Follow the numbers if you want to know your true worth

Follow the numbers. That is the advice of John Pinto to ophthalmologists who want to know the true worth of their practice. Pinto, an ophthalmic practice management consultant from San Diego, California, says one of the biggest challenges facing ophthalmologists and their practice managers is assessing the day-to-day value of what they do in commercial terms.

“If I go up to a typical eye care administrator and say: ‘What is your profit margin? What is your average revenue yield per patient visit? What is the surgical density of your practice?’, a few of them will have a ball park answer, but a lot of them will not be able to answer those questions,” says Pinto.

“They are most likely to tell me: ‘Oh, we have a very nice practice. We have five doctors and we provide cataract surgery and some glaucoma care and a visiting retina specialist. We take great care of our patients, we get paid very well and my doctor drives a Ferrari’.”

These are subjectives, says Pinto, and should be avoided.

“It would be like if I asked a doctor: ‘How is your patient?’, and he or she answered: ‘Oh they are lovely. You should see their eyebrows and their blue eyes. I have never seen such azure eyes in my life!’”

In a clinical setting, these subjective questions or answers do not work. “You do not ask the patient: ‘Are you left-handed or right-handed?’, during an eye clinic,” he added.

Pinto says when asked to describe their practices, ophthalmologists should be able to tell him that they were established in 1975, they have a profit margin of 57 per cent, which is up from 54 per cent the previous year but which is still behind the 60 per cent profit margin of their best-of-class colleagues.

“They will also tell me that, in order to drive more efficiency in the practice, they will have to discuss how to do this with their doctors. If ophthalmological businesses are to run well they must operate in the same way as they operate clinically, objectively and diagnostically.

“I should be able to go to an administrator and have them tell me what the most adverse 'diagnoses' in the practice are, and have them say: ‘We have insufficient space. We cannot afford to build more rooms so we will have a temporary expansion’,” says Pinto.

CLEAR VISION

Arthur Cummings MD, FRCS, Consultant Ophthalmologist at the Wellington Eye Clinic, Dublin, Ireland, agrees with Pinto's assessment. He also argues that if you follow the numbers, you need to have a clear vision of how your practice operates.

“If you own your own practice, it is generally assumed that you run it. This is not always the case. It depends what size it is and what it involves. Some ophthalmologists will have busy surgeries, and if they are taking on other responsibilities such as research it is not possible to manage the practice on your own,” he says.

“In a busy practice, you need a clinical manager as well as a business manager. Your clinical manager should decide on a day-to-day basis how the clinic operates, what the surgery lists look like and what rooms are used for which professionals on a given day and so on. Besides that, you need someone with a different skill set who looks after the administrative and business side of the practice. That person, as well as overseeing the financial end of the practice, will also be responsible for staff contracts and contracts with research companies for example.

“I am the sole owner of our practice and work closely with my business manager and my clinical manager. All three of us understand what the other is doing, but we know for a fact that the person in charge of their own particular area knows more about that area than the rest of us. Everyone knows their roles well, which gives me time to look at clinical issues. Teamwork is vital and I cannot run my practice without a very strong team around me. The best compliment I can get from any patient is: ‘You have an amazing team’,” says Dr Cummings.

John Pinto: pintoinc@aol.com

Arthur Cummings: abc@wellingtoneyeclinic.com