Beyond Eye Care: Offering Ancillary Services

Creating new profit centers without disruption.

BY JERRY HELZNER, SENIOR EDITOR AND LESLIE GOLDBERG, ASSOCIATE EDITOR

In the corporate world, companies are constantly striving to create new profit centers that complement their core skills. As an example, Greenbrier Companies and Trinity Industries, two companies that for decades focused on building mundane railroad cars, are now taking advantage of their basic metal-fabricating capabilities to participate in faster-growing markets such as building specialized barges and making wind towers for electricity generation.

With the ophthalmology community facing increasing costs and declining reimbursement, many practices are also now seeking to add higher-margin ancillary services that are complementary, valued by patients, non-disruptive and bottom-line builders. In most instances, ophthalmology practices have opted to add hearing services and/or aesthetic treatments, but some practices have added such services as hair transplantation, medical skin care, full-facial cosmetic surgery and even tattoo removal.

This article will explore the new boom in ancillary services and provide firsthand observations on introducing hearing and aesthetic services in a cost-effective and non-disruptive manner.

The Appeal of Hearing Testing

One of the most popular — and most complementary — services that many ophthalmology practices have begun offering is hearing testing. A hearing program makes the most sense for those ophthalmology practices that focus on primary care and have repeat-visit patients rather than surgical cases.

"It's the perfect fit," says John Olive, CEO of Physician Hearing Services, Inc. (PHSI), a fast-growing company that specializes in providing what is close to a turnkey hearing services program to ophthalmology practices. "The seniors who comprise the primary patient base for most ophthalmology practices are the same people who are most in need of hearing services. These are the people who have been walking through your door every day."

Over the last several years, PHSI has innovated and dominated in combining hearing services with ophthalmology. The company has signed up more than 60 general ophthalmology practices by offering a hearing program that is designed to minimize any intrusion into basic practice routines. Mr. Olive is now working to interest retina practices in the service. He says that retina specialists have told him that patients with macular degeneration also tend to have a sharp decline in their hearing ability.

An Ocala Eye hearing specialist tests a patient.

To date, only two practices have discontinued the service. Mr. Olive says neither of those practices made a wholehearted commitment to hearing testing and were thus unable to embrace the program with the full staff buy-in that PHSI advocates.

"We do not operate like a typical hearing aid store. This is not renting a room," asserts Mr. Olive. "Our message is simple. Vision and hearing are our two most important senses and both tend to go bad at the same stage of life. The practice must embrace both ophthalmology and hearing and be invested physically and emotionally."

Making it Easy for Practices

Mr. Olive says that there has been a learning curve in providing hearing services to ophthalmology practices. Much of the learning has involved reducing the involvement of physicians in the hearing program.

"We learned early on that not intruding on the eyecare practice was key," he says. "Our program has evolved over three years. It has gotten simpler and is now as turnkey as you can get. We have moved from a long questionnaire and a physician examining the ears to a free 30-second hearing test using a tone box and administered by a tech. If the test indicates a problem, our licensed hearing professional takes over from there. The practice infrastructure is barely touched."

In addition to providing an audiologist, PHSI handles all hearing aid and hearing equipment purchases, using its purchasing clout with leading manufacturers to obtain discounts.

The practice is responsible for having a dedicated, quiet testing room and making an investment in the required hearing equipment. PHSI makes its profit on the sale of hearing aids and charges no other management fees.

Ophthalmology Management surveyed several larger practices in an effort to determine how the addition of a hearing program is working out for them. The responses were uniformly positive (see sidebar below), though practice administrators emphasize the need for initial staff training and total physician buy-in to the concept.

ENTs May Benefit

One initial concern of practices that has been for the most part put to rest is the belief that ophthalmologists who offered hearing testing would incur the enduring wrath of ENT practices. However, the response by ENTs to ophthalmologists offering hearing services has been somewhat varied. Some ENT practices have warmed to the idea as they received referrals, but a few have been hostile.

"There was some predictable unhappiness from ENT colleagues, who now, by the way, receive some referrals from our eye practice," says Amir Arbisser, MD, of Eye Surgeons Associates in Bettendorf, Ia. "To my knowledge, it is unlikely we had any ENT referrals before initiating the (hearing) testing program." Mr. Olive says these referrals result when the audiologist diagnoses otologic pathology in a patient being tested.

"The hearing professional is trained to look for the seven red flags that can be detected by the hearing test and that require an ENT referral," notes Mr. Olive. He estimates that about 5% to 10% of the people tested require referral to an ENT, though some practices with hearing programs report fewer referrals.

Patients Value the Program

Peter Polack, MD, of Ocala Eye in Ocala, Fla., says that he and his partners thought long and hard before introducing the PHSI hearing program.

