Optometrists dominate the contact lens market, writing nearly an estimated 90% of contact lens prescriptions annually.1 However, many practitioners are still not taking full advantage of the revenue potential from the contact lens arm of their practices, instead relying on it as a supplemental source of income.1 Cutthroat pricing by the big box retailers and online suppliers makes contact lenses a losing proposition, many still believe.
Some optometrists say it’s time to rethink that tired mindset. “Embrace contact lenses as a practice builder and not a loss leader in your practice,” says Glenda Secor, OD, of Huntington Beach, CA. “Increasing your enthusiasm for new products, introducing opportunities for new wearers and offering to address problems will reduce dropouts, create loyalty and increase revenue.”
|Specialty lenses like this scleral lens could give your practice an edge over others. |
Don’t Shy Away from Specialty Lenses
Optometrist Ken Krivacic of Irving, TX, believes the most profitable contact lenses are specialty lenses like sclerals, hybrids and multifocals. “They generally cost more, but you can also charge more, and profit margins are much larger than standard disposables or gas permeables. If you can train yourself in those areas and then market to your existing and potential patients, this will allow you to charge more and increase your net,” Dr. Krivacic says. Equally important: specialty lenses provide your patients with better vision correction than conventional lenses do, and that elevated level of care bonds the patient to your practice.
Offering specialty lenses in your practice helps to distinguish you from your peers, adds Jason Jedlicka, OD, of Edina, MN. A common mistake is underpricing your professional services. “I’m not talking about disposable bifocal lenses; those are a commodity and anyone can fit them. I’m talking about GP multifocal, ortho-k and sclerals,” Dr. Jedlicka says.
Additionally, patients usually don’t shop around for specialty services and lenses, says Justin Bazan, OD, of Brooklyn, NY. “If patients are referred to you or they are coming to you because they did their own research, they probably aren’t overly concerned with saving a few bucks,” he explains, adding that specialty lenses are often unavailable for the consumer to purchase directly, which guarantees the optometrist additional revenue from dispensing in-office.
Patients who are fit with specialty lenses are also likely to refer other patients to your practice. “I saw a new patient this week who came to me for sclerals because he knows someone who I fit in sclerals post-RK. He didn’t even need contacts, but was persuaded to see me for sclerals because of word of mouth,” Dr. Jedlicka says.
Specialty lenses are more mainstream than ever, with new modalities that are easier to fit and are also affordable for patients. One caveat with specialty lenses, however, is that over time, they may not be so unique, Dr. Bazan says. “As technology advances and doctors look for other revenue streams, you will see more and more providers doing specialty ‘whatever.’ As history shows, it will probably lead to a form of commoditization, and we will see a dip in profitability.”
Don’t Lowball Your Services
To build a thriving contact lens practice, be careful not to undervalue your expertise. Most doctors lowball their fees and try to garner most of their contact lens revenue from the material side, Dr. Krivacic explains. In fact, the revenue from the professional fees can be substantial if you price yourself correctly, and no direct cost is involved, he adds.
Optometrists should provide a higher level of service—and then charge accordingly, Dr. Jedlicka says. This includes performing topography on all new contact lens fits and refits; staining the patient’s eyes and everting their lids to look for any issues; using photography when possible to back up your recommendations; and individualizing product offerings for different patients.
When patients perceive a higher level of service, they are either willing to pay more for it—these are the patients you want—or not willing to pay for it. “Focus on taking exceptional care of the patients that appreciate the higher level of care and are willing to pay for it,” Dr. Jedlicka says.
By setting higher fees, many patients will consider you to be better at what you do since you are more expensive, Dr. Jedlicka points out. In turn, patients will often consider you the expert.
“I know a doctor whose ortho-k practice was languishing. In an effort to grow it, he considered lowering his fees. Instead, he was persuaded to raise his fees considerably. Doing so caused his ortho-k practice to grow significantly as patients perceived that—based on his higher fees—he was the best, and they wanted the best,” Dr. Jedlicka says.
For years, doctors have made the mistake of giving away their contact lens services with “free contact lens evaluations,” says Dr. Bazan. “Doctors would simply not charge if there was no change in the contact lens brand.” However, he suggests, it is important for patients to recognize that your services are worth paying for. This can be done by offering a higher level of service and charging accordingly.
“Do you just simply flick a slit lamp light on and off, or do you explain what you’re doing as you’re doing it? Do you simply ask how a patient is doing with their contacts, hoping to hear ‘fine’ so you can just move on, or do you get better answers because you ask better questions? Do you find out how the patient is wearing and caring for their lenses, or is re-education needed? Do you let them know about new options and why you are going to let them try them?” Dr. Bazan asks. The bottom line, he says, is that most patients are used to getting a subpar contact lens exam “and they feel like it’s worth not much more than free. It’s time for us to change that.”
You should, of course, monitor what the competition is charging, advises practice management consultant Bryan Rogoff, OD, of Baltimore, MD. If your practice is not established, you can’t charge $150 if the going rate is $100, or you’ll price yourself out of the market. “If you build up your brand and your reputation, you can charge higher prices,” Dr. Rogoff says.
