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Rich Man, Poor Man

BOUTIQUE CLINICS: NEW FUNDING SOURCES FOR TEACHING HOSPITALS?

The New Physician March 2004
Something odd happens when you dial the Pratt Diagnostic Center at Tufts-New England Medical Center (NEMC). A person picks up. This is quite a revelation for those of us accustomed to talking to our dogs while listening to recorded options for service. When the same person repeatedly apologizes for putting you on hold, you want to hug her and tell her everything will turn out OK. How strange, you think to yourself. And then, you remember: This is a concierge medical practice, where personalized service reigns for patients who can afford it.


While the Pratt clinic just opened its doors in December 2003, concierge or boutique medicine—retainer practices, if you prefer—isn’t a new idea. Since the mid-1990s, about 130 primary care physicians nationwide, fed up with managed care, have left their traditional practices to open a kind of VIP lounge of care. For an annual fee that once topped $10,000 and can now be found for as little as $1,200, physicians go above and beyond the usual call of duty for patients who sign up with their practices.


Instead of 8-minute office visits, patients get 30 minutes; instead of waiting two weeks for an appointment, they get in right away or the next day. And the clincher: 24-7 access to the physician, via his personal pager. Concierge care patients must still pay for nonpreventive office visits; but they get special features with their annual checkups that other patients don’t, like more intensive screenings and comfier waiting rooms. It’s like buying a DVD versus a videotape.


What is different about the Pratt clinic, though, is that it’s the first concierge practice to be operated by an academic medical center. Admittedly, the two entities seem as if they come from opposite sides of the tracks: A downtown Boston teaching hospital with a record of indigent care meets a country club clinic with a membership fee. But Pratt’s medical director, Dr. Brian Cohen, says that unlike in John Hughes’ 1980s teenage angst movies, the two sides will get along just fine in Boston.


In fact, he says, in this case, the rich kid will give the poor kid his lunch money, funds that are direly needed at the teaching hospital. In 2002, Tufts-NEMC lost $12.5 million in operations, partly due to dipping Medicare and insurance reimbursements and the costs associated with providing its free care services. Its general practice clinic alone loses about $1 million annually—about $70,000 per primary care physician—because it receives lower reimbursements than such procedural-based practices as surgery, a rather sad refrain at many teaching hospitals.


“People looked around here in Boston and saw that within a few blocks of here are a number of high-end condos going up,” Cohen says. “We thought we were in the position to provide [concierge] services to those interested. In the process, we can put the surplus that we earn back into our medical center. Because we’re not just near high-rises, we’re also near Chinatown and South Boston, true working-class communities where the need is great. That’s the sole reason for doing this.”


In March 2003, Tufts-NEMC administrators turned to Wayne Lipton, an executive at the 3-year-old concierge care company MDVIP, to learn how they could create a retainer practice. Lipton had more than a little experience in the matter: The Boca Raton, Florida-based organization manages the business details of 30 concierge physicians in private practices nationwide, collecting annual fees, processing contracts and launching marketing campaigns for its clients.


As one might expect, this form of medicine isn’t without controversy. Since MDVIP’s inception in February 2001, the company has come under harsh criticism from health-care economists and advocates for the uninsured, who charge that boutique medicine would drive down access in the U.S. health-care system by forcing patients to pay a premium for quality care.


“It’s just an inevitable thing,” says Paul Ginsburg, president of the Center for Studying Health System Change, a Washington, D.C.-based research organization funded by the Robert Wood Johnson Foundation. “It’s the development of new products and services for wealthy people that’s gaining steam. It’s happened with luxury and near-luxury cars, and now it’s something that’s happening in the medical community. I suspect a lot of patients respond with fear, that rather than losing their doctor and being crowded into another practice, they’ll just pay the extra money to keep the doctor they like and know.”


Lipton saw a partnership with Tufts-NEMC as a way to soften MDVIP’s image. There was just one problem: How would they make concierge care work in a public setting?


“We looked at it and thought it was a long shot,” Lipton says. “It’d never been done in academic medicine before, where you have to balance teaching responsibilities and administrative duties. It’s not an easy thing. You also have to meet all the needs of the different parts of an institution—the university, boards, hospitals, physicians.”


One of the biggest concerns among concierge critics is that patients who don’t want to stay with a physician who opens a retainer practice are left with nowhere to go. A typical primary care physician has about 2,500 patients, and some physicians who’ve come to Lipton have had more than 6,000—a situation he calls “medicine on roller skates.”


To make its product work, MDVIP caps patient rolls per physician at 600. This means more time spent with patients, and more free time for overworked, private-practice physicians. But it also means a great deal of lost access, and Tufts-NEMC didn’t want that kind of press.


So, Cohen says, the teaching hospital approached the boutique clinic with caution. “We were careful to set this up to deflect some of the criticism that’s beset private practices doing this—that they leave their patients hanging without a physician unless they join the concierge services.”


And so a new model for concierge medicine was born: Each of the three physicians at the Pratt Diagnostic Center work only half-day shifts in the concierge setting, spending the remainder of their workdays treating patients in their existing general practices at the Tufts medical center. If a concierge patient pages Cohen while he’s working on the general side, for example, the patient has to see the concierge physician on staff for that shift instead. Theoretically, none of their general practice patients should get left behind. And because they work half-shifts, the physicians are also limited to only 300 concierge patients each, spots Cohen and colleagues intend to fill from their 1,200-patient rosters at the medical center. Two additional physicians will see fewer numbers of patients at the Pratt clinic.


