Faithful patients prove good for bottom line

Investing in patient loyalty pays off

On the average, employers change health plans every two to three years, creating potential for disrupted patient/physician relationships if the physician in question isn’t a member of the new health plan’s provider network. Despite these changes, researchers say it’s more important than ever to hang on to existing patients.

Some practices have such a strong base of loyal patients that they’ve gone to the extent of forming their own insurance plans — or even their own Medicare HMOs — so their patients can remain on their rolls.

Patient choice is a hot political issue, but it also is an economic and clinical one. Researchers now say long-term patient relationships often carry financial benefits as well. Generally, these patients cost less because of shorter hospital lengths of stay, more proactive care, and fewer office visits because many concerns can be dealt with by telephone.1

This is an emerging issue, experts say, because of the highly charged marketing craze attendant with a competitive Medicare risk environment. While some seniors fight for choice, others switch insurers and physicians every time they get a better Medicare HMO offer. HCFA allows Medicare risk enrollees to switch carriers every 30 days, and for some seniors, physician shopping isn’t much different from shopping for a new long-distance service or a cellular phone. The perks change as quickly as the billboards can be repainted, and so does constituent loyalty.

Strong relationships often mean lower costs

As seniors switch to any number of new Medicare HMO offers, some forsaking physicians they’ve known for decades, the question of the cost of that volatility is becoming an important one. Physician groups that can enhance their patient relationships and keep their "faithful" patients from switching brands will have lower costs, experts say.

If you have the kind of practice where patients make a point to stick with you, you have a valuable asset that you might not be computing in your income statement, points out Neill T. Fishman, executive director of Vancouver (WA) Clinic, a 62-physician multispecialty practice. In the push for managed care contracting in Vancouver, Fishman’s practice has worked hard at maintaining its loyal patient base, even to the point of starting its own HMO and participating in a Medicare HMO to give patients plenty of opportunity to remain with their physicians.

Specialist practices are making similar efforts, only typically they function strictly under fee-for-service contracts, says Charles Lock, administrator for the Sutherland Clinic, a 10-physician cardiology practice in Memphis, TN. Sutherland’s physicians court not only the patients to stay with them, but referring primary care physicians to stick with them as well so their "faithful patients" can be referred for specialty care.

Sustaining patient loyalty in this competitive market is getting tougher all the time, say Linda J. Weiss, PhD, and Jan Blustein, MD, PhD, both of whom are professors of medicine at the Columbia College of Physicians and Surgeons in New York City. They recently completed a study that quantifies and compares the costs of faithful vs. less faithful patients.

Better costs, compliance, outcomes

Their study of 12,677 Medicare beneficiaries suggests that "faithful patients" — as the researchers termed them — who remain with their physicians in a long-term relationship tend to have lower costs, better compliance, and better outcomes than patients who do not. Their data do not show faithful patients as any more conscientious about taking preventive care measures.

They hypothesized that longer relationships between patients and physicians would be associated with the following:

— greater use of preventive care services (mammograms and flu shots);

— more healthy behavior (less obesity and more smoking cessation);

— more efficient use of health care services (fewer doctor visits and hospitalizations) and a decrease in "inappropriate" service use (less use of hospital emergency rooms);

— decreased costs of care (lower annual Medicare Part A and Part B reimbursement).

Their data did not support the first hypothesis, but they did support the last three.

Here are specifics of their findings about patients who switch vs. patients who don’t:

There was no significant difference between the groups in utilization of preventive care services. For example, 37.6% of female patients whose relationship with their current physician was less than 1year old had mammographies, vs. 39.5% whose relationship with their current physician was 3 to 5 years old.

The longer the relationship, the lower the patient costs. The longer the duration of the patient-physician relationship, the greater the cost efficiencies.

The longer relationship, the better the patient outcomes. In self-reported health status surveys, they found that better health status is associated with a longer patient-physician relationship.

Most older Americans are strikingly faithful patients. More than half (55.3%) reported having a tie to their physicians of more than five years; more than one-third (35.8%) reported their physician relationship to date back 10 years or more.

Patient skimming might not work

These findings have interesting implications for claims that HMOs skim the healthier populations, the researchers point out. They also could be useful for physicians who want to make a case to their insurer about the value of keeping their patients with whom they share long-term relationships.

"Our finding of an association between lower costs and ties of longer duration might seem at odds with prior studies showing that people in better health and with a history of lower health service use are more likely to switch from the fee-for-service sector to join an HMO," Weiss and Blustein wrote. "In our nationally representative sample of older Americans in the fee-for-service sector, there was no suggestion that relatively healthy patients switch providers more frequently; on the contrary, in our sample, relatively good health was associated with ties of longer duration."

Confounding some of their results is the possibility that patients switch physicians at the onset of a serious illness, Weiss and Blustein point out. To try to account for this, the researchers took out extreme outlier cases that might have skewed the outcomes.

The value of patient-physician loyalty will be rigorously tested in the real world, Weiss and Blustein predict. "For better or for worse, there are likely to be numerous such ‘natural experiments’ in the coming months, as large numbers of Americans break ties with their providers in order to join managed care systems," they wrote.

Market reflects wave of physician-switching

Based on 1994 data from the Washington, DC-based Health Insurance Association of America, 41% of all insured consumers switched physicians when they joined an HMO. That figure no doubt would be higher now, they said.

Their findings offer a challenge to group practices and insurers. "While the solo practitioner is disappearing, it does not necessarily follow that enduring doctor-patient relationships are a phenomenon of the past," they wrote. "Multispecialty group practices and managed care plans can be organized to promote or discourage enduring ties, depending on managerial policy."

Sutherland Clinic is already involved in this effort. "We have a lot of patient loyalty," says Lock. The key is providing the highest-quality patient care, and providing high-quality service to primary care physicians.

To do that, the clinic has invested in computer systems — and trained both physicians and staff — so they can turn reports around quickly to primary care physicians and insurers. Also, clinic leaders believe in investing in cutting-edge technology. For example, the practice recently purchased a nuclear camera that functions much like a magnetic resonance imaging machine. It photographs heart tissue and thus reduces the need for invasive surgery.


1. Weiss L, Blustein J. Faithful patients: The effect of long-term physician-patient relationships on the costs and use of health care by older Americans. Am J Public Health 1996; 86:1742-1747.