Staff Takes the Baton
Staff is a tremendous resource when promoting a contact lens practice. At Dr. Krivacic’s office, he relies on his staff to make all the contact lens sales. “They work with the patient after the exam and go over fees and material costs and are instructed to promote yearly supplies. If staff are properly trained and incentivized, they can improve your bottom line,” he says.
Dr. Jedlicka’s staff members are fitted for and wear the contacts that are offered at his practice, making them the ideal ambassadors to discuss the highlights and positive experiences of their lens wear.
“Staff needs to hear the success stories you have, so they can get in your camp and become excited about what you do as a practice. Staff will often end up talking fees with the patients, so they need to believe in what you do and in the level of care you provide, so they are completely comfortable explaining fees and why the fees you charge are worth it,” Dr. Jedlicka says.
When assessing your staff’s role in contact lens sales, consider whether you look at your staff as “order takers or sales makers,” Dr. Bazan suggests. Educate staff why the annual supply is best for the patient and the practice, he says. Then train your staff on a script that makes it easy for them to sell the annual supplies to the patient. “The annual supply sale should be the norm, not the exception,” Dr. Bazan says.
Look to Your Spectacle Lens Patients
If a spectacle patient is a good candidate for contact lenses, Dr. Krivacic will ask if the patient has considered them. He will also mention the availability of one-day options, which are often easier to wear and easier to take care of, and would therefore be able to be worn easily on a part-time basis. He also explains that contacts are a good option for someone who only wants them for sporting activities, or for those with allergy issues.
In Dr. Jedlicka’s practice, he concludes every exam with a discussion of all available options for refractive correction: glasses, contact lenses and surgical procedures. If a patient is a natural candidate for contact lenses, he offers them a chance to try lenses. “Dailies are the perfect way [to ease] into this, since they are low maintenance and commitment,” Dr. Jedlicka says.
A good opportunity to market contact lenses to your spectacle wearers is to offer a patient the chance to try the lenses on while they are waiting for their glasses in the optical department, Dr. Rogoff suggests. Also, don’t discount contact lenses for special occasions, such as weddings or other special events where your patients might want to opt out of wearing their glasses, Dr. Secor says.
Pricing 'UPPs' and Downs
Although contact lenses are medical devices, they’re also a consumer product, subject to all the same incentives and disincentives to purchase as any other. Pricing matters, and patients want to be treated fairly, the experts say. Disposable lenses are the same no matter where they are purchased, so charging a premium for them, Dr. Jedlicka feels, is “sticking it to patients for their loyalty to your practice.” He believes optometrists should be competitive with product pricing and place the premium on services—making sure, of course, that the services offered are top-notch.
With the advent of the unilateral pricing policy (UPP) from many manufacturers, which dictates the minimum price that can be charged for certain brands of contact lenses, some doctors feel UPP has benefited private practice by leveling the pricing playing field. They do say UPP has posed some disadvantages as well, however. News reports on UPP, especially in states with legislative efforts against it, tend to misrepresent the policy as one of price fixing or artificial inflation at the consumer’s expense. Explaining UPP to the patient can help keep the sale in the practice instead of having them search online or seek out a cheaper retailer.
“UPP is helping, though most patients are unaware of this until we explain it to them,” Dr. Jedlicka says. “When they find out, many patients do elect to purchase their lenses from us instead of going elsewhere, as we point out the other benefits to buying lenses from us such as exchanges, trials, rebates and free shipping.”
As doctors consider which brands to keep in stock, they may want to opt for lenses that can’t be ordered for a cheaper price elsewhere.
“Why would any business sell a product that can easily be found for less online? I just don’t get it,” Dr. Bazan says. “When there are so many contact lens options that are clinically equivalent, why not go with the lenses that ensure your doors will remain open for you to see patients?”
Dr. Bazan says he is seeing some slippage in UPP policies, so he believes it is important to research the brands you use to check on current pricing. It’s also important to remember the listed price is probably not the final price. He suggests setting up an account with the vendors your patients use—or, hopefully, formerly used—and actually go through with the purchase until the site asks for a credit card. You want to know the bottom line price for the same supply after all the extras like shipping and handling are added in, he says.
For Dr. Krivacic, he believes UPP pricing has been both good and bad for the industry. The good is that it has helped level the playing field. If a lens is distributed using UPP, the prices at his practice are the same as the big retailers. The price incentive is then eliminated and most patients would rather buy directly from the doctor. “In our practice, this has helped,” Dr. Krivacic says.
However, the downside is that since all prices are now the same, there is less incentive for the patient to purchase a larger quantity unless a rebate is involved, Dr. Krivacic adds. Also, if the price is the same, patients may opt for convenience and purchase a lens online or at a retailer.
One final tip—you must have enough volume to generate good profits from the contact lens side of your practice, Dr. Krivacic says. This goes back to the basics of practice management and keeping your appointment book full.
“The contact lens patient is still our most loyal patient, and they appreciate and value the care you provide,” Dr. Secor says. “They are best at referring their friends and family, and they share word of your expertise with potential new patients more effectively than you can ever imagine.”
1. The State of the Optometric Profession: 2013. American Optometric Association, Jobson Medical Information. 5-6.