From the wRVU Treadmill to a Cash-Pay Integrative Gynecology Practice: CPOM, Medicare Opt-Out, Malpractice & Tech Stack

01The insurance wRVU treadmill in numbers

Most employed or group OB/GYNs are paid on work relative value units (wRVUs): a points system that values each service, multiplied by a dollar conversion factor in the contract. The model rewards volume. To produce 6,200–7,500 wRVUs a year at $40–$46 per wRVU, a typical generalist carries 2,200–3,000 active patients and sees 24–32 a day, which leaves about 11 minutes of face time per visit.

Table 1 · IntegrativeGyn.com 2026 market estimates; individual contracts vary widely.

Three structural problems sit behind those numbers. First, a large share of overhead exists only to get paid: coders, billers, prior-authorization staff and clearinghouse fees. Second, obstetric malpractice, often around $85,000 a year in the research benchmark and far higher in some states, is priced for labor and delivery risk even on clinic days. Third, the work that midlife patients most need — 45 minutes on perimenopause, PCOS or pelvic pain — produces fewer wRVUs per hour than a full schedule of short visits.

Divide the numbers into an hourly rate and the treadmill becomes visible. At $365,000 net across 48 weeks of five 10-hour clinic days, you earn about $152 an hour before counting call. Add a typical OB call schedule and the real figure is lower still. None of this means insurance practice is wrong for everyone; it means the hours, not the skill, set the ceiling. The practice transition calculator runs this for your own volume, conversion factor and overhead.

02Integrative DSC micro-practice economics

Direct specialty care (DSC) replaces insurance billing with a direct financial relationship: patients pay a monthly membership, per-visit fees, or a hybrid, and the practice issues superbills so they can seek out-of-network reimbursement themselves. Dropping obstetrics and insurance billing changes both sides of the P&L.

Table 2 · IntegrativeGyn.com 2026 model of a mature practice; not a projection for any specific physician.

The lean overhead assumes no insurance billers, one nurse or medical assistant, one care coordinator, a membership billing platform plus an EHR, modest clinic space and gyn-only outpatient malpractice. At four days a week for 46 weeks of eight-hour days, $660,000 net works out to roughly $450 an hour.

Treat the supplement and ancillary lines with care. They depend on clinical need, honest pricing and patient trust, and they draw scrutiny when they look like the business model rather than the care. Our supplement dispensary audit shows how patients evaluate markups, and the pellet licensing ROI audit covers the economics and clinical caveats of adding a pellet program. A practice that grows only on its membership value is the more durable one.

Membership pricing for patients also has to make sense against out-of-network reimbursement. Patients often compare your fee with what they can recover on visit codes; the superbill and HSA/FSA guide explains what they will ask about, and why the membership access fee itself is not reimbursable.

03Panel conversion assumptions and the break-even member count

The model assumes that 12%–18% of an existing insurance panel converts to a paid membership over the transition, plus new patients from referrals and search. From a 2,500-patient panel, that is 300–450 potential members — enough to reach the modeled practice, but only if you are allowed to tell patients where you are going (see the non-compete section below).

Contribution per member

Using the research assumptions, each member contributes about $3,170 a year:

• Membership: $200 × 12 = $2,400.
• Dispensary: 73% of members buying (220 of 300) × $115 × 12 × 30% margin ≈ $304.
• Ancillary labs and procedures: $140,000 ÷ 300 ≈ $467.

Break-even formula

Break-even members = fixed annual overhead ÷ annual contribution per member. With about $285,000 of overhead, $285,000 ÷ $3,170 ≈ 90 members to cover costs with nothing left for you. To also replace a $365,000 insurance income: ($285,000 + $365,000) ÷ $3,170 ≈ 205 members.

Three sensitivities matter more than the rest:

• Membership fee. At $150 a month, contribution falls to about $2,570 and the income-replacement panel rises to roughly 253. At $250 it falls to about 172.
• Churn. If 15% of members leave each year, you must add about 45 new members a year just to hold a 300-member panel.
• Launch overhead. Overhead in the first year is usually lower than the mature figure because you hire staff as the panel grows. Model the year-one number separately.

You can change every one of these inputs — panel, fee, dispensary uptake and ancillary revenue — in the transition P&L simulator, which also shows the break-even panel and a month-by-month ramp.

04Entity structure: corporate practice of medicine and MSOs

Before you sign a lease, decide who owns what. The rules differ sharply by state, so read this section as a map of the questions, not as answers. Confirm every structural decision with a healthcare attorney licensed in your state.

Corporate practice of medicine (CPOM)

Many states prohibit business corporations owned by non-physicians from practicing medicine or employing physicians to do so. California, New York and Texas are commonly cited as strict CPOM states; others are permissive or have exceptions. CPOM can also apply to nurse practitioners in some states. If you own 100% of a professional corporation (PC) or professional limited liability company (PLLC) and employ your own staff, CPOM is usually simple. It becomes complex when a spouse, investor, management company or franchise wants an ownership share or a percentage of revenue.

