FEATURE | OBAMACARE

Obamacare…

FRIEND OR FOE?
The potential impact on eyecare professionals as providers and business owners

BY WILLIAM J. NOLAN

mUCH HAS BEEN WRITTEN AND DISCUSSED ABOUT THE AFFORDABLE CARE ACT and the potential impact on today’s practicing optometrists and other eyecare professionals. Much of the discussion centers around the potential negative affect on patient care, net income, and the political landscape surrounding its passage.

This is not the first time the profession has faced issues surrounding managed care and third-party payment entities. And, though the Affordable Care Act engenders a great deal of angst and worry in all healthcare providers, it may not be as threatening as first thought.

No one is better positioned in the eyecare marketplace to provide the mandated care and service contained in the Affordable Care Act than today’s optometrists. As a profession, you have the skill set, the distribution of providers, and expertise to be a major player in this arena.

NEW MIX

The landscape of the independent optometric practice has evolved tremendously over the past several decades. The next decade will see an even greater change for practicing optometrists in terms of the mix of revenue sources and how the business of optometry will evolve. The traditional mix of retail product to professional care will change dramatically. In many practices, the historical mix of 60 percent optical to 40 percent professional fees will most likely change. With the advent of more and more online competitors, revenue sources (and mix of products carried) will most likely change. However, this will not be the only area of a practice that will evolve in the years ahead.

Over the last 30 years, optometrists have seen their scope of practice expand beyond refraction and optical to include diagnostic and therapeutic services. In some states, legislation has given minor invasive privileges to optometry. Medical opportunities for optometrists continue to expand as an increasing number of states are now allowing O.D.s to prescribe oral medications to patients. These added specialties can create a lucrative source of revenue for doctors while requiring less overhead than traditional revenue resources.

What does this mean for independent practice? It means optometry must be more deliberate in managing and evolving their practices. They need to become even more deliberate in the optical dispensary, while also broadening their focus to include the new opportunities arising in the field. Where are these new opportunities? Can you say “medical optometry?”

FULL PARTNER

The Affordable Care Act may be just the mechanism to help continue the push of optometry to being a true full partner in the healthcare delivery system. The Affordable Care Act has many unknowns, and the jury is still out on the implementation process. But there be more good than bad in the long run.

Besides being a good clinician, every practice owner also has the responsibility to run a good business. Not only is adding medical optometry professionally rewarding, but it has the potential to be lucrative, too.

Consider, for example, a patient being treated for glaucoma. There is no real cost-of-goods-sold, but rather clinic overhead or chair cost, which means a high profit margin. The professional fees can be as great as a single pair of glasses but with no 30 percent cost-of-goods-sold factor. The margins in medical optometry are very good.

This doesn’t mean that maintaining an optical can’t still be profitable. It can! But in order to remain competitive, one must be open to opportunities that come with adding in a more specialized medical model.

This is an exciting opportunity for most doctors. The expansion of the medical model could mean higher profit margins. It definitely means a greater ability to diagnose and treat ocular conditions, as well as find a specialty you are passionate about and expand your knowledge and services in that area.

It also means more loyal patients; the optometrist who diagnoses a patient with high blood pressure or diabetes will have a patient for life. The future of optometry is bright and full of rewarding professional opportunities—if you are willing to evolve.

Bill Nolan is president, practice transitions and acquisitions, of the Williams Group, based in Lincoln, NE.

HOW TO STEP INTO THE MEDICAL MODEL

Here are some practical suggestions of steps to take to transition toward a more specialized medical model of practice and avoid falling behind the competition.

1. SEEK OUT OPPORTUNITIES TO JOIN A STATE HEALTH EXCHANGE BOARD.

With the Affordable Care Act (Obamacare) and a continued push for universal healthcare, these boards will play a key role in future legislation. The credentials from being part of your state’s board will also increase the perception of value your patients have of your expertise.

2. BECOME MORE COMPETITIVE IN YOUR OPTICAL.

While cutting prices may seem cost-prohibitive, you must remember that your customers are increasingly being courted by online retailers. It is critical that you carry lines of frames and lenses that are priced competitively while educating your patients on the superior quality and value they receive at your practice.

3. PARTNER WITH A LAB OR OTHER VENDOR TO OFFER AND SELL GLASSES ONLINE.

There are currently several vendors offering this option to O.D.s, and many more will likely follow suit in the near future.

4. BE WILLING TO SERVICE PATIENTS WHO BUY THEIR GLASSES ELSEWHERE.

Consider providing an optical service package plan (see sidebar on page 94). Don’t necessarily provide a warranty.

Offering to conveniently service the frames will keep patients coming back to you at the low cost of a little employee time. And, if the quality is poor, you’ve just regained an optical order.

5. COMMUNICATE YOUR ABILITIES.

It’s easy to assume your patients know what you can do, but they don’t. Patients are often amazed to hear that their optometrist can help them manage their diabetes, provide CRT, and even identify and treat visual disorders that may have been misdiagnosed as behavioral or learning disorders in children. But, they won’t know about any of this unless you tell them.

6. FIND A SPECIALTY.

One of the most rewarding and profitable ways to bring in more revenue is to find a specialty. Whether it’s vision therapy, dry eye treatment, CRT, or low vision, find something you’re passionate about and translate it into the way you practice.

7. NETWORK WITH OTHER PROFESSIONALS.

Build close relationships with other professionals like an internist, family practitioner, etc. Also, hold seminars for educational professionals such as school nurses or pediatricians on the incidences of child behavioral disorders related to vision and when they should be referred to you for an eye exam or vision therapy.