) which would usually pay about $150/hr around here and then see my own patients with the rest of my time. I'm rather risk-averse and like the idea of the steady income. There also doesn't tend to be much uncompensated time with contract work - fewer follow up phone calls, insurance issues, etc because the staff at the facilities usually take care of that for you.

Hospitalists in psychiatry definitely exist, although the model isn't as common as it is in general medicine.

 

[Leo Aquarius]

For cash-only practices, you tend to see people with lots of cash. I've heard this favors Cluster B personalities. But if its your solo practice, you can screen in or out any kind of patient you want.

 

[notdeadyet]

You will want to know what the rules are for cash-only practices and Medicare patients in your area. In Massachusetts, providers aren't allowed to charge rates higher than Medicare for anyone who is eligible (notice "eligible" and not "signed up for") for Medicare. I have seen cash-only practices who for this reason do not accept patients 63 years and older.

That's interesting. Folks who are on the disability roster for mental illness are eligible for Medicare after two years. By this logic, the cash-only folks should try to screen out folks with severe mental illness, which perpetuates the problem. Oi...

 

[happygilmore]

That's interesting. Folks who are on the disability roster for mental illness are eligible for Medicare after two years. By this logic, the cash-only folks should try to screen out folks with severe mental illness, which perpetuates the problem. Oi...

Well, the real solution is to increase reimbursements all around and providers. I don't really blame psychiatrists for choosing patients. If there are 1,000 people who need help and you can help 50, does it matter which 50 it is? Who makes the moral judgement that one set of 50 is better than another? This isn't to say to cater to the rich, but it's completely fine to avoid those who seek to pay pennies on the dollar for your services. You can help people who can pay, then give away free care to those in your free time.

The NYTs had an op-ed last month with a variety of psychiatrists chiming in on practices accepting insurance less. It's odd that some conclude that it must be a greedy self-interested move to do so. Family practice now rushes people in and out in 15 min appointments with the doctor in the room for 5 minutes. You see plenty of 2 minute psychiatric diagnoses in family med. This is the model insurance companies love. They skimp off the top of the huge assembly line and pay multimillion dollar salaries to executives all the while attempting to deny any and every claim. Having the ability to avoid these individuals and the waste + assembly line they create is a positive for the practitioner and the patient.

 

[OldPsychDoc]

Well, the real solution is to increase reimbursements all around and providers. I don't really blame psychiatrists for choosing patients. If there are 1,000 people who need help and you can help 50, does it matter which 50 it is? Who makes the moral judgement that one set of 50 is better than another? This isn't to say to cater to the rich, but it's completely fine to avoid those who seek to pay pennies on the dollar for your services. You can help people who can pay, then give away free care to those in your free time.

The NYTs had an op-ed last month with a variety of psychiatrists chiming in on practices accepting insurance less. It's odd that some conclude that it must be a greedy self-interested move to do so. Family practice now rushes people in and out in 15 min appointments with the doctor in the room for 5 minutes. You see plenty of 2 minute psychiatric diagnoses in family med. This is the model insurance companies love. They skimp off the top of the huge assembly line and pay multimillion dollar salaries to executives all the while attempting to deny any and every claim. Having the ability to avoid these individuals and the waste + assembly line they create is a positive for the practitioner and the patient.

If this is your philosophy, then please don't enter any of the threads about mid-levels providing psychiatric care and "taking our jobs", OK?

 

[splik]

Well, the real solution is to increase reimbursements all around and providers. I don't really blame psychiatrists for choosing patients. If there are 1,000 people who need help and you can help 50, does it matter which 50 it is? Who makes the moral judgement that one set of 50 is better than another? .

There are 1000 patients in the ER with chest pain. 50 of those patients have non-cardiac chest pain that is chronic but are willing to pay top dollar to be seen ahead of 50 other with chest pain who can't afford to pain top dollar, but are experiencing chest pain due to aortic dissection, massive PE, STEMI, cardiac tamponade, tension pneumothoraces etc. Does it matter which 50 you see? Who makes the moral judgement that one set of 50 is better than another?

It's not a moral judgement, it's a medical one. some people are just sicker than others it doesn't matter whether that's mental or physical.

 

[happygilmore]

There are 1000 patients in the ER with chest pain. 50 of those patients have non-cardiac chest pain that is chronic but are willing to pay top dollar to be seen ahead of 50 other with chest pain who can't afford to pain top dollar, but are experiencing chest pain due to aortic dissection, massive PE, STEMI, cardiac tamponade, tension pneumothoraces etc. Does it matter which 50 you see? Who makes the moral judgement that one set of 50 is better than another?

It's not a moral judgement, it's a medical one. some people are just sicker than others it doesn't matter whether that's mental or physical.

I think a better corollary for emergency would be 10 people needing a cardiac cath when you only have one cath lab. The example you offered was emergent cases with no money vs nonemergent cases with money. Its clear to treat the emergent if you're an emergency doc.

What do you do when all the cases are emergent and supply is limited? Equivalent medical need.

