Optometric Management Tip # 236 - Wednesday, July 26, 2006
Jump-start Your Practice: Part 2
This series on jump-starting your practice is based on the premise of making your practice
appear to be the way you hope it will become. Act now as you mean to go. Visualize the
practice you want to build and make your present office look and act like that in every
way possible. This strategy involves doing things before they seem necessary. By
emulating the high-level practice, your practice will become one. Itís not hocus-pocus;
high-powered practices have certain traits that generate more business. These traits may
involve excellent customer service, an outstanding professional image or other competitive
Jump-start #2: Raise your exam fees
Once again, Iím advising taking an action that, on the surface, seems contrary to what you
might do if a practice was not busy enough. Why would more patients come to your office if
you raised fees? Most ODs worry that a fee increase will drive away the few loyal patients
they have. Here is why a fee increase will help grow your practice.
How much to raise them
- There will be an immediate increase in profit. That extra cash should be reinvested in
the practice in the form of more staff, a new instrument, a new logo and exterior sign, a
remodeling job... whatever your practice needs the most. The new and improved service and
physical facility justifies the higher exam fee and the higher exam fee pays for the improved
service and facility. Which should come first? It doesnít matter Ė do them both at once.
- A higher fee structure raises your confidence and your pride. Your vision of operating
the best practice in the state immediately begins to take shape because the best practice in
the state would have higher fees.
- Your perception in the community just went up because people judge technical services they
canít fully comprehend by the fee. If your fee is the highest, you must be the best.
I have successfully raised fees in my own practice and in clientís practices in fairly large
increments. Very few patients really keep track of what your exam fee was last time they were
in, and even if someone does, so what? Fees are like prices on anything Ė they go up! How much
to increase exam fees depends upon how woefully off-base they are. I have known doctors who feel
a 10% increase in fees is a very large increase, but they are charging $60 for an exam with
refraction. That increase is a whopping $6 bucks! It will still help the bottom line, but itís
a missed opportunity to do something that will really make a difference in the practice. That
fee will likely not be raised again for over a year; maybe not for two or three years. Since
youíre raising it, why not raise it $25? At $85, the exam you are providing is still a great
bargain! The vast majority of patients still wonít notice and even those that do notice wonít
How to raise them
Just do it... with as little fanfare as possible. You are allowed to raise your fees without
notice. What good would it do your practice to make some announcement? Sending a message that
you and your staff are defensive about fees or that they may not be justified is the one action
that will make a patient balk at the fee. Act as if itís business as usual and no one pays any
Erase any feelings you may harbor that your services may not be worth a high fee and talk with
your staff about it. After all, you provide the very best exam technology and patient care, donít
you? And your customer service is second to none, right? If so, trust that there are many people
willing to pay for that excellent care.
I strongly believe that the exam fee should be stated over the phone to every person who schedules
an appointment, even if they donít ask. Your staff need not say that the fee went up, just say what
it is and discuss if insurance will be accepted or if payment will be due at the time of the visit.
If your fee structure is so complex that you canít quote the fee without seeing the patient first, I
think thatís a problem. Quoting the fee and explaining the payment policy in advance is a major step
in achieving patient satisfaction. Patients want to know and they deserve to know.
On the day you raise the fees, you might tell your staff that if any patient responds by saying they
were quoted a lower fee than what is being presented, the staff is empowered to explain that there
was a fee increase, but that the office will substitute the old fee since that was quoted. I doubt
that anyone will respond that way, but itís a good policy just in case. That policy can end after
about two weeks.
But it will make no difference with vision plans
This may be the ODís favorite reason for not raising fees; it wonít make any difference anyway.
Well, if it wonít make any difference then why not raise them? You certainly wonít hurt anyoneís
feelings at the vision plan headquarters if your usual exam fee is much higher than their maximum
payment. They wonít complain or even notice. Most practices do have some private pay patients and
the owner is worried about offending them, or thinks it would not be fair to charge so much more to
this valuable patient group.
What about fairness to you? You probably believe that your professional judgment, your staff and
your physical facility is worth much more than your current exam fee. Sure, the private patient is
valuable, but why should he or she pay so much less than you are worth? I can see why a vision plan
should get a discount on your fees (assuming they deliver patient volume or potential volume), but
why should all private patients get a discount? You canít give everyone a discount.
The volume discount you grant to vision plans is a business decision that should not relate to your
usual fee. Just because some vision plans pay ridiculously low fees and you accept them does not
mean that is what your services are worth. It only means that you feel the volume of patients the
plan delivers is of sufficient value that you are willing to accept a huge discount for that group.
If you no longer feel that way then drop the plan.
My friend Jerry Hayes sums up fee levels in a very clever way as he makes the point that fees are
not the most important criteria when patients choose an eye doctor. He starts by asking if there
are any practices in your area that have lower fees than you. Generally the answer is yes, there
are lower fee providers. He then asks ďWhy donít they have all your patients?Ē
Best wishes for continued success,
Neil B. Gailmard, OD, MBA, FAAO
Chief Optometric Editor, Optometric Management