The Intake

Insights for those starting, managing, and growing independent healthcare practices

5 legal considerations with concierge medicine

Patients want more attention and time from physicians, yet many physicians are struggling to hire and retain enough staff to keep their doors open while also maintaining a work-life balance. Concierge medicine is one potential solution, but there are legal questions to consider.

Physician assisting patient while wondering is concierge medicine legal

At a Glance

  • Concierge medicine allows physicians to provide personalized care and avoid insurance constraints, but legal considerations must be addressed when transitioning to this model.
  • The patient contract is crucial — it governs the relationship and must outline services, fees, billing, and more.
  • Carefully consider how you’ll handle Medicare and insurance.
  • Compliance with state and federal healthcare laws is essential. This includes telemedicine rules, HIPAA, Medicare billing, licensing, and scope of practice. Consult an attorney for guidance.

Thinking about transitioning into concierge medicine? You’re not alone. There are many reasons why physicians make the switch from fee-for-service to concierge medicine, including the following:

  • Avoid third-party payer constraints.
  • Make more money.
  • Provide higher-quality patient care.
  • Reduce administrative burden. 

However, if you think opening a concierge medical practice is the right move for you, there are important legal topics that you’ll need to address. Here are 5 of them.

[Note: Any physicians interested in the concierge model should consult with a healthcare attorney familiar with these issues throughout the transition process to ensure that all legal obligations are met.]

Concierge medicine legal consideration 1: Contract 

Known as the patient enrollment agreement, patient agreement, or membership agreement, this is the written document that governs the provider-patient relationship in a concierge medical practice.

It typically includes the concierge practice enrollment term, pricing and payment terms, renewal guidelines, and termination and refund provisions. It also usually includes a menu of healthcare services that are included in the concierge medical practice membership fee, not included in the membership fee (but available for an extra cost), and not available. 

Keep in mind that not all concierge practices are cash-only. Some use a hybrid model in which certain services are billed to insurance, and others are not. Patients seem to favor a hybrid model in which physicians participate with Medicare, according to recent data. If you plan to bill insurers, your contract should also clarify what services you’ll bill to insurers and which ones you’ll bill directly to patients.

Keep in mind that not all concierge practices are cash-only. ”

For example, if you decide to opt into Medicare (or you’re a healthcare provider who can’t opt out, such as chiropractors, occupational therapists, physical therapists, and others), you’ll need to bill Medicare directly for covered services. When it comes to noncovered services, you can bill patients directly. 

An evaluation and management (E/M) service, for instance, is covered under Medicare. However, if the E/M service isn’t medically necessary, then it’s not a covered service.

Consider a physician who performs an E/M service for the purpose of preparing a patient for a cosmetic Botox injection. This is not a covered E/M service. Thus, the provider has no obligation to bill the service to Medicare and can bill the patient directly.

Other examples of non-covered services include weekly maintenance care for physical therapy or chiropractic services, certain routine foot care, certain ongoing wellness and prevention services, and more.

Caveats to keep in mind

One caveat: You’ll need to provide the patient with an Advanced Beneficiary Notice (ABN) when the non-coverage is due to lack of medical necessity.

Another caveat: If you opt into Medicare, you’re potentially subject to denials as well as post-payment audits and recoupments, just like any other healthcare provider. 

On the other hand, if you decide to opt out of Medicare, you can bill patients directly for any service. Still, you’ll need to include certain mandated provisions as part of your private contract with Medicare beneficiaries.

You can charge patients more than the Medicare-approved amount for Medicare-covered services as long as you comply with the 15% limit called the Medicare limiting charge. ”

The good news? You can charge patients more than the Medicare-approved amount for Medicare-covered services as long as you comply with the 15% limit called the Medicare limiting charge. 

Needless to say, it’s a bit more complicated when your concierge medical practice uses a hybrid model of accepting cash, Medicare, and/or commercial insurance. Regardless of your concierge medicine model, ensure patients understand the terms of the arrangement before signing the contract. 

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Concierge medicine legal consideration 2: State laws

Your concierge medicine practice must comply with telemedicine rules, consumer protection laws, medical malpractice laws, scope of practice and insurance laws, limitations imposed by third-party payer contracts (for hybrid concierge models), and other laws and regulations that govern the practice of medicine.

This can get complicated, which is why it’s best to consult with an attorney when developing the structure of your concierge medical practice.

Concierge medicine legal consideration 3: Federal laws

This includes HIPAA and Medicare billing rules (if you opt into Medicare). Those who transition to a concierge care model that doesn’t require submission of claims to Medicare and other carriers may not be subject to the privacy and security provisions of HIPAA because they don’t meet the definition of a covered entity under the law.

It’s always a good idea to protect patient information regardless of whether you’re legally obligated to do so. ”

Essentially, they don’t engage in electronic transactions (e.g., electronic claims, benefit verifications, or receive electronic remittance advice). However, these physicians must continue to abide by state laws and common law restrictions pertaining to privacy and confidentiality. It’s also always a good idea to protect patient information regardless of whether you’re legally obligated to do so.

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Concierge medicine legal consideration 4: Medical codes 

In a cash-only concierge medical practice, medical codes are not necessary. Instead, develop internal codes for tracking.

Concierge medicine legal consideration 5: Clinical documentation 

All healthcare providers should maintain detailed documentation regardless of whether an insurer or other entity requires it. It also makes sense from a legal standpoint so you can justify what you do and why in case the patient has an adverse event.

However, if your concierge practice is cash-only, then you don’t need to adhere to strict payer documentation requirements (e.g., Medicare National Coverage Determinations or Local Coverage Determinations).

The concierge care model benefits physicians who want to provide deeper-level care for patients. It also benefits patients who want greater access to their physician. However, as concierge care continues to grow, it’s important for providers to structure their practices in a legally compliant manner. Use this article to help you get started, and be sure to consult with an attorney to ensure compliance. 

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Lisa Eramo, freelance healthcare writer

Lisa A. Eramo, BA, MA is a freelance writer specializing in health information management, medical coding, and regulatory topics. She began her healthcare career as a referral specialist for a well-known cancer center. Lisa went on to work for several years at a healthcare publishing company. She regularly contributes to healthcare publications, websites, and blogs, including the AHIMA Journal. Her focus areas are medical coding, and ICD-10 in particular, clinical documentation improvement, and healthcare quality/efficiency.

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