Unorthodox primary care provider ChenMed entering Indy market

ChenMed LLC doesn’t look like your everyday physician group.

Doctors give their cellphone numbers to patients and urge them to call when complications or difficulties arise.

The CEO, a cardiologist, talks about “God’s spectacular and mysterious plan” on his web page.

Now, the unorthodox, fast-growing operation, based in Miami, is preparing to expand into Indianapolis. It has filed plans with the state to renovate three buildings and open them as primary care medical clinics.

ChenMed, a private, family-owned operation with more than 6,000 employees in 15 states, specializes in offering primary care to underserved seniors with multiple chronic conditions.

It is the latest out-of-state company to enter the Indianapolis primary care market, with the potential to disrupt the traditional market here.

In September, New York City-based Cityblock Health Inc. said it planned to expand into Indianapolis and Fort Wayne and create 140 jobs, although it did not say how many clinics it would open. The company partners with community-based organizations and health plans to deliver care and social services.

And last year, Chicago-based VillageMD, whose biggest investor is pharmacy giant Walgreens, launched a major expansion into Indiana and has since opened or bought 12 practices in the state, including two in Indianapolis.

Now ChenMed confirms it is about to open three clinics in Indianapolis under its JenCare Senior Medical Center brand, although it has yet to make a formal announcement.

“JenCare is expanding into Indiana because tens of thousands of seniors statewide live in underserved ZIP codes,” company spokesman James Brown told IBJ in an email. “… We are looking forward to transforming care for at-risk seniors throughout Indiana and nationwide by earning patient trust which is vital to effectively detecting and managing high-risk diseases.”

Altogether, it’s a lot of activity for a midsize market that has been dominated by hospital systems, along with a smattering of smaller specialty groups.

“I do think it is unusual,” said Ed Abel, former director of health care practice at Indianapolis-based Blue & Co., an accounting and consulting firm. “Maybe there’s room for more providers. It’s hard to predict how these kinds of things will shake out.”

But some long-standing players view the trend with consternation.

Ben Harvey, CEO of the Indiana Primary Health Care Association, a trade group representing dozens of not-for-profit community health centers, said out-of-state providers don’t necessarily have the same connections to the community and could edge out established providers.

“This is a big concern for our members, who are community-led and community-driven,” Harvey said, “regarding the potential to come in without a community grounding and create short-term access which lacks community perspective.”

The nation’s $1 trillion primary care market has been undergoing a reckoning in recent years, with competitors springing up from all sides. That includes retailers and pharmacy chains, such as CVS and Target, which house more than 1,000 MinuteClinics; and virtual health care, with national firms Teladoc, Amwell and MDLive offering remote consultations via phone or home computer.

‘Concierge medicine’

ChenMed, for its part, has been quietly expanding through the South and East in recent years.

It calls its service “concierge medicine for the poorest,” targeted to low-income seniors on Medicare, many with multiple chronic conditions—traditionally the most expensive sector of the nation’s patient population.

The company says its teams “coordinate the entire patient journey for vulnerable seniors.” About 30% of its patients are dually eligible for Medicare and Medicaid, with monthly incomes below $1,025.

What ChenMed does is partner with insurers who offer Medicare Advantage plans—the private-sector alternative to traditional Medicare. Under the partnership, ChenMed receives a monthly fee for each patient, with the goal of keeping them healthy and out of the hospital.

Under the model, patients are encouraged to see their doctor as often as necessary, even monthly. If they can’t get a ride to the clinic, ChenMed will pick up the taxi fare and will even send the patients home with their medications, instead of sending them to an outside pharmacy.

The company says each patient spends a total of 189 minutes of face time with their doctors over a year—much longer than the national average of 21 minutes.

ChenMed says its doctors benefit, too, because they see fewer patients and can keep near-constant tabs on their health. The company said each of its primary care physicians cares for 450 patients, compared with the national average of up to 3,000 patients per doctor.

“Our primary care physicians have small patient panels, and patients have 24/7 access to their doctor,” ChenMed’s website says. “This fosters rewarding doctor-patient relationships and ensures healthier, more compliant patients.”

As a result, ChenMed patients have 50% fewer hospitalizations and 33% fewer emergency room visits than the national average, the company says.

In contrast, the dominant business model in primary care, fee for service, rewards physicians for the quantity of services they provide, not the quality, nor for patients’ outcomes.

“Traditional primary care in the United States is narrow and reactive,” the company wrote last month in an open letter. “Primary care providers are too often put on a treadmill by business administrators, and they burn out. … The result is too many patients, too little time, and [physicians] not doing much of the work they are equipped to do that would transform health and well-being. This isn’t serving anybody.”

Right model?

