Podcast
Jan 8, 2026
Roetzel HealthLaw HotSpot: Concierge Practices: Understanding the Model and Its Unique Challenges
In this episode of the Roetzel HealthLaw HotSpot, host Ericka Adler is joined by fellow shareholder Jonna Eimer to discuss concierge practices, how they differ from traditional practices and some of the unique challenges presented in drafting appropriate corporate documents.
Ericka and Jonna explain what a concierge or boutique-style, membership-based practice is and why it differs from a traditional medical practice, especially when it comes to governance documents, compensation arrangements and exit strategies. They also discuss how practices handle membership fees, what can happen when a physician leaves and why planning for notice, replacement coverage and insurance can be critical.
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Transcript
Ericka Adler:
Hi, everyone. Welcome to the HealthLaw HotSpot. I am Erica Adler, shareholder, and leader of the health care practice at Roetzel and Adress. Today, I am joined by fellow shareholder and member of our health care practice, Jonna Eimer. Welcome, Jonna.
Jonna Eimer:
Thanks, Erica, thanks for having me.
Ericka Adler:
So, Jonna and I are going to talk about something today that we deal with regularly, but which people rarely talk about. So, it's a little bit of a novel issue, and I think everyone will find it quite interesting. And the topic is, for those of you out there who are part of, or thinking of starting, or just about to start, a concierge practice.
How is it different in terms of its governance documents, its compensation arrangements, and its exit strategies from a more traditional medical practice? And this is something, that for those of you who have never been involved with concierge, you might not have given any thought to, but it's something that we are encountering all the time, and we thought it would be helpful to share some of what we're seeing.
Right? So, Jonna, tell me, when you're talking to practices about doing concierge, and maybe, actually, let's back up just a little bit, why don't we have you just describe what we mean by concierge practice, so everybody listening is on the same page.
Jonna Eimer:
So, by concierge practices, we usually mean a boutique-style practice, a practice where you pay often a membership fee to get special or personalized services from your doctor. So, you have this special relationship with your doctor, you sign a patient agreement with them, and for that agreement, you have this special kind of access, usually special services, in addition to, maybe their cell phone and increased time for visits. Maybe there's other things you get, like weight loss services or dietitian services or other things. So it can be, whether you call it concierge practice or boutique style, there's all different names. We kind of mean this special membership-style, retainer-based practice.
Ericka Adler:
Okay, and so important things to note about that would be, we're talking about a practice with no insurance at all, correct? No.
Jonna Eimer:
Yes, no insurance at all. But for this conversation.
Ericka Adler:
Right, for this conversation, cash only, and no insurance, and typically we're talking about a situation where you collect a membership fee, as Jonna mentioned, and typically it's a fee for the year, even if it's paid out in smaller increments. Sometimes it's not, and sometimes it is. So, but that's going to be important for what we're talking about.
And just to also make it clear, in a concierge practice, typically you have a particular doctor, like Jonna mentioned, that you see, and unless that doctor's out of town, or somebody's covering for them, you're part of their panel. So, you have a very special relationship with them, and if they were to leave the practice, you wouldn't necessarily automatically just start seeing another doctor, because that other doctor might have a full panel, or you may not want them, right? So, these are all kind of important parameters for the kind of practices we see that impact the documents we write, okay? Anything else you can think of that's going to kind of affect what we're going to talk about?
Jonna Eimer:
I think just what you said, that it is a unique relationship between the patient and doctor, but this one's even more personal than some of the more traditional ones. And so, because you have this unique patient agreement with the doctor, you have this expectation of service and relationship that doesn't necessarily transfer should that doctor leave or retire, and you can't just necessarily substitute a new physician in that place.
Ericka Adler:
Perfect, perfect statement. Okay, so I think you and I can both agree that in a traditional medical practice, doctors are compensated in all kinds of different ways, right? They often get a base salary, maybe they're getting paid based on overall productivity, maybe they're getting a percentage of collections, etc. But, as we mentioned, in a concierge or boutique practice, the money that's coming in is money primarily from these patient contracts.
So, if you have 100 patients on your panel, and they're each paying you $5,000 each, that's the revenue that you're making for your patient panel, okay? That number and that amount are totally random, so I don't want everyone to think that's kind of how it works, but I'm trying to describe a situation.
So, in a typical concierge practice, what kind of compensation relationships are you seeing when it comes time for everybody to kind of sit down and say, okay, this is how our formula's going to work in our corporation, in our PLLC, whatever it is. How do you typically see it being done in a concierge practice?
