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PRACTICE MANAGEMENT

Five New Year’s Resolutions for 2014

1. Chart a Course

Every business plan has to start with a realistic self-appraisal of the previous year, including financial goals met or missed, staff performance, identification of practice strengths & weaknesses, and identifying the causes of both any problem areas and strengths. Unfortunately, too many eye care practices find it all too easy to get caught up in the everyday stresses of doing business and lose sight of where they are now, where they are heading and why. Or as the street grifters in New Orleans say to the tourists, “I bet you five dollars I can tell you where you got your shoes at.” The wager accepted, the grifter replies “you got your shoes on your feet, you fool,” snatching the five dollars and disappearing into the crowd.

It’s fairly easy to set goals, but over the years we have noticed that the practices which are successful in meeting their goals also have a plan to reach those goals; and they share their plan and their goals with their staff.

Financial Goals – assuming you set goals for 2013; your practice management software should provide the numbers necessary to see how far over or below the practice performed in relation to your goals. There is no shortage of practice metrics published on the web and in trade magazines, but here is a list of what we feel are the core metrics important to every practice.

  • Gross revenue

  • Net income

  • OD hours worked

  • Staff hours worked

  • Total patient visits

  • New patient visits

  • Medical eye care visits

  • Eye exam revenue

  • Medical revenue

  • Frame sales

  • Lens sales

  • Contact lens sales

  • 3rd party (insurance) revenue

  • Cash revenue

From these numbers you can figure the important ratios, such as percentage of new patients to total patients, percentage of revenue coming from the optical dispensary, and many others. You can also drill down deeper into the numbers to find product percentages in the optical and other information which will tell you the overall health of your practice.

In projecting growth for the upcoming year, an independent OD will grow on average between 2% and 6% per year; growth of 1% or less is an indication of serious problems in the practice, and growth of 7% or more is considered excellent.

Staff Performance Reviews – these can be a source of tension between management and staff, or they can be an opportunity for mutual understanding and improvement.

We have developed a 2-page employee appraisal for the doctor or manager to fill out, while the employee fills out the same form as an employee self-appraisal. The two then sit down for a short period of time and discuss their findings; there are usually some surprises on both sides. These appraisal forms keep the doctor/manager in charge while allowing the employee to have some input into the management of the practice. Just email me at cliff@ecpmag.com and I will forward copies of the form for your information and/or use.

2. Get a Crew

Are you happy and satisfied with your current staffing as it is now? If you have recently concluded your annual employee evaluations, it might be a good time to make any necessary changes if they will improve your practice. Like it or not, increases in managed care results in your staff having more and more influence on your patients’ perception of your practice.

Also, your personal perception of the practice is not necessarily the perception your patients have. Try to see your practice through your patients’ eyes: remember that they visit your practice for only about an hour or so every one or two years. Their visit takes up a significant portion of their day, it may be stressful, and they are usually spending hundreds of dollars on glasses and/or contact lenses. Knowing this, are you happy and satisfied with the attitudes and professionalism of your staff? Hopefully, your answer would be yes…

One of the misconceptions we had to deal with as consultants was that we were there to make wholesale changes in the staffing of the practice. In fact, nothing could be further from the truth. In almost twenty years of consulting we have only recommended terminating three employees, and in each case they were stealing money and/or equipment from the practice. We would go in assuming the staffing would remain the same; we concerned ourselves with raising the overall education and work habits of each individual staff member to improve patient care.

That said, there were instances where doctors would put up with bad attitudes among their staff for far too long, and for reasons such as being members of the same church or being distantly related to the employee. Again, we would advise them to take a step back and look at the situation from the point of view of their patients: Is a staff member’s negative attitude obvious to patients? Is it negatively affecting other staff members? If so, then turnover would be a good thing.

One last thought on the subject: have you noticed how the most successful practices tend to bring along many staff members for continuing education at the state & regional optometric shows? Have you ever considered that perhaps the continuing training of their staff is one of the reasons for their success, and not one of the results?

3. Manage Your Managed Care Plans

Far too many doctors sign up for just about every plan that crosses their desk, or because the doctor down the street signed up, no matter what the reimbursements or the number of potential patients to be covered. Remember, vision insurance is a two-way street; the administrators of the plan need you as a provider when they go out and market their plan to local industries. Take the time to evaluate how much income the plan might bring in. You already should know what your average income per patient is currently; compare that with what the plan brings to the table. I can’t tell you how many times I have heard doctors tell me “I hate this plan. I only accept it because the other doctors in town do.” Have you ever thought that they might be saying the same thing?

However, each practice has to evaluate vision plans independently. If your competitor down the street does not accept a plan because of low reimbursements, it might still be worth it for you if you are new to the area and need to increase patient flow quickly.

4. Don’t Assume Anything About Your Patients

If you’ve been in practice for a while, you and your staff probably feel as though you know your patients pretty well by now. Well, I’d like to challenge you to try something new this year: forget the assumptions you have regarding your patients. That’s right. Try to view them as a blank slate so far as their visual needs are concerned. Ask them what they both like and dislike about their present eyewear; and ask what is new in their lives: changes in their workplace routines, hobbies, and sports activities, anything which might have changed visual requirements. Try not to pre-judge them; that mild-mannered accountant may have just fulfilled a lifetime dream of buying a Harley and really needs some top-rate polarized sun wear, or the suburban soccer mom might have taken up racquetball or kickboxing at the local health club and need sports goggles right now. They’ll appreciate your taking the time to know them better, and you might find out you didn’t know them quite as well as you thought.

5. Market Your Practice Internally

One of the biggest surprises we had going into consulting was the interest, bordering on obsession in some cases, that doctors have about their competitors down the street or across town. “What do they do over there?” we were asked over and over again.

Over and over again we stressed that knowing what they do across town was beyond their control; all you can control is what happens in your practice. It’s been proven many times that people will return to and buy from establishments which treat them fairly and respectfully. Only you can control whether or not that occurs at your practice. The advertising people at chain and big-box stores would kill for the effectiveness of word-of-mouth advertising that happens every day in your town – and it’s free!

Work closely with your staff to ensure that each of your patients knows that your practice is the only place they’ll ever need for their vision care. Should the opportunity arise, there is no reason why the receptionist or the employee working up the patients can’t discuss the importance of sports goggles for children, and if she notes the discussion on the chart the doctor can reinforce the thought. To the patient, it appears the entire practice is concerned with their vision and everyone is on the same page.

Cliff Capriola, Practice Management Consultant

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