Physicians adding fees for services that once were free

More practices charge for services such as phone consultations and filling out forms, adding a little revenue but risking a backlash.

By Robert Kazel, AMNews staff. March 24/31, 2003.

Ben Alvarez, MD, a Lyndhurst, Ohio, obstetrician-gynecologist, was withdrawing cash from a bank machine when he had an epiphany. If a bank can charge an administrative fee for certain services, why couldn't a physician practice do the same?

Dr. Alvarez, medical director of Beachwood OB GYN Inc., thought a modest annual patient fee could provide some cushion, and patients wouldn't mind paying it. "When we are at an ATM, we cough it up and nobody knows what it's for."

He isn't the only physician thinking this way. As pressure increases on insurance reimbursements and more of physicians' time is spent on nonbillable tasks, administrative fees for patients are looking appealing to more practices. Consultants and medical societies are reporting more frequent calls from physicians asking for advice on fee structures.

These may be specific fees for transferring records, resolving insurance problems, giving advice on the telephone or via e-mail or filling out forms. Or the fee may be a single annual charge -- for example, Dr. Alvarez's clinic instituted a $30 payment to defray overhead.

Such fees can bolster income but also represent an unfamiliar domain in which practices may alienate patients or violate insurance contracts. Consultants and medical associations are advising doctors who want to explore fee strategies to do it with care and expect a possible backlash -- as happened at Dr. Alvarez's clinic.

In fact, some consultants say backlash is more probable than possible.