Introduction
As healthcare practices evolve, many doctors are exploring new ways to maintain patient care quality while also managing the financial viability of their practices. One common approach is transitioning away from insurance-based payment models and introducing a direct patient membership plan. This strategy has been successfully implemented by numerous healthcare providers, allowing them to focus more on patient care and less on administrative burdens.
In this article, we’ll dive into the strategy of dropping insurance and replacing it with a patient membership plan. We’ll share sample letters you can use to communicate this change to your patients, outline a proven strategy to get patients on board, and highlight a real-life success story of Dr. Sarah, who successfully transitioned her practice and signed up over 1,200 patients on her membership plan. With her new model, she achieved a substantial Monthly Recurring Revenue (MRR) and Annual Recurring Revenue (ARR), transforming her practice and enhancing patient care.
Sample: Dropping Insurance Letter to Patients
Sample Letter 1: A Warm, Reassuring Approach
Subject: Important Update: Exciting Changes to Our Practice
Dear [Patient’s Name],
We hope this message finds you well. We are writing to share some exciting news about changes happening in our practice that we believe will benefit you and all our patients.
Starting [Effective Date], our practice will no longer be accepting insurance. We understand that this may come as a surprise, but we want to assure you that this change is made with your best interest at heart.
Over the years, we’ve noticed that the constraints of insurance companies often limit the quality of care we can provide. By moving away from insurance, we will be able to spend more time focusing on what truly matters—your health and well-being.
To ensure that healthcare remains affordable and accessible, we are introducing a new Patient Membership Plan. For just $45 per month, you will have access to the same comprehensive care you’ve always received, with added benefits such as:
- Unlimited office visits without co-pays
- Same or next-day appointments
- Extended appointment times
- Discounts on services and procedures not covered by insurance
We understand that this is a significant change, and we are here to answer any questions you may have. Please feel free to contact us at [Phone Number] or [Email Address] with any concerns.
Thank you for being a valued patient. We look forward to continuing to serve you in the best way possible.
Warm regards,
[Doctor’s Name]
[Practice Name]
[Contact Information]
Sample Letter 2: A Direct, Informative Approach – Dropping Insurance Letter to Patients
Subject: Changes to Insurance Coverage at [Practice Name]
Dear [Patient’s Name],
I am writing to inform you of an important change at [Practice Name]. Effective [Effective Date], we will no longer be participating with insurance companies for patient care. This decision was not made lightly, but it has become increasingly clear that the traditional insurance model is no longer conducive to providing the personalized care we strive to deliver.
In place of insurance, we are introducing a Patient Membership Plan that offers comprehensive care for a flat fee of $45 per month. This plan includes:
- Unlimited office visits with no additional cost
- Direct access to your physician through phone and email
- Prioritized appointment scheduling
- Discounts on specialty services
We believe this new model will allow us to dedicate more time to each patient and remove the barriers that insurance often imposes on the care process.
We are committed to making this transition as smooth as possible for you. Please don’t hesitate to reach out if you have any questions or need assistance.
Thank you for your understanding and continued trust in our care.
Sincerely,
[Doctor’s Name]
[Practice Name]
[Contact Information]
Sample Letter 3: A Storytelling Approach – Dropping Insurance Letter to Patients
Subject: Exciting Changes Ahead at [Practice Name]
Dear [Patient’s Name],
I want to share a personal story with you that has led to an important change in our practice.
Over the years, I’ve had countless conversations with patients who feel frustrated by the limitations imposed by insurance companies. I’ve felt this frustration too—wanting to provide the best care possible but being constrained by insurance requirements.
After much reflection and research, I’ve decided to make a change. As of [Effective Date], our practice will no longer be accepting insurance. Instead, we will be offering a Patient Membership Plan for $45 per month, which will allow us to provide you with more personalized, high-quality care without the interference of insurance companies.
This plan includes:
- Unlimited visits with no extra charges
- Direct communication with me via phone or email
- Priority scheduling and extended appointment times
- Discounts on non-covered services
I know change can be difficult, but I truly believe this is the best path forward for providing you with the care you deserve. My team and I are here to answer any questions you may have and to help you transition smoothly to this new model.
Thank you for being part of our journey. I look forward to continuing our relationship in this new, exciting chapter.
Best regards,
[Doctor’s Name]
[Practice Name]
[Contact Information]
The Strategy: Creating a Successful Patient Membership Plan
Transitioning away from insurance can be a daunting task, but with the right strategy, it can lead to tremendous success for your practice. The key is to create a membership plan that resonates with your patients, ensuring that they see the value in what you’re offering.
Step 1: Understand Your Patient Base
Before launching a membership plan, it’s crucial to understand your patient demographic. Are they primarily older adults who value regular check-ups? Young families looking for affordable care? Or perhaps busy professionals who need flexible, on-demand service?
