Exploring Membership Models: Now Is the Time to Reinvent Your Practice

Tom Blue


The first time I ever contemplated altering the financial arrangement between a doctor and a patient was in the spring of 2002. An enterprising businesswoman, a good bit older than I was at the time, approached me after reading about a concierge medical practice on an airplane magazine. The concept had immediately resonated with her, and she was eager to see such a service available in our home town.

At the age of 30, and with little experience as a user of the healthcare system, the country club medical relationship she described seemed strange. Why would a person want to pay a $1,600 membership fee to a primary care doctor when primary care was readily available for a mere $20 copay?

She was persuasive—and keenly aware of the tastes of her demographic. Thus began Virginia’s first concierge medical practice—today, a group of more than 25 membership-based doctors spread across several states—and my 16-year, ongoing adventure in the world of direct contracting between doctors and patients.

I share this story as a foundation to build the first of several arguments (more to follow)… If you are ready and willing to act, you are likely in the most exciting window of your career as a physician.

A few key facts to refresh your memory of the healthcare environment in 2002:

  1. This idea was very new. At the time, there were less than 25 doctors in the country experimenting with membership models. And Richmond, VA, has never been known as a community of early adopters.
  2. Only one year prior had it been established, by way of a memo from then US Department of Health and Human Services Secretary Tommy Thompson, that it was even legal for a doctor to sell a service to a patient that was not covered by Medicare or commercial insurance.
  3. Patients were almost entirely shielded from the cost of health care and chronic disease. The average premium for a family health plan was less than $400/month, and a high deductible plan was nearly unheard of.
  4. The primary care physician shortage was visible only in forecasting models. The erosion of the doctor-patient relationship brought about by the ever-increasing speed of the primary care treadmill was barely perceptible to most patients.
  5. The national infrastructure for delivering progressive primary care was just beginning to form. LipoScience had just introduced the market to advanced lipid analysis.

Fast forward to 2018…

  1. The idea of private-pay medicine is well established and familiar in most communities as thousands of doctors around the country now contract directly with their patients.
  2. The pathway for doctors to develop and deploy a host of innovative business models is well paved and, with basic precautions, nearly free of regulatory risk.
  3. Holding aside catastrophic scenarios, working-age families are shouldering nearly all of the financial responsibility for their health and are more engaged in the stewardship of their well-being every year.
  4. The primary care patient experience has eroded to the point that consumers are being treated at pharmacies and by strangers on the phone.
  5. The US is home to the world’s greatest abundance of product, service, technology, and training assets to empower any physician to provide remarkably differentiated, high-value services in their community.

Equipped with your IFM training, in 2018, there has never been a better time for a primary care physician to design and manifest a practice of extraordinary value to the people it serves. Equipped with the business training that IFM and IFM Practice Implementation Educator Dan Kalish have assembled together, there is no reason that you and your practice should not thrive in this moment when your skills have never been more needed.

In my next post, I’ll share with you the revelation that has fueled my unending passion for this work in Functional Medicine and the connection between your business model and patient health outcomes.

About Tom blue

Tom Blue is the Director of Industry Strategy & Partnerships for The Institute for Functional Medicine (IFM), the global leader in Functional Medicine education. Since 2002, he has been a pioneer in the use of innovative business models to enable physicians to successfully shape their own futures and the services they bring to their patients and communities.

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