Concierge, Payment, and “Membership” Plans

The ICS Journal has previously discussed regulators’ views about the legal risks of prepaid health care or health care membership programs. In an economic environment where reimbursement is shrinking, it is understandable that physicians would consider different forms of practice models and fee structures to increase receipts. In fact, health care providers may consider offering concierge, membership or prepayment plans as a way of generating additional business and making services available to their patients. The ICS is aware that a number of these plans are operating in the State of Illinois. However, a great deal of controversy persists as to whether these arrangements are permitted by law. Insurance commissioners may consider these plans to constitute the unlicensed practice of insurance, and physician regulators may consider them to constitute unethical or unprofessional conduct, overcharging, charging for services not rendered, or other violations of the Medical Practice Act.

In response to member interest about the legality of concierge, membership and prepayment plans, the ICS recently attempted to obtain updated guidance from State regulators. The Illinois Department of Insurance and the Department of Financial and Professional Regulation prefer to view these plans on a case-by-case basis, and, therefore, have issued very few pronouncements on prepayment plans as a whole. They declined to give us opinions about the legality of specific plan structures. Nonetheless, in response to our members’ questions, the ICS would like to share information about the questions we posed to regulators and their responses, albeit limited, so that our members are up-to-date on the information that is currently available.