For sale: body scans, boutique care & second opinions. (Retail Health Care).

Remember Marcus Welby, MD?

Of course you do, if you're a doctor. Even if you were too young or too tired out or too sophisticated to tune in to the ABC television network at 10 p.m. on Tuesdays between September 1969 and May 1976, you know that Welby-portrayed by actor Robert Young--embodied the standard by which all contemporary American physicians can measure their fall from grace.

Out of his homey, suburban office that he shared with a younger colleague and a nurse, Welby offered wise unhurried, holistic care to patients with an extraordinary array of diseases, from leprosy to Huntington's chorea.

True, he had to resolve at least two malpractice suits filed by misguided patients during those 172 top-rated episodes. But he was not yet required to haggle with health insurers or concern himself in any overt way with payment or reimbursement paperwork.

He responded to his patients day and night; he visited them in their homes and at hospital bedsides; he had probing conversations with them; he shepherded them through consultations with appropriate specialists. And for those ministrations he was rewarded with affection, respect and a nice, modest, middle-class income.

A lot of doctors and a lot of patients would like to re-experience that scenario.

In an updated way, some of them are.

The twist is, patients are now being asked to pay a fee up front to assure the Welby-esque attentions--an annual retainer that can top $13,000. And the physicians are generally shooting for a book of business that will provide a revenue floor of $1 million a year.

Battling for consumers

"Boutique medicine," "concierge care," "premium practice" or any of several other terms for this new approach ("the name," notes Frank A. Riddick, Jr., MD, FACPE, "depends on the amount of moral influence you want to apply") is just one aspect of a growing market in "retail" or "direct-to-consumer" medical enterprise.

Other such ventures include:

* Unindicated, full-body, computed tomography diagnostic scans advertised in the mass media

* "Medi-spas" that provide alternative or cosmetic services in luxurious surroundings, often in conjunction with specialty medical care by the plastic surgeons or dermatologists who own them

* Executive health programs that cater to corporate clients with comprehensive physical examinations and same-day access to a battery of specialists

* Travel medicine clinics that stock vaccines, preventive health information and accessories for exotic destinations

* Second-opinion and "e-consultation" services provided via the Internet

* Direct sales to patients of health and nutrition products

"The rationale for all this is pretty clear," says Riddick, CEO emeritus of the Alton Ochsner Medical Foundation in New Orleans and a former head of the American Medical Association's Council on Ethical and Judicial Affairs. "In an environment in which traditional sources of revenue are drying up, people are looking for new income streams."

Reimbursements under Medicare continue to drop. Under pressure from insurers and their own medical groups, many doctors are working Herculean hours, breathlessly shuttling 40 or more patients a day through their exam rooms and floundering in a mire of bureaucratic requirements.

There's a backlash, though, and it's gaining strength. In California, for instance, according to a recent survey by the Center for Health Professions at the University of California, San Francisco, more than 40 percent of doctors are now refusing to accept new HMO patients.

And an estimated 2,000 of the state's 50,000 physicians have stopped dealing with health insurers altogether. Patients in these practices have to pay out of pocket (and do their own reimbursement claims processing, if any, later.)

Maxed out on patient load and facing increased costs for malpractice insurance, office space and staff, physicians can do one of two things to increase revenues, Riddick says. "You can either find a new technology to offer that didn't exist in the community before--but there are relatively few of those. Or you can provide a new service, you can try to capture a niche--develop an interest, get a reputation, put a label on it and start marketing it.

"Of course," he adds, "that usually falls into that category of taking someone else's income stream."

Terry's travel

A lot of community doctors apparently lust after the income Brian Terry, MD, makes, even though he is siphoning it off the local public health department.

At least three times a month some other medical group calls Terry's South Pasadena practice-Healthy Traveler-and asks, "What do we need to do to set up our own travel medicine clinic?"

Practice assistant Ramon Bautista says he gives callers the "Cliff Notes version" of how to set up a similar clinic.

But it's not too inspirational.

"This is enormously labor-intensive," he warns. "And the patients are extremely price sensitive. For most immunizations we charge pretty close to what the public health department does. Maybe 10 to 15 percent higher, but we have to stay competitive. We also charge a $39 basic office visit fee. If it were any higher we'd lose a lot of people."

The Healthy Traveler does not accept insurance and that reduces administrative costs. But keeping a full range of vaccines on tap requires a big cash outlay. And drug prices constantly fluctuate, based on shifting supply and demand.

"A smaller practice has difficulty getting its hands on some of these vaccines sometimes," Bautista says, "like meningitis right now, for example. During the past summer there was a run on yellow fever." Moreover, he adds, "these drugs have expiration dates, so you've got to make sure the inventory moves."

