Issue 5 - April 2003

Getting paid in the 21st Century
An alternative to managed care and insurance dependence
by Dennis Perman, DC and Bob Hoffman, DC

The healthcare payment system is changing. It seems to be evolving into two categories – direct payment programs including cash practice, family and wellness packages and unlimited care plans; and entitlement programs, such as Medicare, Medicaid, Workers’ Compensation and no-fault personal injury cases.

These entitlement programs will be fee- and frequency-regulated, not unlike the current managed care system. In these regulated plans, cost containment will influence decisions on care before patient welfare.

The majority of people, however, will be thrust into a new era in healthcare compensation, in which doctors and their constituent families will partner in creating a fair and equitable relationship that delivers the optimal health and wellness service the people want, while rewarding the provider appropriately for a job well done.

We believe that this type of healthcare compensation revolves around establishing value for services rendered and charging a reasonable fee, enforcing those policies consistently and building a foundation of financial integrity in which everyone is dealt with equally.

This is not to say that patients shouldn’t be allowed to capitalize on whatever healthcare coverage they do have. An intelligent strategy should include a way for patients who have covered benefits to use them properly.

We contend that it’s critical to make the financial relationship a part of the doctor-patient relationship, not a triangle in which the patient feels that some third-party agent is responsible for services rendered to that patient’s family. We have found that paying is therapeutic for patients; it reinforces value for services received.

Global-fee care: an alternative concept
One of the newest ideas in the last decade is the concept of paying one global fee for unlimited care. This concept reinforces the idea of value-driven healthcare compensation.

Prepaid fixed-fee care represents a paradigm shift for chiropractors, much like chiropractic care represents a paradigm shift for patients. It requires looking at the situation in a new way. It preserves the integrity of the doctor’s fee, while supplying a payment option for the patient that takes into account both the front-loading of a typical chiropractic care program, and the ongoing need for wellness services beyond the resolution of any particular problem that precipitated the patient’s desire for services.

The purpose of a global fixed-fee program is long-term patient compliance. It is designed to increase retention and focus the patient away from the allopathic model of treating disease on a per visit basis and toward a quality of life driven model of wellness care, concentrating not only on symptoms but on healing, by offering the patient one global fee for unlimited utilization.

The idea of a comprehensive fee for unlimited utilization is commonplace in our society. From AOL to Disneyland, from orthodontia to obstetrics, this trend has appealed to the modern consumer because it allows a personalized and customized use of these services, even if circumstances change.

Implementing a global fee program is easy. Here are the basic steps.

1. Check to see if global fee programs are legal in your state. Consult a healthcare attorney to make sure you can do this in your state. In those states where this type of plan may not be not allowed, you may be able to predetermine a specific number of visits and calculate the payments on that exact number. If the patient needs more or fewer visits, you can reconcile at the end of the year.

2. Create a model of at least three separate plans. These should be designed for children and adults. Estimate an approximate number of visits, based on clinical severity. It’s important to custom-tailor the projected number of visits, because the way the current insurance laws are written, you can’t offer the exact same plan to everyone.

3. Choose the number of visits you believe the patient will need for the year – the initial intensive care period, the corrective and rehabilitative phase and the wellness services the patient needs. Multiply the number of visits by your fee, and then add any other services you plan on including – for example, re-examination, orthotics, subluxation station scans or post X-rays. Add up the services to be rendered and offer one of the following alternatives for payment:

Option A. The patient pays for the entire year in one lump sum. If so, consider a ten percent adjustment to the fee, to provide a savings for their commitment and reduced bookkeeping for you.

Option B. The patient may pay monthly. Divide the total by twelve, and collect twelve post-dated checks, secured by a credit card imprint. In this option, consider a five percent adjustment to the fee.

Option C. The patient may pay weekly. No fee reduction, but this option helps patients afford the first few months of care, which tend to be more expensive due to the frequency of visits.

If the patient has insurance, call the carrier and qualify the benefits. If the patient has legitimate coverage, you have the option of accepting assignment on that portion of their care and deducting it from their payment. Or, you can have the patient pay you directly and let him or her be reimbursed by the carrier.

When the end of the year approaches, re-estimate the patient’s needs, and offer the same payment options for follow-up years of wellness care.

Since global fixed fee payment is a paradigm shift, it is essential that you have or develop a prosperity consciousness, which is always based on self-esteem. When you realize the immense value of chiropractic care in people’s lives, and you realize how important you are in the delivery of these vital services, it will give you confidence to confront patients on their financial responsibility and create systems that are fair to you as well as to the patient.

Communicating these ideas congruently and authoritatively will attract patients who are willing to take their responsibility and comply with your recommendations better than those who feel less invested in your care.

Not all patients will be willing to take this responsibility, since many have been spoiled by the third party pay system. Some will have legitimate financial hardships. It’s up to you to decide what to do in these situations, but a word to the wise – if you select fair, reasonable policies and fee structures and apply them across the board, you’ll create a vibration of value in your office that will tend to appeal to people who want to conform with such policies, to ensure high quality.

Raise your own standards, and you will find yourself magnetically attracting people who actually prefer your policy to the ordinary.

The prosperous practice of the future will refine and master communication, both to attract and then to effectively serve the patients they want. This can easily be accomplished with global fees. Adapt your fee policies and compensation standards to meet the market trends, and you’ll be more profitable – and happier, too.

Dr. Dennis Perman and Dr. Bob Hoffman, along with Dr. Larry Markson, are co-founders of The Masters Circle, a firm that helps chiropractors find success and fulfillment through seminars, coaching, teleclasses and audiovisual support materials. For more information on global-fee programs or to contact them directly, call 800-451-4514 or go to www.themasterscircle.com