o.d. to o.d.

How to Survive the Brave New World of Optometry

At a time when the road ahead appears more challenging than ever, follow these four new rules for survival.

By Walter D. West, O.D., F.A.A.O., Chief Optometric Editor

As optometrists, we find ourselves at the epicenter of one of the most dramatic periods of change in the history of the U.S. healthcare system. We face a “new normal,” in many sectors of our economy, perhaps in healthcare more than others, at a time when our satisfaction with our profession, in general, could be at an all-time low. The “old rules” will not work.

For some of us, the greatest advantage of being an independent optometrist is the freedom to manage our businesses anyway we like. Unfortunately, this is a disadvantage for those who continue to do things the way they've always done them. For their practices to continue to exist, these O.D.s will need to embrace rather than resist change.

I believe we're confronted with a major decision: Do we go along with the current administration's plan for our careers, or seize the opportunity to re-design our own practice paths? To survive, optometry cannot be like it once was, nor how it is currently. Therefore, we must understand the “New Rules.”

Rules of compensation

Old rule: Optometrists could earn a decent living by receiving their income from third-party (insurance carriers and government-paid healthcare) reimbursement.

New rule: Surviving on third-party reimbursement will be increasingly difficult. You will either need to be absorbed by an integrated delivery system or diversify your income through ancillary services, lifestyle medicine, etc., much of it paid in cash directly by the patient.

Old rule: Insurance carriers and government health plans offered fee-for-service arrangements.

New rule: Fee-for-service reimbursement will diminish through the next five years. Value-based or performance-based compensation will become the primary form of reimbursement from carriers and Medicare/Medicaid.

Old rule: Optometrists could make a good living without having much business sense; just being a “good doctor” was enough for practice success.

New rule: Change is the “new normal.” Optometrists will need to be keen observers of healthcare economic conditions and determine how to change their business model from a business standpoint.

Old rule: Enough healthcare dollars were available to allow O.D.s to take their fair share of the pie.

New rule: Reimbursements will be slashed. Smart optometrists will look for alternative sources of income and prepare for changes in the fee-for-service reimbursement model.

Good news

The good news for optometry? Optometry is better positioned to generate income from professional fees as well as retail sales than perhaps any other healthcare profession. However, in order to benefit from this envious position, optometry must move to redefine itself. OM