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Each year the Optometric Business Academy releases their survey results for practice stats of Walmart and Sam’s Club affiliated doctors. (The OBA should not be confused with the MBA, Management and Business Academy run by the same sponsors for private practice optometrists.)

The OBA has the 2012 metrics for download here, and you’ll probably have to log in to get it. Even though it is the 2012 report, it’s really analyzing 2011 stats.

If you were to guess the most likely day an optometrist takes off, you would guess Sunday, of course. But did you know the second? Turns out that about a quarter of us take Mondays off. That’s me, too. I like to pretend I have a weekend.

And seriously, here are some points they make that I ordered and would like to discuss:

1. Typical affiliated ODs spend less than
   0.5 percent of gross fee income for
   marketing. The median expenditure is
   $500 annually, a sum insufficient to fund
   any significant initiative.
2. Affiliated ODs are generally less
   active in service improvement processes
   recommended by service experts than are
   private practice ODs.
3. Among the major advantages of hiring
   staff is the ability to shape a service
   culture and service standards to deliver a
   consistently excellent patient experience.
4. …only a minority of affiliated practices actively market medical eye care services today.

Okay, #1. Part of the reason that I don’t spend on advertising is that I don’t collect a lot of money to do so AND I’m in a high traffic location anyway, so spending a lot on external marketing doesn’t make a lot of sense. Maybe Sam’s Club doctors should spend more, but one of the advantages of being a Walmart doctor is that my marketing budget can be low since I have more awareness by default. Also, private practice doctors spend more on marketing because they sell $500 pairs of glasses. I only collect money on exams. My gross is much less, so my overhead should be less and that includes the marketing dollars.

#2 and #3 are related. Again it goes back to overhead. If I wanted the headaches of hiring, paying, training, providing benefits, scheduling, managing complaints, and firing staff…then I would be a private practice doctor. If I let Walmart handle the headaches, then why can’t I also let Walmart handle the service improvement process while I make the occasional suggestion? Also, where am I supposed to get all this money to compensate the staff I hire? If I’m a one-room doctor whose appointment book is not full, then what incentive do I have to spend money on staff? If I’m a doctor whose appointment book is starting to get full, it’s a big cut in pay for me to hire more staff, hope business picks up, and somehow try to change exam-traffic flow in a Walmart optical floor plan.

Speaking of which, where does my hired air-puffer do my insurance billing when they’re not taking acuities? There is no nurse’s station. The Walmart floor plan needs to change before I get crazy and hire a staff of people.

#4. I’ve been hearing for years about how we’re supposed to be on board with the “Medical Model” which is a code word for billing a lot more medical insurances, which is more code for jacking up your medical fees because “you don’t want to leave any money on the table.”

First, there are three major insurance carriers in my area who only allow ophthalmologists on their panels- no optometrists. Second, if I start seeing a whole bunch of medical insurance people, then my accounts receivable will go up, and these are sicker patients who take up more time in the chair. Then I’ll have to start raising exam fees. Once I start raising exam fees, business will taper off because that’s the whole reason most people come to Walmart: the exam is cheaper.

Some people think it’s fine to charge a wildly different exam fee for “medical” vs “routine vision,” but I’ve addressed this topic elsewhere. In summary, I don’t think having a $50 “routine” eye exam while charging $150 for a “medical” eye exam is ethical.

On the other hand, I would love to charge some patients more if their case is complicated, but try explaining that to someone who got quoted a certain price, so that’s why they signed up for an exam. They won’t be happy paying more than they expected.

I wouldn’t mind having an hourly rate. I think that would be more fair for everyone except the insurance companies.

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Tags: Consultants, Income, management, MBA, metrics, OBA

I got a very special e-mail today (see below for full text). After a huge campaign which cost taxpayers…well, nothing, I’m one of the few optometrists who have been selected to attend the Walmart annual Health and Wellness Conference for 2010.

I intend to blog about my experience daily. As one of the few selected, I imagine there will be an occasion for me to express concerns and ask questions. If you have any comments or questions you would like me to consider voicing in Bentonville, then please write it in the comment section below. (Please be serious and civil.)

Here’s that e-mail:

Dear David Langford

Historically, the annual Doctor meeting was primarily focused around Optometry. As our health and wellness businesses continue to become more integrated, we seek to further expose the important work of health care professionals to the greater Walmart organization. We also want our senior leadership to better understand the difference you are making every day in the lives of our patients. With that in mind, we will be hosting the Health & Wellness Conference May 3-5th, 2010 in Bentonville Arkansas.

You have been chosen through a nomination process to take part in this exclusive gathering of professionals; you’ll hear from the executive leadership of Walmart on our company’s ongoing growth strategy; discussion from governmental and NGO’s on health care reform in America as well as inspirational messages from medical visionaries on the impact they are making within their communities.

We have made several changes of this conference design from years past. For example a smaller more intimate gathering will facilitate the opportunity for you to interact with and learn from key leaders as well as your peers. Representatives from all of the Walmart Health & Wellness business units will take part including professionals from the practices of Optometry and Pharmacy as well as our Clinic Operator partners in addition to select representatives of our internal support teams.

