This is a KFF Health News story.
For-profit hospitals, set up largely to serve the poor, are adding concierge physician practices, charging patients annual membership fees of $2,000 or more for easier access to their doctors.
It’s a trend that started decades ago with medical practices. Thousands of doctors have switched to the concierge model, where they can increase their income while reducing their patient load.
Northwestern Medicine in Chicago, Penn Medicine in Philadelphia, University Hospitals in the Cleveland area and Baptist Health in Miami are among the large hospital systems offering concierge physician services. The fees, which can exceed $4,000 per year, are in addition to copayments, deductibles and other fees not paid by patients’ insurance plans.
Critics of concierge medicine say the practice exacerbates primary care shortages by providing access only to the wealthy while driving up health care costs. But for tax-exempt hospitals, the financial benefits can be two-fold.
Concierge fees provide new revenue directly and serve as a tool to help recruit and retain physicians. These doctors then provide lucrative referrals to their wealthy patients at the hospitals that employ them.
“Hospitals are attracted to doctors who offer concierge services because their patients don’t come in with bad debt or in need of charity, and most of them have private insurance that pays the hospital very well,” said Gerard Anderson, a hospital finance expert at Johns Hopkins University. “They are the ideal patient from the hospital’s point of view.
Concierge doctors typically limit their practices to a few hundred patients, compared to a few thousand for a traditional primary care physician, so they can promise immediate access and longer visits.
“Every time we see these patterns expand, we’re shrinking the availability of primary care physicians for the general population,” said Jewel Mullen, associate dean for health equity at the University of Texas at Austin’s Dell School of Medicine. Connecticut’s former health commissioner said concierge doctors join large hospital systems because of the institutions’ reputations, while hospitals hire concierge doctors to provide referrals to specialists and hospital care.
“It helps hospitals secure a larger share of their market,” she said.
Concierge doctors usually promise same-day or next-day appointments. Many provide patients with their cell phone number.
Aaron Klein, who leads Baptist Health’s concierge physician practices, said the program was originally designed to serve donors.
“The high-end donors wanted to be sure they had doctors to take care of them,” he said.
Baptist opened its concierge program in 2019 and now has three practices in South Florida, where patients pay $2,500 a year.
“My philosophy is: It’s better to provide world-class care to a few hundred patients than to provide inadequate care to a few thousand patients,” Klein said.
Concierge physician practices began more than 20 years ago, primarily in prestigious areas such as Boca Raton, Florida and La Jolla, California. They mostly catered to wealthy retirees willing to pay extra for better access to a doctor. Some of the first physician practices to enter the business were backed by private equity firms.
One of the largest, Boca Raton-based MDVIP, has more than 1,100 doctors and more than 390,000 patients. It was launched in 2000, and since 2014, private equity firms have held a majority stake in the company.
Some concierge doctors say their more attentive care means healthier patients. A study published last year by researchers at the University of California-Berkeley and the University of Pennsylvania found no effect on death rates. What the study found: higher costs.
Using Medicare claims data, researchers found that concierge medicine enrollment corresponded to a 30% to 50% increase in total health care spending by patients.
For hospitals, “it’s a continuation of their consolidation in the market,” said Adam Leve, study co-author and assistant professor of public policy at the University of California, Berkeley. Inova Health Care Services in Fairfax, Va., one of the state’s largest tax-exempt hospital chains, employs 18 concierge physicians, each serving no more than 400 patients. Those patients pay $2,200 a year for the privilege.
George Salem, 70, of McLean, Va., has been a patient at Inova’s concierge practice for several years along with his wife. Earlier this year, he hit his finger on a hotel door, he said. As soon as he got home, he called his doctor, who immediately saw him and stitched up the wound. He said he sees his doctor about 10 to 12 times a year.
“I loved my internist before, but it was impossible to see him,” Salem said. Having immediate access to his doctor “gives me a lot of peace of mind,” he said.
Craig Chaifetz, an Inova vice president who runs the concierge program, said the hospital system became interested in the model after MDVIP began aggressively moving into the Washington, D.C., suburbs about a decade ago. Today, Inova’s program has 6,000 patients.
Cheifetz disputes the charge that concierge physician programs are exacerbating primary care shortages. The model keeps doctors who have considered early retirement in the business with a lighter caseload, he said. And the fees amount to no more than a few dollars a day — about what some people spend on coffee, he said.
“Inova has an incredible primary care network for those who cannot afford concierge care,” he said. “We’re still providing everything we need in primary care for those who need it.”
Some hospitals are starting concierge physician practices away from their location. For example, Tampa General Hospital in Florida last year opened a concierge practice in upper-middle-class Palm Beach Gardens, about a three-hour drive from Tampa. Mount Sinai Health System in New York operates a concierge medical practice in West Palm Beach.
NCH Healthcare System in Naples, Florida employs 12 concierge physicians who treat a total of about 3,000 patients.
“We found a need in this community for those who want a more personalized health care experience,” said James Brinkert, the system’s regional administrator. Members pay an annual fee of at least $3,500.
NCH patients whose doctors become gatekeepers and who don’t want to pay the membership fees are being referred to other primary care practices or to urgent care, Brinkert said.