Jonna Eimer:
Well, I see it done two ways. I have some concierge practices that more take a traditional form, even though they're a non-traditional practice, where they're all, you know, kind of employees of an overarching kind of brand of concierge, and maybe in that situation, there is a founder, and the other docs that work there are really employees of that founder. They're paid a percentage of their membership fees that they collect, less expenses to the business as a whole.
I have other practices that are set up very differently, where they have it, like, almost looks like to the outside world that they're under one umbrella, which they kind of are. But it almost can be like a cost-sharing arrangement, and there might be separate PLLCs under that overarching entity, where each doctor is really set up independently, which creates a whole different kind of formatting and organizational issue, where you're sharing expenses, but you're really not a traditional practice in the way we think of a traditional practice, and so maybe in those practices, they can be set up in all different ways.
Maybe they finance and pay for their own expenses. Maybe they only share a billing, maybe everything is separate. Maybe other than maybe shared, you know, lease space, maybe that PLCs is entirely separate with respect to paying their own mid-levels and their own reception and their own bill, or everything. So I've seen all different versions of this, as you have too, I'm sure, and we have to really tailor it to the specific practice and what the group You know, whether it's one doctor or many, or one doctor and a bunch of mid-levels, what they're looking for and how they envision this practice looking in the future, but there really isn't a one-size-fits-all.
Ericka Adler:
Okay, what about in a practice where you have two owners, and they are in the same entity? And that is probably the most common arrangement that I'm seeing. How do you see them sharing compensation?
Jonna Eimer:
Well, then usually each of them would take a percentage of the membership fees that is attributable to them, less some kind of overhead expense amount. So, it's a rather simple formula in that sense, right? Like, we get to keep everything other than the expenses that we're sharing.
So the expenses could be, like I said, it could be the lease payment, it could be the other employees, it could be, if they have other, you know, maybe non-partner doctors that they have, compensation for, or anything else that, you know, malpractice, everything else that they're sharing. But it's a rather kind of easy formula that they carry keep this percentage of membership fees, less the expenses of the practice. Is that what you mostly see?
Ericka Adler:
Yeah, no, that sounds exactly, you know, like a very common arrangement. Now, one thing we should mention is that, you know, those membership fees are kind of a sure thing as long as the patient stays with you, but, you know, there can be people who come mid-year, or people who leave, or die, or whatever the reason is. So, you know, it is a pretty steady bookkeeping process for that kind of practice. You agree?
Jonna Eimer:
Yeah, and a lot of them like that. A lot of my practices that I represent like to take fees in one lump sum in the beginning of the year, because it's an accounting ease, right? To know it's coming in at one point, you can kind of plan for the year. It's this, it's just kind of easy that way, but as you and I know, that creates a very tricky situation should anyone leave, because now all your fees have come in, but the services haven't yet been provided.
So, you have to deal with, well, what happens if something happens to that doctor? They get sick, or the patient leaves, or a bunch of things happen, right? So that creates a very kind of complicated scenario if you're getting all your fees in the beginning of the year.
Ericka Adler:
That's a great point. And so, what kind of solutions are there, really, in order to prevent that? I know what I've seen is sometimes we allocate them kind of on a prorated basis over the course of the year, so if we have to bring in a locum, so to speak, or somebody to fill in, then the fees for that particular month are there. And sometimes we even do it when the doctors are providing coverage for each child.
So, if somebody is on a two-week vacation across the world, and the other doctor is picking up all their slack, let's say, although with a full panel, that can be kind of hard to do, we're able to allocate some of that revenue. Have you seen something similar?
Jonna Eimer:
Yeah, yeah, so it just depends. Like, like I said, some really like all their fees up front, but that's complicated for the reasons I said, and some allocate them according, you know, prorated along the year, right? So, then it's easier, because you haven't received them all up front, so if you need to substitute a locum, or someone else, or another partner, you have fees that You can allocate. Right? So that's a good way to do it. I've just found that not all my practices want it. They like their money up front. Right. So, it just depends, right?
Ericka Adler:
Right. And that kind of leads me to think about another thought, which is, what happens when someone leaves? Now, in a traditional practice, there's a formula. They may get bought out of their ownership in hard assets, furniture, fixtures, and equipment, and maybe get some accounts receivable, or some kind of formula associated with the goodwill of a practice.
I think we can agree that in a concierge practice, you have your panel, and, you know, another doctor working with you. They may have a full panel. In fact, most of the concierge practices we work with are very popular right now, and they're very full, and they don't really, you know, want to take on somebody else's full panel. So, what happens if somebody leaves?
