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SCALABILITY, PART 8: 14 Traits Of Unsuccessful Membership Medicine Clinic Owners

DPC Journal Highlights Articles & Educational Pertaining to Economics of DPC Model ... Read More ...

Data assimilated from interviews and polls (conducted in the Fall of 2014 by the The DPC Journal ), indicate that over 60% of physician respondents would NOT advise a medical resident right out of school to enter into a direct-pay medical clinic for about 6-8 years for two reasons … 

By Michael Tetreault, Editor-in-Chief

Editor-In-Chief, Michael Tetreault | The DPC Journal

Editor-In-Chief, Michael Tetreault | The DPC Journal

DECEMBER 16, 2014 – If you want to become more successful as a doctor or in your medical career, you can start by making a habit of talking and thinking more like the people you know, treat or read about who are already successful.

Over the years we’ve (The Direct Primary Care Journal, i.e. The DPC Journal) provided many informative and practical educational stories and articles which point out key successful business traits that physicians tell us are important. We’ve identified numerous trends among some of the most successful membership medicine owner/operators throughout the country. Today, with the influx of younger physicians learning about the growing trends happening inside certain membership-based delivery models involving private-pay, membership medicine plans, direct primary care (DPC) and concierge medicine, we’ve been asked by our readers to put together a list of cautionary road signs to aid in the future success of the younger physician demographic.

According to industry analysis and national data summaries to be released in 2015 by The Direct Primary Care Journal (The DPC Journal), the independent trade journal and news reporting publication observing and reporting on the national pulse of the DPC industry, 90% of interview, survey and DPC physician polls indicate that their practices are doing better financially over one year ago, whereas, only 10% said they were doing worse nationwide.

STARTUP: 17 Signs You Need To Start Your Own DPC Practice.

Dr. Kylie Vannaman, MD is a board-certified Family Medicine doctor who is passionate about restoring the doctor-patient relationship built on trust, communication and mutual respect.

Dr. Kylie Vannaman, MD is a board-certified Family Medicine doctor who is passionate about restoring the doctor-patient relationship built on trust, communication and mutual respect.

“There are many of us leaving the traditional medical model for one that focuses care back on the patient [instead of their insurance company],” tells Kylie Vannaman MD, a KC Family doctor who plans to open a DPC clinic in Summer 2015.

In any industry, there are winners and well, not so fortunate owners. Typically, those that startup a new membership medicine practice are excited about the prospect of their new endeavor. They feel a palpable energy around their practice and are motivated in-part, by how this delivery model is truly going to impact their patients and local community — and how they spend their time as a physician.

“DPC allows me to have the time to care for patients rather than third party payers,” writes Dr. Eric Potter to The DPC Journal. Dr. Potter is a DPC physician at Sanctuary Medical Care which services the Middle Tennessee-Nashville region and Northeast Tennessee/Southwest Virginia. “Many more doctors turn over a new leaf with DPC.”

But for those that began their journey a year, three years or even 6 months ago and are struggling to squeak out a living by offering affordable direct-pay memberships to their patients, these doctors and their businesses, slowly fade into the background … usually never to be heard from again or eventually shared with a hospital colleague in a quiet corner or to a managed care dependent physician now considering a new course correction and career shift.

“This transition is getting harder and harder the closer I get [to my ‘all-in’ date],” states one DPC physician in a December 2014 interview with The DPC Journal. “There’s a lot of rejection from patients I’ve cared for and thought would join. It’s difficult to hear.”

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Dr. Potter has experienced both sides of health care, not only walking through health crises with adults and children in various settings, but also walking through the patient side of health care with several close family members. This has provided ample opportunity to study the needs of those suffering from health problems in our fallen world, and has given Dr. Potter a desire to comfort and provide relief as God allows, through scriptural, natural and scientific means.

Recently, The DPC Journal staff interviewed and polled its physician readers and asked a series of engaging and practical questions. One question that received a particular amount of interest and a wide variety of comments was the question ‘Is DPC Recommended for Medical Residents, Students Right Out of School? Why/Why Not?’

According to The DPC Journal interviews and polls (Fall 2014), over 60% of respondents commented and said that they would not advise a medical resident to enter into a direct-pay medical clinic for about 6-8 years for two reasons. First, ‘it requires a great knowledge of payor/payee issues with the healthcare marketplace that you really need to understand in order to navigate the questions that will come your way from patients,’ said a family medical physician from Utah. The second concern physicians mentioned in response to this question was ‘Any private practice endeavor would be hard for a residency graduate due to the debt that they bring with them in their new business endeavor.’

“Business is tough,” says Dr. Chris Ewin of 121MD in Fort Worth, TX. “If you are doing something just for the money, you are never going to enjoy it. You will be the hardest boss you have ever had. So, find something you love and pursue it. Follow this advice and you will set yourself up for an enjoyable future in medicine.”

