Steven Schwartz (00:24)
Hello and welcome to the Concierge Medical Marketing Podcast. I’m your host, Steve Schwartz, and it’s my pleasure to have you along on our discussion today. Today we have a really special guest, Jim Eischen. And Jim is an attorney with many years of experience practicing. He’s based in San Diego, California, and a really cool guy, surfer, and plays music and guitar and bass in rock bands, and just really enjoys life.

But when it comes to the law related to concierge and DPC practices, Jim’s your guy. He knows it. Jim, thank you for joining us today on the podcast.

Jim Eischen (01:01)
Hey, thank you so much. Thank you for inviting me and including me. And this is a topic that I’ve been rolling around in for 14 years all throughout the United States, working with every different brand, every different model, every different kind of cash healthcare you might’ve heard of. And I love talking about this. So let’s get at it.

Steven Schwartz (01:22)
Absolutely. So thanks so much, Jim. So what I’d like to do is first give us a very quick background on yourself as far as your background as an attorney, how you ended up working in the medical space, and just maybe like a 30-second quick snapshot of your background.

Jim Eischen (01:39)
Been a lawyer for 36 years, went to UC Davis Law School in Northern California, practiced corporate and real estate law for the majority of my career, but…

was dating an internal medicine doctor and 14 years ago, she was leaving a large concierge practice to start her own practice and she asked her corporate real estate lawyer boyfriend if he would go to a conference in Scottsdale, Arizona, listen to this concierge talk and then help out. So I listened to the talk in Scottsdale. My gut told me they were misapprehending the Medicare risk. They were overrating it. I popped off, opened my big mouth. Two months later, I was asked

to give that presentation for a New York conference for the same organized set of conference folks, gave the talk after doing about a month of research in cash healthcare in America. And ever since then, I’ve been busy working with healthcare professionals around the country, sometimes large provider networks, sometimes individuals, sometimes businesses aligned with this style of practice. And it’s been my daily bread and butter for 14 years.

Steven Schwartz (02:47)
Love it. Excellent background, my friend. For people who are showing interest in cash health care, whether that’s Concierge Medicine or DPC, can you just give a quick definition of what cash health care really means and maybe how that compares and contrasts with the insurance-based model?

Jim Eischen (03:09)
Absolutely, and I’m going to apologize to you right now. I’m an English major, but should have been a history major. So I look at things from a deep historical analytical perspective. So give me a moment. I’m going to get there. Cash health care in America as we know it really probably arose in 1913.

And it was basically a version of executive health. And by that, I mean it was annual and follow-up routine exams detached from medical necessity on a cash basis, whether it was subscription or fee for service. That, I think, is the beginning. In 1920, 1921, occupational health experts noticed that particularly very important executives were dropping dead of unanticipated heart attack, stroke, undetected

to cancer, lifestyle problems, and decided as a matter of worker health, air quotes, it might make sense to do routine exams instead of waiting for someone to get sick and then treating them.

That was the inception of this executive healthcare model as part of an employment relationship to keep a very important person alive as long as possible rather than awaiting the disease state. From that date until 1965 in America when America passed Medicare and Medicaid laws, that was probably the most successful version of cash healthcare that would replicate or align with what we call today concierge

or DPC medicine, or for that matter, functional medicine, know, root cause of disease exams.

In 1965, routine exams were excluded from Medicare coverage, which meant that this model was perfectly Medicare lawful all the way through and now until today. In about 2000, I’m going to say 1999, 2000, physicians had had it with inflation and lowering plan reimbursement for primary care and prevention care. So there were three revolutions. One revolution was what we will call DPC.

And that was basically being entirely out of plan, out of Medicare, out of plan, and selling essential primary care for a modest monthly fee. And that was Dr. Bliss in Washington, Dr. Brian Forrest in South Carolina. Forrest said in a conference that I co-presented with him, hey, I priced it at a carton of cigarettes in South Carolina, because I knew there were a bunch of folks who could afford a carton of cigarettes, but didn’t have health care insurance and didn’t have health care.

For Bliss, he aimed at about 50 bucks a month. So this version of DPC, as we call it, direct primary care, arose from a need to detach or desire to detach from plan and sell a version of primary care for essentially a modest monthly fee.

