Questions about VSP (Accepting, Requirements, Profits, Out of Network)

[eyepeople]

Hello please forgive my ignorance, I am not very wise on the subject which is why I am here so please have grace on me.

I have just started a dispensary and I have noticed quite a few people asking if we carry insurance which we do not since we are not 51% owned by an OD.

My questions are:

Is it worth me looking into going into a partnership with an optometrist just for the sake of accepting insurance?

Is there more profit to be in network? Obviously other than turning people down because we currently don't accept insurance?

Is there any ways around VSP? Ive heard to just go "Out of Network" but what does that mean? Can we just call these patients insurance companies to get them reimbursed for going out of network?

Is VSP a pain? How quickly do they pay the practice?

I appreciate any help.

[sharpstick777]

Wow. You will get a huge amount of answers here.
The first question I have is what is your market segment? It will determine first wether you even take insurance. If you are after a family/general market, insurance of any kind is a double edged sword, but it may be nessary. It depends on your volume and the marketing plan you have in place. The only practices w/o insurance in this area are very trendy, adult focused on very funky premium eyewear. They do well but they get their frames in Paris and Milan.

With insurance you trade higher volume for lower reimbursements. To see if this makes sense, you have to compare the write-off with your current patient aquisition costs. If you don't know that number, you should probably hire an accountant to figure it out.

Also, what is your experience with Insurance yourself? If you don't know how to work each company, insurance will eat you alive. Its a painful lesson to learn, and one or two mistakes could derail your business. You need to be an insurance pro, and if your not, you will need to hire someone who is.

If you do decide to take insurance, or VSP (in or out of network), you will want to master the numbers so you are not deceiveing your potential patients. They need to know exactly what the difference is. Again, you need an expert biller.

So what is your business plan on marketing and placement? Will insurance complement that plan or distract you? What are most common insurances in your area? What are your alternatives to VSP? (some insurances are more optician friendly than VSP).

Partnering with OD is not a bad idea, no matter what you decide on insurance. Two new practices in this area are Optician/OD co-owned and are both thriving (exploding is more accurate). Its a good combination.

[SharonB]

Er du min vän från COA? Om svaret är ja behag , meddelande jag privat betraktande VSP.

[AustinEyewear]

This is a very simplified summary of VSP:

VSP pay quick, but figuring out if they paid correctly is difficult.
Easy to get a hold of customer support, but they have difficulty answering difficult questions. i.e. why did I only get paid x dollars for this transaction.
You can use your own lab if you purchase lenses from VSP, otherwise you must send job to VSP qualified lab.
You must use VSP approved lenses, not all are
How you make your money with VSP is by selling the frame. They make money off the lenses, however, you do make some when the pt moves to a better lens that VSP does not cover. This is fairly easy, because they typically only cover plastic or poly.
You collect the money for lenses from patient, and then VSP takes that money away from you, making VSP look like the hero and you the turkey that is overcharging the patient. Little does pt know that VSP takes that money from you in the form of a "charge back". How this works is too complicated to explain in a post.
Most pts have a frame allowance and then a discount on balance owed. You can actually lose money on some frames when dealing with VSP, Oakley and Maui-Jim come to mind. This really burns me up. I would like to exclude these from my list of frames that I will allow VSP pts to utilize their ins from. VSP supposedly reimburses you for wholesale cost of frame, that is, if it doesn't go over X dollars, and X is very low.
The main thing VSP can do for you is bring pts to your office, and you can make money from exam fees. If you want to make a living off just frames and lenses via VSP I'm not sure how well you will do. The reason I don't know is back to the first bullet.
Oh yes, don't forget contact lens - the reimburse for that too.
We plan to develop or purchase some software that is capable of figuring out what VSP owes us and if we are actually getting paid correctly and our profit margin from VSP frame sales. We also use Officemate, and that info is not available - go figure.
Having insurance companies, requires hiring additional personnel to handle those insurance transactions and additional personnel to handing the additional volume of patients you serve, but at a lower margin, so you gotta figure out where your break-even point is or you may pay more in salaries to handle the insurance than it actually brings in. And, they can clog your dispensary with pts who just want what their ins covers, meanwhile, your priv pay pts are tired of waiting for help and w alk down the street. Its definitely a double edge sword.

