Welld Health | How Much Money Can I Make from Medicare Diabetes Prevention Program

Chasing the MDPP Money

Do it right and the MDPP can really pay off

When discussing Medicare's Diabetes Prevention Program with health club managers, they eventually always ask me: “How much money can we really get back from Medicare on this program?” Here are some insights into how this program can be a lucrative offering to positively affect your bottom line.

Reimbursement Payments

Working with a Medicare reimbursement schedule is often new territory for fitness clubs. First, let’s get a handle on what reimbursements are possible and then we’ll talk more about the full revenue impact of the program.

Performance Goal	If participant loses 5%	Without 5% weight loss
1st session attended	$25	$25
4 sessions attended in Months 1-6	$50	$50
9 sessions attended in Months 1-6	$90	$90
2 sessions attended in Months 7-9	$60	$15
2 sessions attended in Months 10-12	$60	$15
5% weight loss achieved	$160	ineligible
9% weight loss achieved	$25	ineligible
Total Year One Possible Reimbursement	$470	$195
2 sessions in Months 13-15	$50	ineligible
2 sessions in Months 16-18	$50	ineligible
2 sessions in Months 19-21	$50	ineligible
2 sessions in Months 22-24	$50	ineligible
Total Reimbursement for Entire Program	$670	$195

Under the heading of making hay while the sun is shining, you can see that the potential to earn reimbursements from year one is the highest. Your initial time investments are higher but participant engagement is likely to be higher during that first year, too. Therefore, it's crucial to capture early enthusiasm to help cement a new healthy lifestyle and keep them coming back for the program sessions. Participant retention is going to be a key marker to watch as your program ages and more people are moving through the phases.

Additional Revenue: Consider Offering a Fitness Program

Medicare strictly disallows a fitness center from requiring that a Medicare beneficiary purchase a club membership. However, if you are already offering a short-term program like Exercise is Medicine, p.r.e.p. or 60 for $60 you can extend that offer to your DPP enrollees as a supplemental program. This will allow them to have full access to your facility for the duration of the fitness program, help them become comfortable with the club environment and gain the confidence they need to go ahead and purchase a regular membership. A DPP participant can always simply elect to purchase a regular membership contract, too. Sometimes, it’s nice to have that extra layer of hand-holding to get them past any anxiety that might exist.

So How Much Can I Expect?

Let’s take a look at a simple model to see potential revenue for a 10-member cohort (a group of participants) using some industry averages for membership fees and other charges:

Expected Revenue	Assumptions	First Year	Lifetime (30 mo)
Reimbursement per Participant	5% weight lost	$470	$670
Fitness Program Revenue	Two-month temp membership @ $60	$60	$60
Additional Services	Upsell merchandise, cafe, etc.	$200	$500
Annual Membership Dues	If converted, $50 per month	$600	$1500
Total Revenue per Participant	Without annual membership	$730	$1,230
	If converted to annual membership	$1,330	$2,730
Revenue per 10 Person Cohort	50% conversion rate	$10,300	$19,800
Total Annual Revenue	6 Cohorts per Year	$61,800

The Bottom Line

As you can see, it’s entirely possible to make the numbers work for your facility. The cost to get started can vary widely and can be minimalist or robust. The choice is yours to decide how much to invest on the outset, the costs of running and marketing the program from week to week and training your teams. You’re the authority on that side of things, so I’ll leave it to you to determine how you want to grow the margins.

And while the bottom line can look really good, what looks even better (and what keeps me coming to work everyday) is the knowledge that I’m helping people reverse course and find a healthy way to live before diabetes ruins their quality of life.

We’re here to help.