So lets take this notion of debt one step further. We then asked current DPC physicians ‘Did you go into debt to start your DPC practice?’ Over 85% of respondents said they incurred between $25,000 to $180,000 in debt to set-up, staff and open the doors to their new DPC practice in the first 18-months. Wait, what? Why?

So how did the DPC industry’s pioneering physicians finance their practice? According to DPC Journal analysis of interviews, surveys and polling data assimilated from 2013-2014, most physicians leveraged personal assets (i.e. savings, house, 401 K, sold real estate property, etc). Some doctors moonlighted at Urgent Care Centers. Others sought out more traditional methods (13%) with a bank loan.

Dr. Chris Ewin of Fort Worth has run a concierge practice for nearly a decade. Ewin says, "I don't have to go through a bean counter, insurance and the government. Therefore I get the cost down." PHOTO CREDIT Courtesy of Dr. Chris Ewin

Dr. Chris Ewin of Fort Worth has run a concierge practice for nearly a decade. Ewin says, “I don’t have to go through a bean counter, insurance and the government. Therefore I get the cost down.” PHOTO CREDIT Courtesy of Dr. Chris Ewin

“Direct practices should be successful in most cities and states where there is an inadequate supply of primary care physicians,” says Dr. Chris Ewin, Founder and physician at 121MD in Fort Worth, TX. “This may be true in the country with the correct practice model. Most important, a physician needs to have social skills to sell him/herself and there new practice model to their patients and their community.”

While you might think this polling data, commentary and opinions from active membership medicine physician colleagues is painting with a rather red brush, experienced industry DPC physicians tell The DPC Journal that it’s important for the younger generation of doctors to not be discouraged by these models, but encouraged and simply understand what to expect.

14 Traits Of Unsuccessful Membership Medicine Clinic Owners

So lets reverse things a little and go over the the common traits of unsuccessful membership medicine business model owner/operators we’ve interviewed in this industry over the years. What do they have to say to their peers and colleagues?

  1. Doctors who do not understand that if you are not able to differentiate yourself in your local market, you will fail.
  2. Doctors who do not overcome common patient objections to the membership medicine model(s) with the appropriate answers and correct, locally relevant, education. I.e. Doctors have to be prepared to educate all their patients realizing that most patients don’t think they can afford it and do not understand how it works with their current insurance.
  3. Understand that most patients have (and pay for) insurance and they want to use it. Period. Under the law of the ACA, everyone has to have insurance. It’s now the law of the land.
  4. Understand it takes a special kind of individual to even want to understand the benefits of a membership medicine practice. Understand that it may require some patients (on their own) to make major/minor adjustments to their existing healthcare coverage (i.e. going to a higher deductible/catastrophic coverage plan) and manage where their healthcare dollars are going.
  5. Doctors who find they have a great sales increase, but don’t know where it came from.
  6. Doctors who say that they never have enough time for themselves or family, but who refuse to hire anyone because they do not have the ability to trust anyone else.
  7. Doctors who do not study industry trends.
  8. Doctors who treat all their staff the same or Doctors who have high turnover and blame it on the market or the economy.
  9. Doctors who rely simply on word of mouth referrals to grow their base.
  10. Doctors who desperately need a marketing plan, business plan, operation plan, strategic plan, etc.,  but never seem to get around to getting it.
  11. Doctors who do not understand the importance of branding their services within a 3-10 mile radius of their practice.
  12. Doctors who are totally reactive to circumstances.
  13. Doctors who refuse to ask for help, even when they run into major problems.
  14. Doctors who never seem to be ready for change.

We’ve been told there are many more, but these 14 traits of unsuccessful membership medicine owner/operators seem to be the most prevalent, according to our interviews. Do you have any additional traits that we should add? If so, please let us know in the comment section below.

But let’s not end on a low note. As Dr. Potter wrote to The DPC Journal and I believe sums it up best … “Direct Primary Care is a growing point of light in the darkness. I encourage those who are facing these high deductibles to look for Direct Primary Care which can save them money on doctor visits, urgent care visits, prescription costs, lab costs, and help avoid some ER visits. People will be surprised at the value they get for their healthcare dollar.”

1 Comment on SCALABILITY, PART 8: 14 Traits Of Unsuccessful Membership Medicine Clinic Owners

  1. As we begin a transition to a DPC model from an insurance based model I agree that in order to sell the idea to patients ,the physician (and the staff) have to have a solid grasp of why this is good financially and medically for the PATIENT and be able to overcome common objections in a gentle and positive way. Frankly the patients generally don’t care why it is good for US and I don’t think they honestly think we would close our doors because we can’t afford to keep going down the insurance road.

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