[Barry Santini]

Don't make the insurance plans you take, nor the frame lines you carry, nor the lenses you feature become the focal points of your business. All of these, and I mean all of them, can easily be duplicated by others, whether they are down the street or online. You *must* focus on what YOU bring to the table in skills, customer satisfaction and community involvement define what your value-added/trust basis essentially is, and effectively communicate it.

Miss this, and you are already dead, but don't know it!

B

[eyepeople]

So what is your business plan on marketing and placement? Will insurance complement that plan or distract you? What are most common insurances in your area? What are your alternatives to VSP? (some insurances are more optician friendly than VSP).

We only sell higher-end frames and prescriptions. Currently we do not have a lab or an exam lane but we are putting in a lane in the near future. So as it stands we are just a dispensary looking to expand. Since we are different from the standard general family optical we are wondering if trying to take insurance is right for us... What about eyemed and spectera? Are they a little more optician friendly? Or claim friendly for that matter?

I appreciate everybody's help and input on the subject.

[SharonB]

Eye Med (Luxottica) not too bad - you can use your own lab, or any lab for that matter. Reimbursements are not great, but OK. Spectera (United Health Care/ Optum) is the absolute pits. The labs are horrible - the customer service is non-existent, and I could go on and on. We dropped them as soon as we could.
Your high end frames will not have allowances that make them worthwhile purchases for the patient in most cases, regardless of the plan.
I've found that practitioner friends in niche markets do better without accepting insurance. Many plans have "out-of-network" provisions for subscribers. That might be the road you want to travel. You are dealing in products that are not run-of-the-mill.....you don't need to jump on the insurance bandwagon. It's a slippery slope to mediocracy.

[ilanh]

This is a very simplified summary of VSP:

VSP pay quick, but figuring out if they paid correctly is difficult.
Easy to get a hold of customer support, but they have difficulty answering difficult questions. i.e. why did I only get paid x dollars for this transaction.
You can use your own lab if you purchase lenses from VSP, otherwise you must send job to VSP qualified lab.
You must use VSP approved lenses, not all are
How you make your money with VSP is by selling the frame. They make money off the lenses, however, you do make some when the pt moves to a better lens that VSP does not cover. This is fairly easy, because they typically only cover plastic or poly.
You collect the money for lenses from patient, and then VSP takes that money away from you, making VSP look like the hero and you the turkey that is overcharging the patient. Little does pt know that VSP takes that money from you in the form of a "charge back". How this works is too complicated to explain in a post.
Most pts have a frame allowance and then a discount on balance owed. You can actually lose money on some frames when dealing with VSP, Oakley and Maui-Jim come to mind. This really burns me up. I would like to exclude these from my list of frames that I will allow VSP pts to utilize their ins from. VSP supposedly reimburses you for wholesale cost of frame, that is, if it doesn't go over X dollars, and X is very low.
The main thing VSP can do for you is bring pts to your office, and you can make money from exam fees. If you want to make a living off just frames and lenses via VSP I'm not sure how well you will do. The reason I don't know is back to the first bullet.
Oh yes, don't forget contact lens - the reimburse for that too.
We plan to develop or purchase some software that is capable of figuring out what VSP owes us and if we are actually getting paid correctly and our profit margin from VSP frame sales. We also use Officemate, and that info is not available - go figure.
Having insurance companies, requires hiring additional personnel to handle those insurance transactions and additional personnel to handing the additional volume of patients you serve, but at a lower margin, so you gotta figure out where your break-even point is or you may pay more in salaries to handle the insurance than it actually brings in. And, they can clog your dispensary with pts who just want what their ins covers, meanwhile, your priv pay pts are tired of waiting for help and w alk down the street. Its definitely a double edge sword.

Many of your observations are spot on but I'm surprised by your claim that VSP makes mistakes in their reimbursement. I may be naiive about this but we very rarely find any errors in the way they compensate us. In fact, initially I scrutinized every remittance/EOB that they sent us for months until I was satisfied that the mistakes were minimal to non-existant. We then stopped checking the remittances because it was laborious. This may be a mistake on my part but I would love to find out if others feel the same way. Otherwise, I think your analysis is pretty good. In my practice they have brought in a large number of patients and they reimburse decently for exam, fitting, refraction etc. It's true that it's more difficult to benefit from lens and frame sales with VSP but the emphasis is definitely on the various fees that they reimburse. Otherwise, they are a quality company, easy to deal with and usually great support. I believe that they try hard to champion the OD cause even though they are sometimes accused of "selling out". I have attended some of their town meetings, listened to their executives and even met some of their board members. I think that in terms of vision plans they're as good as it gets.