"We are a very busy practice and would not support anything that would have a significant impact on our eyecare practice," says Dr. Polack. "Before we launched hearing, we surveyed our patients and they said they wanted it. For most of them, the alternative would be a hearing aid store. We don't aggressively market our hearing program. It's primarily for our own patients."

Dr. Polack says the Ocala Eye hearing program did have some growing pains, mainly in initially using a format that required more physician involvement. Now, the practice does its initial free screening with a tone box operated by a medical assistant.

"Some of the larger practices that have introduced hearing are working together through the Large Practice Interest Group to develop a set of best practices for hearing services. PHSI has also been providing advice to individual practices," says Dr. Polack. "At this point, I would say that the larger practices are doing well with the program but for smaller practices it may still be a question mark."

Must Every Face Launch a Thousand Ships?

There are many good reasons to add aesthetics to an ophthalmology practice — very little investment is required to get started, you already have experience with injectibles, in many cases there is no big equipment purchase required and it can be quite profitable. So, where to begin this endeavor? How do you market and to whom do you market? And, do you draw the line above or below the eyes?

Is This Really for You?

"The owner of the practice has to be dedicated to the process whole-heartedly and bring the practice on with him," says Bob Teale, an Eye Care Business Advisor with Allergan, Inc. "Ophthalmology is not used to adding a service line like cosmetics — it is a totally different ball of wax," Mr. Teale says. Physicians need to look at the market and ask: Is this service saturated in my area?

Am I willing to take the time to train my staff and look at rescheduling? "It is a totally different way of running the business. Most physicians don't do fee-for-service," says Mr. Teale.

"To add cosmetics to a practice, someone needs to be enthusiastic about the field and willing to dedicate time, money and energy into moving forward with the idea," says Marion Van Kirk, MD. She says that support from staff such as surgery coordinators, technicians or aestheticians also needs to be strong in order to face the challenges that lie ahead.

"Cosmetics are very different from the general framework of ophthalmology," says Bob Wolford, executive director, Grand Rapids Ophthalmology. "The whole skin care area has to compete for space with other parts of the practice. We consistently ask ourselves: ‘Is this the best thing we can be doing with our resources? Is there something that would be better for our patients or practice? Should we be going into audiology?’ We have to qualify and quantify choices."

The spa-like waiting lounge at Grand Rapids Ophthalmology Skin Solutions aesthetic facility.

"You have to wrap your head around the idea of adding aesthetics to your practice and figure out what makes you comfortable," says Steven Yoelin, MD, who practices in Newport Beach, Calif. "I have limited my inclusion of cosmetics to what makes sense for me. We, as ophthalmologists, are uniquely equipped to perform many of these procedures, as we have an appreciation and respect for tissue."

"I restrict my practice to procedures or surgeries with which I have extensive experience," says James Kirszrot, MD, of the Lexington Eye Group, "Botox and cosmetic eyelid surgeries are the bread and butter of what I choose to offer and I am trying to gear our marketing to get into that patient population."

Neiel Baronberg, MD, part of a private practice in Denver, feels very differently about the idea of embracing cosmetic services. "When I graduated from medical school, I did not have the intention of practicing anything other than medical and surgical ophthalmology. I was a physician first — not a cosmetician," he says.

He strongly encourages doctors interested in ancillary services to stay within their core competencies. "Join an ASC, add an optical shop or low-vision aids. Find other things that deal with the medical and surgical care of patients rather than becoming part of a society that is suggesting that you need to change your appearance," he recommends.

Don't Mix and Match Patients

"It is important to keep one thing in mind when thinking about adding cosmetic procedures," said Sarah Boyce Sawyer, MD, assistant professor of dermatology at the University of Alabama at Birmingham in a 2006 issue of Skin & Aging. "That is, cosmetic patients are not sick, they're shopping. Their total experience with your practice must be a completely positive experience, or you simply won't be able to successfully build your cosmetic practice."

Patients need to feel good about their experience. "It is best to alternate between ophthalmology and cosmetic days. Don't try to mix patients because cosmetic patients are totally different," says Basil Pakeman, MD, FRCS, from the Manhattan Surgical Care in New York. "They have no interest in seeing your cataract patients — it causes a disconnect in their minds. They want to see similar patients surrounding them in the waiting room."

He adds that cosmetic patients have a very low tolerance for not getting the service they want. "They are taking money out of their pocket, so they demand more. You will generally have a lower volume on your cosmetic days and have more time to spend with these patients. The atmosphere is more relaxed and there is an increased opportunity to build good relationships."

Dr. Yoelin concurs. "These patients expect a different level of service. Aesthetics is results-based pay and in order to have repeat business, not only do you need to be engaging, but you need to be the best at what you do."

Getting the Word Out

The majority of doctors interviewed by Ophthalmology Management said that word of mouth and internal marketing has been their most valuable marketing tools.

