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O.D.s Express Concern Regarding VSP Pilot Program

WORRIES OVER VSP INVOLVEMENT WITH RETAIL/WHOLESALE VISION CENTERS

■ VSP's recent launch of a limited pilot program with Costco Wholesale has drawn the attention of many optometrists who question whether the eyecare benefits company — founded by and for the independent O.D. — is providing significant benefits to Costco Wholesale vision centers, an out-of-network (OON) provider.

Pilot program

Under the program, VSP patients from a small number of employers can visit a Costco vision center, and the warehouse store can both check benefits and submit claims electronically on behalf of these patients through 2020source.com. (Costco Wholesale does not have access to www.eye finity.com.) In addition, the patients in the program need only pay their typical co-pay and deductible at the time of the visit.

All other OON providers, from optical chains to independent O.D.s in private practice, do not have electronic access to VSP benefit information, and they must file VSP claims on paper.

O.D. concerns

Several optometrists claim the program provides Costco with an attractive competitive advantage — that is, from the perspective of the VSP patients in the program, it appears that Costco operates similarly to VSP in-network providers. While VSP members can use their benefits at any OON provider, typically the patient would pay the OON provider out of pocket for the full cost of the visit. The patient would then file a claim for the visit himself. Once it receives the claim, VSP would then approve or deny it, and upon approval, mail the patient a reimbursement check.

Why would VSP begin such a program? According to Pat McNeil, VSP spokesperson, by offering retail alternatives, the company satisfies its clients' needs, which then allows VSP to grow its membership, thereby providing “more patients for private practice.”

“Our goal is to win business away from retail-based managed vision care plans that could be sending 40% plus of the patients into retail chains, and enable patients to see the doctors they prefer — the private practice doctors on our network,” says Mr. McNeil. “We believe that by piloting a program with Costco, VSP network doctors gain access to far more patients because we'll be able to win and retain clients that we might not otherwise have access to and direct these patients to VSP network doctors.”

He adds that the 2008 VSP Consumer Eyewear and Eyecare study reveals that 85% of consumers expect to receive the best care at private practice.

Measuring success/expansion

VSP will measure the success of the Costco pilot program by closely monitoring how the program affects the company's ability to win new groups and study where members obtain services, explains Mr. McNeil.

So, does VSP have plans to expand the pilot program?

“We have and will continue to pilot a number of innovative approaches to the market. Recently, VSP has offered new practice management incentives, lens technology solutions and other optical and managed care programs,” says Mr. McNeil.

Vision Reigns Supreme, Says New Study

PATIENTS RATE NEEDS

■ Vision is the top consideration when choosing eye products, says the Needs, Symptoms, Incidence Global Eye Health Trends (NSIGHT) Study, from Bausch + Lomb. The study asked patients ages 15 to 65 from China, Korea, Japan, France, Italy, the United Kingdom and the United States to score 40 features of eyecare products, which represent eight broader categories of patient needs.

Researchers then produced a statistical analysis of the eight needs, including utility index (UI) scores: Vision UI 161; Health UI 136; Environment UI 114; Eye Condition UI 108; Convenience UI 87; Comfort UI 81; Personal Performance UI 33; and Personal Appearance UI 2.

An UI score greater than 151 indicates “highly compelling.” Scores from 100 to 150 indicates medium importance, and those below 100 indicates a low importance feature.

The Future of Medicare Examined

A LOOK AT WHAT I THINK WE CAN EXPECT

Charles B. Brownlow, O.D. PMI, LLC, Waupaca, Wisc.

■ It is no surprise to any of us that the Centers for Medicare & Medicaid Services (CMS) is struggling to make ends meet. Looking ahead, with the first of the baby boomers reaching retirement age in 2011, one could assume that the CMS' money troubles will continue to worsen.

Controlling costs

It is likely that the three methods available to CMS for controlling costs will all be implemented next year and well into the future:

1. Relative values for covered services might continue to be reduced. The relative values are an integral part of Medicare's payment system, Resource Based Relative Value System, which calculates fees based upon the formula: Fee = Relative Value x Conversion Factor. The relative values are recommended by a committee of the American Medical Association, the Relative Value Scale Update Committee (RUC), with input from affected professions, including the American Optometric Association (AOA). CMS has the right to set the actual value. With downward pressure on costs, naturally, the relative values recommended by the RUC may be further reduced by CMS before they become part of the final CMS fee calculation.
2. Medicare's formula for calculating conversion factors will continue to create lower numbers as doctors' claims rise. As utilization and/or relative values rise, conversion factors decrease.
3. National Coverage Determinations might be employed to limit the diagnostic codes for which services are covered and the frequency at which services may be provided.