Obviously, if it's death or disability, we can talk about that a little bit separately, but let's just say somebody wants to relocate, or maybe the partners aren't getting along. What kind of solutions are available to a concierge practice where everybody has their own panel of patients?
Jonna Eimer:
Yeah, it's complicated, and one of the first things I do is usually suggest a rather long notice provision, right? If it's a voluntary resignation or termination, or even retirement, if it's things we can plan, we try to put a long notice provision, even possibly a year, in order to account for all these differences, especially if they're getting their fees up front. So sometimes that long notice provision gives us the ability to then plan through the course of the year what we're going to do.
Now, that's not always the case, right? There are emergencies, or disabilities or just extreme, like, disagreements that come up that require people right early. And in that case, we try to do whatever we can within the agreement to provide for that. So sometimes it might be, well, if you can find a replacement physician.
And the patients accept that, right? That's a big thing. The patients then have to accept and transition to that new replacement concierge physician, and then we account for how those fees are transferred, right? If they haven't been all paid up front, or if they have, maybe you are responsible for refunding for the portion of the year you didn't service.
to this new provider. So, I mean, that's the way we have mostly dealt with it, and if you can't find a replacement physician, sometimes you can be on the hook. Sometimes you might have to refund out of the fees entirely, you know, the amount that you've Taken in order to put it back into the practice to finance, basically, another doctor coming in, and if you can't find that doctor, refund it to the patients altogether.
Which your partners shouldn't have to do just because something happened with you, and even if that's a terrible situation, like a death or disability, which we can talk about that later, but that's why we have insurance, right?
Ericka Adler:
Exactly. So, I mean, I think this is something that a lot of people really forget to talk about. Just like you mentioned, sometimes there are individual entities sharing expenses, but when they are in a single entity, they may be operating as if they're separate, you know, divisions almost, right? But in fact, they are legal partners, so to speak, right? And they share responsibility.
So, if somebody just disappears, we certainly don't want patients to feel abandoned, but a doctor with a full panel likely doesn't have the capacity to take it on, and certainly is not going to want to pay a departing, you know, shareholder or member for a practice they don't want, right? So, finding that doctor is important, and not only must the patients accept that doctor, but you're not going to force you know, your fellow member or shareholder to accept somebody that they don't want either, so it can be quite hard to depart a practice. You're right, absolutely. A lot of time is really needed to kind of make this work. And like a traditional practice, you need to think about the idea of having younger associates there, and kind of a flow of, you know, preparation for the future. And I know a lot of people who are like I'm busy, I'm not going to worry about it now, right? But it's, you know, when we're not expecting it is when it comes in handy to have those young doctors there.
So really what we're talking about then is a year or so to find a replacement. Maybe it's refunding money to patients, maybe it's paying some of the money to someone who does come in and take over, if you can find that person. But what happens if you can't find the person.
You've refunded money to the patient, and basically you just say goodbye. Do you ever have your shareholders or members owing each other anything?
Jonna Eimer:
Yeah, yeah, it's potential. Just because I always remind people, as I'm sure you do too, that if you're a partner in a practice, that, you know, people love the idea of being a partner, right? But they only are thinking about the good side, right? The upside. the profits, right? But when you're a partner, you also take all the liability and the downside, too. You're sharing in the good and the bad.
So, when you agreed to be a partner with these people, you also likely signed on to possibly personal guarantees. for loans, or you sign on to the lease, but these other arrangements and agreements, you don't necessarily get out of just because you decide you don't like to work there anymore.
So, we usually, in our agreements, you and I, we try to plan for all these things. Do you get to get out of that personal guarantee? Do you get to get off the lease? Do you, you know, if you can find a replacement physician, maybe you are off the lease. If you can't, maybe you're still on the hook for the lease, even though you're not providing services there anymore. And that may seem really, you know, harsh for someone who's going through it.
But you have to understand that the other doctors didn't account for this, and they possibly would go out of business if that wasn't covered. And then there's also the situation where multiple doctors might want to leave or retire at once. And how do you account for that? Which, that's true in concierge or traditional practices, but everything seems even more complicated on exits with concierge, because of the unique fee situation.
