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Monday
Oct112010

Medical Spa MD {5} Dr. Steven Knope - Concierge Medicine

Medical Spa MD Podcast - Dr Stephen Knope - Concierge Medicine

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In this podcast episode, Dr Knope brings us up-to-speed on Concierge Medicine. We discuss how to open and operate a concierge practice.

Dr. Knope is a board-certified internist and sports medicine expert. He completed his premedical studies at Columbia University and graduated with honors in internal medicine from Cornell University Medical College in 1988. He completed his residency training at UCLA, where he was awarded the first Sherman Melinkoff Teacher of the Year Award. He has served as Chief of Medicine, Chairman of the Department of Medicine, and Director of the ICU in the Carondelet system in Tucson, Arizona. He is a pioneer in the field of concierge medicine, opening one of the first concierge practices in America in December 2000. He authored the first book on concierge medicine entitled, Concierge Medicine; A New System to Get the Best Healthcare (Praeger, 2008).

Knope has received local and national media attention for his work as an uncompromising patient advocate and opponent of the HMO industry. He has been covered in the Arizona Daily Star, Moneymagazine and The Wall Street Journal. In his fight against a local HMO, Nobel Peace Prize Laureate and inventor of the cardiac defibrillator, Dr. Bernard Lown, praised Knope as “courageous” and “deeply principled.”

Knope has served as the official internist for the Colorado Rockies baseball team during their spring training in Tucson and has been a member of the editorial board of The American College of Sports Medicine’s Health & Fitness Journal. He is a highly regarded national speaker on the subjects of obesity, fitness and exercise.

Some of what we talked about in this episode.

 

Podcast Transcript

This is Medical Spa MD.

Andy: Hello and welcome to Medical Spa MD, the show. Well we give you the inside information to help physicians reclaim control of their medical practice and lifestyle even you’re clueless about running a business and you’re already working 60-hour weeks.

Medical Spa MD brought to you by MedicalSpaMD.com, a worldwide community of physicians practicing cosmetic medicine. Hello Jeff!

Jeff: Hello Andy! How are you doing?

Andy: I’m very, very well. Thank you very much. I’m interested to see in the world of medicine a rather interesting post on your blog entitled: “Medical Spa Advertising: Keeping it Legal” There’s a lot of legislation, isn’t there? As a sort of governing how you advertise medicines and medical things in the US, as indeed in the UK. How is it different in the US?

Jeff: Well, to be honest, I’m not an expert in the UK and I’m not a lawyer in the US, there are generally things that kind of, business kinds of things that you can and cannot say. But, when you’re advertising a medical clinic or medical practice or kind of healthcare specifically, you just need to be aware that things that you say online are attributable to you and they are governed by the same rules and regulations that govern whether they’re in print media or whether you’ve actually sent them to the patient or put them inside of your paperwork. And there was some legislation passed I think it was probably about 8 months ago now that kind of restricted actually added some kind of caveat to what you must disclose when you’re advertising and so this affects clinics in some kind of odd ways. For example, if you have before and after patient photos and you have provided value to them in some ways in order to get those photos that has to now be disclosed on the website. Now, probably it’s not a huge necessity to kind of run around and decide what it is that you need to actually do to for every photo and whether you had a signed form consent or what you might have given them if you gave them discount on treatment or some other things, but it is something that you kind of be aware of when you’re kind of posting materials to your website.

Now, we have some information on the site so you’re more than welcome and probably a good idea to kind of do a search on medical spa advertising or legal resources. Legal is one of the things that is covered extensively on the site and that is always the concern for physicians. The majority of that information is applicable to the United States so I would add the caveat that if you’re outside the United States, which a huge number of our members are, that you are going to be subject to this regulation or it might differ in some way.

Andy: Actually, one of the things on this post towards the bottom of question 8 says: “With all these legal requirements, why don’t more doctors get prosecuted?” which is a good question.

Jeff: Well, this is not very high on the list. What this legislation was, in effect, designed to do was to kind of give the regulatory bodies some kind of ability to combat egregious things, claims the weight loss stuff and the hidden kind of endorsement. There’s a number of things that this was really designed to do and going around and trying to please before and after photos or claims that are on typical websites is not one of those. And so that’s not either their mission or their goal what it was designed to do. It is really to once they’ve identified somebody who is become problematic or is making claims that are unreasonable or something else that kind of be able to have a little bit of a stick to beat them over the head with.
Andy: Interesting stuff, the legal framework, isn’t it?

