Concierge Services

There's a growing movement, more in the US than in Canada, but it's popping up here too, where physicians - typically family physicians - charge individual patients directly for their primary care needs. In exchange for a yearly or monthly charge, patients get a litany of services, often including basic lab work, imaging, and physiotherapy, in addition to their routine doctor visits. Insurance is essentially taken out of the equation.

In Canada, this is technically against the rules in many respects - physicians are forbidden from charging patients for their care while also charging the government for that care. It happens, but either the providers just hope the regulatory colleges don't get wind of their actions, or they add on extra services and claim the charge is for those extras (it's legal to charge patients for services not covered by government insurance).

In the US, however, it's perfectly legal and becoming increasingly popular. Family doctors love the set-up, as they get to spend more time with each patient. In addition, they have no real incentive to order more services for a patient (actually a bit of a disincentive to do so) and overall, their incomes seem to go up. Many patients like these set-ups as well, as they get more dedicated time with their physicians.

The downside is cost. Seeing fewer patients for more time each while earning more money means that without significant increases in efficiency, concierge medicine is more expensive than traditional fee-for-service or insurance-based care. In the US, there is one major source of increased efficiency - lower administrative costs. Most estimates I've seen put direct administrative costs in the US at about 15%, well above that of other countries. The mishmash of various insurers and their interest in reducing payouts accounts for a good portion of that. By eliminating all or most interactions with insurers, US physicians can save themselves a lot of time and money, which can go towards more time with patients, lower costs for patients, or higher incomes for themselves.

These cost savings appear to be significant. While initial concierge services were incredibly expensive, available only for the super-rich, emerging clinics seem to be charging in the range of $1500 a year per patient. This is still beyond the ability of low-income individuals to pay, but after regular insurance payments (now mandatory due to Obamacare statutes), middle-class patients may be able to manage these costs. If insurance companies discount their prices to account for concierge services, as some are, they may become more affordable. At the moment, however, the majority of patients in concierge practices are quite wealthy.

$1500 is also a substantial sum for primary care alone. Per person healthcare costs in the US and Canada are well above that, but are concentrated on a set of high-intensity patients who receive a substantial amount of non-primary care. If the US were to spend $1500 on every person's primary care - or even only $1000 - their overall healthcare costs would skyrocket above their already immense values.

In Canada, the situation is more clear-cut. With universal health insurance, concierge services are by definition an extra, with extra costs associated. There's virtually no room for increases in administrative efficiency, as one major benefit to universal health care is low administrative costs. That may seem surprising, given the stilted bureaucracy of Canada's health care system, but most of the money ultimately does go to providing care.

It will be interesting to see how the situation evolves as time goes on, especially in Canada. Currently colleges are cracking down on known instances of concierge medicine, but sporadically and often only in response to complaints. More importantly, while our public universal healthcare is well ingrained in the culture of the public, many physicians would prefer being able to work outside the system, or believe that private care has a role alongside public care. There may be pressure to allow for parallel private medicine in Canada, including concierge services.