Bliss had a friend named Marin who went a totally different direction and decided to sell a very expensive type of practice, 25 grand per family. He also opted out of Medicare and didn’t want to really navigate Medicare coverage rules. That became MD squared, which still exists today. The third revolution was in Florida, and that was a physician who looked at the Cleveland Clinic executive health physical model and said, maybe that’s what I want to do.

And so he and a venture capitalist friend put together a version of healthcare that essentially sold an annual exam, follow-up to that exam, communications related to that exam, same and next day availability, extra time with the doctor, and that became your so-called concierge healthcare. Now, important to note that that model did not need to opt out of Medicare.

Congressman Waxman at the time complained about this and said, wait, what’s going on in Florida? They’re selling these concierge medicine memberships to Floridian retirees. And I think that could be a Medicare assignment violation. Well, the head of HHS at the time, Tommy Thompson, took a look at that with OIG. And in 2005, published an open letter that said, no.

You can lawfully sell healthcare in America that’s not covered by Medicare, and that’s perfectly lawful for cash. And interestingly, the Waxman complaint letter that Thompson replied to had all of the classic concierge marketing claims. Annual physical, follow up to that physical, same and next day appointments, extra time with doctor.

So those are the versions of cash healthcare that arose. And I’ll say there’s a fourth, and I’m gonna sort of make reference to the integrative functional medicine folks. They often opted out of Medicare, often found plan reimbursement unworkable, but tended to replicate fee for service in the form of a cash menu for integrative services. So I would say those four different styles of cash healthcare.

today continue to inform us as to what’s out there. So you either have opted out of Medicare, opted out of plan, versions of direct primary care. You have versions of so-called concierge medicine that may also be opted out of Medicare and out of network, but are aimed at the wealthy. You have something that you could call concierge medicine.

And it could be in Medicare and it might not be in Medicare. But what we know historically and by statute is that it doesn’t have to be out of Medicare because the 1965 statute that created Medicare excluded routine exams. It was also excluded by statute in 1996 and 2006. So what you call these things doesn’t necessarily tell you what they are. And then you have your functional medicine crowd, your integratives with a cash menu or subscription.

What you’ll find with all four of these things I described to you is you really can’t be sure if they’re in Medicare or not.

and you really can’t be sure if they build plans or not. The only one of those four that you can be fairly certain is DPC because they make that basically part of their orthodoxy that they are always out of Medicare and out of network. So that’s your cash healthcare in America and executive health has flourished for over a hundred years and continues to thrive. And I would say that Florida concierge model was just a variation of executive health. Does that make sense?

Steven Schwartz (09:48)
Generally speaking, yes. I think it would be great if you had a document, like an infographic or an outline or something that we could post on our website along with this blog so that people who are very visual could see A, B, C, D, or in an outline type of list. Do you have something like that?

Jim Eischen (10:09)
I’d be happy to do that. I’ll make it for you. And you know what I’ll do is I’ll make five categories and it’ll go like this. It’ll be executive health, because that’s the beginning from 1913 and 1921. And then you have the three that split up in about 1999, 2000. So DPC, Concierge brand, and essentially Concierge.

Steven Schwartz (10:13)
You’re the man.

Alright.

Jim Eischen (10:38)
middle cost, concierge, high cost, and then five would be functional medicine integrative. So those are your categories, but it is confusing because you really don’t know exactly what they’re doing by the name of the brand, which we can talk about.

Steven Schwartz (10:55)
Right. It seems to me that many times for practices that want to grow, they start the process by having a meet and greet meeting, a physician with the prospective patient, and they get to know each other. They answer questions. And I would imagine at that level, they can discuss whether or not their practice accepts any insurance or definitely not, if they’re deal with Medicare or not and other considerations. Would you agree?

Jim Eischen (11:23)
Yeah, I would agree. I think that each professional who creates a cash health care model is typically primarily motivated to do some version of health care that’s different than plan reimbursed fee for service. And there are some serious misalignments with plan fee for service reimbursement. Our country has twice the most expensive health care system in the world.

and we’re ranked 69th in the world with respect to public health. So how is it that this incredible economy with these incredible pockets of talent in science, healthcare, business, how do we manage to be twice as expensive than anyone else and have such poor outcomes? And it’s typically blamed on fee for service plan reimbursed healthcare.

