Given the overwhelming response to my most recent Tip of the Week regarding little to no-cost revenue building, I decided to add a "Part 2" tip that would continue upon that same vein of practice management. In addition to my practices I outline here, I have to give a nod to Scott Luther from ABB for providing me with supportive facts and figures. Please refer to my last tip for previous ideas on building revenues, which lays the groundwork for ideas presented here.
In addition to utilizing the resources you already have in your office, an oft-overlooked aspect is time. Time is money. Your staff’s time is valuable, and how you direct them to use that time can save you, and make you, money. I’m always analyzing how to best "spend" or delegate staff time, and if you ask my office manager what my pet peeve is, it’s when staff appears to be sitting idle or involved in busy work that could be consolidated. This leads to my next suggestion:
Analyze vendors who can save staff time. Perhaps you already use a distributor for your contact lenses, but for those of you who don’t, you should strongly consider. If you think about the administrative time in the ordering, processing and distributing of contact lenses in your practice, the time does add up significantly. Let’s say it takes several minutes to order lenses, receive them and then store them while waiting for patient pick up. You may have to call or email your patients to let them know you have their lenses, track their orders, possibly return lenses, reconcile invoices, and pay your suppliers. Then there’s the notorious pick-up by the patient at your busiest time of the day. If you have separate suppliers, there is separate work for each one.
Based on several minutes to around one minute for each of these tasks listed, I’m estimating approximately 20 minutes per order from order to distribution. If you stay with my previous tip estimate of 100 contact lens patients per month, if even only half order from you, and your primary contact lens tech is paid $17/hour, that’s 50 orders x 0.33 hours (20 min) x $17 = $280.50/month. But, as I illustrate to my staff in their annual reviews, I’m not "just" paying them $17/hour. I pay benefits (health insurance, PTO, 401k, bonuses, etc), which raises a full-time staff member’s pay an approximate $4/hour more, so that’s $21/hour cost to me, the practice owner. This calculation now changes to 50 orders x 0.33 hours x $21 = $346.50/month. For an entire year, that’s $4,158 in contact lens admin costs just for handling orders.
Now, if you use a distributor, and keep all your processes the same, it can cut your employee’s time in half for each task mentioned. We now have saved approximately $2,079/year. But, if you work on making most of your orders ship directly to your patients, that can cut your employee’s time to ¼ of the original estimate, or a cost of only $1,039.50/year. Remember, this is all with only 50 orders per month. Implement my last tip’s suggestions, and those orders should increase. With that, using a distributor, so will your savings. For larger practices, the savings is even more significant. The potential savings is tens of thousands of dollars.
In addition to lens distributors, I also utilize a company that assists with schedule management. I will argue that proper schedule management is THE most valuable aspect of running a practice. Doctor time is the most expensive time to waste, so when there are holes in the schedule, everyone suffers. By having electronic scheduling, appointment reminders, and confirmations, scheduling becomes more of a managed system versus your staff chasing down patients with phone calls or expensive postcards to remind them of appointments or notify them it’s time to schedule. If you see 200 patients per month, and via previous schedule management methods you call to schedule, call to confirm and/or send some sort of snail or electronic mail, I estimate at least 15 minutes of staff time for each patient (remember, you will have to gather new insurance information, demographic data and answer any patient questions). If we use the same wage estimate of $21/hour (including benefits), that’s 200 patients x 0.25 hour x $21/hour = $1,050 spent on admin time per month to schedule and confirm and manage those 200 patients. That’s $12,600 per year.
The first thing I would suggest lowering this cost is to pre-appoint your patients. This way, you are only confirming, rescheduling or canceling next year’s exam, not having to create a new appointment all together. Then, use the schedule management company to confirm the appointments electronically, via email or text. The only staff time spent is to move the appointment and handle a few calls when necessary. For new patients, add online scheduling. This also eases staff time. If you can cut your staff time with schedule management down to a quarter of what it was, that would reduce your monthly cost to $262 and your yearly costs to $3,150. What I’ve discovered is that as your patients get used to your schedule "system" the time saved is even greater for more cost savings. They know and understand their appointment is reserved and they simply need to confirm annually. Add in the lower likelihood of no-shows, and the potential for revenue increases even more.
The last revenue tip focused on increasing revenues via sales, but the content here should remind us all that monitoring your expenses is also a key driver to improve the bottom line. Again, for little to no cost, these small wins add up to large wins over the course of the year. Explore your options for improvement in your practice daily.
Gina M. Wesley OD, MS, FAAO owns and practices at Complete Eye Care in Medina, MN. Accolades include Minnesota's Young Optometrist of the Year in 2011 and the Early Professional Achievement Award from The Ohio State University College of Optometry in 2013. She is a member of the American Optometric Association, a fellow in the American Academy of Optometry and enjoys practicing, writing and lecturing in the industry. For questions or comments about this article, please contact firstname.lastname@example.org.