Jeff: It is and it’s complicated and has a tremendous amount to… it has a lot of moving parts that you kind of need to know. One of the questions that we often get has to do and will probably do in the entire show about this, we’ll get one of the lawyers on, has to do with how you have to compensate or whether you pay for patient endorsements or patient referrals and some other kinds of things. So, we’ll probably cover that extensively in another show, but this also kind of gets into that area if you are paying and paying can be from treatments to gift certificates to other kind of things. For referrals, what steps that you are going to need to make sure that you are kind of covered, whether that’s a patient who is referring people to your practice or whether that’s another physician and how you should be handling that.

There is a lot of information on the site. That’s a very long topic and I don’t want to try and get it in before our interview with Steve, but we will probably be handling that in another podcast.

Andy: Okay. That would be good so I’ll be looking forward to that. So let’s move on to the interview then with Dr. Steve Knope. I’ve got the surname right there, haven’t I Jeff? You pronounce the K “ka-nope”.

Jeff: Yes you do.

Andy: Interesting chap. He’s a pioneer, just a few quick facts before we go to the interview, in the field of concierge medicine. Well, I won’t ask you what that means Jeff because I know you will discuss that in the interview, don’t you?

Jeff: We’ll do talk about that, yeah.

Andy: And he offered first book on concierge medicine entitled, not surprisingly, “Concierge Medicine”.

Jeff: It’s no surprise at all.

Andy: And he used to play the French horn so he’s a bit of musician as well at the sound of it.

Jeff: Yeah. He was a professional French horn player before he went to medical school and became a physician.

Andy: Excellent. Okay. Well, let’s get into the interview then.

Interview

Jeff: Steve, you own a concierge medical clinic. What is your definition of concierge medicine?

Dr. Knope: Well, Concierge Medicine is nothing more than fee for service medicine, really what marks [inaudible – 06:44] 4 decades ago. So, the only difference between what I do and what doctors did before the day of third-party payers is that I collect the fee anywhere upfront once a year. But, many concierge doctors deal monthly. So, really concierge medicine is nothing more than a return to private medicine.
Jeff: So, you actually bill your patients like in a year? They’re not actually paying monthly, they’re paying in a yearly contract?

Dr. Knope: Correct. So in my practice people are paying me $6,000 a year as an individual or $10,000 for a couple and they write a check once a year. And at the end of that year if they’re happy then they’ll write another check and they sign up again and sign another contract and that’s how I run my practice.

Jeff: And so to kind of delve into that, what is your kind of churn rate on that? How often do you have patients kind of turn over? I assume that patients move… there are a number of reasons why this could have happened, but what is the percentage of patients that you keep year to year?

Dr. Knope: In terms of people who don’t move, we’ve got about a 98% we operate. So people generally want to take a taste of this are pretty happy with it and they come back. To be honest, I probably terminate more people than leave so probably a couple of people [inaudible – 08:06] because I can’t help them. People fall in 2 categories. 1) They’re drug abusers and they thought they could basically buy my DEA number and they said they can [inaudible – 08:23] for a while. Or, if people have major personality disorders and specifically I would say the groups that are most incompatible with this would be people who have true motivation disorders or people who are plainly narcissist who again would think that they bought your heart and soul for [inaudible – 08:45]. Most people would just come to have to Jesus talk and if it doesn’t work and they would rather do in those situations is refund all their money, shake your hand, part as friends and that’s the end of it, which really is very much kind of a two-way street because it has to work for both sides. So, I’ll bend over backwards to help somebody and to do everything I can for him medically, but if somebody comes here with a secondary agenda that’s not a good use of my time. We just shake hands and part as friends.

Jeff: So those are the clients that don’t work out. Who is your kind of perfect target client?

Dr. Knope: No. It’s really a group because if I had all sick people, I’d probably be keep busy. If I had all healthy people, I would not keep my skills sharp. I would say that my practice really splits into 3 groups. There is a group of acutely ill, very sick people, people with brain tumors, cancers, series of heart failures, diabetes… kind of things that every interns deal with. And we got some probably third of the people who are in the middle of the road who turns up with hypertension, diabetes and things like that. There are people frankly who just want me available. [inaudible – 09:53]…  I drag them in… spend a couple of hours once a year and they don’t want to see me much more than that. They just want me available in case something happens. So it’s really very much a mix.