[sharpstick777]

Er du min vän från COA? Om svaret är ja behag , meddelande jag privat betraktande VSP.

Rough Tranlation from Swedish (courtesy of Google): Are you my friend from the COA? If so please message me privately viewing VSP.

[AustinEyewear]

Many of your observations are spot on but I'm surprised by your claim that VSP makes mistakes in their reimbursement. I may be naiive about this but we very rarely find any errors in the way they compensate us. In fact, initially I scrutinized every remittance/EOB that they sent us for months until I was satisfied that the mistakes were minimal to non-existant. We then stopped checking the remittances because it was laborious. This may be a mistake on my part but I would love to find out if others feel the same way. Otherwise, I think your analysis is pretty good. In my practice they have brought in a large number of patients and they reimburse decently for exam, fitting, refraction etc. It's true that it's more difficult to benefit from lens and frame sales with VSP but the emphasis is definitely on the various fees that they reimburse. Otherwise, they are a quality company, easy to deal with and usually great support. I believe that they try hard to champion the OD cause even though they are sometimes accused of "selling out". I have attended some of their town meetings, listened to their executives and even met some of their board members. I think that in terms of vision plans they're as good as it gets.

I only said it was difficult to determine if they paid properly, meaning, their payment information is cryptic and jumbled and really is not very logical. Looks like you agree with that. I should have said its very difficult! I don't know why they make it so hard, it doesn't have to be that way. Its very hard to track it in your books too. I have found mistakes though. I was like you, checked a bunch for a while, decided it was all good. Then a few months back decided to spot check one, and first one I looked at (pure chance) found a mistake. Called support, ended up with them on the phone for about an hour, finally she was supposed to call me back. Never did, I tried calling a few times and never heard from her. I don't call often, but the few times I do, they usually can't answer my questions. I don't ask easy questions, I usually already can figure the easy questions out on my own..... It would be a lot easier if they just went to a pure discount model on products and with straight across the line reimbursements for services. That way they only owe for services. But I'm sure they probably would never do that because then pt would realize the insurance is not all that good. The way they do it now, it appears as though they save the pt quite a bit of money and any price gouging is occurring at the doctors office.

[eyepeople]

Many plans have "out-of-network" provisions for subscribers. That might be the road you want to travel.

Please explain this further. Can I try to persuade patients to let us see if they can get reimbursed for going "out of network?" If so how do you convince a random customer as they're walking out (because we don't take their insurance) that we might be able to get them reimbursed for a portion of what they purchase?

I really appreciate everyone's help, opinions and tips on each provider. It helps me to determine which direction we need to head in. Happy Holidays!

[ilanh]

Please explain this further. Can I try to persuade patients to let us see if they can get reimbursed for going "out of network?" If so how do you convince a random customer as they're walking out (because we don't take their insurance) that we might be able to get them reimbursed for a portion of what they purchase?

I really appreciate everyone's help, opinions and tips on each provider. It helps me to determine which direction we need to head in. Happy Holidays!

Eyepeople, I think that this is what you are referring to: Some patients who do not want to use a VSP provider can go "out of network". I occasionally have some patients who do this when they simply cannot find a frame in my office that they like. However, if they go out of network their benefits are greatly reduced. For example, if they have a Signature plan which gives them a benefit of $130 towards frames, they will get the full benefit with us but only $50 or so if they go out of network. I'm not sure how it works for lenses but I think it's the same concept. In essence, yes a VSP patient CAN go out of network but they will get about half or less of the benefit. I may be a little off about these numbers but I'm fairly sure about the main concept.

[Barry Santini]

The ONLY reason for vision insurance for eyewear (not exams) is for the *discount*. So the ECP's goal if they want to NOT deal with insurance is to offer that (some recipe that's attractive) which others taking insurance are not.

Are you game?

