Today, you need to take a long look at both the brutal facts and the opportunities facing your practice so that you can plan for a profitable tomorrow.
So take the long view. Here’s what you can expect on the road ahead.
1. Obamacare presents financial hazards—and opportunities. Forty-nine percent of eye care professionals say healthcare reform is their biggest financial concern, according to an Eyecare Business market survey.
So far, ACA has been a mixed bag for vision care. While 61 percent of eye care professionals have reported a decrease in profit margins, there are opportunities. For instance, many medical plans now cover wellness eye exams for children. These services don’t produce large profits, but they do bring in new patients, which can make all the difference.
2. Profits will begin to drop at two to four times the current rate, predicts Dan D. Chambers, MBA, COE, chief administrative officer at the Key-Whitman Eye Center in Dallas, TX. “In a traditional ophthalmology practice with an average overhead, a 10% reduction in collected revenue will require a nearly 30% increase in patient volume to sustain a physician’s present income,” Chambers estimates.
Labor and benefits will likely take the biggest bite out of your vision care practice’s profits, says Chambers. To offer competitive benefits to your staff, some of which are now mandated, many practices will need to focus on practice management and on bringing new patients in the door.
3. The old days of doctors ignoring the business side of their practices are gone. Yes, you need to hire smart back office staff to handle marketing, billing and other revenue boosts, but you also need to stay involved yourself. “Put no fewer than eight hours per week into co-managing the practice with lay management staff,” advises ophthalmic practice management consultant John Pinto.
4. More practices will turn to OD-MD co-management as a survival strategy. “The ratio of ODs to MDs will grow from one-to-one ratios to two-, three-, and four-to-one ratios,” Pinto predicts. “By 2024, group ophthalmology practices without material optometric staffing will be rare,” he writes in an Ocular Surgery News article.
5. We will see more non-physician practitioners in vision care. “To optimize clinical staff to the highest levels, practices will likely hire more Nurse Practitioners and Physician Assistants, Chambers says.
6. Practices continue to take the slow ride to technological change. Like the most diehard Foghat fans, vision care practices take it easy when it comes to some kinds of technology.
While 75 percent of ophthalmology practices have EHR, only 50 percent of optometry practices do.
And while social media can be a powerful marketing tool, regulatory concerns prevent many practices from racing full speed ahead. Nearly half of surveyed eye care practices have a Facebook or Twitter account, according to Eyecare Business. But only 30 percent of those practices post at least once a week on social media, with most practices posting much less frequently. It remains to be seen whether social media becomes a dead end road for marketing.
7. You may have to merge with another health care organization just to be able to afford your clinical equipment. Larger practices can justify the cost of cutting-edge eye care and surgery equipment because it bring in higher volumes of patients, but “smaller practices simply won’t be able to afford new technology” with fewer patients using the services, warns Chambers. Consolidation will be one way to pay for climbing technology costs.
8. Your practice manager will need to be a geek. To make a practice profit today, office managers need to master HIT, data mining, financial benchmarking, health care policy and more. If you have a great practice manager who is weak in one of these areas, get her training or hire support staff or consultants with these competencies