Jeff: Is there a way that you keep that mix? Meaning that… Are you kind of aware? Or, do you kind o f juggle the fact that you have so many patients that already have existing disorders you know how much time that’d going to take up so that you kind of…. Do you vet incoming patients in order to kind of maximize your practice?

[00:10:32]
Dr. Knope: Well, I don’t vet them to maximize say... income by calling up the healthy ones. Really… people just kind of come to a practice like this by word of mouth. So, if there’s a good personality match regardless of complexity of their medical problem, then I’ll take them but, I do sit down and I offer a complementary interview. This is really an opportunity for both of us to make sure that this is a good match.

Jeff: And what are the questions that you are asking in the interview?

Dr. Knope: Well, I really ask very open-ended questions and I kind of let them talk and then I get a feel for them, see what their expectations are. And most of the people who come in here have a good idea of what good doctor who are usually referred by friends. We’re usually heard very well and things go smoothly. Occasionally like I said, you’ll get somebody who will come in and this is really important for folks who are going to offer this kind of service. If you get a sense that somebody really has some sort of agenda or you get a phone call that goes something like this: “I got your name. I’m coming to see you because every other doctor in Tucson sucks and I have [inaudible – 11:49] and chronic fatigue syndrome and I’ve been to the nail clinic and the fired me….” You start something like this.

Jeff: Sure.

Dr. Knope: We need to sit down and have a talk. If I think somebody is primarily dealing with psychiatric issues, I’d certainly don’t to that conclusion after not having examined their medical history. If I really get the sense and say: “Look, I suspect, I can’t say for sure, I suspect that really every other doctor doesn’t suck and I’m not going to be your savior. I would strongly suggest that you see a psychiatrist before you see me.” And I’ve done that as well. So, what I’m trying to say is that this is a big investment for the doctor. It’s a big investment for the patient and when you are paying somebody a lot of money to be taken care of, and as a physician you’re throwing a lot of energy into this, you’d really want to trust your gut and feel like this is a going to be a good long term relationship because if you spend hours and hours with a patient and there’s no way to help them you both just going to be frustrated and it’s going to end badly. And that’s the voice of 10 years of experience.

Jeff: So you’ve been practicing concierge medicine for 10 years. You are practicing clinical medicine with third-party reimbursement before that and became the solution to that. Is that accurate?

Dr. Knope: Yeah. That’s very much accurate. So, I’ve been practicing 20 years now. The first 10 years I was seeing typical 40 patients a day from 5-15 hospitals on top of that. Every 10-15 minutes another patient comes in my clinic and [inaudible – 13:38] at the same time direct to the ICU and it was frankly brutal. I just can’t have this nagging sense that I was not doing the right thing that I did not have time to really devout to taking excellent care of all these folks because I was just going to [inaudible – 13:57]. I was exhausted and I hated my life. And I was not really [inaudible – 14:02]. It was a disaster for me personally and professionally. I hated it.

Jeff: And what was the move that you made, the decision that you made? Did you learn about concierge medicine someplace? Have you thought ‘this is where I want to go’?

Dr. Knope: Well interestingly, I was approached by a patient who told me about this. The first practice opened up about 4 years prior to mine and he squared up in Seattle. And some half of my business folks in my community said: “Look, are you really happy seeing 40 patients a day? You’re a great guy, you’re well-trained. We like you, but we feel like you’re on a treadmill with this too. Generally, 12-15 minutes you’re on a patient. Wouldn’t you rather get better reimbursement and have more time to do what you’re trained to do.” Initially, I kind of had the typical response which is ‘I don’t think so’. But, the more they came back and the more they talk, the more I have to confront the fact that I really hated my professional life. And it’s never the medicine that I hated. I mean, I love my practice now, I love medicine. I hated seeing so many patients and getting paid so little and giving all my time and jeopardizing my career.

Jeff: How did you kind of come to terms? Where was the tipping point for you? How do you deal with the kind of [inaudible – 15:30] remarks around that?

Dr. Knope: Well, it’s very interesting. When I did this it was so new. There were maybe half a dozen across this country who were doing it and talking about it. So, there was a front page newspaper story… And there was a physician who quoted from a university in academics, he said [inaudible – 15:52]. So I know I was on the right track because the academic hated me. So I basically just didn’t care because I went through this whole process of thinking about it. And I reread it [inaudible – 16:10] I didn’t see anything in there about being abused by HMOs and third-party payers and getting 10% of your billing and being sued by patients if you didn’t get them exactly what they wanted. The whole system has just become very clear to me. This whole system was broken and the idea of solving that problem by being a martyr just seemed absolutely retarded to me. It didn’t make any sense at all. Why would I want my lawyer or my doctor to e overworked, unhappy and hate every professional day of his life? Why would that be good for me as a patient?

