Practice transition and startup for physicians considering or ready for a change to a membership or direct pay practice business model.
Improvement and enhancement for existing practices with demonstrated growth potential with difficulty getting traction.
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We offer a variety of services to our clients including
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Concierge and DPC Clients
Team members in varying specialty areas
NEW FROM THE BLOG...
Read some articles we've shared on the business of concierge and DPC medical practices
Many callers ask us what they should expect as far as costs to startup or transition to a concierge or direct pay practice. They need this information to create a budget pro forma for a business plan that will be used by lenders or simply for internal planning purposes.
|Budget Line Item||Our cost estimate||Actual cost|
|Corporate setup, legal fees||unknown|
|Accounting costs, tax advice, accountant fees||unknown|
|Bank fees and transactional costs||unknown|
|Staffing and benefits||unknown|
|Rents and leases||unknown|
|Equipment and technology purchases, leases, office furnishings||unknown|
|Interior remodeling, permits, contract labor, and space planning||unknown|
|EMR and software/hardware computer associated expenses||unknown|
|Revenue management expense, billing, coding, collections||unknown|
|Answering service||$250 /month|
|Appointment scheduling software integration||unknown|
|Telehealth tools and technology||unknown|
|Startup consultation||$400 per hour|
|Market research||$400 per hour|
|Strategic planning||$4800 and up depending on scope and time at your location|
|Existing and new payer contract review, analysis, recommendations||$2500 per contract, on average|
|Photography and videography, professional editing and production||$10,000 for both, plus any travel and location use fees|
|Website setup, design, email, licenses, registrations, etc.||$4500 first time, $2000 annual renewals|
|e-Newsletter setup, design, quarterly editing and mailing services||$4000 annual|
|Social media marketing set up and management||$5000 first year, $3800 annually thereafter|
|Sales tools creation, brochure, sales, flyers, member handbooks||$5500|
|Member contracts (Medicare and non-Medicare templates)||$750-1250|
Don't "fear" the budget estimates above; instead, use them to your advantage.
Keep in mind these are only estimates. What you decide and how you deploy will all impact these estimates. You may not have budget to do all you'd like to do at the very beginning. That's perfectly normal. We take the approach that you do the best you can do, call on favors, supportive friends and family who may be graphic artists, photographers, web designers, English majors that can edit, and others to contribute to your cause. Barter with some patients if you must (always a last resort!) and stage the rest for later. The worst mistake you can make is to underestimate and under capitalize out of ignorance or insult someone's value by not perceiving the retail price they would get if you had to pay for their services.
Understand the competitive marketplace
According to MerrittHawkins published research, one tenth (n=3000+) of American physicians, both in primary care and surgical and non-surgical sub-specialties have declared intention to switch or launch a concierge membership or DPC practice. You must be positioned above your competitive rivals to win ideal customers (patients) and grow.
Eventually, for the ideal patient seeking this style of healthcare delivery, price will merely act as a filter. The real competition you will face occurs at the perceived value proposition and differentiation level. It will occur each year at renewal decision time as well, where 30% attrition is normal and you must locate new members/buyers to maintain equilibrium. Living brands are hyper-personalized just like your concierge or direct pay medical practice business model. That's how you keep them size constrained to the maximum patient panel size you want while setting the income levels at a comfortable number. To do this, we use data from the CHNA, data from the demographics of your existing patients (if transitioning) and data from past utilization, procedures, diagnoses, and other indicators to assess your practice and create ideal customer personas.
Understanding brand value
Setting your value proposition so that the value you offer is also perceived by the members day in and day out is an objective of branding, rebranding and brand relevance. The perception that the extra amenities you provide must be conveyed through proper messaging, imagery, consistency in staff service and attitude, and the little differentiating extras that people will want to mention and appreciate in word of mouth comments to friends and family, online in feedback, and in repeat purchases. Physicians and dentists who functionally integrate around the customer with regard to the technology, data, marketing and the patient experience leapfrog beyond their competitive rivals by delivering their membership or DPC products and services not simply as an offer, but as an experience ecosystem: a hyper-contexual, empathetic, cohesive and humanized experience that responds to, learns from and anticipates its customers’ next moves and needs and willingness to renew subscriptions upon their contract anniversary. Everything you do, everything you invest in the budget estimate above must enhance your brand relevance to the ideal customers you want to attract and filters out those you don't. Therefore, above and beyond the basic startup expenses (rent, accounting, corporate formation, etc.) should be prioritized accordingly. Until you have created your "living brand" architecture, don't create a website, brochures, sales flyers, newsletters, and even a list of what is included in your amenities package until you've created the brand architecture or you'll waste time and money on do overs or be forced to live with ineffective website, brochures, sales flyers, newsletters and amenities packages until you can afford the do over or flat out fail at your new business model.
A sign that the initial customers didn't realize or perceive the same value you thought you presented is when they quit and transfer to a different concierge or DPC practice in the same community. This sort of attrition is very different from one where they quit and went back to traditional neighborhood "hamster wheel" practices...a sign that they believed could not afford to continue to pay for a "luxury." Or the attrition that occurs because of a significant life change (a new financial responsibility or a move). Living brands are in learning mode all the time and use this knowledge to inform how they think, act, and engage with consumers. It is critical that you learn why the patient signed up and what gave rise to any attrition that occurs by reaching out with a personal call to each member who joins or leaves your practice. Your "brand" is not a collection of static logos or advertising campaigns, but instead, a total immersive experience of how you help people advocate for themselves for their healthcare and wellness. Without this, you won't grow. You'll simply have a business model that involves a membership amenities fee and/or no longer accepts insurance as payment for services.
Your patients bring you value as well
In some cases, you may wish to have a discretionary "waiver" allowance for certain patients you want to retain, no matter what. That discretionary allowance will affect your income projections, but perhaps there is something that patient can offer (influence, services, or something else) in trade that will cut costs elsewhere. Allowing them to trade value for value (at full retail barter) enables them to maintain their dignity and self-respect and desire to remain in your practice even if they can't afford to pay for your services otherwise. First, come back to the budget list above and figure out what you can cross off the expense column in trade. Is what they bring mission critical? Prioritize this!
We offer this counsel to everyone. While some of these services may be the very services we offer, we want you to succeed even if it means not using our services. We don't mind working with your daughter, the journalism major, to help edit your web and brochure content as long as she can deliver on time, on target, and provide value equal to a professional we would otherwise bring to your project. We don't mind working with your patient, the website designer or social media "hot shot" as a substitute for a team member we might otherwise introduce. In fact, we'll welcome them and integrate them onto "your" team.
With some 800,000+ licensed physicians in the USA, and 10% of them with intentions or decisions to move to these business models, we know we can't claim the market and that not all physicians who decide to transition or start up a concierge membership or direct pay practice will be our customers. Of the addressable market, we've assisted about one-half of one percent. They come with all sorts of ideas, differentiation, locations, budgets, and dreams. Reach out and let's start with a 15 minute courtesy introductory call. There's no obligation to go beyond that. If we aren't the best fit for what you want and need or if we are too busy to help you in the time frame you desire, we will happily refer you to professional colleagues we know and trust who may be able to help you.
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To arrange a consultation send us a message or call us by phone (800) 727. 4160