Ericka Adler:
Right, I absolutely agree. So, let's talk about death and disability. I know we said we were going to come to it. Now, certainly having insurance, life insurance on each other, is a great idea. And of course, the more people you have, the more complicated that can become, but it's one way to make sure, that you can cover expenses for a period of time, refund money to patients, maybe find a replacement, so that money can come in quite handy, but it certainly does not solve all the problems, and it doesn't solve it quickly. But it helps, right? Are there any other solutions you've seen for death? I mean, really, life insurance is the best approach for that.
Jonna Eimer:
Yeah, yeah, and I always do recommend to physicians and other professionals, you know, umbrella policies, lots of insurance, right? There's a lot of things that come into play, because it isn't necessarily this portable practice when you're gone. So even for your spouse or partner, it's not this asset that they think they're possibly going to get paid for. It's just not that way with physician practices, and certainly not with concierge practices, where you're the value and the asset in this practice, and once you're gone. It may not necessarily have value, and in fact, it could have liability. Because of these agreements you've signed on to.
Ericka Adler:
Exactly. And disability, unfortunately, is a little bit harder to cover. It puts everybody in an awkward situation. You're not going to get a.
Jonna Eimer:
I really hate it.
Ericka Adler:
Right? And yet you have a physician. Maybe they can work partially, but, you know, they're not working full-time because they're disabled, right? That's really hard to plan for, under the documents or just in life. Have you seen any creative solutions for that?
Jonna Eimer:
Yeah, I mean, it is very hard, and I have had situations where practices go in with the best of intentions, and they'll even draft initially saying, you know, we'll cover each other. And I'll kind of explain to them, I know you want to cover each other, but listen, your 5 or 6 full panels- how would you do that? How would you do that if there was more than one of you?
And we did have that situation where a certain physician had a cancer issue and had to be out, and then another physician had a family issue. Well, they couldn't cover. They had full panels, and even though they thought maybe they could cover, they really couldn't cover. And it was risking the whole practice, because now every patient's upset, because they have paid this membership fee for increased access, increased time, getting in when they need to, and now the doctors are busy.
And so, it becomes a very difficult situation, so we put in contracts even, like, well, maybe we'll cover you for only a few weeks, maybe. And if there's a second person, you know, regardless of the reason. that person cannot be covered, you know, or maybe it's 2 weeks, maybe it's less. So, it depends on how many people are in your practice. how full it is, and how you could cover, and whether you could cover more than one, or even one in that situation. So, you really walk through it with the client to see what they think they could realistically do without risking the whole practice and the other patient satisfaction, other partners, you know, getting upset.
Ericka Adler:
Right? And, you know, on a similar note, leaves for maternity have presented challenges in a concierge practice as well. You know, as much as your partners want to accommodate you, you know, if you're thinking you're going to take 12 weeks off when you have a full panel, it's not like just working, being a doctor at the hospital, where there's a lot of other doctors. Like, this is your baby. You have to own it. This is, like, your patients looking to you. It is kind of like a solo practice in many ways. You know, five solos practicing together, in a sense, right?
Ericka Adler:
It's very complicated, and so I think those same concepts really apply to that. I guess paternity leave as well, although.
Jonna Eimer:
Yeah, yeah.
Ericka Adler:
It’s less common.
Jonna Eimer:
Right, but it's hard, because, right, if you're at a health system, you just expect these benefits, right? And here, you're a health care provider, and sometimes their kind of gut reaction is to be upset that they wouldn't get that benefit, and you try to explain to them it's not to be mean or not be helpful to you. Just realistically, how can we do this?
Because usually, most of these practices, they're open to suggestions. They don't know how to cover all these things that need covering and do the work they want to do, and they're usually smaller practices, and they're full, and so there's a lot of conversations that need to be had with the lawyer and the client, and then the health care providers amongst themselves about how they see this going in order to kind of avoid conflicts later on. So, it's better to have all these conversations when you have clear heads. And before there's issues, so then when those issues come, whether it's sickness or maternity leave, they don't become so tense and difficult to deal with then.
Ericka Adler:
Right? I agree. And then, so, one of the last things I want to talk about is what somebody leaving a practice might expect. We already talked about the idea that, hey, if you can find a replacement, great. If you can't, maybe you're out of luck, you don't get anything, and you're still on the hook. Have you seen situations where there's any type of payments Residual payments made to a departing physician where some replacement has been found, or maybe the partner that's behind, or partners are going to take responsibility for those patients and hire an associate rather than another partner to help with those patients. Have you seen any kind of buyout arrangements along those lines?
Jonna Eimer:
I haven't seen that, but I could imagine it, right? So, I could imagine a situation where, if they could transition the practice to a new… new party that they possibly would consider if it was a very valuable patient panel, so I could see something like that working. I have not done it.