Interestingly enough 10 years later looking back at this, I’m sort of blazing the trail here, there are about 6 doctors in this town now who are practicing concierge medicine many of whom said what I was doing 10 years ago was unethical and somehow it all changed. So this is nonsense, we should not be concerned about what other people think of us if we feel that we’re doing the right thing for ourselves and our patients. To those people who say it’s unethical, I say what’s the goal of the code of ethics? And who is to decide? If you have 30 or 40 patients a day, giving them [inaudible – 17:24] and they’re unhappy and you’re unhappy and you’re being beaten up by a third-party payer, is this the ethical goal of standards?

When I made this transition, there’s a long history of the battles that I waged with the [inaudible – 17:42] and from my perspective the majority of physicians were working [inaudible] to limit care. They knowingly did so. They work with these third-party payers to limit care to their patients for the [inaudible] profits so that they could get a paycheck. So, I find that the third-party model is far less ethical than what I’m dealing. I simply offer service to people that are willing to pay for it and they pay for it. And for those who can’t, I’ve got about 50 patients if I malpractice they get free of charge, not that [inaudible] or to do what they want me to do, but because that makes me feel good and I do that on my own [inaudible]. The idea that somehow working in [inaudible], working for Medicaid or Medicare or United Health Care, somehow the ethical standard and charging patients fee-for-services’ unethical. It’s just wrong and [inaudible].

Jeff: So when you made the decision, what did you actually do? How did you set out your shingle?

Dr. Knope: Well, it’s a little different 10 years ago that I had the luxury of having a big practice and what I did is that I started out with a pilot project 1 year with 4 patients. And all I do is try and see how it works. And so I really ran what’s called a mixture of hybrid practice without really knowing it back then. Tha’ts the term we would use today. And the next year it was 10 and then it was 16 and 30. It just grew and ultimately 6 years ago I dropped Medicare and slowly try to keep patients on this as long as I could. I just let them follow-up by a [inaudible – 19:28] as opposed to sending out letters to my distant patients and telling them they have to find a new doctor. So, I would say over a period of about 6 to 7 years we just transitioned ultimately converted to a full fee-for-service practice.

Jeff: So are Internists most suited for concierge medicine?

Dr. Knope: Internists are family practitioners. I think pediatricians are next and several of those have already put their hand on the water and… What you really need is a diagnostician, a point person, who kind of a [inaudible] people are paying for because they’ll send people [inaudible] this might benefit from having a concierge cardiologist. Most people go in for a procedure with a specialist and get some degree of limited follow-up, but no one cared. So, the value here is really the access in time.

Jeff: So, do you see concierge medicine is kind of growing out being kind of a minor player, growing out to be a mature kind of minor player? Are specialist still needed to be paid for by third parties?

Dr. Knope: I think at the moment that’s the way it is. I mean, I identically kind of take this discussion full circle and go back to where we started really what is concierge medicine. It’s nothing more than fee-for-service. I think until doctors decide to take back their profession and go to a fee-for-service model then that’s the way it’s going to be. I don’t think it’s gotten bad enough for specialists that their willing to take a risk and drop the third-party payers.

[00:21:11]
Jeff: I’m not aware of any kind of concierge specialist, are you?

Dr. Knope: No, I’m not. I get calls from specialists all the time asking if I think the model can work and I said it’d be pretty hard. I know that somebody in orthopedic groups across the country that are well established, kind of high profile guys, are working in fee-for-service only basis. I think you’re going to start saying that [inaudible], the gurus, start to say that: “I’m sorry we don’t take any third-party payers.”

Jeff: And do you think that’ll put pressure on the third-party? Because what will obviously happen will be physicians who’ll come out of school, unless they got connections or something, they will probably go into a kind of current system. But, as they build up a practice they will decide a transition to a fee-for-service in one sort.

Dr. Knope: Yeah, I think that’s true. I get a lot of calls from young doctors and medical students asking: “How do I do this?” And I say: “It’s very difficult to get out of training because you need reputation and you actually need experience. It’s first few years where you’re seeing 30 or 40 patients a year is actually important for your professional development.” And so I think you’re absolutely right. I think people will probably start out in third-party system and then as they develop their reputation and the desire to be free…

Jeff: In your practice, you’re the only physician as far as I understand. Is that correct?

