ODs’ top 4 gripes about vision care plans: Part 3-Reimbursements

The views expressed here belong to the author. They do not necessarily represent the views of Optometry Times or UBM Medica.

In order to continue this dialogue, and in an attempt to help bring some clarity to the landscape around vision plans, I have put together this five-part blog series. Part 1 of this series outlined the four big topics ODs seem to have the most complaints with vison care plans (VCP). In Part 2 of the series, we covered if it has to be this difficult.

For review, here are the four gripes:

1. Does it have to be this difficult?

2. Reimbursements

3. Competing with me for retail sales and patients

4. Misleading and misinformation

In Part 3 of this five-part blog series, let’s take a closer look at Gripe Number Two-Reimbursements.

Previously from Dr. Spear: The benefits of cleaning out your practice

Reimbursements

I don’t think anyone finds it surprising that a major gripe was reimbursements. Here are a few of the comments I received from ODs:

• “Low exam fees. Terrible pay for frames and lenses.”

• “In many years, no increase in reimbursement (in fact a decrease) despite the cost of business going up, making profitability increasingly difficult.”

• “Getting paid less for an exam than I did in 1984 when I started practice.”

• “More and more documentation, less reimbursement.”

• “Horrible exam reimbursement.”

What did surprise me in the conversations and correspondence with many ODs is reimbursement was not necessarily the top complaint.

Many ODs recognize VCPs do bring patients into the office and help provide access to patients. Most ODs would accept the reduced payments much less begrudgingly if the other gripes were mitigated.

Related: 5 steps to creating a budget

Although reimbursements are a problem, the following complaints actually make us resentful of low reimbursement:

• Patients do not know what plan they have-which means your staff must spend a lot of time figuring it out

• VCP representatives are not available to answer questions, and the answers are often different depending on who you speak with

• Patients are often misinformed by VCP representatives about what is covered

• Difficulties in understanding plans and the variety of plans that exist

Here are four things you can do to make sure you are being profitable with VCPs:

Click here for Dr. Spear's 4 gripes with reimbursements

1. Review your contracts, institute staff training

I use audience response when lecturing about VCP contracts, and typically only 2 to 3 percent of people responding in the audience have read and understand their VCP contracts.

VCP revenues represent a large portion of a practice’s revenue, and you must read and understand the contracts and the rules. More importantly, your staff must understand the rules, which will allow everyone to work together making the VCPs more profitable for your practice.

Related: 10 tips to surviving an insurance audit

It is impossible to bill, collect, and understand the product mix you need without understanding the VCPs themselves. Also, patients rarely understand their plans-which means to be successful with VCPs you and your team must have a thorough understanding and be able to educate and guide patients.

We have always conducted monthly staff meetings geared at educating our team’s understanding of the VCPs and our strategy. More recently we developed short video training modules staff can watch and stay updated on VCPs.

Up next: Have the righ product mix, retail pricing strategy

2. Have the right product mix, retail pricing strategy

When I am working with practices, the first thing I find is most do not have the correct product mix and pricing strategy to be profitable with VCPs. Having an overall practice strategy or personality with a corresponding retail pricing structure, and the correct planogram for frame inventory, is critical in being profitable with VCPs.

Related: Overcoming our fear of change

One of the biggest misconceptions I hear is retail pricing does not matter. In fact, one of the most important things you can do is to develop strategic retail pricing that allows you to be profitable.

When I consult, this is the first step in making sure a practice is set up to reap the benefits of accepting VCPs. This product mix and strategy is dependent on your mix of insurances and geographic location.

Up next: Bill correctly, bill medical when appropriate

3. Bill correctly, bill medical when appropriate

We will look in depth at the topic of medical billing in Part 5 of this series. For now, my experience working with doctors is they do not bill medical when they should.

Both Vision Service Plan (VSP) and EyeMed clearly state in their contracts that if the patient has a medical condition, the visit should be billed to the patient’s medical insurance. Many practices simply do not have good processes and protocols in place to make sure patients are informed and medical insurance is billed when appropriate.

Related: 6 tips to navigating the insurance game

It is also common to see practices under-bill and/or charge patients incorrectly. Given the large number of variation within the VCPs, this is not surprising. You must develop a systematic process to ensure you are billing appropriately.

For example, not billing VSP for backside ultraviolet (UV) protection on lenses not only results in you not getting paid, but it also results in a loss because VSP will incur chargeback. Other areas that are easily missed with VCPs include:

• Custom measurements

• Wrong contact lens fitting fees

• Other add-ons

Up next: Reconcile explanation of benefits

4. Reconcile explanation of benefits

The only way to make sure you are billing correctly and that the insurance is paying you in accordance with the contract is to make sure you are reconciling the explanation of benefits (EOB) for all patients.

This is a major area of weakness within many practices and unfortunately a very tough area to learn and teach.

Related: 5 ways media coverage can benefit your practice

We have found occasions in which practices were routinely underpaid based on their contracted rate for certain plans. By auditing the EOB and reconciling them to the contract, we have caught these automated payment errors and saved thousands of dollars.

While these incorrect payments are a problem, it is up to you to develop the system to catch these mistakes and make sure you are getting paid.

Up next: Know your options

Know your options

When dealing with VCP reimbursements, you as the OD and practice owner have two options:

• Don’t take the insurance

• Take the plan but make sure you know the rules, train your staff, develop a retail pricing strategy, bill correctly, and routinely audit your EOBs

While not taking VCPs sounds appealing, I have found VCPs bring in patients. Many of these patients will need medical eye care and if VCPs are what initially brings them to our offices, then they have served a valuable role.

Related: 6 challenges when changing from a group to private practice

For those patients who need only preventive eye care or glasses and contact lenses, I accept the reduced exam reimbursements as the cost of doing business. In my mind, because most of our patients come from word of mouth and we take their insurance, I have allocated the reduction in fees to marketing.

It is easy to complain about reimbursements and VCPs, but it is harder to make them work for you. However, those ODs who do create a plan and process find VCPs can be good for business.

You must decide if you are going to complain or take action. Remember, once the patient is in your practice it is you, your strategy, your team, and your systems that determine the patient experience and practice profitability.

I look forward to your questions and comments chspear@gmail.com.

Read more from Dr. Spear here