I have had practices structure themselves as they move and grow, where they've created new structures where they'll have younger doctors who are non-concierge, and kind of are employees of the practice make money for the whole practice. And then, after 2-3 years, convert. To a concierge practice as they get bigger and fuller and more experienced. And sometimes those younger doctors, in addition to helping, you know, staff the practice and provide extra comp for the practice, but they're also available then to potentially then have some sort of buy-in potential for departing doctors. practice, if it works.
And I've also had departing doctors get into, discussions and tense situations. Because they want to monetize maybe one panel of patients, or one doctor had a much bigger practice than the other, and… and sometimes it's intentional, like, maybe some just wanted to work less, some wanted to work with more patients, some wanted less, and it was fine in the beginning of the practice. But now, as they're maybe looking to sell or exit, they feel like their practice is worth more than perhaps the practice with the smaller panel, and they don't think it's fair to be, like, restricted from monetizing it, and perhaps selling their kind of panel and their patient base to a new, younger doctor who might then buy them out.
So I've had discussions more and more along those lines, as if, you know, how would we allow a doctor to Kind of sell just their panel, right, to a new doctor, and that could kind of create that situation where you're talking about, that there could be this potential kind of revenue stream coming in when you exit.
Ericka Adler:
Right? What are the
Jonna Eimer:
That's for a new doctor.
Ericka Adler:
Right, one of the things I've seen is where you have a doctor retiring, and they come up with a severance approach, where they pay a percentage of the membership fee of the patients that the practice is able to retain for a certain amount of time. So, let's say for 2 years, we'll give you 25% of the fee that we collect from those patients that we're able to retain, whether we can fit them in or that they're willing to stay.
And that severance, obviously, is not a buyout price, because it could change from day to day on who stays. day, etc. So, I have seen that, but, you know, concierge practices overall have grown in popularity in the past couple of years. You and I know that we've started to do a lot of these, and I really do think we're going to continue to see it grow. So, all of these are really cases where everybody is learning at the same time exactly what's going to work, what's not going to work, and trying new things, right, to see satisfies the people in a particular group, what is interesting or acceptable to doctors who might be looking to come in and replace a departing physician.
So, all of this is a learning experience, and I really think we probably do, like, you know, a higher volume of concierge than most. So, we don't have all the answers, but we have lots of ideas, we have things that have worked. things that haven't worked, and so hopefully any of you that are listening out there who have questions about this will feel free to contact Jonna or contact me, and we're happy to talk through this with you. If you have ideas about things you think have worked or don't work, we're happy to hear that as well. Any final thoughts on this, Jonna?
Jonna Eimer:
I think you said it all very, very well. I just have one final thought would be that these agreements don't have to be static, right? We can revisit them, and we often do and should. As new situations come up, or new complications come up, then we go, just as you and I do in any situation, you learn from different things that come up that maybe you didn't foresee, and certainly practices have that same experience, and they'll tell us, listen, this is the complication now, or we have this new situation come up.
Let’s draft that into the agreement and provide for it so it doesn't happen next time. And so I would just advise clients that reach out to us, tell us what's going on, so then we can plan and expand our knowledge, and then the agreements get better, and hopefully then the next one doesn't happen. The next complication we foresee, or maybe it triggers a conversation where we think of additional things that could be similar, and we adjust the agreements now accordingly to, you know, to prevent these disputes later on.
Ericka Adler:
Right, and there's so much more we could say that.
Jonna Eimer:
Yeah, you and I could.
Ericka Adler:
unique arrangements, you know, within the concierge world. I've seen lots of, you know, non-standard type things that different practices are doing, and maybe we'll cover that another time, but hopefully this gave everybody out there some ideas about what to think about.
And if you're taking a standard shareholders agreement, or operating agreement, and you're applying it, or a standard employment agreement, and a normal comp formula. And you're not thinking about what is different about concierge practices from traditional practices, you may find yourself, you know, in an unexpected situation where your documents do not give you guidance, they do not match what you're doing, and you cannot find the answers to your problem in those documents. So, I think really what I wanted to do today was say, hey. You know, think about what you're doing and make sure that you're tailoring your documents to match what's needed.
Jonna Eimer:
Yeah, agree, couldn't agree more.
Ericka Adler:
All right, perfect. Well, everybody, thanks for joining us. This has been the HealthLaw HotSpot. We hope you'll join us next time, and you can catch the rest of our podcast at ralaw.com. Thanks, we'll see you next time.