Dr. Knope: Yes.

Jeff: Is there anything that will prevent you… Meaning, being inside this business… Is there anything that would prevent you from hiring younger physicians or something and building out your practice as a larger clinic?

Dr. Knope: Nothing would prevent it. Many people do that and many people start franchises and all that stuffs, but my whole desire which is to be happy running my own shop and practicing medicine. Actually, I did hire one young physician, which did not really work out. It wasn’t a good match. If that’s your goal, to make a whole bunch of money, then you can start a franchise and do that. But when I look at the franchise, I think this is the reason I got out of third-party payers. I don’t want a manager. I don’t want a third-party business person and certainly not a necessary they take a big chunk out of your income and they control you. There’s really no benefit. That’s one thing I would caution people. When I started doing this, I started getting some national attention. I started getting calls from a couple of larger franchises and their message was: “We’ve got a legal team. We can make it bullet proof.” When I sat down with my attorney I said: “What can I do that you can’t do?” We cleared up that there is virtually nothing. So, I think doctors are oftentimes afraid to strike out on their own, but that’s where the fun is because once you’re free… I can’t tell you how much fun it is to practice medicine because that’s what I got time to do. And I almost sound ridiculous in this day and age, but I don’t hate my job. I like it, I like my patients and I like to practice medicine in your own terms and that is my goal.
Jeff: As a physician, what skills that you have that other physicians that don’t have to be able to kind of manage this?

Dr. Knope: It was a narcissistic personality disorder. So, as everybody else was bickering… honestly, what happened was I backed myself up into a corner. I stood up and said to the HMO: “Screw you. You know something? I’m not going to do this. I’m dumping your contract. I’m tired of your approval, pre-approval and all of this crap. And I’m not just going to play well with others.” And people originally thought I was crazy. So, if you ask about skill set, it wasn’t skill set. I didn’t have business knowledge at that time. I just had to use the word ‘now’ and I said: “ I’m not going to do this. I’m not going to work this hard and have some clear [inaudible – 25:30] line and tell me my patient doesn’t need a [inaudible]. And I’m not going to bill 150 bucks for stress tabs and get a $19 reimbursement. I’m not going to do that anymore. I’m just not going to play this silly game.”

I don’t know. I had to tell you I went to medical school in [inaudible] and everybody made fun of old prime surgeon, Terry and Shaira and those guys. They had a lot of [inaudible], but I can’t imagine them ever putting up with the kind of crap that doctors put up with today. I don’t think it benefit doctors and patients. It is not compassionate. It is not cool. It does not improve patient care. It just creates [inaudible]. And I think that if we’re always talking about the demise of medicine, I think [inaudible – 26:15] in shoulders of doctors. We need to stand up and say that this our profession, nothing personal, but get out of my backyard, get out of my sandbox. You are nothing as a third-party payer. And so if you ask what I had that other people don’t have, it was that attitude. I couldn’t imagine living my life for some [inaudible] telling me how to practice my craft. Does that make sense?

Jeff: Absolutely. While a huge number of our members are moving into cosmetic medicine for exactly those types of reasons. The rid of third-party payers and to have fee-for-service and to be paid for your time and effort. And you made an interesting comment which was that you didn’t have any business skills, which intimated that now do have business skills. What are they? What have you learned?

Dr. Knope: I tried actually to be a martial artist… and one of my great visions was to have an exercise facility, which plays part of my medical office. And to make the long story short, about 8 years ago I got a bank that actually loaned me and a partner wanted to [inaudible – 27:32] to build this facility. And to make the long story short, the whole thing kind of blew up over some partner issues and I rapidly had to go from fine sky, what I’d like to see… what Utopia would look like, what happens when you got your name in a 1.5 million dollar note and you got a business that’s financially in trouble. And I learned real fast about cash flow, what it meant not signing personally a note, dealing with lawyers, dealing with partners and making a huge number of mistakes. And so now what I do when doctors consult with me, me message is to run lean and mean, to be really, really careful, to be opposite of the U.S. government in this economy, don’t spend money you don’t have, keep your overhead low, look at the books understand this because if you bury your head in the sand and you don’t know how your business operates then it’s a disaster waiting to happen. So, I acquired the skill set by making lots of mistakes and then having some smart patients who actually sort of took under their wing and said: “You’re a typical doctor. You need to understand this. This is how this works, this is how that works. And so, really it’s kind of an evolution.