“Spending more time with patients, being more personalized—this is medicine the way we all want to do it. But I’ve had some of these patients for 10 years, and I don’t want to give up those relationships because they can’t pay a fee,” Cohen says.


One casualty Cohen says he can do nothing about is losing the time to teach; he says he hates “giving that up, but something had to go.” Now, instead of doing rounds with students, the only interaction he’ll have with physicians-in-training is with the hospital’s house staff when he’s admitting patients. And while students do rotate through Tuft’s general practice, they won’t be allowed at Pratt Diagnostic Center.


“This crowd would not want students,” he says. “We’re catering to people in the financial district who don’t have a lot of time, and medical students need a lot of time. We’re also promising to be on time, and that’s something that’s just not possible when medical students are involved.”


And if he were planning to teach, chances are he wouldn’t advise future physicians to go into concierge medicine. “I’d never be able to do this more than half-time, because you hear about these guys—oh, they have a great life, they only see 10 patients a day. Well, I look at that guy and say: He’s rusting. You’ve got to see patients.”


This comment intrigues one critic. “It sounds like Tufts is really planning what this means to the doctor, and in doing so, adding to the discussion of this issue,” Ginsburg says. “No one has examined what it’s like for the physician in concierge medicine. It seems better to not go full steam ahead with a concierge practice. But who knows what drives [concierge] physicians. You have to remember there are entrepreneurs involved in this who go to the media and get the attention. The difference at Tufts is that they’re figuring this out on their own, instead of just signing on the dotted line.”


No matter how Tufts justifies its new venture, some people won’t be swayed. “This kind of thing infuriates me almost beyond rational thought,” an employee at Tufts University Sackler School of Graduate Biomedical Sciences, who asked to remain anonymous, wrote in an online forum last fall. “It feels like something from a horrible dystopian fiction. But why should medical care be any different than anything else? You get what you pay for, and if you can’t pay, you get what you deserve. Is that the motto of a healthy society?”


To be sure, some Tufts administrators were wary of the idea from the beginning, Lipton says. “Certain people thought it wasn’t something they would have done and not something that would have been done 10 or 15 years ago. But they recognized that it’s not 10 or 15 years ago anymore. It’s now. And times are tough.”


If projections hold true, the Pratt clinic should bring in “several hundred thousand dollars a year,” Cohen says. That’s enough to add a couple more primary care physicians to Tufts Medical Center. Unlike in most concierge arrangements, none of the Pratt physicians’ current salaries will increase with the switch.


Finding innovative funding sources for indigent care is nothing new to academic medicine, Ginsburg says. “The Tufts idea corresponds with the longstanding practices of many hospitals—especially teaching hospitals—that they would use the surplus in centers that make more money to cover for the costs of those that don’t generate as much revenue, whether that’s in research efforts or in teaching or in caring for the poor. [Yet] this could be a new model of using concierge practices.”


Indeed, the Tufts project has become so fascinating at MDVIP that Lipton recently received a new title: director of institutional growth and programs. MDVIP has approached “40 or 50 other institutions” about its group model and is in talks with four of them. He would not say which medical centers, only that they “are rather well-known institutions.”


The American Society of Concierge Physicians, a Michigan nonprofit begun last year to advocate for concierge medicine, will hold its first national conference in Denver this May. The speakers include Dr. Deeb Salem, Tufts-NEMC’s chief of medicine who has overseen the creation of the Pratt clinic; and Dr. Douglas Tilt, whose Camellia Medical Group opened in early January as part of the University of Alabama at Birmingham (UAB) Health System. The Camellia Medical Group is the nation’s second concierge clinic to be associated with an academic medical center.


Tilt, who says he prefers the term “personal care medicine,” decided to open Camellia after returning from a two-year stint in the United Arab Emirates, where he helped overhaul the country’s medical system. He visited prominent concierge clinics in Seattle and elsewhere and came up with his own template for the UAB clinic.


“This is the way I practiced when I first started [25 years ago], when I was brand new and had very few patients,” he says. “Each time I’ve started a new practice, I’ve been able to provide that kind of care, at least until patient rolls swelled. I want to get back to that.”


Tilt, whose daughter is a third-year UAB medical student, says he’s worried about the future of primary care and what students may be picking up from their superiors about its lifestyle. “The problem with universities is that the primary care physicians are asked to see more and more patients so they can make more money to recoup the losses. It’s a sense of frustration, a sense of failure, that makes many of us feel bad. The more patients you see, the less time you can give to patients and the more you go home and worry about whether you’ve done everything you were supposed to do.”


Camellia charges $3,000 per patient for annual membership, which will likely be filled by UAB donors whom “the university wants to be sure…have easy access to the institution and get well cared for.”


“[But] it’s not a cash cow,” Tilt says. “People say, ‘How can a university do a system like this? What about indigent care?’ We do more than our fair share of that, gladly. We’re proud of it. But we also need other revenue sources to allow that to happen. To have a healthy university, you have to attract all types of payers.”
Beth McNichol is a contributing editor with The New Physician and a freelance writer based in Durham, North Carolina. Direct questions and comments about this article to tnp@amsa.org.