In addition we elected to conserve time and resources in an effort to present a holistic message around health care and the challenges that our customer, health care professionals and company is facing today, therefore CE credits will not be offered at this meeting. And as this meeting has been limited to a select group of attendees, we are asking that spouses not attend.

We look forward to having you take part in the Health & Wellness Conference 2010. Please click the View Event Summary link below, view the event details, and respond by clicking either the Yes or No button at the bottom of the invitation. Or you can simply select the register button on the Event Summary website. Registration will close on March 13th, 2010

Thank you,
Health & Wellness Professional Affairs

Tags: commercial, Consultants, optometrist, Wal-Mart, WMHWC2010

There is a not-so-simple question that pretty much every patient asks, “How much is your eye exam.”

While the medical model has varying levels of exam, like Level II-New vs. Level IV-Est, which depend upon the history, exam, and complexity of that particular case; however, there are some among our profession that make it an especially hard question to answer, and this issue raises concern over the ethics of a fairly popular fee structure.

For example: the price in front of the Big Box says “Eye exams starting at $45!”
But are they really? Sure, for a “routine eye exam” where nothing is wrong and you just want your glasses updated, then it’s the $45. But what if I have some allergy eyes, so the doctor gives me a prescription for Pataday as well as my glasses Rx? All the sudden the exam somehow costs $120!?!?

Huh, something funny going on around here. I think big box doctors are more likely to do this since their exam fees are so low, they make up for it by gouging in other fees. I have no problem with a doctor who says their S0620 is $100 and their 92004 is $120. However, I think there is something wrong if the S0620 is $45 and the 92004 is $140.

It’s like some among us in the optometric profession are playing the windshield chip repairman scheme.

But what really happens? Patients won’t typically notice this bait-and-switch. It’s really the insurance companies who get hammered. The patient pays their copay, and if the doctor can come up with any excuse to bill a medical code, they use their medical model fee structure to justify it.

Ethics applies when we realize that, for some reason, private pay patients are rarely charged the same high fees as the insurance companies. Huh. Oh well. It’s a victimless crime because those big, bad insurance companies won’t miss the extra cash. Until we realize that the more insurance companies pay out, the more the patient’s premiums will be raised next year. Whoops. Sorry, Mrs. Smith, that you can’t afford to keep your medical insurance in the future because I wanted to get paid double or triple my usual fee because you have insurance today.

By the way, it cost me about $2000 to bill insurance last year (PIM software license, E-filing charges, and postage/paper for mailing statements/refunds). Also add to that the cost of time spent filing claims and handling overpayment and underpayment. If I didn’t have to deal with insurance, I could drop my exam fee by at least $5 per person.

I have an idea: All patients should pay for office visits out of pocket. If they have insurance, get reimbursed later. The doctor won’t know about their insurance, so there won’t be a conflict of interest about what exam fee structure he’ll choose. The doctor can lower his fees since filing claims is expensive and time consuming. Everyone wins. Another idea, insurances should allow me to charge either them or the patient a $5 claim filing service fee.

Take home point: I don’t believe it is ethical to have one fee structure for insurance patients and another drastically different one for private pay. Yes, I’m all for charging more money if something is more work and more time. That’s why a contact lens evaluation is paid on top of the routine eye exam. That’s why there are different levels of 99*** office visits. But sneaking a huge fee onto an insurance claim just because there is some medical code excuse is something I don’t think our profession should feel comfortable with.

Tags: Comics, commercial, Consultants, Income, insurance, optometrist

With Walmart’s announcement of a sweeping change about getting out of the business of billing vision insurance companies for their doctors, a whole new cottage industry has sprung up. Businesses are soliciting Walmart doctors to let them handle all the insurance billing.

Yup, I’ve said it before and I’ll say it again. Ophthalmic vendors think we optometrists are so stupid. Just because we picked this profession, they think we are prone to making poor financial choices just like some people are accident prone.

Any of you vendors seeking to do insurance billing for me are wasting your time. All I need is my practice management software and Apex EDI. It’s as automated as can be. Most of the vision insurances have their own website for authorization and billing, and then I use Apex EDI for my BlueCross, Medicaid, DMBA, and other miscellaneous insurance companies. (You can do Medicare also, but I am disinclined to participate with them.)

Apex EDI works great. It’s fast and easy. And I don’t need no stinking slick Rick to be some unnecessary middle man. It’s cheap too. I pay 43 cents per claim, less than a postage stamp these days. I also pay the extra $20 a month for the ERAs and Electronic Tools which make my life a lot easier, so it’s worth it.

Call up Apex EDI and tell them I sent you. Use my Champions Code (sales code) to get a better deal: Champ148. I use it in my practice (VisionHealth EyeCare PLLC), and you can use it in yours without the growing cottage cheese industry of Walmart insurance billing middle men.

[Note to Slick Ricks: Any more “comments” made by you to advertise your middle man services will be marked as Spam and deleted. Do us all a favor and go con some other profession.]

