A recent warning from federal officials about "concierge" medical practices hasn't exactly sent shudders through the small community of physicians around the country charging annual membership fees for personalized service and perquisites such as same-day appointments, these practitioners say.
Bernard Kaminetsky, an internist who opened one of the nation's first boutique practices about three years ago in Boca Raton, Fla., said the March 31 alert from the HHS' inspector general's office simply restates existing policy that physicians are not allowed to charge additional fees to their Medicare patients for services already covered by the federally funded health program. "I don't think there's anything new there," said Kaminetsky, who limits his practice to about 600 patients who each pay $1,500 for what he describes as preventive services and exercise physiology programs, among other benefits. "There is no cause for concern on my part."
Kaminetsky is one of an estimated 200 to 250 physicians, out of the 669,000 practicing doctors in the U.S., who charge such fees for everything from customized-care plans to round-the-clock access, according to the American Society of Concierge Physicians. The group, with 36 members, was formed just a month or so before the inspector general addressed the boutique-fee issue for the first time in a two-page alert.
"We are hearing reports about physicians asking patients to pay additional fees, and we believe this is an ideal time to remind physicians and Medicare patients about this potential liability," Dara Corrigan, HHS' acting principal deputy inspector general, said in a written statement. "Charging extra fees for already covered services abuses the trust of Medicare patients by making them pay again for services already covered by Medicare."
The alert referred to a physician in Minneapolis who agreed to a $53,400 penalty in July 2003 after asking his patients to pay $600 for services that were at least partially covered by Medicare. Among the services offered in the patient's contract with internist R. Douglas Thorsen, the alert said, were, "coordination of care with other providers," a "comprehensive assessment and plan for optimum health" and "extra time" spent on patient care.
The alert points out that "at least some of these contracted services" were already covered and reimbursable by Medicare. Thorsen's contract with patients offered a list of eight "special" services, including comprehensive assessments and "exclusive, 24-hour access to me through my personal phone number."
Jennifer Leonardo, senior counsel at the inspector general's office, said, "Most, if not all, of the services, as he described them," were already covered by Medicare. Yet she cautioned that the interpretation of the rules must be made on an individual, case-by-base basis. In other words, in certain contexts, depending on exactly what services the doctor includes in broadly defined categories such as "coordination of care," those services might go above and beyond those now covered by Medicare. In those cases, doctors could lawfully charge extra, Leonardo said. "People were actually paying extra money to get nothing extra (from Thorsen)," she said.
Michael Blau, a lawyer with McDermott, Will & Emery, suggested that Thorsen might have violated the letter of the Medicare law by offering a "comprehensive assessment" of his patients' health, which is already covered by Medicare. Other practices, including those he represents, are careful to point out that they charge for "amenities" and "patient-convenience" items such as scheduling appointments with specialists.
"If you're doing what are clearly noncovered activities, you should be fine," he said.
Steven Flier, one of three physicians who operate Personal Physicians HealthCare, a group that charges a $4,000 annual fee to about 800 patients, called the alert a "clear message to physicians that they should take the law seriously." He said he is certain his practice is operating within that law by offering services such as lifestyle-oriented nutritional assessments and fitness evaluations by personal trainers.
"We're very carefully delineating those services that are covered (by Medicare) and those that are not," he said.
Still, the alert raises some concerns because it doesn't clearly define exactly what kinds of services provided by these membership-based practices might come under fire from federal officials, said John Marquis, a lawyer with Warner Norcross & Judd, who is general counsel for the new association of concierge physicians. The alert, for example, appears to suggest that "extra time" spent on patient care is among the services offered by the Minneapolis doctor that are already covered by Medicare.
"The alert is very confusing in referring to `other' services," Marquis said. "How can anyone say that spending extra time with a patient is a service covered by Medicare?"
While the alert marks the first time federal officials have directly addressed the legality of concierge medicine, the new type of physician practice has generated considerable controversy. Last year, Rep. Henry Waxman (D-Calif.) said in a letter to HHS that membership-fee plans like Kaminetsky's violate Medicare laws. In response, HHS Secretary Tommy Thompson wrote that such fees "would not appear to be in violation" if they were assessed for services not covered by Medicare.
Kaminetsky, part of the MDVIP network of about 50 concierge doctors in several states, said his patients are paying the extra fee for "wellness services" and bonuses, for example a "personally crafted exercise program." The extra time and attention they receive are part of the benefits that everyone enjoys when their physicians have fewer patients, he said.