B

[sharpstick777]

We only sell higher-end frames and prescriptions. Currently we do not have a lab or an exam lane but we are putting in a lane in the near future. So as it stands we are just a dispensary looking to expand. Since we are different from the standard general family optical we are wondering if trying to take insurance is right for us... What about eyemed and spectera? Are they a little more optician friendly? Or claim friendly for that matter?

I appreciate everybody's help and input on the subject.

Eyemed may be a good choice for your business. They exclude a lot of high end frame lines for the 20% discount you have to give to patients. If you sell a Marchon frame for example (irony) you have to give the patient thier allowance (say $100) and then discount the rest by 20%. With many premium lines you don't have to give that extra discount. The lines that are excluded are the lines where you have to sign an agreement that you can't discount them. That can mean an extra $40 a job.

Eyemed is far from perfect, and the discount plans really suck, so its a pain. Plus I swear their phone opperators are prisoners who are being outsourced by the warden for $1.25 an hour.

[Optimonte]

We have been an Optician owned retail for over 28 years now. We have never joined any vision plans and I am hoping we never have to. In our town we have 3 opticals and a Wal-mart optical. We have an OD doing exams, however we do not make anything off of exam fees or cl's.
The reason I have not joined any vision plans is this: The reimbursement to providers is so low that the only way you can turn a profit on a pair of glasses is you have to raise your prices on lenses and frames so that everything exceeds the plans limits and then you can charge patient for the overages.
This year alone I have had many people buy their glasses thru me and use their out of network benefits and end up paying less for their eyewear than had they went to the two in network providers in town. They also have mentioned they will probably drop the vision plan the next year.
I am selling them the exact same frame that the other two are and the initial retail price thru me is usually $60 to $70 less because i dont have to artificially inflate my prices for vision plan patients.
On more of an ethical note, what about the family of 4, all wearing glasses that doesn't have a vision plan, yet go to one of my competitors and now have to pay inflated prices for their eyewear.
I do offer those people with Eye Med and such a 10% discount on their purchase and this has defintitely enabled them to get a better price thru me.
I am going to keep bucking the vision plan system as long as I still have private pay customers coming in.
One other note is we really try to cater to the older population, which typically doesn't have an employer based vision plan and they also are a generation who will pay their bills.
I understand my situation is different than yours as you are just starting out, but maybe their is niche their for you. Instead of offices complaining about the vision plans they should all decide to not accept them. This would either put the vision plans out of business or they would have to raise their reimbursements to providers and make it profitable. You have the patient, the provider and the vision plan in this and the only entity making money or saving money is the plan.

[GokhanSF]

The ONLY reason for vision insurance for eyewear (not exams) is for the *discount*. So the ECP's goal if they want to NOT deal with insurance is to offer that (some recipe that's attractive) which others taking insurance are not.

B

Agreed... Also, you can print out of network reimbursement forms, fill out for the patient, and then mail it for them. Most people will appreciate the extra step you took and will stay with you instead of going somewhere to use the benefits.

[ilanh]

We have been an Optician owned retail for over 28 years now. We have never joined any vision plans and I am hoping we never have to. In our town we have 3 opticals and a Wal-mart optical. We have an OD doing exams, however we do not make anything off of exam fees or cl's.
The reason I have not joined any vision plans is this: The reimbursement to providers is so low that the only way you can turn a profit on a pair of glasses is you have to raise your prices on lenses and frames so that everything exceeds the plans limits and then you can charge patient for the overages.
This year alone I have had many people buy their glasses thru me and use their out of network benefits and end up paying less for their eyewear than had they went to the two in network providers in town. They also have mentioned they will probably drop the vision plan the next year.
I am selling them the exact same frame that the other two are and the initial retail price thru me is usually $60 to $70 less because i dont have to artificially inflate my prices for vision plan patients.
On more of an ethical note, what about the family of 4, all wearing glasses that doesn't have a vision plan, yet go to one of my competitors and now have to pay inflated prices for their eyewear.
I do offer those people with Eye Med and such a 10% discount on their purchase and this has defintitely enabled them to get a better price thru me.
I am going to keep bucking the vision plan system as long as I still have private pay customers coming in.
One other note is we really try to cater to the older population, which typically doesn't have an employer based vision plan and they also are a generation who will pay their bills.
I understand my situation is different than yours as you are just starting out, but maybe their is niche their for you. Instead of offices complaining about the vision plans they should all decide to not accept them. This would either put the vision plans out of business or they would have to raise their reimbursements to providers and make it profitable. You have the patient, the provider and the vision plan in this and the only entity making money or saving money is the plan.

