In this post I link to and excerpt from the June 12, 2015 Barron’s article by Robert Milburn, Wealthy Increasingly Hire Pricey Health-Care Consultants.
Here are excerpts:
Wealthy families can now add “private health advisors” to their rolodex of personal hand holders. For about $10,000 to $20,000 per annum, a team of M.D.’s will help a relatively healthy family of four navigate the complex health-care system by providing 24/7 health advisory services, in-depth research on diseases, digitization and management of medical records, virtual consultations, and referrals to specialists.
That’s the basic package, with costs easily mounting from there. When a medical advisor is brought in during a true health crisis, like a stage-four cancer diagnosis and all-hands are on deck, costs can easily go into the hundreds of thousands of dollars. This fee is of course tacked-on to the actual cost of treatment and the doctors doing the hands-on work.
This medical version of fund-of-funds is, remarkably, catching on with the truly wealthy, a testament to how crazy and complex the health-care system has become. Health advisory outfits like Baltimore-based PinnacleCare and Los Angeles-based Private Health Management help wealthy clients navigate the health-care system. Clients “bring in a health advisor much like how they would for tax, legal or estate planning issues,” says Leslie Michelson, CEO of Private Health Management, a company with 15,000 ultra-wealthy clients and a proprietary database of 6,000 medical specialists. The health-care system is changing faster than it ever has, he says, while also becoming “more bureaucratic and difficult to access.”
A complex health issue can lay waste to a lot of good financial planning,” says Deanna Rodriguez, an executive vice president of private health advisory PinnacleCare.
Rodriguez knows this first hand. Four years ago, while she was still head of Morgan Stanley’s lifestyle advisory services, Rodriguez was diagnosed with stage-four colon cancer while at Langone Medical Center in New York. To help manage her health issues, Rodriguez turned to PinnacleCare, a service offered to Morgan Stanley’s wealth management clients.
A PinnacleCare advisor was on hand during all treatments and consultations with the doctor, to take notes and interpret the medical buzz words for Rodriguez and her husband. All told, it cost Rodriguez $24,000 for 6-months of advisement but, she says, “it was the best money I ever spent.” Having a knowledgeable advisor along put her whole family’s mind at ease, so much so, she went to work for the medical advisory company.
PinnacleCare currently serves more than 3,000 clients, and a representative for the firm says clients typically have at least $5 million in assets, with the average client spending between $16,000 and $22,000 per annum for advisory services. Michelson, of Private Health Management, was a bit more guarded about disclosing costs. He said a regular membership can cost “10s of thousands of dollars,” and, in a true medical emergency, costs “can get into the hundreds of thousands.”
Expensive but, as a sweetener, health advisories also trumpet the fact they can provide life-saving services to clients even while traveling. A college-aged son of a PinnacleCare client was traveling with friends when he was taken to the emergency room of a local hospital in Boulder, Colorado, complaining of a high fever, headache, and confusion. PinnacleCare advisors, after consulting with the client’s pediatrician, thought his symptoms were consistent with encephalitis, a potentially life-threatening disease caused by inflammation of the brain.
After conferring with the family, PinnacleCare oversaw an overnight “evacuation” to neurological specialists at Baltimore-based Johns Hopkins Hospital. The air transport was included in the family’s membership. The son spent 3 weeks in the hospital, after being diagnosed by the Centers for Disease Control and Prevention with West Nile Encephalitis.
The moral of their pitch: A medical advisor is money well spent.