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Friday, May 28, 2004 - Page updated at 12:00 AM

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'Concierge physicians' medical model growing

Seattle Times staff reporter

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Some doctors are uncomfortable with the labels — "concierge physician" sounds like someone more at home in a tux than a scrub suit, and "boutique practice," complains one Seattle doctor, sounds like "something small and fluffy, for rich people."

Whatever it's called, more and more doctors are charging patients retainer fees, allowing the doctors to see fewer patients but spend more time with each one — and make more money, too.

Around the country, there's so much interest in this emerging model of practice that a Detroit-area family doctor is convening the first "National Conference on Concierge Medicine" this week in Denver.

Many of the speakers are from the Seattle area, where a professional sports team doctor and his partner started the first concierge practice in the country in 1996. Dubbed MD{+2}, it catered to patients willing to pay $10,000 or more a year for first-class, personal medical attention, including in-home or vacation-cabin visits.

Since then, a small but growing number of doctors around the Puget Sound area have quietly converted their practices, most charging patients from $30 to $250 a month. Some provide all office services for the fee, while others also bill patients' health insurers.

"This model started as a kind of elitist-type approach, but it's evolved into a grass-roots initiative to retool the delivery of health care," said Dr. John Blanchard, a 34-year-old Grosse Point family doctor and founding president of the American Society of Concierge Physicians, sponsor of the conference. "It's where we're going in health care, toward more consumer-driven health plans."

In the last couple of years, though, retainer-fee practices have faced what Blanchard calls a "host of legal, regulatory and public-relations obstacles," only too familiar to concierge physicians around the Puget Sound area. They include challenges from the federal government on Medicare billing, problems with state insurance regulators and legal concerns by some private health insurers.

The practices also have faced charges from ethics experts and fellow physicians that they cherry pick patients and violate doctors' responsibilities to patients and to their communities.

Concierge physicians acknowledge such fees bring in more money.

For example: One local practice limits each doctor to 800 patients, most paying about $1,000 per year. Even after subtracting patient-care costs, overhead and the subsidized patients most of these doctors say they carry, the physicians have the potential to make considerably more than the $150,000-$155,000 national average of total compensation for primary-care or internal-medicine doctors.

Most recently, Medicare warned doctors not to charge patients extra fees for covered services, and cracked down on a Minneapolis doctor, who settled the case for an undisclosed amount.

Washington state's Office of the Insurance Commissioner maintains the fees violate existing laws and regulations. The office has met with some higher-profile concierge practices and is working on a compromise to allow them to continue but with regulatory oversight to protect patients.

"Right now we're working again to craft legislation we'd like to propose next year," said Deputy Insurance Commissioner Beth Berendt, who will speak at the Denver conference today.

Some insurers now prohibit doctors who contract with them from charging patients fees beyond those specified in their insurance plans. And from the insurance commissioner's point of view, doctors who don't bill insurers but promise to deliver certain services to patients for a set fee are operating as unregulated insurers.

But patients want the choice, Berendt said, and her office will try to balance the need to "foster innovation and creativity" in health care with protection of patients.

She's seen instances where insurers have promised more than they can deliver, and says it's her office's job to ensure that doesn't happen with retainer-fee practices. "We don't want to have a situation where people can be hurt financially or physically. We take both responsibilities very seriously."

Berendt said the insurance commissioner for now won't take action against "well-intentioned and ethical providers." But, she said, "if we find someone comes into the state and tries to exploit the situation, or a practice that's exhibiting clear harm to the consumers, we will use our regulatory authority."

Patients who have been asked to pay retainer fees range from angry to satisfied, or a little of each.

Victoria Doyle, who left her Polyclinic doctor of 20 years after he asked for a $300-per-year fee, said her decision involved both finances and principle. Doyle, a heart-transplant patient, said her doctor provided "compassionate and efficient care."

But Doyle was stretching her disability payments to the max, paying for private health insurance so she could afford expensive anti-rejection drugs and other care.

The clinic offered her a financial-hardship application, she said, but "it was humiliating to be forced to beg to continue with my doctor of more than 20 years."

The principle of the thing bothered her, too.

"If we're going to put ourselves in the position where only people who can pay for it can get the quality health care that is provided by these people, we're creating a monster," said Doyle, who notes that many doctors no longer take low-income patients on Medicaid.

Robert Ramberg, a 61-year-old Ballard retiree, sees a doctor at Seattle Medical Associates, which charges $1,020 per year for adults for all care provided in the office, doesn't bill insurance, and limits patients to 800 per doctor.

Ramberg relates a story about an acute knee problem two years ago, explaining how his doctor quickly coordinated diagnosis and surgery on a tight schedule.

"Would I like to get this kind of service without an additional charge? Of course," Ramberg said. "But for me it has been money well spent."

A Medicare patient who is paying $75 a month to keep her Eastside doctor has a different view.

"You're not actually getting any more — it's not like anything changes," she said. "There's no way around this. You're damned if you do and damned if you don't."

She said she was "scared stiff" for her name to appear in the newspaper, though, because she wants to keep her doctor, whom she considers one of the best. "I don't want to lose that."

Many of the doctors who have decided to charge retainer fees say they didn't feel good about the care they were providing before.

"Very few doctors went into medicine seeking mediocrity," said Dr. Garrison Bliss, one of the founders of Seattle Medical Associates. "It's no fun to practice bad medicine. The patients know it, the doctors know it."

The new system, he said, is "an opportunity for doctors and patients to rebuild medicine."

Being able to provide better care to patients was a major reason Dr. Hank Williams and his partner converted to a $200-per-month retainer-fee practice a year and a half ago, said Williams, a Bellevue internist and geriatrician. He was frustrated by having less time to care for patients.

"You can't see a 55-year-old with multiple issues in 10 or 15 minutes without making mistakes," Williams said. "We decided to do something different. It was basically for quality of care."

Williams and Kaner, both of whom work half-time at the practice, now have about 300 patients between them, compared to the average primary-care doctor's 3,000 or more. They don't bill insurance or Medicare, and fees cover all in-office care, including tests and lab work, 24-hour phone access and same-day care for acute problems.

"We weren't looking to become the exclusive club," said Kaner, who along with Williams also works at a senior health center. "We were looking to get back to practicing medicine and advocating for our patients."

Carol M. Ostrom: 206-464-2249 or costrom@seattletimes.com

Copyright © 2004 The Seattle Times Company

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