In business since 1997, the Healthy Traveler relies heavily on its Web site, www.healthytraveler.com, to draw patients from throughout the teeming Los Angeles basin, says Bautista. Customers can also follow links to U.S. State Department travel advisories, immunization and region-specific disease analyses, or they can apply for a U.S. passport. And they can shop the Healthy Traveler's online store for insect repellants, sun-blocks, mosquito netting, first aid kits, travel books, water purification and filtration gear and similar accessories.

"We do that as a convenience to our patients," Bautista says. "We really should start a travel agency."

Web-ready

The Internet is a key enabler of the retail medicine boom. In an age of direct-to-consumer pharmaceutical advertising, it isn't hard to find an online source for the latest hot prescription drug.

For example, Buy My Prescription.com, based in Marietta, Ga., will send you a supply of weight loss, pills, Viagra, Propecia, Celebrex, Vioxx, Retin-A or any of 20 popular "lifestyle" drugs based simply on the answers you provide to a brief medical questionnaire. (The right responses are the. defaults.) A moonlighting "licensed U.S. physician" will review the order and write the prescription, the company explains, as long as you seem from your disembodied assertions to be in good health. No physical examination is required.

"There is no reason to suggest that an in-person review of this history is any more relevant than an online consultation," the e-tailer maintains. (A recently formed coalition of Internet pharmacies called the Council for Responsible Telemedicine makes the same claim, as long as the prescriptions are not for emergency conditions and are not for narcotics or controlled substances.)

The American Medical Association and most state medical boards beg to differ.

Even so-called lifestyle drugs "have the potential to harm almost everyone," declares AMA president Yank D. Coble, Jr., MD. The only way to minimize that risk, he insists, is through a previously established physician-patient relationship, a physician's thorough knowledge of the patient's full history--and a hands-on physical examination.

But even some of the nation's most respected health care providers have decided it's okay to finesse those requirements. They're offering second opinions over the Internet--an irresistible medium for extending the reach of their experts while fattening the organization's bottom line.

Online second opinions were actually pioneered by entrepreneurial physicians. One of the first out of the blocks was Bethesda, Md. pathologist Barry Shmookler, MD, who launched FindCancerExperts.com two years ago.

Patients log on to FindCancerExperts.com, describe their diagnosis and receive by email a list of three appropriate pathologists from a national panel of some 70 whom Shmookler has assembled. The patient chooses one and sends off the biopsy slides or wax blocks from which the diagnosis was reached. Within three to seven days a corroborating or dissenting verdict is returned. The only cost is the pathology consultant's fee, paid directly by the patient--typically $150 to $300, says Shmookler. FindCancerExperts.com gets no cut for the referral.

Julian Schink, MD, was another early Internet adapter when he founded MDExpert.com in January 2000. An oncologist at the University of Wisconsin Comprehensive Cancer Center in Madison, Schink widened the scope of his Web-based service to include more problematic second-guessing of a patient's cancer prognosis and recommended treatment strategy.

MDExpert.com relies on its own national panel of some 200 oncologists at 75 major academic cancer programs. The patient pays $450 by check or credit card to the Palo Alto-based service, but it is the personal physician who must provide all the medical documentation and who receives, within five business days, the feedback from MDExpert.com reviewers. (There's an additional charge of $450 to $1,250 if one wants a backup pathology report reading.)

In 2001, Boston's Partners HealthCare further broadened the Internet's second-opinion reach to encompass virtually any specialty represented by its Harvard Medical School Teaching Affiliates, Dana Farber Cancer Institute, Brigham & Women's and Massachusetts General hospital medical staff. Cost to the patient for seeking a Partners Online Specialty Consultation: $600. Again, though, everything funnels through the patient's own physician.

Last year saw the debut of the e-Cleveland Clinic, providing online second opinions on "life threatening and life-altering diagnoses, including cancer, heart disease, digestive disorders and urologic problems."

The base cost for an e-Cleveland Clinic consult is $565. Competing on more than just price, the e-Cleveland Clinic will accommodate patients whether or not they have a formal diagnosis. More controversially, it will also allow them to opt for second-opinion secrecy, excluding their own doctor from the loop.

Body scans

"This Year Give the Gift of Health," urges the newspaper display ad for AmeriScan's Silicon Valley Body Imaging Center in San Jose, Calif. Below is the photograph of a smiling white-haired woman surrounded by the family members who have presumably lavished upon her a full body CT scan. The copy promises that this "simple, quick, life-saving" examination "detects over 100 life-threatening diseases in the arteries, heart, lungs, liver and other major vital organs--before it's too late."