Because how does that work? There’s always a cost. So whenever a patient avails themselves to care, they know they have unpredictable costs and scheduling inconveniences. Frictions against me being motivated to go get preventative care. So then what am I going to do as an American? I’m going to work on my job. I’m going to be very busy. I’m going to kick the can down the road until my minor medical problem becomes a major medical problem. Now what do I do?

Steven Schwartz (12:44)
That’s right.

Jim Eischen (12:46)
Now what do I do? Well, if I call my doctor, my doctor says, well, we can see you in two to five weeks. So then what do I do? I get told, well, you better go to the ER. So a huge amount of healthcare in America occurs in the ER system.

Now in the ER system, they are seeing folks that they could have fixed 10 years ago easily, but everything got delayed till now. What’s it gonna cost you? Do you know? No, you don’t. So the ER is a completely non-transparent out-of-pocket cost. What does that mean? Well, what that means is the number one cause of bankruptcy in America is medical debt.

And there are 100 million Americans in America who have medical debt impacting negatively their economics. Think about that.

So we have perfected a system. It’s really good at killing people. So the way you kill them is you make it really painful and expensive unpredictably to get good care. You wait until conditions ripen to unbelievable states, and then you push them into a system where there’s no idea how much it’s going to cost you. You have no idea how much your plan will cover if you have coverage. And then maybe you’re going to go bankrupt.

So because of that pain, I’m going to delay, delay, delay until it’s a catastrophe. And there you go. There’s your recipe for US healthcare. That’s why we’re twice as expensive as any other country in the world with just the worst public health data of any developed country in the world. We perfected it. It is, but so our healthcare professionals have every reason in the world to explore alternatives.

Steven Schwartz (14:17)
So frustrating, truly frustrating.

Jim Eischen (14:27)
Because unfortunately, they can’t go back in time and change the decision making that led us to avoid the insurance models that other countries adopted, which is another story and maybe another podcast. so doctors, healthcare professionals go, well, what can I do to help people? And so here’s where I tell people, you’re actually going back to 1913 and 1921.

because you are instinctually wanting to just check people whether they’re ill or not ill and help them live longer and better for as long as possible. It’s an instinctually sensible version of care and it’s as old as 100 plus years and it works like a charm. So these doctors, when they decide on insurance are always trying to do something different than insurance. The question is, do they stay in insurance or not?

Steven Schwartz (15:00)
Love it.

and that’s part of their business plan. I’m sure there’s several very important documents that a physician who’s starting a new business needs to create in order to establish their business and the practices of the business. Can you tell us a little bit about the documents that you help your clients establish when they start a business?

Jim Eischen (15:43)
Absolutely. I’m a history buff. I don’t believe in recreating something that’s already perfect. So the routine exam service is perfect, in my opinion. No one’s ever come up with a better model for keeping people healthier. And it’s worked in corporate America for 100 plus years. And I feel like they know what they’re doing with their money. I mean, we have the largest economy in world history.

Another thing I’m not going to recreate is the way Concierge Medicine was created in 2000 because the venture capitalist asked that burned out Florida doctor the most important question, what do you want to do?

So before we draft a single document, before I even know where a client is going, I ask that same question. I make sure that they understand that routine exams are excluded from Medicare coverage and are perfectly lawful for cash health care in America. And it’s a very workable recipe that’s been around for a very long time. So it’s probably good. And I then ask the doctor or the health care professional of any licensure, what do you want to do? Now, once I know what they want,

want to do, I know what they will do. Okay, because these are very smart folks. And eventually they’re going to do what they want to do. So I need to find out what they want to do because it’s what they will do. And then what I help them do is figure out how to do what they’d love to do and want to do in the most compliant and effective business model possible.

And so that usually is reflected in a patient agreement that expresses their version of cash healthcare in a way that’s Medicare Medicaid compliant with my projects tax advantaged. So employer fundable, HSA fundable, FSA, HRA fundable, MSA fundable, and documenting essential written prior consent to basic cash healthcare services for these fees. So those are my three objectives.

fulfilled in what I call a patient agreement. When the practice is integrative or functional medicine and doing non-allopathic things, which is fine, it’s good to experiment as long as it’s safe, we have a document added to that called consent, and we make sure we get informed consent to non-allopathic treatments with disclosure of all risks.

