Four Allergy Program Models Behind the Confusing Names
Primary care providers starting to explore adding allergy as a service line will first need to navigate confusing nomenclature. Different sources use a mishmash of different but often similar terms to refer only four, distinct, and easily differentiated models. They are: home testing, commodity supplies, third party testing, and comprehensive self-staffed allergy programs. To illustrate the problem, various AIs, search engines, and allergy suppliers themselves describe only two of those models with at least six, overlapping, ambiguous terms, including:
Why Allergy Program Names Get Confusing
Primary care providers starting to explore adding allergy as a service line will first need to navigate confusing nomenclature. The various AIs, search engines, and allergy suppliers themselves describe a quite limited number of business models with multiple, overlapping, ambiguous terms. They include:
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The confusion these terms create is readily apparent. Just a few obvious questions are:
- Is there really any reasonably common allergy program that does not involve a physician?
- How does a “physician” program differ from an “in-office” one, or for that matter from a specialist allergy practice?
- In-office, or sometimes in-house, in-clinic, or point-of-care allergy helpfully distinguishes from a referral program, but who, as in which person, actually performs that test? Typically it’s not the physician, and the person “in” the “office” may not even be the physician’s employee.
- An “ancillary” program suggests that allergy is something separate from core primary care, yet a third to a half of patients have significant allergies, so why use a description that points away from helpful understanding? See why allergy is not ancillary to primary care.
- The increasingly prevalent use of “allergy as a service” or AaaS echoes in the familiar term software as a service, SaaS, which describes subscription-based software that’s hosted and managed somewhere else, so is AaaS like a referral model, where the test or treatment occurs outside the clinic?
- If AaaS happens inside the clinic, who is doing it, and why the subscription?
As a remedy for lack of settled naming conventions, here’s a primer to clarify the options and the nomenclature. For a deeper look at why these terms are so inconsistent in search results, AI answers, and vendor language, see why allergy program names are confusing.
Four Business Models for POC Allergy, in Plain English
There is a grand total of three basic business models available for adding point-of-care candidate detection, allergy testing, and treatment as a new service line in primary care or specialty practices like ENT, ophthalmology, and sleep. They are: commodity, third party, and comprehensive, true turnkey, self-staffed allergy programs.
Referral out is of course another option pertaining to allergy in primary care, but it’s hardly a business model. On the contrary, as one of two approaches necessitated by primary care clinics opting out of the allergy business, it’s a non-business model, or a give-the-business-away model. See more on in-clinic allergy testing vs lab referral. The other approach that arises from primary care physicians declining to address highly prevalent patient needs is a consumer-direct business model, home testing. We’ll start there.
Home Test Allergy Programs
In light of the fact that the vast majority of primary care practices do not provide allergy testing and treatment, it is unsurprising that the market has offered a consumer-direct attempt at a solution. Multiple companies now offer home-based allergy tests. In fact, they’re available on Amazon. They all have a simple three-step process in common:
- The customer arranges for some kind of sample. These range from a cutting of hair, to a swab for saliva, to a lancet for blood drops, to a blood sample taken at a third-party lab like LabCorp.
- The sample then goes to the supplier or another lab, who analyzes it for IgE, typically.
- A results report then goes back to the customer at home.
Two additional steps are included only sometimes. There may or may not be a consultation with a doctor before or after the sample, or the result. And there may or may not be a treatment offered.
Physicians considering adding allergy as a service line need to concern themselves with home-based testing and treatment options because they’re competing for some patients’ attention. But only some. The vast majority of patients identified for allergy testing do not, in fact, request it. A primary care physician with knowledge of the pertinent medical history would enhance the patient experience and outcome, to put it mildly. In addition, from a billing and payment standpoint, it’s often easier and less expensive for patients to be tested and treated by their primary care provider.
The Commodity Allergy Model
This model is exactly what it sounds like: hoping to run an allergy program successfully by merely purchasing the commodity component materials. That is, the clinic buys allergens and applicators, some skin markers, maybe results recording sheets and marketing slicks, and puts them to use. Such materials are available from McKesson, for example, or from allergen manufacturers.