Dr. Kirszrot says the addition of aesthetics to his practice is a work in progress. He is looking to update his practice's Web site and is grateful to the manufacturers of the injections and fillers as they have provided useful marketing materials and pamphlets.

He says one of the major obstacles he has found in marketing is that patients are unaware that the subspeciality of oculoplastics actually exists. Says Dr. Kirszrot, "70% to 80% of patients I operate on tell me that they didn't know eye doctors could perform cosmetic eyelid surgery. They usually assume that general plastic surgeons are best suited for this type of surgery."

Dr. Pakeman says that the addition of cosmetics was an outgrowth of performing his blepharoplasty and ptosis procedures. He does not have much conversion from his general ophthalmology patients to his cosmetic patients as the general patients are on the older side. He says his "biggest marketing bang" comes from the internet and word of mouth.

"We do not strongly advertise outside of our local community," says Jamie Zucker, MD, in private practice in Canton, Ohio. "We try to have strong internal, in-office marketing with posters, handouts and before and after photos. We also run a weekly ad in our only Canton newspaper, which seems to be productive." The practice also has Botox parties every six months and Dr. Zucker gives talks about the cosmetics at the local hospital.

Dr. Van Kirk says that most of her practice's marketing is done internally with seminars, displays and signs. They also promote their services through local businesses that focus on beauty such as salons. "Don't forget to offer services to your staff at no charge or severely reduced rates to help develop walking testimonies for the practice," reccomends Dr. Van Kirk. "Internal training for the staff is also a key aspect for success."

"We have a very large practice with eight sites and we target our own patients in our marketing efforts. We don't do a lot of external marketing," says Mr. Wolford. "But we do events such as the Women's Expo in Western Michigan. We will also go to women's clubs where they ask for a speaker on cosmetics."

He says beyond the events, they target internal patients with brochures and poster in the offices. "The oculoplastic surgeons will talk about the cosmetic side of the practice to patients who are curious about the different procedures," says Mr. Wolford. "All of the offices have optometrists, which have younger patient bases, and we tell them to keep the cosmetic side of the business in mind when patients show an interest."

Once a month, the skin care area will have an evening event — sometimes focused on Botox, sometimes on cosmetics. The practice will do a mailing and ask that an existing patient bring a guest. Mr. Wolford says that this works well. "They like it here because they are in an ophthalmology practice and are comforted by that feeling — it's not like admitting you are going to cosmetic spa."

Staffing and Decor

Doctors interviewed for this article stressed the importance of having a strong staff member manning the phones. "She can reduce your consult times considerably by being able to answer questions on neurotoxins, inquiries about the service, how long it will last and expected outcomes," says Dr. Yoelin. He says that it is not prudent to quote price over the phone, as this will differ from patient to patient.

Mr. Teale concurs, saying that 95% of office contact takes place over the phone. "We will go into the practice as consultants and train the practice on understanding what types of questions need to be fielded by this person and do telephone training." He explains that booking is a three-step process. First, the front desk person takes inquiries and needs to book a consult. The next step is a consult. "If this is not booked as an injection, it is a lot of wasted time and money," says Mr. Teale. The last step is the patient receiving his or her injection.

"Training is crucial to great outcomes when considering adding neurotoxins and dermal fillers to a practice," says Dr. Yoelin. "Additionally, neurotoxins and dermal fillers does not require any type of ‘big monetary’ investment."

Executing this service well is essential. Unlike LASIK, where the patient may not ever return once the procedure is complete, patients receiving injections and fillers are frequently put on a rotating schedule and return every four to six months. Mr. Teale says that the practice will need to invest in this group of patients and provide a totally different environment for them. "The room and how the patient is treated needs to be spa-like — not a doctor in a lab coat scene," he says.

"We have a separate area for skin procedures," says Michael Boyle, MD, of Grand Rapids Ophthalmology, "but the space is incorporated into our office." He says that the rooms are designed differently than ophthalmology lanes — they are bigger and nicer. "When we built our new office, we planned a dedicated space for the cosmetic side," says Mr. Wolford. "The décor and how the area fits in the office were taken into consideration so that it appeared to be a cosmetic elective area to cosmetic patients and wouldn't blend in with the surroundings of our macular degeneration and cataract patients."

Ancillary Services Without Tears

In evaluating the pros and cons of adding any ancillary service, these five questions must be answered first:

(1) Are the physicians and staff comfortable and enthusiastic in offering this service?

(2) Can the service be added without undue disruption to the core eyecare practice?

(3) Is adding this service the best use of practice resources?

(4) Do your patients want and need this service?

(5) Can the ancillary service produce high-enough profit margins to justify its inclusion within the practice?

If you can answer all five questions in the affirmative, it may be time to look into the ancillary services that may fit well with your practice. OM