The "new" VSP??

[paw]

That is the thing that is so frustrating. Our frame mark-up is less than the "average", according to VSP. (We try very hard to be competitive (i.e. keep frame price down) because we do want to appeal to the self-pay patient.) Therefore, we get penalized when a VSP patient picks a frame that is less than or equal to the retail frame allowance (so there is no overage to collect) but the wholesale frame price is higher than the wholesale frame allowance. We get reimbursed the wholesale frame allowance. So in the above example we get burned by the difference between the wholesale frame price and the wholesale frame allowance. A small difference, true, but it will add up over time since we have a significant number of VSP patients.

If we implement an increase in frame mark-up that will prevent that situation from occuring, then our prices seem high to the self-pays and they could go elsewhere. And we end up with an even higher percentage of our practice being VSP. Aaarrrgh!

We are the ones trying to keep prices down, and VSP is actually causing our prices to go up. That's so convoluted.

[DrKLP]

paw said:
We are the ones trying to keep prices down, and VSP is actually causing our prices to go up. That's so convoluted.

That's what is so ironic about plans like VSP. Due to the pricing structure you're forced to adopt, you attract the worst, least loyal, most complaint prone patients on the one hand. And, on the other hand, you penalize and gradually exclude the best, and usually easiest to please, self-pay patients. Actually, if you really think about it, all health insurance is like that. The providers are generally dissatisfied, the patients are often confused & dissatisfied, and the only ones to achieve any real level of gratification & control are the insurance companies. And, the only reason they're in total control is because federal anti-trust laws prohibit any type of organized resistance on the part of the providers--that would be considered conspiracy to commit a criminal activity (i.e. price fixing). However, insurors can organize, conspire, collude, threaten, sanction, dissemble, prevaricate, obfuscate and do just about anything they dam well please to further their ends--they call that free enterprise.

[paw]

DrKLP, Bravo, bravo, hear, hear !!!!

The gov't doesn't seem to mind collusion as long as the collusion drives prices down.

[Joann Raytar]

For those of you who mentioned concern over whether to keep certain plans or to get off the panels here is a quote from another thread that might be of some interest:

Pete Hanlin said:
Regarding VSP... My office no longer accepts it. When you do the math, when you see a VSP patient, you are basically discounting services and products about 30% after you allow for the fact that the work is done outside. Unless your profit margin is a lot better than mine, this leaves you with very slim margins on VSP patients.

We cut the plan 2 years ago. What did we find? Well, about 1/3 of our patients kept coming to us anyway (electing to drop their VSP coverage when it was time to renew). Of course, we sent all of our VSP patients a letter explaining why we were dropping the plan, so they were prepared. We are making about the same profit on the 1/3 that stayed as we did for the entire group under VSP.

Okay, the "forgetfulness" issue. During a VSP sponsored informational seminar three years ago, the lady kept saying "the patient is responsible for informing you they have VSP." After hearing this about 10 times, I asked "But when the patient remembers they have VSP after we've already made the glasses, you tell the patient we can back date the claim and still file their insurance."

There were echos of "yeah, that happens to us too" all over the room. The now uncomfortable lady said that, yes, VSP does have a policy of telling patients that providers can backdate claims- but that she personally didn't think this was a good policy. Basically, VSP makes the doctor look like the bad guy in any dispute...

What should YOU do about VSP? Don't accept it. If your doctor wonders if you can really "afford" to drop the plan, give him/her my email address, and I'll show them the numbers from our practice.

Pete "now if VSP would only find it in their hearts to drop us from all their provider lists..." Hanlin[B]http://www.optiboard.com/forums/show...&highlight=VSP

Note: This was from back when Pete was managing an OD practice.

[Johns]

Nobody says you have to use a "formula" mark-up when figuring VSPdo they?
Why can't you add (purely hypothetical amount) $200 to all wholesale costs, and then give a $120 discount to non-insurance customers. I don't see why there shouldn't be an "administrative fee" for taking care of the paperwork. VSP charges one don't they? Out of 4500 frames in our inventory, not one has a price tag on it.

I took the new rules, based on retail as a sign VSP wsa going to let us make more. We have so far.

I guess I still don't get this...

[DrKLP]

paw said:
DrKLP, Bravo, bravo, hear, hear !!!!

The gov't doesn't seem to mind collusion as long as the collusion drives prices down.