Finally, for practices that say, just want to opt out of Medicare, Jim, I hear you. I know I don’t have to, but I want to. It’s like, OK.

Then there’s a mandatory addendum that Medicare requires for an opted out practice, and that’s attached to the patient agreement. So there’s your patient agreement. Then there’s what I call an electronic communications agreement, because I know these practices are inherently more communicative with the patient, and often through electronic means. I can’t wave HIPAA. I can’t document that away, but I can reduce risk and inform the patient of the risks of electronic communication

and get, in a sense, their informed consent to that. And I always separate that because under the HIPAA final rule, HIPAA final rule says that you cannot have what’s called a compound consent to releasing PHI or waiving certain HIPAA rights. And so I never put it in the patient agreement. A lot of people do. I think that’s wrong. You should have it as a separate agreement for electronic communications. And then attached to the electronic communications agreement is their notice of privacy practices mandated by HIPAA law that they

to provably distribute to all of their patients. So voila, we get it all done. So we get Medicare Medicaid compliance, we get tax advantage, we get disclosure and consent to fees for service, we get mitigated electronic communications risk, and we provably circulate our NPP.

Steven Schwartz (19:28)
If a physician sits down with you 10 AM tomorrow morning and you have a nice discussion for an hour or two answering these questions, how long does it take you to draft the documents and get them ready for that physician’s review and signature?

Jim Eischen (19:44)
I can do it as fast as they can go. And I’ll give you an example. So Intermountain Health is a Utah multiple provider network, a very large one for the state of Utah. They had a particular situation that required a correction of their concierge model.

I got that done in a week. And so I was able to get all of the documentation done. And then by the way, once we get the documentation done, have to also edit the marketing, make sure the website is congruent with the patient agreement. So our footprint for compliance and our tax advantage model, it all needs to be consistent. And then there’s also a document that’s often distributed by these practices telling patients what they’re doing. Hey, guess what we’re doing? You know, like a notice.

letter or it could be a marketing title. So those all those documents have to be congruent, consistent, and effective.

to do everything I just said. And it can be done as quickly as a week. I’ve done it. It’s not easy. Normally the process is two months. And then when someone has a practice panel that’s insurance and they’re telling folks, hey, good news, bad news. I’m going to do a cash health care model. I can only keep 300 of you and this is the cost. I know this won’t work for all of you.

And I’ll certainly help you find other practices if that’s what you want to do. But first 300 sign up here. OK. That, to avoid abandonment issues under state law, should be no less than 30 days and really ought to be more like 60 to 90 days so that that licensed health care professional doesn’t look like they’re abandoning patients who do not elect to subscribe to the cash model. Does that make sense timewise?

Steven Schwartz (21:30)
absolutely. And the follow-up question is, for the providers who have 2,000 or 3,000 patients in their insurance-based practice and they want to transfer to a cash payment system, what challenges have you seen? In fact, maybe not just for those transitioning practices, but maybe one or two examples of mistakes?

Jim Eischen (21:48)
well.

Steven Schwartz (21:57)
that practices have done that if they would have consulted with you first could have been mitigated.

Jim Eischen (22:07)
Okay, let’s try to make a checklist of how not to do this. Okay. Not to screw up. All right, here we go. Number one, you have to give the patients a letter that focuses on them and not you. So the first mistake I find health professionals make.

Steven Schwartz (22:12)
How not to screw up, right?

Jim Eischen (22:27)
is they tell a very sad story about how they’re, despite being the highest paid income bracket of any professional or employee in America, how they are badly mistreated by insurance, and you don’t know the trouble I’ve seen. And so this is what I’ve got to do to make enough money to live.

