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Referral Rescue
Losing your patients and your money to referrals? Learn how to get them back.

Richard S. Kattouf, O.D.

Q I have a practice that generates more than the normal ophthalmic referrals. Can I get an M.D. to rent from me and examine my referrals in office? How can I generate more income from referrals?

Dr. S. T. Lorrell

A: M.D.s need your referrals more now than ever before. Surgery centers are being developed with networks of O.D.s for referrals. This leaves M.D.s in a position to court O.D.s. But before entering into an agreement, set the following rules.

Establishing the rule

If you're in a state that has a therapeutic prescribing act (TPA) law that has approved all medications necessary for performing one-day post-op evaluations, then I feel it is your professional obligation to see the patient the day after surgery unless the surgeon feels that individual complications would contraindicate this practice. Here are ways to raise net in this scenario:

• Your name appearing on all medicine screams to the patient that you're an R.D. (real doctor).
• M.D. to rent from you based on the length of time (hours, rental of your staff, rental of your instrumentation, rental of your physical plant and possible assistance from the optometrist). Lowering cost of operations and lowering net. That's what having an M.D. rent from you does.

You must take and maintain control of the above stipulations.

Keep in mind that the M.D. gets fees for the consult visit plus the surgery and, if he has his own surgery center, facility fees. Here's a general range of rental fees: $400 for four hours at a small- to medium-size practice that has a gross income of $500,000. For a larger practice, $800 for a four-hour rental is appropriate.

Making the point clear

Dr. Lance (not his real name), who had a large Medicare and general medical patient population, called my company. His net income was at 26% of his gross collections and it was immediately evident to me that he wasn't coding medical procedures properly and the referring M.D. was sending the cataract post-ops for refraction only.

Plus, a tech from the M.D.'s office was performing A-scans on Dr. Lance's patients. This is a pre-op diagnostic procedure that every O.D. can do and get reimbursed for as long as the medical plan isn't a closed panel. Dr. Lance wasn't getting a post-op income from the medical carrier because he was not maximizing his diagnostic licensure.

Leveling the playing field

I negotiated with the M.D. and developed the following agreement:

• Dr. Lance sees all patients one-day post-op unless complications indicate otherwise. (This increased unit sales per patient by $200.)
• Dr. Lance prescribes and has his name appear on all medicine given to the patient. (This raised his image.)
• Dr. Lance's office performs all pre- and post-op diagnostic procedures. (This raised the unit sale per patient by $100 more.)
• The M.D. would visit Dr. Lance's office twice each month, paying an $800 rental fee for a four-hour visit. (This generated almost $20,000 of extra income, which lowered operating expenses and raised net income.)

This consultation raised Dr. Lance's income $150,000 in medical reimbursements alone, which has a high net-to-gross ratio. Dr. Lance's practice image skyrocketed just by his learning to use his licensure to its maximum and to take control of his own patients. In two years, Dr. Lance's net income grew to 38% -- an increase of 12%.

Dr. Kattouf is president and founder of two management and consulting companies.  For information, call (800) 745-EYES or e-mail him at advancedeycare@hotmail.com. The information in this column is based on actual consulting files.