America's system is set up to reward those who can pay. Cardiology, GI, hematology oncology, pick your specialty. Is there any case that someone earning 15k per year working at Walmart gets the same healthcare as a multimillionaire or Bill Gates would get? Does orthopedics perform hip replacements for the homeless? Do CT surgeons perform CABG on the homeless? It's similar discrimination to psychiatrist not taking insurance. In a world of limited supply everyone discriminates.

There aren't enough doctors out there. Oldpsychdoc, I'll take your advice and avoid the mid level threads. What is your solution? To have all 10 min appointments and give everyone meds? Just curious what your solution is- not trying to argue. I would love to learn a better philosophy if it's best for everyone.

Who knows, maybe midlevels will be a necessity. Either more doctors need trained, appts need to be shortened or midlevels will need a larger role.

 

[splik]

Does orthopedics perform hip replacements for the homeless? Do CT surgeons perform CABG on the homeless? It's similar discrimination to psychiatrist not taking insurance. In a world of limited supply everyone discriminates..

YES they do! that's the difference. you are right, it's partly because our system (even medicare and medicaid) rewards procedures and doesn't value the sort of wooly non-specific treatment or symbolic healing psychiatrists offer, but it is also much more complex than that. There is no doubt than an overhaul in how psychiatrists are paid is necessary to get psychiatrists to see more of this patients, but it is also related to psychiatrists having the types of practice you mention above, which CT surgeons, orthopods, GI docs etc don't have. And then the biggest elephant in the room is fee for service which is the enemy of patient care, but i feel this thread has been derailed enough (sorry OP) so will stop here.

 

[happygilmore]

YES they do! that's the difference. you are right, it's partly because our system (even medicare and medicaid) rewards procedures and doesn't value the sort of wooly non-specific treatment or symbolic healing psychiatrists offer, but it is also much more complex than that. There is no doubt than an overhaul in how psychiatrists are paid is necessary to get psychiatrists to see more of this patients, but it is also related to psychiatrists having the types of practice you mention above, which CT surgeons, orthopods, GI docs etc don't have. And then the biggest elephant in the room is fee for service which is the enemy of patient care, but i feel this thread has been derailed enough (sorry OP) so will stop here.

And you bring up the key issue. When the government and reimbursements completely undervalue critical services and overvalue late expensive interventions, we must decide what to do. Should we accept gross undervaluing or let the free market decide? The government has become overly involved in making these decisions and they are very arbitrary in deciding value. If the government decides your services are worth 10% of what a middle income earner will gladly pay with complete satisfaction, then I think it's fine to operate outside government control. Lower income people can be worked with individually.

Some orthopedic procedures bill 50,000 or more for and take a few hours to perform with minimal costs to the hospital (which is why you can see procedure ranges from 2,000 to 100,000 for the same thing!). At the same time mental health is seen as unimportant or wen a luxury. What is the most important thing that debilitates Americans? Mental health, not a joint replacement. It's ridiculous to pay some doctors 6 times more and continually cut critical mental health care.

 

[vistaril]

And you bring up the key issue. When the government and reimbursements completely undervalue critical services and overvalue late expensive interventions, we must decide what to do. Should we accept gross undervaluing or let the free market decide? The government has become overly involved in making these decisions and they are very arbitrary in deciding value. If the government decides your services are worth 10% of what a middle income earner will gladly pay with complete satisfaction, then I think it's fine to operate outside government control. Lower income people can be worked with individually.

Some orthopedic procedures bill 50,000 or more for and take a few hours to perform with minimal costs to the hospital (which is why you can see procedure ranges from 2,000 to 100,000 for the same thing!). At the same time mental health is seen as unimportant or wen a luxury. What is the most important thing that debilitates Americans? Mental health, not a joint replacement. It's ridiculous to pay some doctors 6 times more and continually cut critical mental health care.

the reality is, though, that large numbers of other masters degree level non-physician clinicians CANNOT do joint replacements. That's the key distinction.

In psych, much of what I'm guessing you think is undervalued is therapy(individuals, groups, maybe some day program type reimbursement, whatever)......since psychiatrists don't do much of that anyways, basically you're arguing that LPCs and lcsws should get paid a lot more for their clinical services. And I have no idea if they should or not(I would argue no), but it has absolutely nothing to do with what an orthopod gets to replace a joint.

I think it's a pretty hard sell to argue that the 99213(probably the or one of the most common outpt code we do right?) is way undervalued by most commercial insurers/medicare. There is no reasonable push to massively increase that.

 

[happygilmore]

the reality is, though, that large numbers of other masters degree level non-physician clinicians CANNOT do joint replacements. That's the key distinction.

In psych, much of what I'm guessing you think is undervalued is therapy(individuals, groups, maybe some day program type reimbursement, whatever)......since psychiatrists don't do much of that anyways, basically you're arguing that LPCs and lcsws should get paid a lot more for their clinical services. And I have no idea if they should or not(I would argue no), but it has absolutely nothing to do with what an orthopod gets to replace a joint.

I think it's a pretty hard sell to argue that the 99213(probably the or one of the most common outpt code we do right?) is way undervalued by most commercial insurers/medicare. There is no reasonable push to massively increase that.