Management services organizations (MSOs)

The common workaround is a split structure: a physician-owned PC holds the medical practice, and a separate MSO — which may have non-physician owners — provides non-clinical services such as space, staff leasing, billing software, marketing and bookkeeping under a management agreement. Points counsel will usually examine:

• Whether the management fee is fair market value and how it is calculated; some states restrict percentage-of-revenue fees as fee-splitting.
• That clinical decisions, medical records and prescribing stay with licensed clinicians.
• How the arrangement interacts with the federal Anti-Kickback Statute and Stark Law if you still see any Medicare, Medicaid or other federal program patients.

The membership agreement itself

Several states have passed laws stating that direct care agreements are not insurance, but many of those laws are written for primary care. A specialty membership that promises unlimited services for a fixed fee could, in some states, raise insurance-regulation questions. Counsel should review what the membership includes, how refunds work on cancellation, and how you describe out-of-network reimbursement to patients so you do not promise a result.

Product sales need the same care. Disclose that you earn a margin on supplements, offer patients the option to buy elsewhere, and check your state’s dispensing rules. If you plan to compare EHR and billing vendors before structuring, see Hint vs Cerbo vs Elation.

05Medicare opt-out: affidavit, two-year terms and private contracts

Integrative gynecology serves many women over 65 for menopause, bone health and genitourinary syndrome of menopause. If you want to charge those patients a membership or cash fee for Medicare-covered services, you generally cannot stay enrolled as a participating Medicare physician. You have three paths.

Stay participating

You bill Medicare and accept the fee schedule. You cannot charge a membership fee for services Medicare covers.

Non-participating

You still submit claims, but may charge up to the limiting charge (115% of the non-participating fee schedule amount) on unassigned claims. This does not allow a cash membership for covered services.

Opt out

You stop billing Medicare entirely and contract privately with each Medicare patient for cash.

How opting out works

• The affidavit. You file a signed opt-out affidavit with each Medicare Administrative Contractor (MAC) that would otherwise process your claims. It applies to all your Medicare patients — you cannot opt out for some and bill Medicare for others.
• Timing. A physician who is currently participating can opt out effective the first day of a calendar quarter, with the affidavit filed at least 30 days before that date. Non-participating physicians can generally opt out at any time.
• Two-year terms. Opt-out lasts two years and renews automatically for further two-year periods unless you cancel in writing at least 30 days before the next period begins. A limited window exists to end a first opt-out early; ask your MAC about the conditions.
• Private contracts. Before any service, each Medicare patient signs a written private contract stating, among other required terms, that she will pay you directly, that neither of you will submit a claim, that Medicare and Medigap will not pay, and that she can see a Medicare-enrolled clinician instead. A contract cannot be signed while the patient faces an emergency or urgent situation.
• Medicare Advantage. Opted-out physicians are not paid by Medicare Advantage plans either, apart from emergency situations.
• Ordering and referring. Opted-out physicians can generally still order labs and imaging and refer; Medicare pays the other provider if your opt-out record is current. Confirm the details with your MAC.

Many integrative gynecologists opt out because most of their panel is under 65 and Medicare would cover only part of what they do. Others keep a small Medicare panel enrolled and limit the membership to commercially insured and self-pay patients. Model both: set a lower panel in the calculator to see what losing Medicare patients would cost.

06Malpractice when you drop obstetrics

Leaving labor and delivery is usually the single largest overhead saving. In the research benchmark, a combined OB/GYN premium of about $85,000 a year drops to roughly $18,000–$26,000 for outpatient gyn-only coverage. Your state, claims history and procedures change that number, so get at least two quotes early.

Tail coverage

Most physician policies are claims-made: they cover claims reported while the policy is active. When you leave, you need an extended reporting endorsement (tail) to cover future claims from past care — or a new carrier willing to cover prior acts (nose coverage). Obstetric tails matter more than most, because many states extend the time a child has to sue until after the age of majority. Tail quotes commonly run roughly 1.5–3 times the expiring annual premium.

• Read your employment contract: it may say who pays the tail, and the answer can change if you resign versus are terminated.
• Ask the new carrier about prior-acts coverage as an alternative to buying tail.
• Price the tail into year-one cash flow; it can exceed $100,000 for an OB/GYN with a high premium.

Covering what you will actually do

Tell the carrier exactly what the new practice includes: in-office procedures such as endometrial biopsy, IUD placement or energy-based vaginal treatments, hormone prescribing (including compounded or pellet therapy if you plan it), telehealth, and which states your patients are in. An unlisted procedure or state can leave a gap. If you add vaginal laser, note that it is not FDA-cleared for genitourinary syndrome of menopause; see laser vs local estrogen for the clinical comparison patients will read.

