It’s either the bane or boom to optometry. Vision plans are popular and their future is secure. Employers like to offer them and employees like to use them for routine eye care and eye wear.
However, their popularity hasn’t been all encompassing within the optometric profession as social media message threads detail the growing disenchantment towards ever lower reimbursement and ever increasing complexity of rules and regulations. Three factors should make optometrists pause before severing a vision plan from their office.
First, vision plans are primarily patient acquisition vehicles. As such, their profitability requires a three year horizon rather than a single year. In other words, like most other patient acquisition methods, the initial cost is always high and with repeat visits, that cost plummets, even if the transaction costs are seemingly modest. The key, therefore, is to promote return visits for the 2d and 3d years where the chances of producing a net profit rises.
Second, vision plans can reduce the unit cost of a transaction by spreading out more of the fixed costs. If an office has excess capacity (an office that isnot busy enough), it is preferable to consume excess capacity to drive down unit fixed costs even if these patients do not meet target revenue levels.
Lastly, vision plans give a practice a new source of patients for medical eye care (usually outside the scope of vision plans) or additional sales (from non-covered vision benefits). Because the acquisition costs is already “sunk” (or assumed), then the unit cost of the patient transaction will drop making the patient a better financial proposition.
In summary, vision plans serve a valuable service for both patients and doctor. It may be tempting to sever a vision plan from your office, but the financial impact of a vision plan runs deep and may actually be a winning proposition for your office.
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