That’s a mistake, okay, for so many reasons. Number one, I’m sorry, but that’s not true, okay? I mean, plans are terrible to work with. Let’s not make that mistake. I mean, it’s a given that plans are incredibly challenging and cause what we’ll call moral injury. But these patients are worried about their health, not your finances. So what they need you to tell them is what are you doing and why is what you’re doing better for my health? So that’s mistake number one.

pour me and pun intended as if you’re poor and this is all about my suffering. That is the biggest mistake you can make from the very beginning. That’s one. Number two, talking to all your friends and colleagues and getting anecdotal folksy almanac like information about Medicare, cash healthcare and how best to do it. So you know how you healthcare professionals make fun of people looking up all their conditions on WebMD.

Steven Schwartz (23:40)
Yes

Jim Eischen (23:41)
and then come into your office and tell you, I’ve diagnosed myself, it’s type two diabetes, and you sort of chuckle inside. That’s how I feel about your collegial advice about Medicare, tax, and compliance. It just sounds kind of dumb. So there are really good answers to all these questions and they’re very citable. So the federal statutes are all citable. The Medicare guidance on this is available online.

The problem is no one’s giving you a straight answer to this. It might be politics or business. So they might be hurting you. So maybe you’re getting herded into a certain belief system. Or maybe you’re being economically herded because your insecurities and fears cause you to want to do a certain way of doing this. makes another company a lot of money. So you’re getting misguided. So mistake number two is you’re not talking to an expert.

If you talk to someone who really understands this area, you get the full array of your options and then you can decide whatever you want to do. Mistake number three. And I see this as a psychological issue. Doctors are trained not to make mistakes. All healthcare professionals. And so consequently they have this tendency sometimes.

to run into a small business footprint and think they can map out every step in their head first. And then what they do is they get into a state of paralysis when they can’t quite figure out every little detail about how they’ll do this. Now, I have deep empathy for them because fee for service is kind of like the shingles virus. It never dies.

So every healthcare professional in America, whether they detest plans or detest them a little less, will nonetheless on first instinct replicate insurance care every single time. So they can hate it with a passion.

and then create a menu that Blue Cross would have created 20 years ago. know, little bit of money for this, little bit of money for that, do this, get paid, do that, get paid, do nothing, get nothing. That’s fee for service. And these doctors will replicate it without knowing every single time because it’s what they think healthcare is, right? And even when they hate it, they do it again. So that’s a big mistake. not recognizing that your experience in healthcare is not only unique in the

for how bad it is in terms of its expense and outcome, but it’s really unique in also the way you’ve not been shown any other way.

So the versions of care that we’re creating that 1913, 1921, keep an important person alive as long as well as possible, old idea, but not well understood. you get stuck in your head and then you won’t do it. You look around for permission. You ask patients, you pay for it? Imagine if Elon Musk said, would you buy $160,000 electronic electric car? I think everyone would have said no.

No, Elan, you’re a total idiot. But Elan did it. It’s just like Henry Ford didn’t go around and ask farmers, what do you need? Because what would they have said? A much better horse buggy, much better whips, nicer leathers, maybe a more comfortable seat.

They didn’t have in mind a Model T, right? So you guys as healthcare professionals need to be more innovative and less requesting permission from people who have no idea what you should do. So you can’t go to everyone and go, would you pay this much money for me? The answer is no. But if you do that practice and then say to keep me, this is how much it costs, it’s a little bit like the Tesla, they’re gonna pay. So those are the most…

Common mistakes I see sort of information deficit information decision-making paralysis really poor sources of information that are often Conflictual sources because there’s other agendas, know, whether it’s economic or political That’s what kills the dream but the good news is I’ve done this thousands of times and I can only think of maybe four or five instances of failure

It usually goes very well.

Steven Schwartz (28:06)
It’s nice to hear that. And I’m sure your clients come back to you with great stories of how things are going. And as they continue to grow their practice or perhaps bring aboard another physician or mid-level, they keep growing and they need more legal paperwork created.

Jim Eischen (28:20)
Yeah. Yeah.

Well, what I’m most excited about personally, well, I’m excited about a lot of things, but these are the two biggies.