Finally, plan coverage for the gap months. If you see patients in a waitlist or founding-member phase before the new policy starts, you are practicing without coverage. Align the policy start date with your first patient visit, not your lease.

07The tech stack: membership billing, EHR, dispensary and labs

A micro-practice replaces a billing department with software. Most integrative gynecology practices assemble four layers. Pricing for all of these changes and is often quote-based or per-member, so confirm current terms with each vendor.

Table 3 · Neutral summary of publicly described products; features and prices change.

Choose the EHR first, then confirm it integrates with your billing platform, dispensary and lab ordering. Ask each vendor three questions: can patients self-enroll and pay online; can the system generate a compliant superbill per visit; and can you export all records if you leave. Budget the stack as a per-member cost rather than a flat fee, because several of these tools price by active patients or members. The full comparison is in Hint vs Cerbo vs Elation.

For labs, decide early whether you will pass wholesale prices through or add a margin. Patients increasingly check, and transparent pricing is a selling point. The lab panel cost builder shows patients the hybrid strategy: serum markers on insurance, specialty tests at cash prices.

08A 12-month transition ramp

The safest transitions overlap: prepare while employed, give notice on your contract’s terms, and open with a waitlist already built. The timeline below is a planning template; your contract’s notice period and non-compete may change it.

1. Month 1 — Review contracts and counsel. Have a healthcare attorney read your employment agreement (notice, non-compete, non-solicitation, tail, records) and advise on entity and CPOM structure for your state.
2. Month 2 — Model the numbers. Build a year-one P&L with conservative conversion (12%), real malpractice quotes and tail cost. Set a cash reserve covering 6–9 months of personal and practice expenses.
3. Month 3 — Form the practice. Form the PC or PLLC, obtain an EIN and Type 2 NPI, open banking, and decide on Medicare: opt out, stay enrolled, or remain non-participating.
4. Month 4 — Space, stack and staff. Sign a lease or sublease, choose EHR, billing and dispensary platforms, and line up a nurse or medical assistant and a care coordinator.
5. Month 5 — Membership design. Finalize tiers, pricing, what is included, cancellation and refund terms, superbill process and Letter of Medical Necessity templates; have counsel review the agreement.
6. Month 6 — Notice and notification. Give notice per contract. Hand off obstetric patients to colleagues well before their due dates. Agree a patient notification letter with your employer where possible.
7. Month 7 — File and open. File the Medicare opt-out affidavit if chosen (participating physicians at least 30 days before a quarter starts), activate malpractice, and see the first founding members.
8. Months 8–9 — Reach break-even. Target about 90 members, the point where the practice covers lean overhead. Track conversion weekly against the 12%–18% assumption.
9. Months 10–11 — Grow to income replacement. Aim for 150–205 members. Add the dispensary and lab workflows once the core visit experience is consistent.
10. Month 12 — Review and adjust. Compare actual churn, revenue per member and overhead with the model. Adjust pricing or hiring before year two.

Cash flow is the risk in months 6–9: income stops before membership revenue arrives. Founding-member pricing with annual prepayment can bridge the gap, but keep refund obligations in mind. The calculator projects the month-by-month ramp.

09Non-competes, patient notification and records

The legal question that most often decides a transition is not Medicare or CPOM; it is your employment contract. Typical OB/GYN non-competes restrict practice within a set radius for one to two years after you leave. Whether a clause is enforceable is a matter of state law. Several states have limited physician non-competes in recent years, and a federal rule that would have banned most non-competes did not take effect. Have counsel answer three questions:

• Does the clause cover a gyn-only, cash-pay practice, or only the services you provide now?
• Is there a buyout amount or a carve-out for telehealth or a different specialty scope?
• Does a separate non-solicitation clause limit how you may contact current patients?

Notifying patients

Ethics guidance and many state boards expect physicians to give patients reasonable notice when they leave and to support continuity of care. Ending care abruptly can be treated as patient abandonment, which matters most for pregnant patients and anyone mid-treatment. A joint letter from you and your employer, stating where you are going and how to request records, is the cleanest approach where the contract allows it.

Patient lists and charts usually belong to the employer. Do not export contact lists or use records from the employer’s EHR to market the new practice without legal advice; that can breach your contract and privacy rules. Patients always have the right to request their own records, and you can ask them to send copies to the new practice.

Telling patients what the new model costs

Converting patients will ask whether insurance still helps. Give them a written explanation: what the membership covers, that the access fee is not reimbursable, that you will issue superbills for visit codes, and that you cannot guarantee reimbursement. Pointing patients to the superbill net-cost calculator lets them see their own numbers. For the contract issues patients will look for, read retainer contract red flags before you draft your agreement.

This blueprint is general business education, not legal, tax or financial advice; confirm each decision with qualified counsel and advisers in your state.