That's just the point. It doesn't drive prices down--it drives profits down! Ultimately price levels have to be maintained or increased just to offset the deep discounts demanded by the insurors. That is, unless you want to work twice as hard or you've discovered a way to cut your expenses dramatically. And, who bears the burden of this cost shifting? Those very individuals who don't get the deep discounts--BTW, I hear they're on the endangered species list. Subsequently, as your discount patient base gets larger and larger, your "usual & customary" charges are forced higher and higher. Its kind of ironic, one could be so successful at attracting these insured patients that you're eventually forced out of business. However, insurance companies will post record profits. In fact, Tennessee's new governor's claim-to-fame is that he made $27,000,000.00 in the health insurance business. Since the investment side the insurance industry has been very depressed due to the falling financial markets, those profits can only come from doctors, hospitals, and other providers who were underpaid or not paid at all, patients who were denied needed care, or premiums that were grossly inflated. I couldn't believe it, with this feather in his cap, he was awarded the highest office in the state! As providers, and patients, we simply cannot afford to let the insurance industry continue to suck this magnitude of vital resources from an already strained system. IMHO.

[paw]

DrKLP,

Right you are! The money going into health care is not going down, it's being shifted from the Drs to the insurers. Being an insurance executive is much more lucrative than being even a high-priced surgeon. This is a perverse turn of events in our health care system.

Have you been on Seniordoc.org. They would love to hear your comments.

[Texas Ranger]

This is a simple profession (if you don't consider all of the skill and knowledge involved). Managing a business of any type has some real challenges, regardless of the product/services offered for compensation, including services such as refracting and eye exams than have no "product". Our businesses all require a location, which has overhead, regardless of whether anything is sold. there are some basic relationships, you perform an eye exam for a patient, under the condition that you be paid $X for that service; same is true for the eyewear. $X for a frame(prices vary greatly), $x for the rx lenses (designs and prices vary greatly). new technologies have made available many great advancements in both. Now in the process of filling an Rx, you and the client agree upon the $$ to be paid for a custom made set of eyewear. no where in this transaction is an insurance company. Now, the client's employer hires an insurance co. to "manage" your relationship with your client. now the client has the "option" to decline coverage, but they are led to believe that this process is saving them money, and they never miss the pittance taken monthly from their paycheck. But now you/we have this ins. co. taking their little cut out of our margin too; they get premium money from our client and they come negotiating with our professions to give them our profits. the FEAR is that our client will go somewhere else. so where will our client go when they tire of dealing with incompetent providers, providers who don't care to give their best to clients who they lose money serving, look, those clients are getting burned just as bad as we are. So, if you're providing services that you're not making money on, you're just part of the scam on your clients. look, the average pt spends about $125 a year on eyecare, if that much, so they pay a premium to the ins. co. that about that much or more, then they have to pay extra, at inflated prices for services they could have paid for with their premium money. So, look in the mirror and ask yourself why you're part of their scheme, and wouldn't you just be better off without the VSP's of the world? be honest now!

[paw]

Texas Ranger,

That's a good synopsis of how insurance has wormed it's way into the eyecare profession, however, you have a couple of incorrect assumptions:

You said, "so where will our client go when they tire of dealing with incompetent providers, providers who don't care to give their best to clients who they lose money serving, look, those clients are getting burned just as bad as we are."

1. I beg your pardon, but we are not imcompetent, and we DO give our best to our patients regardless of whether they are VSP or self-pay.

2. I should clarify my previous posts to say that although we are now losing a few dollars on FRAME reimbursement for some VSP patients, we are not losing money on the patient as a whole. That is because in addition to the frame reimbursement, the provider receives a frame dispensing fee, a lens dispensing fee, and part of the overage on lens options. VSP may think its acceptable to knock frame reimbursement below cost as long as the provider makes a profit overall, but I don't.

The thing that really gets me mad is that they insist that most providers are making more from this change. I challenge any provider to show me actual numbers that prove he has made more per patient with the new way than with the old way. If VSP admitted, yes we are squeezing you, I think I could actually accept that as part of the evil of insurance. Just don't squeeze me and call it a hug.

[Joann Raytar]

paw said:
Texas Ranger,

That's a good synopsis of how insurance has wormed it's way into the eyecare profession, however, you have a couple of incorrect assumptions:

You said, "so where will our client go when they tire of dealing with incompetent providers, providers who don't care to give their best to clients who they lose money serving, look, those clients are getting burned just as bad as we are."

1. I beg your pardon, but we are not imcompetent, and we DO give our best to our patients regardless of whether they are VSP or self-pay.

