Excerpts from GAO Concierge Care Report

Published November 1, 2005

Given the concerns about how concierge care might affect Medicare beneficiaries, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 required us to study and report on the practice.

The American Medical Association (AMA) has described concierge care as one of many options that patients and physicians are free to pursue. AMA in 2003 adopted ethics guidelines for physicians who have concierge care contracts–which AMA calls retainer contracts–with their patients. These guidelines specify, for example, that physicians should facilitate the transition to new physicians for patients who choose not to join their concierge practices and that they must observe relevant laws, rules, and contracts.

Critics of concierge care contend the practice makes health care more lucrative for a few physicians and more convenient for some patients, but less accessible to patients who cannot or choose not to pay a membership fee. Proponents, in contrast, describe concierge care as both a rational response to patient demand for more personal care and a way for physicians to regain control of their medical practices and their lives. They say the approach allows concierge physicians to spend more time with their families, enhance their incomes, and spend more time on research and other professional activities.

[Some of the more popular features offered by concierge physicians as of October 2004 include:]

  • Same- or next-day appointments for nonurgent care
  • 24-hour telephone access
  • Periodic preventive-care physical examination
  • Extended office visits
  • Access to physician via e-mail
  • Access to physician via cell phone or pager
  • Wellness planning
  • Nutrition planning
  • Coordination of medical needs during travel
  • Patient home or workplace consultations
  • Smoking cessation support
  • Preventive screening procedures

Insurance and Medicare

Concierge physicians responding to the GAO survey reported different ways of interacting with patient health insurance and the Medicare program. Eighty-five, approximately three-fourths, of 112 respondents reported that they billed patient health insurance for covered services. Of these 85 physicians, 79 reported they billed Medicare and 6 reported they did not. About one-fourth of the concierge physicians responding to our survey reported that they did not submit any claims to patient health insurance, including Medicare.

About three-fourths of survey respondents reported that they were Medicare participating physicians, and about one-fifth had opted out of Medicare as of October 2004. Nationwide, relatively few physicians–approximately 3,000 in 2004–have opted out of the Medicare program.

Compliance with Medicare

Health and Human Services Office of Inspector General (HHS OIG) has addressed the consequences of noncompliance with Medicare billing requirements. In March 2004, HHS OIG issued an alert “to remind Medicare participating physicians of the potential liabilities posed by billing Medicare patients for services that are already covered by Medicare.” The alert stated that “charging extra fees for already covered services abuses the trust of Medicare patients by making them pay again for services already paid for by Medicare.”

As an example, the alert referred to a Minnesota physician who paid a settlement and agreed to stop offering personal health care contracts to patients for annual fees of $600. According to HHS OIG, these contracts included at least some services that were already covered and reimbursable by Medicare. The alert advised participating physicians that they could be subject to civil monetary penalties if they requested payment from Medicare beneficiaries for those services in addition to the relevant deductibles and coinsurance charged for these services. In addition, the alert noted that nonparticipating physicians may also be subject to penalties for overcharging beneficiaries for covered services.