Tags: Consultants, insurance, management, Wal-Mart

For those of you eye doctors who are out there, on your own, man or woman against the world (i.e. Private Practice), you may get some assistance from this website:  theopticalvisionsite.com

It appears to have lots of useful information regarding running your practice and other stuff they never get around to in optometry school.  You may want to bookmark it or subscribe to their site feed.

Tags: Consultants, private practice

There was an interesting article written at the AmateurEconomist.com about “Why Doctors Are Not Good Businessmen.”

Hat tip to Kevin, M.D. who commented on this story and said,

“This is why the private practice model of medicine is dying. More practices are being bought by hospitals where the physicians are salaried. This relieves the burden of administrative tasks and supervising ancillary staff, so that the doctor can focus on medicine.”

Rob at VSP says that “[private practice doctors] provide the best care.” Well, if I’ve got the weight of a business on my shoulders, doesn’t that detract from patient care? Additionally, in our field where the private practice doctors sell what they prescribe, can you totally rule out any conflicts of interest which potentially detract from patient care?

Again, independent doctors of optometry in a Wal-Mart setting don’t have the conflict of interest and their administrative duties are much less than private practice.

What’s funny to me is that every CE event I’ve been to always has some talk about why optometrists should start the “medical model” in their practice and watch the money role in. Well, how is adding more third party payers going to help you make more money? Primary care medicine is dying according to Kevin M.D., and yet the roboconsultants are telling us to join more insurance panels. I think getting rid of insurance companies in your practice is the way of the future.

The roboconsultant woos you buy saying that for one case of dry eye you can milk an insurance company for $500-$800 in office visits and procedures. Well, do you do that for every dry eye patient, even the poor self pay patient or the patient with insurance but poor benefits? I would think that doing it just for those with good insurance would be unethical as well as probably insurance fraud.

I think the more your appointment book is filled up, the more you should be able to charge for your services. It’s the old supply and demand of free economics. I think a better system would be for patients to have to front the money to pay the doctor for office visits at the time of service. The patient would have to get reimbursed what they can from their insurance company. Maybe then insurance companies would be forced to have a faster turn around time on processing claims for their patients and be watched more closely for just rubber stamping a denial based on some frivolous billing exercise (or at the least the patient has to worry about it instead of me.) I simply provide the best care for the patient, recommending only the products and services that they need, since now I don’t have to worry about getting paid.

Tags: commercial, Consultants, insurance, optometrist, Wal-Mart

So Rob’s Blog has this to say to people about getting yearly diabetic eye exams. As if optometrists in a commercial setting don’t do the same thing, he tells a big lie here:

…these [private practice] doctors consistently have the longest relationships with their patients and provide the best care.

Rob, people aren’t buying what you’re selling anymore. I see VSP beneficiaries out of network all the time in my Wal-Mart setting. I guess they aren’t loyal to a practice setting, but rather they factor in price and convenience while assuming, correctly, that any doctor they see in my area is competent.

Oh, and I remember when Intel in the Hillsboro/Beaverton, Oregon area was buying your VSP, and then they switched to EyeMed. Does that mean they thought your private practice network of doctors couldn’t “provide the best care?”

But I see what he’s trying to do. Any roboconsultant will tell you that you need to differentiate yourself from the competition; however, I take exception when he lies.

Tags: commercial, Consultants, insurance, private practice, Wal-Mart

The Independent Urologist has an excellent post about surviving your first 1-2 years of private practice, should you be insane enough to try. I think he makes a great point, you need much more money in working capitol than capitol equipment. That was part of my problem, I ran out of money, had to get a job 4 days a week outside the practice just to pay the bills, and that left much less time available to grow my own practice.

My financing company wouldn’t give me very much money as working capitol. They capped it as a percentage of the total loan. You’ll note that a urologist has less equipment costs than an optometrist with an optical. If I were to do it again, I would find out all the companies like Altair that give you frames on consignment. I also wouldn’t buy fancy digital phoropters and Officemate Exam Writer. I would go cheap as possible on everything- bootstrap. That’s the only way you’ll survive until the break even point.

And I wouldn’t hire a practice consultant that takes $13,000 of your borrowed money either. Practice consultants will make you think that if you build it, they will come. It’s pretty expensive flavor-aid to be drinking. You’ll get all the information you need from internet searches and free resources like the Management and Business Academy. Also, a good buying group like C&E Vision has excellent resources to help you see what numbers you should be putting up.

By the way, did you know Wal-Mart docs have the Optometric Business Academy? I hope that you didn’t really think that vendors (like Ciba, Essilor, Topcon, and Transitions) only look out for private practice docs.

Also the IU notes that while he now has a positive cash flow, he estimates that he has lost ~$200,000 in income by starting up his own practice. If you start off practicing in Wal-Mart, then you have income from the get-go. I know of doctors working for other optometrists for ~$50-60K pre tax salary for a few years with the hope of buying into the practice. Even if they are allowed to eventually buy in, what about all the income lost? They could have been making $120K+ pre tax net while working with Wal-Mart.

Tags: Consultants, private practice, suppliers, Wal-Mart