Practice Management
July 2021
by William Rabourn Jr.
While few of us would say we are grateful for the forced lessons of 2020, we are nevertheless left with a deeper understanding of the strengths and weaknesses of the ophthalmic practices and ambulatory surgery centers we serve. While it is also true that most of us would rather watch cement dry than stay on the subject of 2020, looking at the yearlong impact on eyecare allows us to revisit and rearrange priorities to maintain healthy, stable, and durable ophthalmic businesses capable of generating pre-pandemic revenue levels, which many have yet to reach.
Read through some of last year’s lows to understand the landscape. Then check out how the lessons we learned can help your ophthalmic business reach new goals in 2021 and the future.
Where we were
Back in Q4 of 2019, the eyecare industry was finishing strong leading up to what was supposed to be a great marketing opportunity to spin 2020 into the year of perfect vision. Management focuses trended toward growth and acquisitions, with cost management trailing the list of priorities. Then, just as we started to settle into our strategies, the latter part of March hit us with an almost complete shutdown of eyecare practices across the nation. The rest is quite literally history.
People will be talking about 2020 for years to come, but unfortunately no one will be marveling at the iconic 20/20 vision marketing taglines. Instead, we will discuss things like:
- Medicare patient spending dropped almost 57% in March and April 2020.
- Ophthalmology was reduced by 29% during the first 6 months and stayed down through the summer.
- ASC revenue dropped by 90% in April due to no elective procedures.
- March, April, May, and June created a gap year for patient recalls in 2021.
Where we are
How are things looking now? Jobson Research regularly surveyed ECPs and optical retailers since mid-March 2020 to measure practice performance. In Wave 21 (conducted March 26–30, 2021) of its Coronavirus ECP Survey, findings showed double-digit improvement from 2020 to 2021 in profitability per patient (+18%) and number of patients per day (+22%).
However, when 2021 performance was compared to 2019, the number of patients was still down 8%, and profitability per patient was down 5%.1
Additionally, Wave 21 findings showed optical sales were flat and optometric practices were operating below capacity, which 42% cited was due to lack of staff.
Where we could be if we revisit spending priorities
Depending on where it is located and what kind of ophthalmic business you are a part of, these statistics may or may not reflect your current situation. However, if you can relate to even one of them, revisiting your business priorities is vital to bringing operations up to at least March 2019 levels.
It is likely that 2020 has already moved cost management to the top of your priority list. In addition to that, consider switching your strategy focus from growth and acquisition to retention if you have not already. Focus on making the most of what you currently have. Look inward at opportunities for what could be called “same-store growth.” This includes analyzing your:
- Profit analysis
- Top-line growth
- Per patient revenue
- Revenue per encounter or max opportunity
- Vision plan exams vs. medical exams
- Retail opportunities
Other internal opportunities to bring revenue up may include getting creative with practice modifications and embracing technology, such as:
- Extending hours of operation
- Adding a mobile location/s
- Tightening control on supply chain management
- Mobile appointment check-in
- Text communications (appointment confirmations, recalls, patient education)
- Virtual patient consultations
- Remote billing, call center, and triage functions
- Telehealth visits
It is important to know where you have been and understand where you are in order to prepare to move forward. As ophthalmic businesses move forward, those with the best, most durable strategic plans will incorporate lessons learned from 2020. Many of us had grand plans for 2020, “the year of perfect vision,” but the reality was we lost a significant amount of ground. Our challenge will be to make it up, then move full speed ahead.
About the author
William Rabourn Jr.
Managing Principal
Medical Consulting Group
Springfield, Missouri
Reference
- Staff. Many Eyecare Practices Still Operating Below March 2019 Level, Wave 21 of Jobson Research Survey Finds. Vision Monday. April 5, 2021. www.visionmonday.com/eyecare/coronavirus-briefing/jobson-ecp-coronavirus-surveys/article/many-eyecare-practices-still-operating-below-march-2019-level-wave-21-of-jobson-research-survey-finds/.
