This is the transcript of my recent podcast interview with PartnerMD founder Linda Nash.
David Williams: This is David Williams, co-founder of MedPharma Partners and author of the Health Business Blog. I’m speaking today with Linda Nash, CEO of PartnerMD. Linda, thanks for your time today.
Linda Nash: You’re very welcome.
Williams: What is PartnerMD?
Nash: PartnerMD is what we like to call a “membership medicine” company. We’re not too crazy about the more popular term “concierge medicine.” We are a company that provides health care to about 4,000 members. We are the largest membership/concierge company under one roof in a single location in the U.S. that we have been able to identify. We also have an office in McLean and we run an executive physical business where we work with Fortune 500 companies to provide a very comprehensive executive physical to top-level executives.
Williams: Tell me about the membership model. What does it mean to be a member?
Nash: If you are a member of PartnerMD you pay a yearly fee. You can pay it by the month, by the quarter or by the year. It’s a pretty low risk proposition because we have a policy that if anybody is not happy for any reason or just doesn’t want to be a member they call us up and we prorate their fee and give them a refund. So we’re very confident in what we do and the value add of the service.
The membership includes basically 24/7 access to a physician. We have six physicians here in Richmond. It’s a very personal relationship with your physician, which means you will have their cell phone, you will have their e-mail, you will have their attention during the day. They will be able to call you back more quickly.
The reason I use the comparative term is I need to put it in context. The average primary care internal medicine physician has 4,000 to 6,000 patients. We reduce our panels to a maximum of 600. People can only deal with so many individuals, so many thorny problems, so many issues. Because our physicians have so much more time they’re able to go a lot deeper and a lot more thoroughly into issues that they would want to deal with anyway. It’s just that we give them the tools to be able to be even more effective as physicians.
Williams: What is the typical profile of a member?
Nash: When I started the practice with Jim Mumper, our medical director seven years ago I really thought the typical profile was going to be CEO’s and the big families in Richmond; the ones we all know and that have their names all over donor lists and different buildings and rooms. But it’s really not that way.
We have those families, of course, but we have a surprising number of ordinary folks over a wide range of professions. We have a lot of public school teachers. We have plumbers. We have state workers. We have all kinds of rank and file folks who have just decided that they want to make this a priority and they want and need the attention and the follow through.
I was very pleasantly surprised because I didn’t want this to be just medicine for the very wealthy. There is a famous practice out in Seattle called MD Squared, which kind of started a lot of this. Last time I checked I think they are $13,000 or $14,000 a year for an individual membership and obviously their ratios are much smaller, but it completely changes the nature of your clientele at that point.
Williams: Absolutely. What is your fee range?
Nash: Our fee range is anywhere from $1,900 in Northern Virginia (where the cost of living is a little more) to $1,700 here in Richmond. We have substantial discounts for spouses and children; a very nominal fee of about $600.
Williams: When you talk about appealing to ordinary folks I’m guess part of it is because of affordability. But are there things that members have in common, such as a particular health issue or a bad experience elsewhere? Is it just word of mouth? What patterns do you find?
Nash: There are a lot of things. Some members have a relationship with one of our physicians. Some of our physicians were in giant practices and made the switch; their patients have such a great relationship they didn’t want to leave. Other folks I think want the attention and want to be taken seriously with their health care. It’s not that traditional physicians don’t want to take them seriously, it’s just the way our system is now it’s very much focused on reactionary medicine.
Somebody comes in with a sinus infection and you get a Z-Pak versus coming in with a sinus infection and having the time to look back and say, “Gosh, I’ve given you a bunch of Z-Paks, what can we do to think about how you can ward this off more quickly?” Or, “Let’s look at your labs and see if there’s anything you can do about stress.”
It’s just a different look. To answer your question, there are several categories, some are the worried well, baby boomers who are aging and thinking, “Gosh I really need to change some things and get on the right start while I can.” Others are folks whose conditions are not being taken as seriously because of the way our system is set up. An example is people with fibromyalgia, women especially. It’s a very difficult issue. One of the wives of one of our physicians has it and when you have it, it’s very hard to diagnose. It’s a very time-consuming process and our traditional system doesn’t always allow for that. And then a third would just be folks that really want the access and the feeling of being taken very seriously, and they may never have had that because they’re not in a country club with physicians or golfing with physicians. They really want that personal attention but don’t have other ways to get it outside of PartnerMD .