Some national groups say providers like ChenMed have the right model in providing primary care.

“I would characterize it as being what primary care was intended to be all along, and should have been all along, in this country,” said Susan Dentzer, president and CEO of America’s Physicians Groups, a Washington, D.C.-based association representing more than 170,000 physicians providing care to 90 million patients.

She said ChenMed’s specialty is addressing the needs of older adults and putting together a care system that bypasses the traditional fragmented, uncoordinated system.

Under the ChenMed model, doctors are responsible for the outcome of care in older adults, instead of just being paid for providing certain services. So, if a patient with diabetes is having trouble getting healthy food, the doctor’s office is expected to connect the patient with a group that will take the patient grocery shopping. If a patient with a heart condition can’t find a nearby place to exercise, the doctor’s office is expected to find that, too. It’s all part of the goal of keeping the patient out of the hospital.

“What ChenMed has done is create a system where clinicians are accountable for the health care and outcomes of their patients in a way that is producing superior results,” Dentzer said.

Ara Darzi, former Labour minister of health in the United Kingdom in 2008, hailed ChenMed as a pioneer in helping reduce hospital admissions and improving overall health.

“Providing proactive rather than reactive care improves health, avoids crises and saves costs,” Darzi wrote in an opinion column in the British newspaper The Guardian in 2016.

The company has also won accolades from such publications as Health Affairs, Forbes magazine and The Economist.

“ChenMed doesn’t look like much,” The Economist wrote in 2014. “Its clinic north of Miami has a modest waiting area and circle of examination rooms. But every action is engineered and tracked. … It profits when [patients] are kept well and their health care costs are kept low. Clinics like ChenMed are the exception, not the rule. But the company is one of many that provide a hint of how American health care might work better.”

The company is eyeing three properties in Indianapolis for its expansion: 2435 N. Sherman Drive on the east side, 3827 Mitthoefer Road on the far-east side, and 2802 Lafayette Road on the west side.

Each of the centers, which will operate as a JenCare Senior Medical Center, will provide care to about 2,700 seniors.

Firsthand frustrations

ChenMed traces its roots to the practice of Dr. Jen-Ling James Chen, born in Taiwan, who moved to the United States after earning an undergraduate degree at Taiwan National University. He picked up a master’s degree in chemistry at Washington University in St. Louis, and a doctorate in biochemistry at the University of Wisconsin.

Along the way, he also earned a medical degree at the University of Miami and began his practice in the suburb of Miami Gardens in the 1970s.

Chen was diagnosed with cancer in 2003 and given two months to live. At that point, he learned of the bumps and blind alleys of the U.S. health care system as a patient.

“He and his family experienced firsthand the frustrations of navigating the health care system where profits, not patients, are the focus,” the company website says. “While Dr. Chen fought for his life, he and his family fought for access and coordinated care.”

To his family’s surprise, Chen recovered and had a mid-career change of plans: to “revolutionize the health care delivery system.” His goal was to offer affordable, human-centered care to medically underserved communities.

At first, he limited the company to south Florida, then gradually spread out—hiring physicians, nurses and assistants by the dozens, then by the hundreds.

The company has made a name for itself in health care circles. It was named one of Fortune’s 2020 “Change the World” companies and was honored by Newsweek as one of “America’s 100 Most Loved Workplaces 2022,” ranking eighth.

Chen has handed off the company in recent years to his two sons, both cardiologists, and extended family. His elder son, Dr. Christopher Chen, has been CEO since 2009. His younger son, Dr. Gordon Chen, is chief clinical officer.

ChenMed declined to make any of its senior leaders available for an interivew with IBJ.

Today, some observers call ChenMed one of the best-run primary care practices in the country. Dr. Robert Kocher, a venture capitalist in Palo Alto, California, and former health policy official in the Obama administration, said the company offers not only primary care but also other services to keep patients healthy.

“In all their offices, they have people that can help with mental health care treatment, with pain management, with physical therapy,” he told IBJ. “So they have a bunch of services that are really easy to access to make it more convenient for people.”

In the ChenMed model, the company gets a per-patient budget from an insurance company that offers Medicare Advantage plans. It’s ChenMed’s job to use that money on the patient’s behalf to make sure all health care is provided and paid for.

“And if they do a good job of making you healthier, they make a profit,” Kocher said.

The company declined to disclose revenue or profit figures. But it has done well enough to keep growing.

It plans to roll its model into Indiana in the coming months.

“We are a living/breathing case study in how care can be paid for and organized to solve problems,” ChenMed spokesperson Brown told IBJ. “We like to let our results and better patient outcomes speak for themselves as a model for the industry at large, and are proud to bring JenCare to Indiana.”•