AmeriScan's motto is "Every two years." Founded by radiologist Craig A. Bittner, MD, it has four locations, three near its Scottsdale, Ariz., headquarters. But there is hardly a major city that does not have at least one radiology practice touting the benefits of voluntary CT screening of the entire body or particular parts such as the colon, coronary artery system or lungs.

The cost of a scan can run from $750 to $1,600, and the patient-or in some cases an employer-foots the bill. A few clinics are reportedly netting more than $2 million a year. But many doctors-not to mention the American College of Radiology, the American College of Cardiology and the U.S. Food & Drug Administration-seriously question the value of the procedures.

Riddick is one critic. He sees basic problems inherent in marketing to the public a screening of such high sensitivity but low specificity.

"My ethical difficulty with it," he says, "is this: How much informed consent is involved when the patient forks over $900? Do people who self-refer really understand what they're buying?"

AmeriScan describes its service as "the perfect life-changing gift." That's an understatement. Riddick notes that in one study of full-body CT screening, fully half of the first 900 patients showed an anomaly that required a follow-up, "and a lot proved to have no disease."

Aside from the expense to the health care system of ruling out false positives, the patients and their families were subjected to a dreadful bout of worry and the very real dangers associated with more aggressive diagnostic interventions. They also get a dose of radiation 100 times stronger than a simple chest X-ray. And then there's the issue of misplaced confidence inspired by a false negative.

Physical fitne$$

Ironically, for many of these medical retailers the Holy Grail is coverage by a health insurer, or at least by a large-scale health care purchaser.

The Cooper Clinic in Dallas pitches its comprehensive six- to eight-hour physicals--which cost $1,800 to $4,000 and include an electron beam tomography scan--as an executive perk for corporate clients. While at Cooper, patients can stay at a gracious Cooper-owned 62 bed lodge, work out or get a massage and facial at the deluxe Cooper spa and go home with a bagful of Cooper-recommended Cooper-label vitamins and dietary supplements.

Health insurers often cover second opinions for major diagnoses, but insurers have been wary of paying for virtual consultations. Which is interesting, since the cost of the latter is a fraction of the bill for a visit to a prestigious hospital or clinic, points out the e-Cleveland Clinic's executive director C. Martin Harris, MD, MBA.

"I believe as we build credibility we can take this model to the payer market," agrees Joseph Kvedar, MD, Partners' director of telemedicine.

Many physicians, though, are utterly disillusioned about the boons bestowed by insurers. In the vanguard are those who have chosen practice retainers or membership fees.

At the forefront of this widely publicized mini-trend is MD2, of Seattle. Since 1996, internists Howard Maron, MD, and Scott Hall, MD, have charged $13,200 a year ($20,000 for couples) to a select group of about 100 patients and families who are promised 24/7/365 access to doctoring at home or in an office featuring marble halls, antique furnishings and monogrammed robes. MD2 wants to franchise the concept as well, for a $75,000 fee to set up a similar two-doctor office.

At the other end of the scale is a recently announced plan by Rhode Island family physician Michael Fine, MD, to provide primary care to 1,000 patients without insurance who enroll for $22 a month in his Hillside Health Access Alliance--$2 less if deducted automatically from a credit or debit card. There's also a $10 co-pay for each visit to the group's Pawtucket or North Scituate offices.

In between ire a variety of retail practices charging fees scaled to the opulence of the service and the number of patients the doctor is willing to treat. The income target, notes Riddick, is typically about $1 million a year. So a practice with a $1,500 annual fee "will tend to have a panel of 600 patients," he observes, "and one that charges $4,000 a year will tend to have about 300."

Despite much worry in the popular press and ethical reservations by some in the profession, medicine that caters exclusively to those wealthy enough to buy it at a boutique premium is not likely to make a serious impact on the health care system, say most observers.

"If the stock market were going crazy, maybe," comments health care futurist Russ Coile, MBA, of Washington, Texas. "But not with the economy the way it is today. Besides, managed care has backed off. It's easier to get a referral now than it used to be." What's more, even ordinary doctor's offices are beginning to experiment with patient satisfaction boosters like open access and same-day appointments.

Why, next thing you know, things will be just the way they were in Dr. Marcus Welby's day.

Or not.

Note:

In the January/February issue of The Physician Executive journal, health care leaders identified retail pharmaceutical sales among the top 25 trends of 2003. Here's an excerpt of what some health care futurists said about the phenomena:

Direct -to-consumer pharmaceutical advertising is "the cocaine of drug marketing," quips Russ Coile, MBA. "Once you start it's hard to stop. And, hey, this is just the way things are."

