Dispensing Frontiers
Beyond the Frontier
For her final column, Leona Meditz discusses the unique challenges that remain for dispensing ophthalmology practices.

AN INTERVIEW WITH LEONA MEDITZ

Five years ago, when cutbacks in Medicare reimbursement for cataract surgery inspired many M.D.s to open optical dispensaries in their practices, dispensing was an unexplored frontier for most ophthalmologists. Since that time, Leona Meditz has been sharing her experience and knowledge about this subject -- 25 years worth of it -- with Ophthalmology Management readers.

Today, optical dispensing is no longer a frontier in ophthalmology; it's become part of the landscape. For that reason, this will be the last column in the series.

To close out Dispensing Frontiers, we interviewed Leona about the changes she's documented over the past 5 years, as well as what the future may hold for dispensing M.D.s.

OM: Why was a column like Dispensing Frontiers needed?

Leona: I saw M.D.s rushing to open dispensaries, thinking that all they had to do was convert an exam room, fill it with frames and hire an optician to create a successful dispensing operation. I knew from experience that integrating a dispensary into a medical practice requires a different set of operational models than other optical venues.

Also, doctors typically didn't have a model for ophthalmological dispensing to measure their results against. Imagine doing an eye exam without knowing what a healthy eye looks like! That's why this column has always explained how to measure results before it offered any solutions.

Few medical doctors realized how much adding a dispensary would change all of their practice operations.

OM: For example?

Leona: Under the medical model, insurance dictates most practice protocols, including fees. Surgical patients typically are covered by Medicare, and Medicare dictates that if a doctor takes assignment for surgical benefits, he's required to offer eyeglasses as well.

Unfortunately, Medicare fees for eyeglasses allow little profit. Unless ophthalmologists dispense multiple pairs of glasses to each patient, they have to see 30% more patients than optometrists or opticians to achieve the same level of profit. And seeing lots of patients stresses both the medical and optical systems.

Also, having patients who receive intraocular implants means ophthalmology practices dispense more lenses-only prescriptions. Yet lenses have 25% less margin than frames.

So, the optical needs to be organized under a different model. Yet M.D.s usually hire opticians who've only operated under traditional, nonmedical models.

OM: From the optician's perspective, what makes this so different?

Leona: First, an optician in an M.D. office has to be highly trained technically. Sixty percent of optometric prescriptions are single-vision, which are easier to dispense. But 60% of ophthalmologic prescriptions are multifocal, and about half of those are trifocals. These take more skill to fit properly. (If 5% or more of your filled prescriptions are re-dos, your optician needs technical training.)

Second, factors such as pathology and geriatrics also complicate dispensing, and many opticians haven't had to deal with these issues.

Third, when opticians make a mistake in an M.D. office, trust in the doctor is diminished, which undercuts the medical side of the practice.

ILLUSTRATION: AMY WUMMER

Fourth, M.D. opticians are typically required to purchase $160,000 in inventory every year, yet few have been formally trained as buyers. This can mean thousands of dollars in wasted product, nonproductive busywork and lost sales.

I advise M.D.s to ask their opticians to share their buying models and how they developed them. If they're using a model at all, it was probably given to them by a favorite frame representative -- whose job is to sell as many of his company's frames as possible.

If you count the number of frames you sold last year and divide by the number on your frame board, and the answer is less than 4, your optician needs buyer training. (If the answer is more than 6, your buyer's doing a great job.) Similarly, if lenses generate 30% or more of your optical revenue, and your cost of goods is greater than 20%, you have a problem with the mix of products you're offering.

OM: Is it all about the bottom line?

Leona: Absolutely not. However, if the bottom line suffers, M.D.s may choose to quit dispensing. I estimate that about 25% of those who chose to dispense already have quit. That's why I've focused on helping M.D.s understand the model a medical dispensary must follow to make dispensing worthwhile.

OM: Do you still see M.D. dispensing as a "frontier?"

Leona: M.D.s have certainly explored the dispensing arena during the past 5 years. Essentially, the dispensing practice model I've outlined in this column is finally intact. That's why this will be my last column.

OM: What does the future hold for M.D.s who continue to dispense?

Leona: Dispensing will get even more complicated as new technologies continue to evolve. Now is the time for M.D.s who plan to continue dispensing to evaluate their dispensing models. These practices should determine which specific issues are causing lower productivity and deal with them. Then they should train staff members to work within the improved dispensing model and measure results every quarter to verify the new model's success. Otherwise change will overwhelm them.

OM: Even though Dispensing Frontiers is ending, I know you'll continue to help ophthalmologists as a consultant. Thank you, Leona, for your contributions to our magazine, and to the field of ophthalmology.

Leona: It's been an honor to work with you.

Leona Meditz has 25 years of experience opening, owning and operating optical dispensaries. To learn how to train your people or manage products, visit her Web site at www.3ps4profit.com or e-mail Leona@3ps4profit.com.