Jeff: If your office manager is the one who really understands all of these and you don’t, you’re probably not in a good position to start these types of things.

Dr. Knope: Yeah, absolutely.

Jeff: Which in a huge number of medical practices, the physician doesn’t know where the paperclips are, doesn’t know where anything is. You see office manager who knows all of this information… And if you don’t have access to that or you’re not the one who knows that, if those questions don’t actually go to you because you don’t want to answer those, you’re probably not in a good position to start running actually the business.

Dr. Knope: I think you hit the nail right on the head. You ought to know every invoice that comes into and goes out of your office. You ought to be looking at the local physician supply, company who’s charging you… “What do you mean we’ve got another $1600 bill? What is this? We didn’t order 32 boxes of gloves this month.” You know, these kinds of stuffs and all of that adds up. And though it may seem like a colossal waste of your time it’s absolutely necessary because physicians traditionally behave the way I did. You’re somehow above all of this nuts-and-bolts book keeping stuffs pretty soon you find yourself in very deep trouble. So, I couldn’t agree with you more. You ought to know exactly what your office manager is doing, look at all the numbers and see what’s going on because the day you turned your back that loyal employee just embezzled $25,000-$50,000. That’s a typical physician situation.

[00:30:29]
Jeff: Which is not uncommon… Embezzlement is the number one crime committed in medical [inaudible – 30:34]. I had one partner who lost, he thinks, between $40,000 and $70,000 from an office manager for about 3 years. It is very, very common. And there are ways to manage that and stuffs, but one of the most important things is to actually know what’s going on inside of your clinic.

Dr. Knope: Well I think that’s really true and I’ll give you a little story about that too, just trying to get into the depth of what I think you need to do to manage an office, as you’ve discussed. I had some employees who were problematic. Money was disappearing and things like that. And they came in one morning and they found back cameras in the ceilings. And I went to the bank, so frustrated after dealing with like my  4th delinquent employee. And I was standing in the bank and I look at those black little domes in the sky and I thought: “You know what? Nobody misbehaves in a bank because they know they’re being watched.” And that may seem really cruel and cynical, but you know what, ever since I installed those things 6 years ago, I have no problems. So, there are ways to solve all of these issues. you don’t have to be burdened with it. You just approach the running of the business, I think logically, the way that you view your diagnostics or anything else in medicine.

Jeff: Let me ask you this, you used to be a professional French horn player according to your bio. That puts you in what I would categorize as the creative camp. The creative guys tend to not play by the rules. Do you think that has something to do with your ‘wild street’?

Dr. Knope: Yeah, perhaps. Yeah, I don’t like to play by the rules. I think did along well with patients and have personal relationships with them, but to me a physician ought to be a leader, right? You got to be an individual. So, the whole idea that you’re going to be subjugated by… sued by somebody else from the government just contrary to the idea of that: “Wait, you’re supposed to be the guy who stands on the [inaudible – 32:46] life and death decisions. So, I’m encouraging people… take one message from this, it’s misbehave. [inaudible] and following this system like a sheep and sacrificing your life, I think that’s a terrible mistake. I think that the tragedy you spent all this time… your education… be rude, say no, do things your way and then you’ll have the pride and creed. You did something truly wonderful and people will benefit from your gifts, but if you sit there and whine about how bad it is, which is what most of my colleagues do at the doctors’ lounge: “Oh, you know such victims…” Once you do something to get out of this situation… right?

Jeff: There’s a lot of kind of bitching and moaning about the current situation, but the first step is actually to decide that you are going to do something and the second is actually start doing anything in order to change that. Let me ask you this. With the concierge kind of model, whether it’s straight fee-for-service or whether it’s kind of a hybrid, where are the potential abuses of that system?

Dr. Knope: I think it’s sort of a psychopathic personality disorder or something… I can’t really see that concierge medicine is vulnerable for that. In fact, really the opposite is true if you think about it. My patients can deal with their fear anytime. They can decide not to renew. And if they’re on a month by month payment basis in other models, they can just decide that they’re not going to pay anymore. The beauty of this model is that it really kind of put a magnifying glass on the quality of service somebody is getting and since they’re paying for it they can withdraw any point. So I don’t really see this unless your [inaudible –34:44] and you’re getting protocol from Michael Jackson and you’re calling that concierge medicine. I can’t really see that there’s an abuse. Clearly, you got a guy whose got psychiatric issues [inaudible].

