Ten Quick Things on Hiring an Associate Optometrist
September 2, 2015
I view hiring an associate OD as one of the best practice management goals a practice owner can set. When you reach the point that your practice is ready for that, many good things happen: revenue and profitability should increase and patient care hours for the senior doctor can decrease. Read on for my quick list of ten things to consider when you want to bring on an associate.
Patient demand. This is the ingredient for success when adding a new doctor. Your practice should be booked solid for several days (or weeks) in advance. A full schedule also presumes that you are already actively delegating to technicians and seeing a strong number of patients per day; if not, do that first and see if you stay booked in advance. Adding a doctor when there is strong demand for services allows the practice to see more patients per day, which results in more revenue and profit. Adding a doctor when there is weak demand only moves the existing patients from one doctor to another, causing no increase in revenue while adding the new doctor’s salary as a big expense.
Consider office hours. Adding an associate is the ideal time to expand office hours by adding evenings and Saturdays. Doing so allows the office to be more productive and patients love the convenience, which creates a higher level of satisfaction and more word-of-mouth referrals. Most job candidates agree to work evenings and Saturdays when asked about it in the interview process, but it can be very difficult to change their schedules later. Hire more staff if needed, but expand the hours with the new OD.
Consider the appointment schedule. Be sure the new associate understands the fast pace that your office works at and feels comfortable with that. Of course, it will take some time to move patients and attract enough new patients to fill the new doctor’s schedule, but that is the goal. The practice will supply plenty of staff support, instrumentation and multiple exam rooms, so the new doctor should realize that fast-paced care is not stressful. It is up to the practice to fill the associate’s schedule with patients; the new doctor plays a role in that as well by providing good care, but most of the burden is on the practice owner (assuming the new doctor is an employee and not a partner).
Insurance credentialing. I would not start paying a new associate at full salary until he or she is credentialed with the major insurance plans the practice works with. The practice can assist with the application process, but it often takes months to be approved and the new doc can’t produce much until that occurs. Do not bill insurance under the senior doctor’s provider number if he or she did not see the patient; it is generally against the contract terms. Don’t take chances.
Full time or part time. Decide how many hours per week you can keep the new doctor fairly busy. I strongly prefer hiring doctors on a full time basis, but part time is fine if patient demand is not enough. I recommend paying a straight salary plus benefits for full time doctors and paying by an hourly or daily rate with no benefits for part time. The cut-off for full time status is often around 32 hours per week. IRS rules are such that associate doctors should generally be paid as employees and not independent contractors.
Need to incentivize? I don’t think paying percentages, incentives or bonuses works as well as you might think. I don’t find that it actually changes the behavior of most ODs and I’m not sure I would want it to. It is possible to pay too much or too little if you don’t really know what the dollars will be. I find that if the practice can fill the associate’s appointment schedule, revenue production will be quite high. That is the factor to work on and the rest takes care of itself.
Reconsider vision plans. It is very difficult to maintain enough patient demand for an additional doctor. Adding a vision plan that did not make sense before could be a big benefit now. Any profit is better than an empty appointment slot.
Restrictive covenant. A non-compete agreement with the new doctor is quite standard and it protects the practice against the associate quitting, setting up a practice nearby and taking patients. The terms are generally softer for part time doctors because, by definition, they need to work in another practice in the local area.
How to move patients to the new doctor. The most important step, which is often overlooked, is to tell the staff that you want to move as many patients as possible to the new doctor. They need to work on it; be creative and charming about it. They must overcome their loyalty and bias for the senior doctor. Additionally, reduce the patient care hours of the senior doctor and do not have the senior doc work any evenings or Saturdays. We need some tough love for patients.
Review gross revenue per comprehensive exam. This is an important metric for associate doctors and it should be calculated for the senior doctor as well which can serve as the norm for the practice. If the associate doctor has much lower average gross revenue per comprehensive exam, sit down and talk about the cause. Review some patient records with the new doctor and discuss how you might handle things differently. Serve as a mentor and consider having the associate observe the senior doctor while performing some exams.