First of all, I get very few calls in the first six months to a year because there are no problems. Lawyers are like a plumber. You’re not going to just call us up and hang out with us and give us money. You don’t want to pay us. So no news is almost always good news. And so for me, when these practices launch, the fact I don’t hear from them for one to two to three years is actually great because it means it’s actually going really well and there are no problems. The other thing,

I’m really excited about. had a.

executive concierge model in Virginia that was purchased by venture capital for $10 million. And I have an integrative stem cell hormone optimization practice in Vail, Colorado that’s under an LOI for $10 million. So here’s what’s really exciting to me. For your insurance-funded only colleagues, these practices are almost never valuable upon retirement or to sell because of the cost associated with insurance billing.

all of the admin load you need to do that kind of health care. These practices have lower overhead and stronger net revenues, and they’re creating opportunities for health care professionals to make a lot of people healthy and then successfully retire with liquidity. And that I’m very excited about. It’s only started in the last couple of years, but I’m hearing about deals pending all over the country. And so I’m very happy for health care professionals that they’re

There is a possibility to create a version of healthcare that gives them an exit strategy for sale, maybe for growth, maybe growth and then sale, and or retirement. And you know, these guys work really hard. These men and women give their lives to the health of others. And then in a strictly insurance world are often left with very little at the end of that.

And it’s driven down self-employment in America. It’s driven a lot of these folks to employed health care. And I think that that’s not overall healthy in terms of like trying to create prosperity or create generational wealth for these well-educated, high IQ, generous professionals. This is giving them a chance to be compensated well for doing really well for patients and then have an exit.

I’m excited about that.

Steven Schwartz (31:00)
Right, so speaking of exit strategy, I know we were at the Concierge Medical Forum near Atlanta a week or two ago, and it was great meeting you there in person and getting to meet so many wonderful physicians and other folks. You gave a couple of examples of $10 million exits. And based on what you’ve seen and what you’ve heard, what does the structure

of a cash-based healthcare business look like in order to be valuable enough that someone would invest $10 million to buy the business? In other words, how many doctors, how many mid-levels, staff, buildings, assets? What might that look like for a $10 million exit?

Jim Eischen (31:51)
Well, that’s a really good question. And this is an N of two, folks. But it’s more than two, because it’s not just these two practices that are sold or being sold, but it’s the last 10 years and looking at what has worked and what hasn’t worked. I’m going to give you my opinions. These may not be shared by everybody, OK? So no offense to anyone who doesn’t agree with me. This is just my personal opinion. So number one.

The routine exam model is the superior model, just straight up. The non-reactive sort of get ahead of disease, which you could call functional medicine or you could not. You could call it executive health or you could not. The brand means nothing to me. I don’t care about those words.

But when you position health care as a non-reactive, ahead of the curve examination and follow-up in which a person’s questions are answered, the cost is transparent, which doesn’t drive me away from you. It encourages me to connect with you. And then without having to whip out my credit card every time we talk,

being able to get answers to questions, that is the model that has worked for 100 plus years. And it happens to be the model of those two practices that are being bought for 10 million. So that’s number one. Number two, I don’t believe these practices should ever be dependent on insurance billing, nor do I think they should ever be designed for insurance billing. But.

In small business, it’s kind of nice to have an extra $20,000 $100,000 a year of a little bit of extra liquidity. Not all these practices bill insurance at all. Some of them stay in Medicare and never bill Medicare. Some of them go into network and bill very little, if anything. Fine by me. But both of these practices that I’m referring to, neither of them were opted out of Medicare. Both of them were perfectly compliant under Medicare law.

And both of them have the capacity to bill a little bit. Not a lot of it. Not fee for service world. Not looking at a laptop and asking someone their name and DOB and then doing a six to 12 minute sprint to figure out what’s going on. Right. That’s fee for service insurance. But just having it around seems to matter. OK. That’s number two. Number three. And by the way, this is all easily confirmed as compliant by any buying attorney.

Number three, I think it’s really important for you to have the freedom to actually sell the practice. So if you are in an economic relationship that has someone other than you controlling your practice, even a little bit, it means there’s someone else in the room when someone wants to buy or you want to retire, you have to ask for permission or you need to get consent.

And that can be very complicated. So the third aspect of what I think is setting you up for success is to look at putting yourself eventually in a position where you don’t have to ask anyone permission to retire or sell or grow.

Steven Schwartz (35:07)
So almost like avoiding partnerships.