Thanks Optimonte. I do understand your point and think it's great that that is working out for you. I have found that many VSP patients actually wind up walking away with almost no costs ie: they have a $150 benefit for glasses and SV or bifoc lenses are completely free. There is no way that those patients are going to pay less by going "out of network". Many of them pay zero simply by using their benefits. Even those that have overages may wind up paying another $50 for frame, $30 for poly etc but it is still much less expensive for them than going out of network. I think that there are some really lousy vision plans which literally pay nothing in terms of benefits and those may be the ones that you are mentioning in your post. However, the classic VSP plans (which constitute most of our vision plan business) have pretty much set in stone what every option costs and nothing is "overpriced". In fact, it is very difficult to beat those prices.

[GokhanSF]

ilanh... I totally disagree. I worked at an optical store in which we did not except any insurance and also I managed multiple Lenscrafters and OD offices. Believe me that no insurance optical store was making more money and seeing more foot traffic than all the rest. Most of the customer were normally covered by VSP :)

It all depends on what products are available in your store and of course having the best knowledgeable staff as well.

[Johns]

eyepeople, unless you are an OD, there is a good chance that taking many of the insurances listed above may not even be an option. VSP and Eyemed regularly exclude non-ODs from being panel providers. The reasons run from, "Must be OD owned" to "We have too many providers in your area."

If you don't believe me, send an application to Eyemed, and report back to this forum. You might be VERY surprised at the response. Additionally, if you do accept any insurances, find out who the local brokers are for that plan, and when someone comes in and asks if you accept Eyemed or VSP, tell them to talk to their HR Dept., and/or direct them to the broker. Be proactive.

[anthonyf1509]

The ONLY reason for vision insurance for eyewear (not exams) is for the *discount*. So the ECP's goal if they want to NOT deal with insurance is to offer that (some recipe that's attractive) which others taking insurance are not.

B

Agreed... Also, you can print out of network reimbursement forms, fill out for the patient, and then mail it for them. Most people will appreciate the extra step you took and will stay with you instead of going somewhere to use the benefits.

Agreed on both of these posts!
Also, I'll add that at times when I'm working with a VSP insured client, (we're not in-network), that I'll encourage them to have their back-up pair made at an in-network provider if they really want to use their benefit.
They'll get the best they can from me, then get 'what's covered' elsewhere.
Undoubtedly they'll come in for adjustments and state how their vision is just sharper with the lenses and fitting we provide.
It does instill a little more trust with us, by simply not being afraid to allow them to buy elsewhere.
I won't do this all the time, usually I'll do what the poster quoted will and send the forms in for them, bit sometimes it will really pay off knowing who their in-network choices are :)

[ilanh]

Agreed on both of these posts!
Also, I'll add that at times when I'm working with a VSP insured client, (we're not in-network), that I'll encourage them to have their back-up pair made at an in-network provider if they really want to use their benefit.
They'll get the best they can from me, then get 'what's covered' elsewhere.
Undoubtedly they'll come in for adjustments and state how their vision is just sharper with the lenses and fitting we provide.
It does instill a little more trust with us, by simply not being afraid to allow them to buy elsewhere.
I won't do this all the time, usually I'll do what the poster quoted will and send the forms in for them, bit sometimes it will really pay off knowing who their in-network choices are :)

OK, let's talk numbers. The typical signature VSP plan will get $150 benefit towards frames and also get free SV or bifocal lenses. Therefore, if he picks a $200 frame it will cost him $50 minus his 20% discount on the overage ie: $40. He then pays another $60 for premium AR. Therefore, for a total of $100 he will get a $200 frame with premium AR on his lenses. Please note that these lenses are surfaced (not stock) and the AR is crizal alize (not a local factory brand). Can you provide this "out of network" at this price? Also, note that if he sticks to the $150 frame limit and decides that he doesn't need AR, then his cost his Zero! On the other hand, if he gets premium AR for $60, poly for $30, transitions for $40 and a progressive for $60; then his total cost (with a covered frame) will be $190. Do you think you could provide that out-of-network for this price? Once again, please note that we are using a VSP lab with top-of-the line surfacing, genuine transitions (not sunsensor), premium coatings and professional surfacing (never stock).