I think the beauty of this is it keeps everybody honest. I never take this for granted. I think it’s my job everyday to get up and provide people with the best healthcare and to stay at the top of my game and to do all that. Frankly if I don’t, I’m not getting to keep patients from some HMO. I get patients by referral. It really puts pressure on me to stay on my toes even I’m not motivated that way. It’s one of the weaknesses even if somebody is not motivated [inaudible] the model forces you in that direction.

Jeff: So a couple things about the model… Why have you decided to make it not a month to month fee in your
practice, but a year to year contract?

Dr. Knope: I started out that way and since I have more routine basis practice as opposed to these monthly contracts that people often offer. They have a small retaining fee and they will take third-party reimbursement as well. I just started out in that mode. It’s a lot complex than somebody you let once a year… once they’re happy… ‘do you want to this? Is it still working?’ and they say yes as opposed to having credit cards and having someone to run all that thing and having to talk every month. I mean, you can do that and it’s fine…

Jeff: So really it was kind of more on the decision on overhead? Meaning, that your accounts receivable or your outgoing bills… they’re 1/12 of what they were?

Dr. Knope: Right. It’s sort of simple, not having to worry about credit card or anything like that and people just write a check. So, I’m aware of that, for example, there are many in the concierge practices that charge only $1,500 a year for retainer spread out every 12 months and those doctors will accept third-party payers as well. And I understand that for a lot of people who can’t write a $6,000 check. That’s a perfectly good model and that works very well for them. For that, they have just a slightly bigger business machine and they run it that way. But, I’m just fortunate to be able to keep it simple.

Jeff: Hoe many staff members do you have in your clinic?

Dr. Knope: I have a whapping one staff member and I have a third person who comes in too, but really that’s all I need for a couple hundred patients.

Jeff: And typically how many times is a patient seeing you?

Dr. Knope: Barely, once a week to once a year. That’s kind of get back to that tree group I’d say… On the average I’d probably say 3-4 times a year for the moderate group. The high [inaudible – 37:51] I might put them to the hospital 2-3 times a year and see them once a week. And there are people I’d sit down with and I’d say: “Do you really want to write a check to see me once a year?” “Yep, I just want to know you’re there.” So I get those people what they want too.

Jeff: Which brings up a very interesting point… You’re getting 2 benefits here. One is time and the other is monetary probably improvement. How much is a concierge physician… What are the levels across the US, if you know, that concierge physicians are kind of making? Are they roughly analogous to their income before they moved to concierge medicine? And is the time kind of makes their lifestyle a lot better? Or, are they actually making more money as well?

Dr. Knope: Most of the people I know who have been doing this for a couple of years are doubling or tripling their salary. So there you have it. You’re kind of starting to approach many specialist salaries seeing a third of the patients that you would see otherwise. So, all of the sudden you’re getting compensated and you’re not [inaudible – 39:08] and you actually have time to read and do a good job.

Jeff: Have you seen concierge practices actually go out of business? Are you aware of any physicians who have tried this either not like it or have actually performed supportably that eventually have gone out of business and gone back to clinical, traditional clinical practices?

Dr. Knope: I don’t know any of those people and I’m sure they exist, but generally what happens is that people have a really good sense that they’ll se a management company or franchise that does an analysis first. And usually, the typical person that would convert would be a sort of internist or family practitioner who has got a big patient-based. They’ve been doing this for 10 years. They got a good reputation in the community and they got a following. They can send out a letter and get a couple hundred people guarantee, they’re going to fly okay. So, most people don’t make the jump unless they’re pretty sure and they got what it takes.

Jeff: Okay. Let me ask you this. So you’re speaking at the Medical Fusion Conference in November, what is it that you’re going to be talking about, Steve?

Dr. Knope: Well, we’re really going to be talking about this issue of what people need to do take back their professional life. And I don’t mean in kind of touchy feeling way, but a real way. I think that some people listening to this may say: “Gee, I think this is possible.” Other people may say: “Gee, this sounds completely different from me. I don’t think I could do that. It sounds risky.” And really what I’m going to focus on, since this isn’t going to be just a group of internist, what are the personality traits? What are the skills you would need to stand up on your own and practice medicine on your own terms? So, that’s going to be [inaudible – 41:03] of my talk.

Jeff: Now, you’ve also launched the… let’s see… I bounced over here… What is the name of the international kind of concierge rescue medicine… Concierge Medicine International, tell me about that. How did you got involved with Greg and launched that business?