Jim Eischen (35:10)
I look, mean, I have clients who are those partnerships, but I’m just saying that eventually what I think will give you the maximum amount of leverage and value is for the value of your practice to not be shared with another party.

So whatever that looks like, it needs to be your money. And then fourthly, what I see in practices that are very vibrant and growing is that they’re growing. So if your practice isn’t growing, there’s reasons. It’s not magic. It’s not religion. It’s not superstition. It’s science. it’s, there’s a reason. so step back and look at what you’re doing and see if what you’re doing is

optimized because I think a lot of practices get stuck in a rut and they’re following someone else’s formula. You someone told them this is how you do it.

And they believed him. They’re like, okay, you I believe you, you’re a great colleague. And so they do it. And so they don’t grow and they don’t have more people and they’re struggling. And that’s a moment of opportunity to stop and go, I mean, is this the right way to do it? You know, and is there a better way to do it? So with my integrative client in Colorado, he had created his own practice on his own with I’ll say informal help. And there were some things about his practice that weren’t working.

ideally. However, he had still done very well. So he had great business instincts and was doing well, but after we worked together he tells me his revenues increased by over a third. And that attracted the venture capital interest. So there’s something about these things I’m telling you within a year. Within a year.

Steven Schwartz (36:56)
Fantastic. And was this just?

Now, was this just one physician?

Jim Eischen (37:01)
So we worked together about two, a year and a half ago. And then we got, I optimized his practice and it followed everything I just told you. So we’re in Medicare, we’re in network. We do a little bit of insurance billing, not a much, very little actually. We’re totally Medicare compliant. We are doing a version of healthcare that is.

baked into our culture psyche as valuable, which is this version of executive health, but it’s referred to correctly as functional medicine integrative root cause of disease. And he’s integrated hormone optimization therapies, which are very popular among folks in America right now.

which I understand, and that recipe has done extraordinarily well. You asked me about mistakes, I’ll add a mistake. You guys always under price yourself. And you do it for two reasons. One, you feel guilty about making money. Let’s just be honest. You went into medicine to save lives.

You didn’t go into business because those are evil, corrupt liars and cheaters who are just living to make money. And you didn’t want to be that person. So you didn’t go that route. Now, what you didn’t know is that we’re all actually quite honest or else we die. know, like if we’re, if we’re dishonest, like as a lawyer, I can’t keep my license and be dishonest, but you don’t necessarily know that. So, so you go into medicine, the purity of it all.

And then when you get into this space where you own your own practice, you get this insecurity like, I being greedy? Am I not helping people anymore? Am I just helping myself? And you also can only see the pricing of the models that are these national models that publish price.

and you’re not seeing what your colleagues are charging who, for example, work with me, right? So you base your decision on guilt and a non-comparable value and you under price yourself. And then what happens is you get a little desperate and insecure about it and it’s stressful. And then you do something.

And what you often do is start selling supplements for a percentage, or you start doing aesthetics, or you start over billing insurance and you get too dependent on insurance, or you start some sort of marketing campaign and you try to find that extra value. Really what’s going wrong is you just radically under priced yourself from inception and you probably didn’t pick the right model.

Okay, when you get the right model and then you price it at market value, these practices are exceptionally stable and profitable in a matter of a month to a year or two. It’s like, depends. So that’s a long answer, but that’s what I’m seeing in the marketplace. I know…

I actually represent some of the private equity, know, and so I actually know what they’re looking for and that’s what they’re looking for. And they look at the price points that are actually higher than those national chains. So the national chains may be around two to three grand a year. And these practices that are getting bought are more like six to 10 grand a year. So if that gives you an idea.

Steven Schwartz (40:25)
Right, specifically, maybe it’s my last question to you, specifically regarding what a practice looks like. Is it just one physician? Is it three or four physicians or more? Kind of structured.

Jim Eischen (40:38)
There’s unlimited potential for diversity. So it’s everything. It’s anything you can think of. So what I love about doing what I do is I can tap into that healthcare professional’s dreamscape. What do you really want to do? And see, it varies. So for example, the one practice in Virginia started as a single doctor doing an executive style concierge model.

