Should you refer clients to private doctors?

Most of us have heard some variation of the quote attributed to Mae West, among others: “If I had known I was going to live this long, I’d have taken better care of myself.” The celebrated actress died in 1980 at age 87, and it’s true that she had a well-earned reputation for knowing how to have a good time.

We may smile at West’s turn of phrase, but her concern for her health in her later years is certainly shared by the clients we work with every day. In poll after poll, Americans approaching retirement cite health concerns as among their top worries. And yet, many folks have not adequately planned for rising medical costs, according to recent research from Voya Financial in which only about 14% of those surveyed have calculated the cost of funding their future health care needs.

Especially now that our planning fees are often not deductible expenses for our clients, we should all be looking for ways to provide a higher level of value-added services to strengthen our bond with those we advise. Clearly, one of the best ways for us to help our clients in satisfying a deeply-felt need is to coach and advise them with regard to health care.

Lance Murphey/Bloomberg

For many of our clients, concierge medical care may present a viable solution. Sometimes referred to as direct-pay, direct primary care (DPC) or private physician practice, concierge medicine has grown markedly in recent years. A landmark 2013 article in The British Medical Journal noted a dramatic uptick in U.S. physicians establishing such practices in advance of the implementation of the Affordable Care Act as a way to regain a measure of control over their practices and especially over the predictability of their billings.

Noting that the practice had its origins in the 1990s, when physicians began charging wealthy patients $15,000 or more annually in exchange for exclusive services like 24-hour mobile phone access, the article stated that plans later evolved into DPC, a “stripped-down” version of concierge care that can feature fees as low as $600 annually.

According to Concierge Medicine Today, the main principle linking all these types of private-delivery medical services is that they bypass insurance. The patient pays the doctor directly, usually in the form of a monthly or annual retainer. In return, the patient receives the level of access guaranteed by the particular plan.

Sites like MyDPC.org list DPC providers for every state, though providers tend to be more available in and near large population centers.

The big advantage that patients note when they switch to some form of concierge care is that their doctor has more time to prescribe a more all-encompassing course of treatment that goes beyond writing a quick prescription and making an appointment for a follow-up visit.

DPC practices typically offer most of the same types of diagnosis and care as standard, fee-for-service physicians, but they stress their ability to save patients time (due to shorter waits made possible by the lower patient load) and expense (due to more time spent with the patient and the resulting reduction in unnecessary diagnostic tests and missed or incomplete diagnoses).

Direct Primary Care Journal’s 2017–18 Annual Report and Market Trends Analysis indicates that 80% of subscription fees to DPC paid by patients are between $51 and $99 per month. By contrast, the typical individual health insurance policy can cost anywhere from $150 to $700 per month, depending on the insured’s age and desired level of coverage, according to WebMD.com.

The price tag on many common screening tests and procedures compares favorably between concierge/DPC practices and traditional FFS providers. A 2017 sampling of concierge clinics and traditional providers found, among other things, a mammogram that could run $350 in a traditional setting came in at $80 at a concierge clinic. A brain MRI without contrast could cost around $600 from a traditional provider, but only about $380 through a concierge clinic.

I have seen firsthand the dramatic difference this can make in the life of a client. To preserve privacy, I’ll change some of the details in the following anecdote, but I particularly recall a client, recently widowed, who I was advising during the difficult transition after the loss of a spouse. The client was 65 to 75 years old over the course of only a few months, I observed an alarming decline in his physical capability. He became increasingly frail and tired much more easily than before. Though he reported regular visits to his primary care provider, he couldn’t seem to find relief from the debilitating symptoms he was experiencing.

At my urging, the client began seeing my personal direct-care physician. As my doctor began talking with the client and gaining an understanding of his background and health history, some patterns began to emerge. The doctor ran some tests that hadn’t previously been considered and obtained some results that suggested the client would need to change his medication regimen. Within a few months, not only the client, but I and others in his life noticed a dramatic improvement in his appearance, his stamina and his overall ability to enjoy the activities he was accustomed to.

What made the difference? Spending quality time with a qualified physician in an unhurried environment. The doctor had a luxury of time (and the absence of pressure from an insurer) to think “outside the box” in ways that were most beneficial to the patient.

What does this have to do with our financial planning practices? Simply this: if we are serious about building better relationship with our clients, why wouldn’t we want to help them solve one of the problems they worry about the most? In a recent article for Financial Planning, citing research from MIT’s AgeLab, I suggested that those entering retirement in the next decade are increasingly outcome-focused: they want solutions to their problems, not product recommendations. I also suggested that if we want to remain relevant as advisors, we need to position ourselves as their toolbox for the various challenges they face, whether that be changing transportation needs, managing lifestyle transitions, or, in this case, finding a better tool for managing the quality and cost of health care.

Providing a referral to a concierge or DPC practice will not result in a fee or commission, but it can certainly result in our clients’ perception of us as valuable problem solvers and as professionals who consider our clients as whole individuals, not just their asset balances.

Most chambers of commerce can provide lists of concierge and DPC medical practices, particularly in major metropolitan areas. And of course, quick online searches for “find a concierge doctor” or “DPC medical practice in my area” can turn up some local options, too. Do yourself and your clients a favor: develop a referral relationship with one or more concierge physicians in your area. Be prepared to refer someone to such a medical practice. It may be the most important thing you can do for your client — and your relationship.