Nobody knows what is in all 34,000 pages of the Affordable Care Act, but what many specialists do know is that the majority of it is not good for their practice or their autonomy. The notion that more Americans having insurance will equate to more patients for specialists is a not as simple as it may seem. First, many of the plans available on the Insurance Exchange are plans that have low reimbursement rates for procedures, meaning that many physicians will close their doors to these newly insured patients. Second, many of these plans have traded low premiums for high deductibles, some up to $10,000. Meeting these deductibles may be challenging for patients wishing to have procedures and leave them with high out of pocket costs.
A growing number of specialists and ASC’s are taking a page from the primary care playbook and beginning to explore a variation of the concierge medicine model, a reduced rate for cash pay patients and employers. The benefits to the patient and employer are quite obvious, especially for self-funded employers. For specialists exploring these arrangements it may not be as simple as it sounds. Research, marketing and public relations are three of the essential aspects that can bring in large quantities of patients.
For many businesses, the cost of insuring employees is their largest expenditure each year and with the Employer Mandate looming those costs are sure to rise. Businesses are scrambling to find ways to supplement these costs and many are cutting their workforces or cutting hours to circumvent the Employer Mandate.
However, many businesses have begun contracting directly with practices and using "a la carte" services for their employees. Essentially, employees are still given catastrophic insurance but, for elective procedures, the employer contracts directly with practices and pays directly for part or all of the employees procedure. This saves these businesses money by lowering the cost of employees' policies as well as only having to spend money when procedures are needed as opposed to paying for care that is never used. Furthermore, this form of medicine allows one of the most important things the ACA prevents — crossing state lines to find the best care. By not being restricted by state based insurers, patients can travel to receive care without being denied by their insurer. Companies like Wal-Mart and GE were some of the first to see this cost savings model and have contracted with Johns Hopkins and the Mayo Clinic.
Based on the reports of the first months Insurance Exchange enrollees, it seems that many in the individual market are willing to forego enrolling in the state exchanges and are opting to instead pay the penalty. Five million others have seen policies they were satisfied with be cancelled because they did not meet the government's arbitrary standard of coverage. On November 14th President Obama announced an amendment to allow cancelled policyholders the option to renew their coverage for up to one year, if their insurance company approves. It remains to be seen whether insurers will elect to renew these cancelled policies.
Regardless of amendments and delays, it seems the Affordable Care Act will be fully implemented in the coming year and the impact on your practice is almost certain. A research and marketing plan is the most important thing to have when considering the transition to a direct-pay model. Below are some things to tips to help begin the process.
Research
Although many in the individual market may want to explore the idea of cash medicine, the bulk of the business is generated by employers who are looking to lower the cost of health expenditures each year. This is where directly contracting with employers becomes a necessity. However, finding these employers and their decision makers (CFO’s, HR reps and Benefits Administrators) is an arduous task. Also, even if this data is compiled, what do you do with it all? Without a plan, the data is useless. This is where the marketing element will come into play.
Further research also needs to be conducted to determine a feasible pricing model. If the prices for procedures are similar to those at local hospitals the ability to highlight cost savings is lost. However, the goal is to still remain profitable using the cash model. Most cash procedures are those that can be performed as outpatient procedures in an OBS or ASC and not complex procedures that use multiple hours in the OR. A formula of OR cost per minute, anesthesia and other fees must be factored in to create one global fee to make it palatable to businesses and individuals. If overhead and staffing costs are high, then a cash model may not be a fit for your practice.
Create A Marketing Plan
Although the direct pay model seems simple to those in the medical world, it is an unfamiliar paradigm for the average patient. The term “cash” in medicine has traditionally evoked thoughts of back-alley physicians doing things “off the books” or chiropractors trying to sign them up for a predetermined number of visits.
The main goal of marketing a direct-pay practice is to assuage these misconceptions and educate patients that the quality remains the same and only the model has changed. Also, creating a message of cost savings to the patient allows them to become informed and a part of the decision making process. Once patients are informed of the benefits that come with direct-pay, they are far more willing to not use insurance and pay cash instead.
Marketing this cash model to businesses is a matter of demonstrating value, both financially and clinically. Businesses will want to make sure that their employees receive the highest quality care but are cost sensitive as well. A concerted effort must be made to highlight the achievements and credentials of the physician or ASC as well as highlighting the cost savings opportunities using hard numbers. For this, you may want to consult an insurance broker who specializes in self-funded or ERISA plans.
Creating a message is not the same for all practices and location and demographics are important things to consider.
Have a Public Relations Angle
Luckily, the media has been featuring physicians and experts alike the past few months who are discussing the hiccups and shortcomings of the Obamacare rollout. Many of the 24 hour news outlets have dedicated considerable blocks of time to Obamacare alternatives such as this. An effort like this is quite timely and generates the interest of many editors and producers.
However, your PR reach does not have to be only national outlets, as the bulk of the patients from cash pay efforts will be local. Finding the appropriate media outlets in your area to cover this allows you to spread your message to a relevant audience. The key is to figure out the political leanings of each outlet and give them the proper angle to entice coverage. For the more conservative media outlets, the idea of “free market medicine” is what will captivate them. For the more neutral media outlets, the key is posing this as a cost savings option for individuals and businesses alike. This gives it more of a human-interest feel rather than a promotional piece about your practice.
However, I always tell those interested in PR that their are far more “do’s” than “don't’s” and it is best left to the pros.
Gold Medical Marketing specializes Marketing, Public Relations and Business Development for practices and ASC’s that are exploring a cash pay model. For those who have already incorporated a cash pay model, Gold Medical Marketing can increase the volume of patients and employers who contract directly with the practice.
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