By understanding your patient base, you can tailor your membership plan to meet their specific needs. This increases the likelihood that they will see the value in your offering and sign up.
Step 2: Develop a Compelling Offer
Once you understand your patients, it’s time to create an offer that they can’t refuse. Your membership plan should be priced attractively and include benefits that appeal directly to your patients’ needs.
For example, Dr. Sarah, who we’ll discuss in more detail later, priced her membership at $45 per month. This price point was affordable for her patients and provided them with benefits such as unlimited visits, direct communication with her, and discounts on additional services.
Step 3: Communicate the Change Effectively
The letters provided earlier in this article serve as examples of how to communicate the transition to your patients. It’s important to be clear about why you’re making this change and how it will benefit them.
Using the “Hook, Story, Offer” framework popularized by Russell Brunson can be particularly effective here:
- Hook: Start with a compelling reason for your patients to keep reading. This could be a personal story, a surprising fact, or a question that piques their interest.
- Story: Share the story behind your decision to drop insurance. This helps build trust and rapport with your patients.
- Offer: Clearly present the benefits of your new membership plan and explain why it’s a better option for them.
Step 4: Make Signing Up Easy
Your patients are more likely to sign up if the process is simple and straightforward. Provide clear instructions on how they can join the membership plan, whether it’s online, over the phone, or in person.
Consider offering incentives for early sign-ups, such as a discount on the first month’s fee or an additional service for free. This can create a sense of urgency and encourage patients to act quickly.
Step 5: Track and Adjust
After launching your membership plan, track your progress closely. Monitor sign-ups, patient feedback, and overall satisfaction. Be open to making adjustments based on what’s working and what isn’t.
Regularly communicating with your patients about the benefits they’re receiving can also help reduce churn and keep them engaged in your membership plan.
Dr. Sarah’s Success Story
To illustrate the effectiveness of this strategy, let’s look at the real-life example of Dr. Sarah, a family medicine practitioner who made the bold decision to drop insurance and transition to a patient membership plan.
The Challenge
Dr. Sarah was growing increasingly frustrated with the limitations imposed by insurance companies. The constant administrative work, restrictions on care, and the financial uncertainty that came with delayed or denied claims were taking a toll on her practice. She knew that something needed to change.
The Transition
Using the steps outlined above, Dr. Sarah decided to drop insurance and introduce a Patient Membership Plan. She understood her patient base well—primarily young families and older adults who valued regular, personalized care.
Dr. Sarah set her membership fee at $45 per month, a price point that was accessible to her patients while still providing a sustainable revenue stream for her practice. The membership included unlimited office visits, priority scheduling, direct access to Dr. Sarah, and discounts on additional services.
The Hook, Story, Offer Framework in Action
To communicate the change, Dr. Sarah used the “Hook, Story, Offer” framework:
- Hook: She began her letter by sharing her personal frustration with the insurance system, something many of her patients could relate to.
- Story: Dr. Sarah explained how these frustrations led her to research and eventually decide on a new model that would benefit her patients more directly.
- Offer: She presented the membership plan as a way for her patients to continue receiving high-quality care without the constraints of insurance, highlighting the benefits they would receive.
The Results
The response was overwhelmingly positive. Within the first few months, over 1,200 patients signed up for Dr. Sarah’s membership plan. This translated to a Monthly Recurring Revenue (MRR) of $54,000 and an Annual Recurring Revenue (ARR) of $648,000.
This new revenue model not only stabilized Dr. Sarah’s practice financially but also allowed her to spend more time with each patient, enhancing the quality of care she could provide. Her patients were happier, her practice was thriving, and she had more control over her professional life.
The Impact
The impact of this change on Dr. Sarah’s practice was profound:
- Financial Stability: The consistent MRR provided financial stability and predictability, allowing Dr. Sarah to plan for the future with confidence.
- Improved Patient Care: With fewer administrative burdens and more time available per patient, Dr. Sarah could focus on providing high-quality, personalized care.
- Patient Satisfaction: Patients appreciated the improved access to care and the transparent pricing model. Many felt that the membership plan was a better value than their previous insurance coverage.
- Growth Opportunities: The success of the membership plan opened up new opportunities for Dr. Sarah’s practice, including expanding services and potentially hiring additional staff to meet growing demand.
Conclusion – Dropping Insurance Letter to Patients
Transitioning away from insurance and implementing a patient membership plan can be a game-changer for healthcare providers. By following a strategic approach—understanding your patient base, crafting a compelling offer, communicating effectively, and making sign-ups easy—you can achieve significant success, just like Dr. Sarah. Download our books about create a patient membership plan and how to fire the PPOs.
The benefits go beyond financial stability. This model allows for better patient care, improved satisfaction, and a more fulfilling practice for healthcare providers. If you’re considering making the switch, the time to start planning is now. Use the sample letters and strategies outlined in this article as a guide, and take the first step toward transforming your practice for the better.
