Beyond The Brand

The Insurance Maze

Are you finding your way? A look at 6 effective strategies for making money with managed care.

Since insurance business is an ever-increasing part of ECPs' patient base today, many are finding creative ways to boost profits while navigating the third-party world. In fact, some view managed care as a true opportunity center.

"Utilization rates were unusually high for the first part of 2009," says Jerry Hayes, optical consultant, "because people were afraid of losing their jobs and rushing in to use their benefits. So, managed care kept patients coming into ECPs' offices in a down economy."

This phenomenon kept retail sales humming in the first half of 2009. "Our ECPs told us that the fl ow of VSP patients was doing a lot to keep their offices going," says Gary Brooks, president of VSP Vision Care, which serves 65 million people nationwide through 25,000 ECPs.

Interestingly, revenue from private plans accounted for 43.3 percent of ODs' total revenue in 2007 and 24.5 percent from public plans, according to the American Optometric Association's (AOA) 2008 Third-Party/Managed Care Survey. With the right tools, eyecare professionals can make a profit with insurance patients. Read on for a roundup of six effective strategies for managing managed care to your benefit.

1 Sell Eyecare First

According to Robert C. Bell, the head coach with EyeCoach, an optical consulting firm, ECPs will benefit from focusing on quality eyecare versus insurance reimbursement. He says many ECPs get off on the wrong foot by asking patients first if they have insurance.

"This is not the purview of the ECP," he says. "Take a step back�you're not their benefits director. You're an ECP and your focus should be on how well you can make them see."

2 Look to Dispensing

Experts recommend looking beyond the exam chair for insurance profits. "As physicians' fees get cut more and more, many are turning to dispensing as a revenue source," says Pam Fritz, president of Ophthalmology Resources in Clinton, CT. The key is to have a good frame buyer in place who can manage an inventory appropriate for the patient base and insurance plans covered. "You have to have frames that fit the price points within your plans," says Fritz.

Dispensers can also profit with patients who use their reimbursement to trade up to higher-priced products. Bell recommends keeping the lowpriced insurance frames in drawers and not on frame boards. "Pull five or six frames for the patient, including low-priced options if cost is an issue," he says. "Tell them 'Here are the best frames for your prescription' and start off with the most expensive or best-made frame and have the patient try them on. I also suggest telling them to look at their insurance as a discount plan that enables them to buy a better product."

3 Profit by Selling Up

On that note, many experts recommend training staff in the art of up-selling. "When a patient says 'How much is this going to cost me?' I tell our staff to say 'It all depends on how well you'd like to see,'" says Allan Barker, OD, with Eye Care Center in Rocky Mount, NC. "We typically offer them three levels, saying 'Your vision plan will cover the lower level, we recommend the top level, and this is in the middle.' Don't push them into anything, just explain the choices and let the patient tell you."

The bottom line is that ECPs need to focus on areas where profits can be made. "You'll be bankrupt if all you do is single-vision lenses with no add-ons," adds Barker.

4 Assess your plans

One of the most targeted ways ECPs can turn insurance business into profits is to select the right plans to participate in. "You don't have to participate in every plan that comes along," says Barker. "Set business criteria and accept the plans where you can make a profit. If you can't make a profit, then don't participate."

Busy practices also only have a limited number of exam slots available and experts recommend filling up those valuable spaces with patients who have solid insurance plans. "Why fill them up with people who have unprofitable plans when you can fill them up with premium plan people?" asks Barker.

While assessing plans it can also be helpful to assess procedures and processes. Taking a realistic look at insurance traffic can reveal the different steps ECPs can take (such as getting paperwork done up front and allowing for a longer visit) to streamline the day.

5 Designate A Plan Guru

Every office will benefit from having a staff member who is an expert on the plans accepted, including private, government and state programs. "You need someone like an optical manager, office administrator, or lead optician to be on top of your insurance plans because they change so often," says Fritz. "They will know how to maximize reimbursements and interpret plan benefits so they can train the rest of the staff on this."

This is also the point person for processing claims; an expert who knows how to file them, with a particular focus on coding and reimbursement for exam fees to get the best reimbursement. They will understand the importance of filing with timeliness, accuracy, and ease. "Many offices make mistakes in this area and lose money that way," adds Fritz.

6 Get Schooled

Lastly, ECPs can often turn to their vendors for information and education to help them succeed with managed care. "Leaders in the industry have a responsibility to help our ECPs better navigate this," says Howard Purcell, OD, FAAO, Essilor of America's Vice President of the Customer Development Group.

Essilor offers educational webinars to customers and also delivers solid managed care information via its sales associates, who are educated in the nuances of today's plans. Also, plan providers themselves can be an excellent resource for information. "We provide ongoing education about our plans and how they work to help make it easy to deal with us," says VSP's Brooks. "We also sponsor a lot of professional and continuing education."