He grew that to having two other employed full-time doctors, each with 300 patient panels. My practice in Vale is still just one healthcare professional as a doctor, but he has worked with nurse practitioners who have come in and done additional work and with some other licensures as well. So he’s created an integrative functional medicine team. What I’ve seen around the country is unbelievable variety.

naturopaths, chiropractic involved, obviously DOs. know, nurse practitioner only practices. Nurse practitioner practices growing with other nurse practitioners. Doctor practices growing with nurse practitioners added on. So there’s really no one formula. And what I always warn people is fee for service shingles taught your brain.

to search for a recipe. You are indoctrinated to read someone else’s lengthy written piece and then do what it says. And I try to tell them stop because the definition of insanity is doing the same thing and expecting a different result. So if you keep looking at other people to tell you exactly how to do your version of healthcare, just tell me the formula, Jim, then you’re just recreating the same moral injury that you

claim you suffer because of plants or Medicare. So what I want them to do instead is to actually think about what’s best for the patient first. Not the money, not the image, not I hate plans. Put away the hatred for a moment. Let’s just think clearly and go, what do you want to do for your favorite people?

And that’s how you build a good practice. You get these folks to do what they love and what they believe in is good healthcare. And it grows from there. And I’ve never seen it fail when it takes that path. When it’s about the money or just I need to make more money or I hate plans and so I’m going to fill in the blank.

You know, there’s not that much to believe in there, right? Like no one like that. I’m not excited. But when I see those patient notice letters that I help edit and they say, I know healthcare is expensive in America. I know you’re facing struggles and challenges. I wanna only work with a model that I know is gonna be most effective to keep you healthy and happy for as long as possible.

Okay, we’re not talking about your injury, we’re not talking about your money, we’re talking about their interests and why this is good for them. That’s what works.

Steven Schwartz (43:41)
Jim, thank you so much for your time today. This discussion has been so illuminating and inspirational to me. I’ve been, say, illuminating. I’ve been taking lots of notes. You may have heard me typing in the background. But it’s been fascinating. And I really appreciate your time and sharing your expertise. our visitors, visitors, silly, for our guests who are listening to the podcast today, if someone has a specific question,

and they would like to reach out to you and have a discussion or perhaps engage your firm to help them launch their business, how can they get in touch with you?

Jim Eischen (44:20)
Well, I love that question. So I have a website, www.ishenlawoffice.com. That’s spelled E-I-S-C-H-E-N, lawoffice.com. I get quite a bit of inquiries from the website of health care professionals who look at some of the white papers on the, maybe curious about cash health care.

Steven Schwartz (44:21)
Of course.

Jim Eischen (44:43)
I always am willing to do an initial conversation. I don’t charge for that. Just to see, are we a good fit? Can I help you?

where do you want to go? And then you can always email me if you have questions or comments on any of this. If you think I got something wrong and you want to set me straight, I’m a very curious person. I’m always open to new and different information. So that’s jim, jim@eischenlawoffice.com. So E-I-S-C-H-E-N-L-A-W-O-F-F-I-C-E.com. And I welcome all feedback.

positive and negative. I’ve worked in every version of every tribe of healthcare I described to you. I have worked on forming them. I’ve worked with their organizations and I’m very familiar with all of them. And I’m just telling you what I’ve learned after 14 years. This is what I’ve learned. This is what I think works.

Steven Schwartz (45:33)
I love it. And speaking of free resources, I wrote a book called The Definitive Guide to Winning with Digital Marketing for Concierge Medical Practices. And for anyone listening to the podcast, that book is available to you completely for free. No strings attached. Just visit our website, conciergemd.marketing. Scroll down the page a little bit, put in your email address and click the button and the system will send the link to you so you can download

Jim Eischen (45:44)
Thanks

Steven Schwartz (46:03)
the entire book again, no strings attached. Just please use it as a resource to help you grow your business. Jim Ishin, thank you so much for your time today. I appreciate you and I know we’ll be talking again soon on another podcast.

Jim Eischen (46:18)
Sounds like a plan. Thank you very much. Thank you for everyone for your attention.

Steven Schwartz (46:22)
Very good and enjoy the San Diego weather and go catch some waves and we’ll catch up with you soon my friend.

Jim Eischen (46:29)
Sounds like a plan.