"Although optometrists are taught the quantitative science of optics and spend most of their workday taking measurements of visual acuity, most do not invest much time to measure the state of their business. More often they form intuitive impressions about business issues. Then they make decisions without a solid, metrics-based understanding of their actual situation and without any quantitative norms against which to compare their performance."
[Key Metrics: Assessing Optometric Practice performance, 2011 Edition (Introduction).]
The Management & Business Academy™ (MBA) is a metrics-based approach to optometric practice management. Since 2005, MBA has gathered comprehensive information on the characteristics and financial performance of over 1,800 private optometric practices in the U.S. There is this popular narrative, "Whatever you measure improves." This is the primary call to action that presupposes introduction of measurement in growing Optometric practice.
With the heavy reliance of eye care health sector on private practicing optometrist in Nigeria, I decided to point out those metrics with the intention of providing insights as to how to grow our practices, because it is said: "Where the money goes, so goes the authority."- and the power too!
Tagged Total Practice Productivity Metrics, it discusses the overall productivity of a practice and empirically analyze them:
1)Gross Revenue per Exam: This is defined as the gross revenue per every comprehensive eye examination at any given time. This metric is singled out as, "...perhaps the single most useful measure of practice productivity..."
It is influenced by the internal processes of your practice and can be improved by the actions of the practitioner.
If H represents the gross revenue receipts in a given time frame, X(0,1,2,3,4...) representing comprehensive eye examinations carried out on a patient in the same given time frame... (0,1,2,3,4...) represents what constitutes a "comprehensive" eye examination and the internal processes of practice! The later identified in numerals has the tendency of influencing gross revenue earned and highlighted in note below
Hence, H/X (0,1,2,3,4...)................................................................. (i)
= Gross Revenue per Exam!
Note:
a) Number of eye tests carried out.
b) Types of high end user frames on display.
c) Products on display such a medications, contact lenses, surgical practices, low vision care etc
d) Turn-over of patients
e) New patient flow
f) Size of practice etc
Influences the "Gross Revenue per Exam" metric.
2) Exams per OD hour: This is defined as, "The number of complete eye exams performed during each hour an optometrist works." It is an empirical reproduction of revenue generated per OD hour. The key variables impacting this metric are size of the patient base, recall effectiveness, extent of delegation of testing tasks to staff, exam process efficiency and appointment scheduling efficiency.
If X(0,1,2,3,4,...) represents the comprehensive eye examination on an individual patient, Hx represents the optometrist's work rate in an hour, therefore,
Exams per OD Hour would be stated empirically thus:
X(0,1,2,3,4...)/Hx.................................................................... (ii)
Apart from adding a new OD, the main way solo OD practices can grow is to increase patient traffic per hour! The primary determinant of this metrics is efficiency of the OD in the clinic measured per hour!
3) Gross Revenue per Staff Hour (non-OD Staff): This metric is a ratio of the total revenue gained in a specific period of time divided by the total number of non-lab/non-OD staff hours worked during the same period.
This metric is a measure of how efficiently patients are managed administratively in a given OD clinic. It also determines how under-staffed an OD clinic is and triggers hiring of more non-OD staff or firing as the case maybe!
Lets take H as the gross revenue receipts in a given period of time.
Let Ns represent the non-lab/non-OD staff hours worked in a given period of time.
The Gross Revenue per Staff Hour can hence be mathematically represented thus:
H/Ns................................................................... (iii)
Note: Gross Revenue per Staff Hour is dependent on the following factors:
a) Number of staff members
b) Exams performed per hour
c) Gross revenue generated per exam
d) Patient traffic.
4) Gross Revenue per OD Hour: This is a ratio of the gross revenue in a given OD hour. It is a measure of how productive an OD uses his time in generating revenue in a given time measured per hour. It also correlates with the productivity of the staff members on how they efficiently attend to patients administratively! This metric correlates strongly with the clinical efficiency of the OD measured in hour! It is strongly suggestive of how successful the clinical practice is.
Other parameters that correlate with this metric include:
i) Revenue per OD hour
ii) Practice size
iii) Practice growth
iv) Improved OD time utilization.
If the Gross Revenue generated, often indicated by the gross revenue receipt generated in a given period of time, is H,
Let the OD hour be indicated by Ohr;
Therefore, Gross Revenue per OD hour can be mathematically represented thus:
H/Ohr...................................................................... (iv)
5) Complete Exams per 100 Active Patients: This is a metric that indicates the recall rate success of patients. A patient is said to be active if he had completed at least one circle of complete eye examination in a particular OD clinic within a given period. One circle of complete eye examination includes at least on recall examination. That being said, it should be noted that this metric is not dependent of the size of the clinic. The following factors can influence the recall rate, viz.
a) Recurrent ocular conditions like Vernal conjunctivitis especially in Children, Dry eye syndrome in adults etc
b) Chronic conditions like ocular manifestations of Diabetes, Hypertension etc...
c) Glass prescriptions for pediatric patients and for binocular anomalies etc.
It is noted that the average recall rate of active patients is about 28 months especially in OD clinics with more than 70% revenue generated from glasses especially for presbyopes! Hence, an OD clinic with 50 exams per 100 Active Patient is said to have an above average successful recall rate!
6) Annual Gross Revenue per Active Patient: This is the ratio of the Gross Revenue generated in an annum in relation to every active patient seen within the same period. It measures the recall rate and revenue per exam.
7) Gross Revenue per Square Foot of the Office Space: It represents how efficient clinic space is fully utilized and translated into revenue recouped either traffic of patients and multiple examinations carried out simultaneously in a clinic space to improve the OD hour, thereby increasing the gross revenue earning. It is weakly correlated to increase in practice size. It is a particular relevant consideration when ODs plan to expand their practice size... Like introducing Slit Lamp Bi-microscope, Automated central visual field analyzers, lens fitting lab etc. Again, when an OD clinic is moving to a new location, this metric helps in determining space size of new location.
The metrics described above have helped developed OD clinical practice in the USA especially for private practicing Optometrists. Subsequently, this blog will discuss each metric in details such that local contents will be developed. Because my primary interest is to synergize these growth concepts with what is obtainable in our country such that efficiency in practice could be achieved.
Finally, I want to say a big thank you to the developers of Management & Business Academy™ (MBA), Practice Advancement Associates (PAA), a unit of Jobson Medical information. To reach PAA, contact Al Greco at agreco@jobson.com.
Hope you enjoyed this piece.
Long Live Optometry in Nigeria!
Long Live Nigeria!
Dr Ezebuiroh Victor Okwudiri.
(This is strictly a free blog with no financial obligation anywhere!)
optometry is discussed here, eye diseases and disabilities are highlighted and management of such ocular conditions enumerated.