If this is the case, why was there a need for the Mental Health Parity Act? And why the push to actually enforce the law this year?

 

[hamstergang]

I'm a 3rd year student interested in psychiatry and I had a couple questions about the field. One of my goals, if I were to do psychiatry, would be to set up my own practice as I'm currently also getting my MBA. In regards to practice models, I'm a bit confused since there's so many different approaches. If someone could maybe elaborate on these different types of practices and how they function/how profitable they are and the potential for earnings/lifestyle in each of these.

There are 2 separate issues that you seem to be mixing. One is how you get paid -- either cash, insurance, or some mix of both, and the other is what type of work you do -- psychotherapy, med management, or both. The 2 aren't related, and so you can mix any payment types with work types. If you join a private practice group or a hospital, I think you'd have to do what it is that they allow, but these are available, and you can also always set up your own practice to do it how you want.

 

[vistaril]

If this is the case, why was there a need for the Mental Health Parity Act? And why the push to actually enforce the law this year?

that's mostly irrelevant to the issue. It doesn't make a lot of difference in the big picture whether psychs get 53.15 or 56.34(just making up numbers) for a certain outpt code.

The point is that physicians of most other specialties have a much easier time increasing volume than psychs do. Have you seen how much time the actual physician in some of these specialty clinics actually spend with patients? Even with 'parity', they still have the ability to beat us on volume by a mile.....even the stack and whack high volume psychs can't run through nearly the volume other specialties can.

 

[happygilmore]

that's mostly irrelevant to the issue. It doesn't make a lot of difference in the big picture whether psychs get 53.15 or 56.34(just making up numbers) for a certain outpt code.

The point is that physicians of most other specialties have a much easier time increasing volume than psychs do. Have you seen how much time the actual physician in some of these specialty clinics actually spend with patients? Even with 'parity', they still have the ability to beat us on volume by a mile.....even the stack and whack high volume psychs can't run through nearly the volume other specialties can.

Sure, I've seen tons of those 5 min pt visits.

But I think we're in agreement then, because if a specialist can fly throw tons of 5 min patients while good psych work takes longer, the pay shouldn't be so different.

But that goes back to my point earlier. Maybe a middle income earner is fine paying a "high" hourly fee to a great psychiatrist because they go see their local specialist and he gets paid $50 for 5 minutes.

I'm not sure if fitting into a government or insurance cookie cutter approach will work in psychiatry. Even some psychiatrists are consulting FM practices, where they manage medications for 600 patients (? forgot the exact amount) a month. They don't even see the patients, it's all done by reviewing notes from other practitioners. Honestly, the government would probably be happy to see psychiatrists just consult by never talking to a person and peddling out drugs for 1,000 patients a month. It's already happening. Is this good for patients or psychiatrists?

Blindly following authority is a scary thing.

 

[vistaril]

Sure, I've seen tons of those 5 min pt visits.

But I think we're in agreement then, because if a specialist can fly throw tons of 5 min patients while good psych work takes longer, the pay shouldn't be so different.
.

the pay isn't that different per visit(for psych it actually may be a bit higher per pt encounter than a high volume internist as the high volume internist is going to have more medicare probably). It just takes more time to do decent med mgt psych than single complaint based(or a few f/u issues) IM outpt. That's due to the very nature of them....one you can look at a few lab values and make tweaks. The other requires lots of questions(and questions take time to answer) to make tweaks.....just the way it is is.

And no, psychs are never going to get reimbursed 165 dollars by medicare or insurance for 99213 level outpt services to make up for this lack of ability to do massive volume. Our services just aren't worth that much. Everyone going into psych knows that it is difficult, even in high volume whack and stack settings, to do more than 4-5 an hour. So it's not like we have been deceived.....

 

[michaelrack]

the pay isn't that different per visit(for psych it actually may be a bit higher per pt encounter than a high volume internist as the high volume internist is going to have more medicare probably). It just takes more time to do decent med mgt psych than single complaint based(or a few f/u issues) IM outpt. That's due to the very nature of them....one you can look at a few lab values and make tweaks. The other requires lots of questions(and questions take time to answer) to make tweaks.....just the way it is is.

And no, psychs are never going to get reimbursed 165 dollars by medicare or insurance for 99213 level outpt services to make up for this lack of ability to do massive volume. Our services just aren't worth that much. Everyone going into psych knows that it is difficult, even in high volume whack and stack settings, to do more than 4-5 an hour. So it's not like we have been deceived.....

In my experience, to do good IM outpt or good psych outpt (med management) takes about the same time. That's my N of 1 experience. The time required for either one can be decreased by cutting corners or dealing with only a limited # of issues and scheduling freq f/u. A high volume psych practice may be a little easier than a high volume IM practice.

 

[Shikima]

Very difficult to provide good, accurate care with a high volume psych practice. 15 min med checks are fine for those returning to your office every 3-6 months, all others need 30, 45 or 60 minute visits. Especially if they lack insight into the illness or resisting treatment.