Projection

My personal short-term projection? The CMS' Allowed Charges (maximum reimbursements) per service will certainly continue to decrease as Medicare's expenditures and frequency of services rise. Professional groups, such as the AOA, will do everything possible to lessen the sting, of course, and may be successful in delaying or reducing cuts in relative values and conversion factors in future years. But, the handwriting on the wall shows the trend will be downward.

Considering Medicare's financial picture and the current national economy, optometrists will undoubtedly continue to find ways to reduce overhead costs and become even more efficient in the delivery of eye-care services.

On the bright side…

One cheerful note to close with: Optometry fared better in Medicare's Allowed Charges than most healthcare professions for 2011. For the 50 common eyecare services that I have tracked annually, the average increase in relative values is 10%. The 2011 national average Medicare conversion factor is about 5.7% below 2010, so the math suggests an increase across those 50 eyecare services averaging between 2% and 4%.

Dr. Brownlow is a practice management consultant. He has presented more than 400 lectures on medical record keeping in 50 states and has served as a consultant for several major healthcare consulting groups and insurers. He has also completed well over 150 in-office consultations for eye doctors and their personnel. E-mail him at brownlowod@aol.com.

Essilor Launches App and Lens

ANNUAL SALES MEETING NEWS

■ Essilor has launched an app that allows iPhone and iPod Touch users to learn about lenses and locate eyecare professionals (ECPs) in the United States. Announced at the company's annual sales meeting, the app provides information on Varilux, Crizal and Xperio lenses.

At the meeting, the company launched the Crizal Easy lens. These lenses are easy-to-clean, smudge resistant and offer glare and scratch protection and will replace the original Crizal lenses, which will be discontinued in the first quarter of 2011, the company says. Essilor will support the Crizal easy lens with a national consumer campaign, including radio and television advertising, that will launch March 7.

Essilor also announced it will take its Visioffice system on a national road show that will allow ECPs to experience this system, which can measure all the fitting parameters and positions of wear required for any Essilor lens available. Visit EssilorVisioffice.com for information and show locations.

In addition, Essilor invites ECPs to upload video testimonials regarding their experiences with Xperio lenses at www.shareyourxperiostory.com. The first 100 participants to upload videos will win a free pair of Xperio lenses through the “Share Your Experio Story” program.

Consider an Alumni Network

MANAGEMENT MEMO

Bob Levoy, O.D., Roslyn, N.Y.

■ Keeping in touch with valued staff members who have voluntarily left your practice makes sense. Widely used in industry, companies, such as Harrah's, Microsoft and Deloitte, use this method of “alumni” contact. Among the benefits:
► Former valued staff members represent a link to other potential candidates — especially in the case of highly specialized positions, such as coder, that might be difficult to fill through conventional channels. People tend to associate with others in their professions, which gives them access to those who have specialized talents.
► If the circumstances that prompted them to leave the practice have changed or if the job for which they left didn't turn out as well as expected, these staff members may be very happy to return to their former jobs. And if they do return, chances are they will be more loyal and hardworking than ever.
► Some practitioners report that on those occasions when they've been short-handed in the office, former employees have filled in on an emergency basis.
► Fostering long-term alumni relationships promotes a sense of identity that will encourage these individuals to not only remain in the practice as patients, often along with their families, but also to recommend new patients.

Action steps: Maintaining contact with former employees can be achieved through social media, such as Facebook, LinkedIn, blogs, e-mail, newsletters or even a phone call. When someone leaves, appoint one of his or her office friends as a liaison. Then, have that person contact the former staff member two or three times a year.

Some practices hold periodic get-togethers of current and former staff members. These include summer picnics, holiday parties or, perhaps, a luncheon in a private dining room at a local country club or hotel.

Needless to say not everyone you've employed through the years will respond to these efforts, but you may be surprised by how many of them will enjoy staying in touch with the practice.

Re-recruiting or staying in touch with valued former employees and developing their roles as goodwill ambassadors is a smart, easy-to-implement strategy.