Robert A. Hayden, DC, PhD, FICC
I went into chiropractic serve my patients with direct accountability to them in a personal therapeutic relationship, not to serve a third party administrator or become an employee of managed-care. My paradigm of healthcare did not include interference with patient care. Dealing with insurance companies reminded of Ginsberg's Theorem: (1) you can't win; (2) you can't break even; (3) you can't even quit the game. My personal frustration drove me to defy number three. Becoming a cash practice is not for everybody, and the decision should be individually based. For doctors who choose to convert, here are some tips.
My soul-searching and literature search about becoming a cash practice uncovered two fears that I believe are common to most of my colleagues. First, we are afraid that if we are not in a managed-care list, no one will come to see us. This fear is closely related to the second, perhaps the greater of the two: we are afraid that our patients will not value the service we provide enough to write a check.
Because practice itself is evidence-based, I searched for an evidence-based methodology to transition from economic dependence on insurance companies into cash independence. I did find multiple sources of information in the literature. Some of it comes from consultants who make their living through their books, courses, CDs, etc., but there are some good articles in the literature that I used for guidance. Ultimately, I took a course of action that made sense to me. Maybe it will make sense to you, too, if you are looking to become a cash practice.
Here are some steps that I took in roughly the order I used.
Form a plan. Give yourself plenty of time to get where you want to be. A slow transition is an easier transition. If you do it abruptly, it will cause repercussions in your business and your relationships with staff and patients.
I took a full year to make my transition. My staff wanted me to move more quickly, but I wanted to be certain that I was doing everything properly and in the right order.
One important point to consider is what you will do with Medicare. You can opt out of all other managed-care plans, but if you want to see seniors or disabled people, you will still need to deal with Medicare. Decide whether you want to keep your current status, or change your status to become a participating or nonparticipating provider. I chose to be a nonparticipating provider in Medicare 16 years ago, and it is working for me.
Share your plan with your staff. Make sure everyone is on the right page with your goal. Your staff is your most valuable asset, not only in manpower, but in brainpower. They can give you valuable ideas about how to proceed. They tend to be close to the patients, and they can give you insight and feedback about your plan and how to execute it. You can call a meeting for strategic planning as an excuse to take them to lunch.
Begin to think about opening side streams of income that are consistent with your personal philosophy of doing business. I have created a number of these in my own clinic, including DOT physicals, pre-employment physicals, drug and alcohol screens, Foot Levelers, bone density studies, Bed Boss mattresses and some selected nutraceuticals. Very soon, we will add a different type of drug testing by hair analysis and DNA testing, which we will market to attorneys. These side streams have kept me viable as a small business when insurance reimbursements fell.
Under the chiropractic practice act, there are many possibilities for side streams. Many of the ones I chose do not require licensure. They may or may not require certification. All of them work in a cohesive way to support my work in the practice.
I mentioned above that we fear the patients will not value what we do enough to write a check. However, the literature said that patients are more likely to write a check to stay well than to get out of pain. This seems counterintuitive to me, but a cash practice is more likely to be successful if it has a wellness orientation in today's market. I use Take Shape for Life, and it complements what we are doing beautifully as a turnkey wellness program.
Start a savings account. The literature suggests that you may have one or two lean months when you first make your change, so you will need acorns hidden away for that time.
I did not really have this option because while I was taking insurance, I did not have the cash flow to save a penny. Everything was committed to paying the bills. It was a great idea on paper, but for me it was just not possible. I do suggest that you do it if you can.
My experience was a happy one in that our patient retention was near 100 percent. We did not experience a dip in patient volume. Indeed, we were busier after the transition. I have been able to stash a modest amount away now that I am free from managed-care.
I may be naïve, but I hold to the notion that if I give people the kind of health care they cannot get anywhere else, I will survive as a practice irrespective of insurance participation. This has worked for me so far and has been contributory to our near 100 percent patient retention. In short, we spoil them.
Once you have a plan in place with target dates, and your staff is on board, share your plan and your rationale with your patients. They do not want to be blindsided, but many of them will want to support you because you have a service they need, or they have bonded with you. Many, if not most, of them will understand your reasoning if you explain it to them. If they are well prepared for the change, they will respond in the manner you hope for when they get the letter from the insurance company urging them to change doctors.
I put out an open letter to our patients in the waiting room. I now have it on my Web site, and you can see what I told them on the "Insurance Changes" tab on the top menu (www.IrisCityChiro.com).
Look at the contracts you have with managed-care companies. Read them carefully to see how you can opt out. They will each have specific amounts of lead time required for you to resign. This gives them time to contact all of your patients and ask them to go somewhere else to keep them in network. The insurance companies will try to tell your patients that if they stay in network, they can use their benefits and save money.
Begin by resigning first from those agreements that send you the least number of patients. This gives you practice of the process without large impact on your practice. It also will give you a prediction of what your patient retention experience will be.
If you proceed too quickly, there is the possibility of putting your practice into a kind of hypovolemic shock. Dropping out of contracts slowly will ease you into the cash environment in some sort of organized fashion.
Be aware that some insurance companies may put you back into their network after you resign without your permission and without your knowledge. Perhaps they are doing this to keep their network strong on paper so they can do business in Georgia. Whatever their motive, it is confusing to patients and will make them angry if they find you on the insurance company Web site only to find that you are not in network. You can combat this by revisiting the insurance company Web site and do a search for yourself. If you find yourself recurring, send them a certified letter. If that does not work for you, let me know, and I will forward the information to someone who could help you.
I have continued to see a few motor vehicle accident cases, but most of these were already our patients, so we know them personally. After the experience I have had with attorneys and reimbursement from personal injury cases, there are very few law firms in which I have confidence in their integrity. We turn away any cases who are represented by specific legal counsel so that we are not donating services.
Continue the process in number six above until it is complete. Set a date for withdrawal from your last contract. Label it as "Independence Day." Celebrate it with your staff.
I have noticed medical and dental practices around me using Care Credit. This is an option if you have patients who can qualify.
There is an increasing number of medical and dental practices using a concierge plan in which the doctor is prepaid an annual fee. The patient then has access to that provider throughout the year without additional fees or co-pays. This is a very attractive option and has several variations being used in practices throughout Georgia, including “family plans.” This may attract the attention and ire of the insurance industry, but history is pushing in this direction.
You might feel like you have just jumped off a cliff with a hang glider. There is nothing visible under you, and that can produce some anxiety. Stay focused on your goal, though, because you are almost there. You have planned and executed and worked for this accomplishment. Congratulations!
My Independence Day was 11 February 2012, when we ended the contract with the largest insurer. Since then the practice is healthier. Our volume is improved. The number of new patients has increased compared to the same period last year. Our cash flow has improved because we are being paid for what we do. My office manager is happier. I sleep better.
We certainly are not wealthy, but at the end of the day I do not have that nagging feeling that I have worked all day for nothing.