[becc971]

We take all of the major vision insurances here at my job, and it is nice because it brings traffic in. Reimbursement as far as i've done the research tends to be at about 2X when we get the insurance cash money and the overages (with the exception of davis vision which is evil anyway). One good way to make a little more cash is to find the companies who have frames that are in frames data at $60, but only cost you $30, etc. That way your bottom line increases a little bit. Taking insurance is essentially a service to your patient, it's a pain in the a$$ to go out of network and try to file the claim yourself. We also offer people who have the eyemed tiers we don't take a 10% discount and sometimes that gets them to stay, and I also tell them that we will help them file the paperwork. Good service is always something to strive for and WILL help you keep some customers, but I feel like the end of story is that they will do whatever is less time consuming and $$ savvy. And since you were so nice to them, they'll buy them somewhere else, and come have YOU do the adjustments for free, or with any problems that they have and say "geez i never should have gone to __insert name here__ seriously, happens to me twice a week at least haha. We use premium products pretty much at all times. I encourage people to use their insurance to get them a pair of glasses that will last them a long time, not just what is covered so they'll have to replace it in a year. That tends to work pretty well as far as upgrades and things like that.

VSP like any insurance has work arounds, you just have to jump through hoops sometimes. But there are little tricks you can use to get reimbursed more :) I think it's worth it to have it in our office, we also have a LOT of competition surrounding us, about 6 optical stores in the same moderate to high end market and 2 "value" stores, so it at least helps fill the chairs. After that its up to our team of certified opticians to do the rest

[GokhanSF]

OK, let's talk numbers. The typical signature VSP plan will get $150 benefit towards frames and also get free SV or bifocal lenses. Therefore, if he picks a $200 frame it will cost him $50 minus his 20% discount on the overage ie: $40. He then pays another $60 for premium AR. Therefore, for a total of $100 he will get a $200 frame with premium AR on his lenses. Please note that these lenses are surfaced (not stock) and the AR is crizal alize (not a local factory brand). Can you provide this "out of network" at this price? Also, note that if he sticks to the $150 frame limit and decides that he doesn't need AR, then his cost his Zero! On the other hand, if he gets premium AR for $60, poly for $30, transitions for $40 and a progressive for $60; then his total cost (with a covered frame) will be $190. Do you think you could provide that out-of-network for this price? Once again, please note that we are using a VSP lab with top-of-the line surfacing, genuine transitions (not sunsensor), premium coatings and professional surfacing (never stock).

I started to wonder if you are an ECP or an accountant for the patient. I can give you examples of stores in your state who does not take any insurance and doing more business than you do. Will that help you understand that not everything is about the cost? I worked in an optical store who did not take any insurance and we have done 14K to 32K in sales on a daily basis. It is all about what you carry in your store, how you market and advertise your store, and having good licensed opticians in your store.

[ilanh]

I started to wonder if you are an ECP or an accountant for the patient. I can give you examples of stores in your state who does not take any insurance and doing more business than you do. Will that help you understand that not everything is about the cost? I worked in an optical store who did not take any insurance and we have done 14K to 32K in sales on a daily basis. It is all about what you carry in your store, how you market and advertise your store, and having good licensed opticians in your store.

The thing to keep in mind is that I am an ECP ie: people come to see me because they have some kind of pathology (my M.D side) or they want a routine eye exam (vision plan). I don't have anyone coming to see me because they walked by the office and saw our nice frames (we are in a medical building on the second floor). My entire clientelle is medical based. Therefore, I don't think that my situation can be compared to a Lenscrafter or boutique at the mall. Our frame selection is predicated mainly on our regular patients (mainly elderly) or those healthy patients who specifically came to see us because we take their vision plan. I doubt that if I filled my optical with Oliver Peoples, Lindburg, Cartier and a staff of playboy bunnies as opticians that I would increase my sales by very much. Perhaps after I retire I may open a place like that in Newport beach or Beverly Hills and refuse ALL vision plans!

[optical24/7]

....... and a staff of playboy bunnies as opticians that I would increase my sales by very much.

Doc, need a new manager?