Training, if it’s available at all from the seller, is a video or once in a while a single live demo that costs extra. There’s no opportunity to ask questions, and no expert-coached clinical, or supervised first test on a patient or volunteer. Even if the program is able to get started on that basis, there’s no expert immunologist or allergist available for consults if the program later encounters difficult medical cases, such as strange reactions, unusual medications, or novel medical histories. In other words, the commodity model treats running an allergy program just like buying strep tests or tongue depressors.
Sellers of this allergy program model do not typically name the business model at all. They’ll just say “allergy test kit” or specify individual test components for purchase.
The commodity allergy business model is sometimes, by some calculations, the least expensive model for point-of-care allergy testing. Therefore, it can be the most profitable on a per-test basis. But it’s a rare clinic that can make this model succeed long term. Setting aside how a clinic running this model would provide treatment options, which is no small issue, successful operation of this model is almost exclusively limited to clinics who already employ a trained allergy technician as an MA, PA, or nurse. If that person leaves without fully training a successor, the program goes away, too.
The Third-Party Staffing Allergy Model
On the other end of the spectrum from the completely unsupported commodity model is the fully third-party allergy model, where the clinic hires out the whole program but it still operates within the clinic. This model requires no in-house expertise because clinic employees themselves have virtually nothing to do with it, save for having to work around the third party and in spaces the third party isn’t occupying.
This third-party staffing model goes by many confusing or misdescriptive names, including Allergy as a Service or AaaS, allergy management service, and even turnkey allergy program, even though the clinic never gets the key, so to speak. The model is largely the result of the powerful business case for allergy, meaning the impressively large ratio of reimbursement to cost. That large net revenue per test allows for revenue sharing and other financial arrangements that seem to make the third-party model attractive.
Usually the third-party staffing model works best, where it’s legal, in high-volume practices with real estate to spare, and only limited concern about clinic cultural fit. The culture question comes from the diminished control over selection of the third-party technician operating within the clinic, who may or may not have the desired training, expertise, bedside manner, and so on. The legal question is because corporate practice of medicine laws prohibit some third-party allergy providers from operating inside clinics in roughly half of the United States.
Finally, while third-party staffing models do provide a fully comprehensive allergy program, usually including treatment options, they also come with considerable opportunity cost. Clinic time and space can’t be devoted to ordinary, revenue-generating medical activity while they’re reserved for use by the third-party allergy company, regardless of whether any allergy activity is actually occurring. The idleness of the exam rooms in this case is a double whammy as well: the clinic is simultaneously missing native revenue generation and paying the third-party company that’s fruitlessly occupying the space. Careful three-way scheduling can address that issue, but adds complexity all its own as clinic staff attempt to coordinate availability of space, patients, and third-party technicians.
The Comprehensive Self-Staffed Allergy Program
Combining the best of both the commodity and third-party models, without the downsides, is the comprehensive, self-staffed allergy program model. This model is the only one that can truly be considered turnkey. The commodity model is certainly self-staffed, but lacking adequate training and expert support, can’t be turnkey because it’s not something a clinic can set up on its own. The third-party model isn’t turnkey because while the third party sets it up without effort on the part of the clinic, it’s never turned over to the clinic, and the clinic can’t run it alone. So it never gets the key, so to speak.
With a comprehensive self-staffed model, the clinic obtains all the materials it needs from a single source, gets all the necessary training from that same source, and as the program runs can always turn to that source for expert advice and more training as personnel cycle through, as often as needed and at no additional cost without long-term contracts. In other words, the supplier sets up the program and supports its instantiation to the point where it’s running well and independently with the clinic’s own staff, then hands over the keys. For a deeper explanation, see what a true turnkey allergy program actually means.
In addition to being legal in all 50 states, this model is likely to be less expensive than the third-party staffing model because the clinic is not paying for the third-party staff. Also, despite having no long-term contract requirement, the availability of repeat training and expert consults in this model means it’s sustainable over time. Consequently, the comprehensive self-staffing allergy model is likely to be the most profitable over time, year after year.
Treatment Options
Regardless of business model, a comprehensive allergy program should include treatment options, of which, generally speaking, there are two: subcutaneous immunotherapy, or SCIT, and sublingual immunotherapy, or SLIT. Without offering treatment too, testing presents a red flag for audits. Nevertheless, not all programs offer treatment. Perhaps needless to say, treatment options should therefore factor heavily in the consideration of which business model, and which supplier, is best for a given clinic.