"There are elements of backlash present," says Jeff Goldsmith, PhD, "but voluntary stimulation is not going to put it back in the box."

"I want the purple pill!" laughs Leland Kaiser, PhD. "I have no idea what it does, but I want it."

RELATED ARTICLE: Physicians Wrestle With Ethics of Retail Health Care

Is retail health care a sell-out or a savvy business move?

Health care futurist Russ Coile says some physician executives react to direct-to-consumer medical sales with fear. They say things like, "It's a threat! Let's make it illegal!"

The American Medical Association certainly has come close to assuming that stance, Coile adds. Its Council on Judicial and Ethical Affairs studied the matter of e-mail and Internet-mediated communications between doctors and patients and ruled that they "have a potential for deception and unethical behavior."

Nevertheless, the AMA itself is a principal investor in Medem, a Web-based physician-patient communications e-network. And although the organization still maintains that doctors may not clinically diagnose or write prescriptions for patients they know only as bytes or pixels, the AMA is more sanguine about physician-to-physician electronic consultations. And that's how most of the online, second-opinion providers characterize their services.

(One Boston group, Partners, carefully excludes patients from its online specialty consultation program if they live in one of the six states where licensing laws do not explicitly permit physicians to consult across state lines.)

In-office sales are a no-no under the AMA code of medical ethics, points out Frank Riddick, MD, FACPE. A pediatrician might provide bike helmets at cost, but ophthalmologists can't dispense glasses. And even though promoters tell doctors they can make $100,000 a year or more pushing neutriceuticals, that definitely represents a conflict of interest, Riddick declares. Patients may feel under pressure to buy, he explains, and they may suspect that the doctors are really placing their own profit motive before the patients' best interests.

And yet, group practices are doing sales all over the place, Riddick says. They have subsidiary hearing aid centers, weight-loss clinics, cosmetic centers and the like, "And AMA rules for physicians don't apply to hospitals," he adds.

As for retainer practices, where doctors offer special contracts to patients guaranteeing greater access and plusher amenities in return for payment of a membership fee, the AMA's Council on Medical Service concluded last year that these are in line with the organization's "long-standing policy in support of the rights of physicians to freely contract with their patients" and of "the rights of individuals to request and receive all services they are willing to pay for."

That latter argument sticks in the craw of some traditionalists, however. "How, then," challenged one, "does that make medicine different from the oldest profession?"

And there is still a straight-and-narrow to adhere to, Riddick emphasizes. Physicians can't simply dump those of their patients unable or unwilling to pay up front when the practice switches to a boutique care model. Failure to make sure those patients get fair warning and are booked up with another good doctor is a serious ethical breach.

Indeed, physicians must also make it clear to their retail clientele that a customer service fee does not buy quality. That's something every patient is entitled to in every physician encounter. And each doctor, the AMA says, is expected to shoulder a share in providing uncompensated care to society's needy.

Just how solid the legal and regulatory ground under boutique practices may be is also questionable. The services provided must be strictly beyond those covered by insurance or Medicare if they are not to fall afoul of balance billing restrictions, the AMA cautions. And some in Congress want the Centers for Medicare and Medicaid Services to rule boutique practice out of bounds.

Given all that, Riddick is one who is skeptical about the prospects of retainer medicine.

"I don't think this is the wave of the future," he says. "It'll work in some communities, for some physicians, in some practices... and God bless 'em. As far as franchising the concept is concerned, my take is that it's not going to be the greatest thing since sliced bread. It's more likely to be the Phycor of the 2000s."

Whatever their reservations, few anticipate any slackening soon in the rush of experimentation with direct-to-consumer medical ventures, especially when academics and consultants are increasingly urging payers to surrender health care purchasing decisions to individual beneficiaries,

Which brings us to the second way a physician executive might respond to the trend, according to Coile: 'Take a marketing class.

" In the current environment, Coile says, "doctors in management positions should know how the retail market works-and how to make themselves attractive in the retail market."

As to weighing which ventures to embrace, Riddick has this sensible advice:

"Carefully evaluate all the opportunities. Do they fit well with the capacities of the organization? Can you do it well? How big an investment is required? Is it a market that's saturated? Are you getting in at the tail end of a pyramid scheme?"

Finally, he says, apply the ethical litmus test: "Would your grandmother approve of your doing this?"

Alternatively, would Marcus Welby?

David Oilier Weber is a frequent contributor to this journal and 2002 winner of the eighth annual award for trade journalism presented by the National Institute for Health Care Management Research and Education. He can be reached in Mendocino, Calif., at [e-mail].