Williams: I understand that with a smaller panel size and the attention to service that the primary care experience could be quite different and could be enhanced compared to what people are used to. But what happens when people get out of the primary care environment and have to deal with specialists or go into the hospital? Are they just back into the regular old system or are there some advantages from this membership model?
Nash: Well one of the things that we do that I think is fairly unique is we have a much larger support staff than a regular concierge physician. We have referral specialists who do nothing but make appointments for our members, push to get them access more quickly, follow through to get the records after they’ve gotten access. And we’re very proactive in steering our members to what we call “specialists of excellence” who are very user friendly and excellent physicians themselves. The physicians in both Northern Virginia and Richmond love our referrals because these patients are not going to lean on them for primary care. They’re going to come for the reason they’re supposed to come for and they are excellent patients.
So our specialists of excellence will see people on their lunch hours, they’ll stay late, and we have a very good track record of using the system very effectively when our patients need a specialist. As far as the hospital, we usually call ahead to the emergency room and fax information. If we can add value we will meet them at the emergency room, but we leave that up to the individual physician and the patient.
Williams: Tell me a little bit about the other part of the business. It sounds like there is an executive physical aspect, which is presumably done outside of the insurance contacts. How do you think about that part of the business?
Nash: We didn’t start the business to be focused on that, but early on a bunch of my friends who were members said to me: Linda, I don’t want to keep going down to Sentara down in Norfolk. I don’t want to go up to Johns Hopkins. You guys can do the same stuff.
So they gave us their book and said look at this and see what you can do. We said well, maybe there’s something here. So we surveyed the various executive physical programs and did a competitive grid. A couple of my friends who were early members were nice enough to have Dr. Mumper do a beta test on them. I interviewed them about all different aspects and we tried to put our own stamp on it.
Since then it has grown tremendously, knock on wood, it’s grown even during this recession. We have a tremendous group of executives that come back every single year and we’ve added a lot more corporate clients. It’s really great from a business standpoint because the doctors who aren’t as full are able to do the executive physicals and when someone goes through the executive physical they can then join for a discount, so they get a good preview of what it’s like to work with that physician. And the physician has a revenue-generating event as the physician is ramping up to a full panel. So it’s very symbiotic. We get lots of corporate clients because our members are in business and we get lots of members because the corporations send their members there. So I think it’s one reason we’ve grown so fast in such a short amount of time.
Williams: What’s the impact of a model like yours if we look more broadly? What if this were to become the mainstream way that people are getting their health care? On the one hand it sounds very good that the physicians can practice in a way that makes sense. Patients are getting access that they need and the incremental cost isn’t that great. On the other hand with a maximum of 600 patients compared to the low or mid thousands that a primary care physician might be dealing with otherwise, what would be the impact on the primary care of the health system in general if there were more of a shift towards this model?
Nash: Well that’s a great question. You’ve really hit the crux of the debate. When this has been looked at before by the government and by different folks the concern is that if this happens enough it’s going to affect the supply of physicians.
But there is a study a few years ago that the Government Accounting Office did as part of a study on Medicare. Their conclusion was that it would not affect physician supply. Physicians that were doing it were a small enough number, but they also had made up their minds to make a change anyway. They were so burned out with the way the system was and this was at least keeping them in medicine. It’s pretty interesting, Dr. Ibrahim, our female physician in McLean will tell you whenever you talk with her that she was planning to leave anyway. Another physician here in Richmond, Dr. Spiers was saying that he was thinking about teaching and leaving primary care. They just get to this point mentally –not all primary care physicians, but many of them– where they just truly are burned out with the system. We want them to feel good about the investment that they’ve made in their career path but it’s not like we’re luring them away from something that they feel terrific about.
Williams: I’ve been speaking today with Linda Nash. She is CEO of PartnerMD. Linda, thanks so much.
Nash: Thank you.May 5, 2010