Heal Thy Practice Highlight: Leaving Insurance-Based Practice….Legally!

Faced with ever-growing bureaucracy and continued declines in reimbursement, a record number of practitioners are contemplating a shift from insurance-based practice into some form of direct-pay or retainer practice.

Holistic Primary Care’s 2013 physician survey suggests as many as 1 in 3 primary care doctors are now contemplating such a shift.

The move out of insurance-based practice is not without medicolegal risks, and needs to be done very carefully, says Alan Dumoff, JD, a lawyer specializing in integrative practice issues. Mr. Dumoff, was a featured speaker at HPC’s 2012 Heal Thy Practice Transforming Primary Care conference in Long Beach, CA, where he offered a big dose of much-needed and highly valuable “preventive lawyering.”


The conversion to a direct-pay model was one of many topics he covered in a 2-hour medicolegal marathon.

“Starting a retainer-style practice doesn’t exempt physicians from caring for those in need, especially those in need of urgent care,” he said. “Doctors must help transfer—at no charge—non-participating patients to others. If no others are available, a doctor may be ethically obligated to continue caring for such patients.”

Creating a Patient Safety Net

If you are setting up a cash-pay or retainer-based practice, you must provide all your patients with 30 days’ written notice of the change. This must include appropriate referrals to other practitioners, and you must ensure that no patient will be left in unstable condition or in the middle of a significant course of treatment at the time of the conversion.

Retainer or “concierge” practice models depend upon a direct contract between you as the practitioner and patients who are willing and able to pay the fees required to be members of the practice. Therefore, you must be able to prove that patients have entered into such contracts without duress, unfair persuasion, and with full disclosure that includes any knowledge you, as their physician, have regarding their insurance coverage.

Judicious Marketing

Mr. Dumoff strongly advised against pitching the benefits of the membership model in terms of “more or better diagnostic and therapeutic services.” To claim that your practice will now offer better medicine to direct-paying patients is to invite medicolegal trouble because it implies that you have been providing “substandard” or “lower quality” care to your insured patients all along.

Each patient who joins a retainer-based practice needs to be very clear about the terms of the arrangement, the services covered (and not covered), and the renewal and termination policy.

Mr. Dumoff recommended putting all of this on paper, and asking each patient who joins the retainer practice to sign an agreement that:

• -Clearly specifies the scope of services covered by the retainer fee.
• -Specifies whether the concierge practice will accept Medicare and/or other insurance.
• -States that retainer fee is paid in addition to and not in exchange for any co-payments, deductibles or co-insurance.
• -Specifies duration of membership, when fee must be paid, whether all or any portion is refundable or non-refundable.
• -Specifies terms of renewal (i.e., automatic renewal or one-year term after which patient must notify practice of renewal).
• -Permits the patient to terminate the relationship without financial penalties or undue burden.

This agreement must be in plain English and easy for patients to understand. It is prudent to have a practice staff member walk each patient through key terms of the agreement. There should be no ambiguity or misunderstanding—either on your end or your patients’–about the terms of the arrangement and the spectrum of services covered.

Want more medicolegal guidance? Purchase the download of Mr. Dumoff’s entire medicolegal intensive! Visit: www.HolisticPrimaryCare.net and click on 2011 Conference Recordings.

Article Copyright 2012, Holistic Primary Care-News for Health & Healing

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