With respect to Texas Ranger's post I admit we had to have a discussion on VSP patients and frame choices. Although it was a short lived discussion, it was a serious scenario. The only way to benefit from accepting VSP is to sell members very low priced frames, discontinued frames, overstock frames bought at a discount that cost us less than the listed wholesale cost or very expensive frames with a high overage. Selling midrange frames isn't beneficial to providers.

Even with VSP, we decided frames that are going to break or won't be warranteed aren't worth bothering with. We also decided if a patient likes a midrange frame that fits well they should be able to get one. I am sure there are providers out there that have decided to sell only low end frames to insured patients. I would just question the integrity of the methods they use to do this.

I have also seen practices so heavy in discounted insurance plans that the only way to turn a profit is by controlling payroll. You won't get good employees by paying them less than the going rate. So you hire based on payroll savings rather than skill and work ethic.

The nice part about all of this is the fact the OptiBoarders appear to take their sense of integrity and ethics seriously or we wouldn't be having this discussion. It's good to know that there are others out there who haven't entirely given into the system yet.

[DrKLP]

paw said:


Have you been on Seniordoc.org.

Hi paw,

I check it out regularly. Lots of really good input. Paul Farkas does a great job over there.

My wife is a licensed optician who owns an optical dispensary with an OMD partner, and I have a solo practice. So, we get hit by "anything" that affects any of the O's. I've been in practice 18 years and seen a lot of perceived "threats", but this insurance monster is truly the scariest of all. So far, I take neither VSP, Cole, Davis, or Eyemed. But, for how much longer I don't know.

[paw]

DrKLP,

My husband is an OD and I work in the office. I'm not a licensed optician, but have given some thought to pursuing licensure.

If you are succeeding without taking any insurance, more power to you! We take only VSP (and Medicare).

[Texas Ranger]

paw, didn't mean that 'youy personally' were incompetent and that you personaaly didn't "care' for clients, regardless of whether you could help them profitably or not. but it just seems the general market impression, and I don't get out much, just listen to patient stories. Bless your heart, just take vsp and medicare; do y'all have to have an insurance clerk to handle all the extra paperwork? the point I was making is that these insurance companies contribute absolutely zero to the prescribing, fitting , fabrication or dispensing of eyewear, and yet they are now taking money from the client and the provider to negotiate lower fees, while failing miserably, they are only impeding the pt from getting a quality pair of glasses at a "competitive" price (since they eliminate the competition). At the same time, they have the providers artificially increase prices to allow huge "artificial" discounts, designed only to give the "perception" to the pt that they are "saving" money on their glasses, when they are truly not! and by participating voluntarily, you are just working to promote the deception. because without "competent, caring, professionals" of the industry, they couldn't perpetuate the scam on society.

[paw]

Texas Ranger,

Well, we also take self-pays too!!! I agree completely with what you say about insurance.

We don't have a dedicated insurance clerk. We are real big on cross-training in our office. Everyone knows how to do everything. But there's no doubt that if we didn't take VSP, we probably would need one less employee. Entering those claims is time-consuming.

My other beef with VSP is that now we are required to give the patient a Savings Statement that itemizes the exam, frame, lenses, and options, and gives the price the patient would have paid without VSP and then shows what the patient is paying with VSP (overages), and shows their savings by using VSP. It takes time to generate and uses 2 sheets of paper per patient (one for the patient and one for the chart), and I don't particularly care to have our fees floating around in public.

I wonder if other insurance plans require that?

[rep]

Jo said:

The only way to benefit from accepting VSP is to sell members very low priced frames, discontinued frames, overstock frames bought at a discount that cost us less than the listed wholesale cost or very expensive frames with a high overage. Selling midrange frames isn't beneficial to providers.

I have always wondered why eyecare professionals immediately reject or devalue a frame when they become discontinued; or overstocked frames.

What difference does it make to the public? Is it the service issue that O my god I may not be able to get a part if I need it or is it a style issue that O that's last years styles or what? Isn't it a personal perception and not one of the public?

Is is unethical to sell a frame from a manufacturer that has outstanding quality to a patient at full price when it is discontiued or purchased at a price lower than standard wholesale prices because they are an overstocked item?

So I want to hear it why isn't everyone using discontinued frames of overstocked frames, that have whosale prices in the frames facts book I might add, on managed care plans?

Why not sell them a discontinued frame marked up to your normal retail price? Wouldnt that be a mid range frame that you could make a reasonable profit on irregardless of the managed care reductions?

Just wondering?????????????

Rep