Dr. Knope: Well, Greg is a world-class [inaudible] doctor and a wilderness medicine expert. And we came up with an idea of people who are travelling abroad or guys going to safaris or going tropical in the Philippines… What if those people have not only an Internist that they could contact 24/7, but really what if they have their own private emergency room physician as well? So that if somebody falls out of a hunting blind in Africa, what would it take to get somebody on the ground there, rescue that guy, get him to the hospital of his choice or his specific problem in the United States and getting taken care of? And that’s the concept. So we’ve just started this. We’ve just opened up our website and we’re starting to meet with folks who have an interest in this, for example the hunting and the safari community. It’s an exciting project in a very interesting way. I think the combined personalized emergency medicine with internal medicine.

One of that triggers this is that one of my patients got stuck in a country with [inaudible – 42:42] medicine. And he had a rescue service, which failed to form. And the guy was stuck there and I have $3,000 phone bill for a week and could not get him out o the country. So, this sort of spawned the idea of ‘what if’, what if we could get paramedics on the ground or get Greg on the ground with in 24 hours. Get somebody at the site, helicopter them out on a med jet, where will they need to be depending on the nature.

Jeff: So this service sounds as though it’s significantly more than a traditional concierge and an international concierge?

Dr. Knope: All in discussed price. This is sort of interesting venture for people who really are world travelers and a chance for… collaborate and really do something creative.

Jeff: And your practice has now allowed you the time to actually investigate other businesses?

Dr. Knope: Yeah. It’s kind of amazing. You have time to think. I learned about a new catheter over the weekend [inaudible – 44:03] and Phoenix is a world class cardiologist. Thinking about working with one patient [inaudible] I send him an email; “Thank you for thinking about me.” And I felt this is sort of the nature of concierge medicine. You’re always thinking even when your patient is not there when you got these complex problems. You got the time to search the world or the country and find the very best person and may have an innovative solution for some patient. It’s a very exciting or rewarding way to practice medicine.

Jeff: Do you see yourself maintaining this practice in the future?

Dr. Knope: Yeah I do. As long I’m still enjoying medicine. And like I said I’ve been approached by people asking me to franchise or join big university groups and sort of be there CEO and all of that. And I realized I don’t want to do that because I have a great life right now. I make enough money, I can make more in something else, but I have a great freedom and I love what I do. So, I think I’m going to keep on doing this for a while.

Jeff: Have you seen any physicians that have actually transitioned out of concierge medicine? Meaning, that they have decided they’re going to retire. Is the plan that you would actually sell your practice then to someone else that kind of steps in, in a kind of traditional [inaudible]?

Dr. Knope: Well, I know some people who are talking about that because they think that this is a legitimate income stream of wealthy business people, talk about that and valuing the practice. And I suppose if you brought a young associate and your patients got to know them and they sort of understood that was your long term plan, then you may in fact have a salable practice the way that [inaudible – 45:49].

Jeff: Very challenging though. I assume that a huge amount of this is personality driven.

Dr. Knope: Well, I think it is. So, there’s no question that it’s a match… I don’t know… I’m sort of [inaudible]. When I look around and I look a bit at kind of things that interest me in a kind of businesses where there is one guy who makes the best product and just passionate about it. Yeah, I think you’re right. I think a lot of times it lies with the person, but that is sort of a fun thing. I really enjoy kind of [inaudible] businesses and people who like to do their very best and do it their way.

END OF INTERVIEW

[00:46:40]
Andy: Well that’s it for the show. Thank you very, very much for listening and hope you enjoyed it. Now, we’d like to hear from you, of course. So, if you got any questions or comments please send them along to our email, which is podcast@medicalspamd.com or you leave a comment in the physicians’ forum on the website, which is MedicalSpaMD.com.

Now, If you’re a subscriber, that’s great, but if you haven’t subscribed yet and you’d like new episodes automatically downloaded then you can find us in iTunes just search Medical Spa MD or go along to the MedicalSpaMD.com website and click on ‘Podcast’. There are some ways to subscribe there as well.
 
Now as always, please consider everything we say to be complete conjecture and random speculation, not medical or legal advice. Laws and regulations vary everywhere so consult a medical or legal professional in your country before taking any action.

Well, it’s goodbye from Andy White.

Jeff: And Jeff Barson.

Andy: Wishing you all the best until we see you next time on Medical Spa MD.

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