Health Care and Insurance and Government

Health care with privileges: Boutique medical practices buy time for doctors, patients

May 8, 2006

Membership definitely has its privileges at the new north-side medical practice launched by doctors Timothy Story and Kevin McCallum.

An annual retainer of at least $2,500 gives patients around-the-clock doctor access, medical records they can carry on a key chain, unlimited office visits and refreshments when they arrive.

FirstLine Personal Health Care represents the Indianapolis market's latest foray into boutique medicine, a form of health care criticized for being exclusionary since it popped up in Seattle a decade ago.

Story, chief of medicine at Clarian North Medical Center, understands that criticism. However, he said "the current [insurance] reimbursement world" left the doctors with little choice but to try something different if they wanted to spend adequate time with patients.

Overhead keeps rising, he said, "so we have to have new revenue streams. And the choice is to blast people through the office at a pace patients would hate or spin off this new revenue stream, and we chose the latter."

So far, Story and McCallum are a rare breed in charging a membership fee for enhanced services. The FirstLine doctors and others know of only two other similar practices in the Indianapolis market.

A U.S. Government Accountability Office report published last summer counted 146 doctors practicing boutique medicine, most of them on the east and west coasts. That represents a sliver of the more than 470,000 doctors who regularly submitted Medicare claims in 2003.

The average primary care doctor may have 3,000 to 5,000 active patients. Story and McCallum want to treat no more than 500 apiece at FirstLine.

That smaller patient load will lead to several forms of personalized care. The doctors promise a comprehensive annual physical and same-day appointments.

If patients need to visit an emergency room, a FirstLine doctor will accompany them.

"When we show up, we can get you right back into a room right away," Story said.

FirstLine also will provide patients with a small flash drive that attaches to their key chain and carries their medical history.

House calls, help with insurance and all the time a patient needs to discuss care also are among the perks touted by First-Line, which pledges a "no wait" policy.

"If the world went first cabin, this is how you'd do it," Story said. "One of the guys who signed up said he was in the Marines, and he was done waiting."

The doctors accept insurance for services that qualify for coverage. They charge the retainer as an access fee, but say they won't pocket all the cash. After they pay startup costs, they plan to donate "a significant amount" to Catholic charities each year, Story said.

The doctors are building their business by recruiting patients they treat through H.M.S Medical Consultants on Naab Road, near St. Vincent Indianapolis Hospital. They plan to open a FirstLine office at Clarian North in July.

Between 60 and 80 patients have shown interest in the practice so far, and Story said the doctors eventually hope to shift their entire focus to FirstLine.

One of the patients who will follow them is Carmel resident Craig Dobbs, who has received primary care from McCallum for eight years.

"Kevin ... just kind of goes above and beyond the traditional doctor setting," said Dobbs, who already pays McCallum a retainer to do so.

Dobbs, a prominent broker with Citigroup Institutional Consulting, noted that McCallum visits his house to treat the intense migraines that occasionally hit his wife, Teneen. He also made an afterhours call last summer when Dobbs, 42, summoned him to help a friend who tore an Achilles tendon while playing basketball.

McCallum stabilized the leg so Dobbs' friend could fly home for surgery.

"I don't know who else I would have been able to do that with," Dobbs said.

The practice in Seattle that started the boutique medicine movement charged a $13,000 retainer fee, according to the GAO report.

FirstLine charges lower rates and says it will aim for middle-class patients and above.

Even so, Story knows some patients won't move to the new practice because of the fee.

"It's a difficult thing to do in a way because there are some people I've taken care of for 25 years who I know can't afford this," he said, noting that others might decide against spending the money because they don't think it would be good value.

He acknowledges that boutique practices like theirs help widen the gap in health care between those who have money and those who don't.

"If we're going to pretend that there's no difference in the health care of say, Mayor Peterson or a guy who lives maybe a short distance away from the City-County Building, that's ludicrous," he said. "Of course there is.

"The question is, how do I best serve that, by doing what the government and large insurance companies tell me or by doing what we're doing and giving money to large Catholic charities?"

Story and McCallum feel they have no choice but to start their new practice. Insurance reimbursement has remained flat while the cost of Story's malpractice coverage rose $10,000 over the past two years, even though he hasn't faced a claim in 17 years.

Story also has watched the cost of staff, rent and other overhead spiral upward.

"Good nurses and medical assistants are very much in demand, and when you find good ones, you're paying for them," he said. "The way we want to practice medicine, we can't exist in the current reimbursement world."

Last summer's GAO report found that nearly all boutique medicine doctors were primary care physicians, who tend to have larger staff than specialists.

FirstLine wasn't first to enter the Indianapolis market with this concept. Indianapolis-based Priority Access celebrates its fourth birthday this month, and Private Wellness Group in Fishers started about two years ago.

The boutique practices generate conflicted feelings among colleagues who are part of traditional practices. On one hand, Dr. Thomas Kintanar applauds the ingenuity the doctors show in increasing revenue, a problem many primary care doctors face.

On the other, creating excellent access to health care for all patients is a big problem confronting the medical field, said Kintanar, a Fort Wayne doctor and board member of the American Academy of Family Physicians.

"The boutique practices are a symptom of a health care system that needs to have a very strong re-evaluation," he said.
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