The "new" VSP??

[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

[rep]

Im sorry, but I have to respectfully disagree. The patient is paying less weather you want to admit it or not.

Most managed care plans pay for a complete eye exam. The patient does not pay for that eye exam, their employer does.

Most managed care plans have a 20 to 30 % reduction in cost for the same products that non managed care patients pay full price for.

Many times the patients are not charged anything by their employer for this benefit. If they are charged, it is still less than what they would have spent at full retail prices.

Texas Ranger said: 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

How do you see what I have just described as impeding the patient from getting a quality pair of glasses at a "competitive price?

Could it be providers choose to use inferior products because they refuse to take a reduced profit even if they get additional volume?

How do you see it as a scam on the public?

It's only a scam on the public if you choose to make it a scam by selling them a product and implying it is your standard quality or premimum quality and you provide them with products with less quality than what you implyed.

Since there are over 1 million covered by the 4 top managed care plans in the country out of 275 million. How can you say they have failed miserably? The numbers say otherwise.

[Texas Ranger]

REP, I suppose it's all in your point of view. If I remember right, you work for a frame company that operates a vision care plan; I am an independent optician. you probably believe the company line about what a great deal the company's plan is, how many more frames it helps you sell. I see spending 30 minutes working with a pt about their eyewear, than another 30 min dealing with a plans customer service rep, trying to figure out how much the pt pays(while real paying pts wait(maybe?). Of course plans differ greatly. and like I said, I've been barred from participating in VSP, since I'm not owned by a doctor. it's great when we do have vsp pts that are on reimbursible plans; they know they are saying money, and we don't have to hassle with the claim. not vsp, but a similar plan; a friend calls, has been asked to "sign up" with a vision plan. we were listed as a provider, good(we aren't any more). his glasses usually cost $500, so he'd get about a %20 disc. or $400, but they want him to participate in a "select" plan where the ins. reimburses the provider a max of $100, while he pays a $20 co-pay, we file something akin to my 1040 to get $80 of the $400 from the ins. co., so he'd pay $320. BUT, he has to have $20 a month payroll deducted for 24 months first; so the ins. gets $480 from him,and maybe even a bit more from his employer, they pay me $80, next month. he pays me $320. now, the question is; If I get $400, and the ins. co. nets $400, how much does he pay? $800? Now, out of my $400, I have to cover the operating costs of my business, provide the frame and the lenses; so what part of this glasses purchase does the ins. co. pay out of their $400? I net about 5% or $20 out of the sale. the ins. co. nets how much? Samller profits with more volume is bad business. especially when the folks "managing" you pt. transaction is making more than you are; you can do it without them, is all i'm saying. so how many "extra" jobs do you need to do to offset the amounts given to the ins. co.?

[rep]

TR:

I do work for a frame company that has a managed care plan, but I use to be an independent optician so lets not kid each other about being able to make a profit on these plans. Metroplitan use to have a plan we took that paid Frame Facts price for the frames and we still made money on the exams, lenses and add on's.

Since you are not taking VSP or my companies plan you probably do not realize that all authorizations, claim filing and printed explanation of benefits are on line and available through web sites. You can actually check to see if the patient is eligable for benefits, get autorization and file the claim at the same time in about 5 minutes.

I don't know about VSP but my companies plan charges the employer much less on average than $20 and either the employee pays for it or the employer pays for it. Most of these plans are optional to the employee and few employees would sign up for them if they had to spend $240 per year as you imply.

Lastly if your only getting 5% ($20) out of a $400 sale then you have a lot more problems than managed care.

Our company's plan pays $100 profit on a complete pair of glasses which includes the exam fee less materials and processing cost. That does not include overhead like heat light rent salary and benefits. If you take 1/2 of the profit on that claim you still make 10 times your 5%. The $100 profit is based on no add on's being sold and is calculated based on jobs being sent to an outside lab. If you do your on edging in house you make more profit.

Lets say that you do 2 managed care claims a day, 10 per week, 43 per month. That contributes $4300 more to the bottom line at the end of the month.

Since my company''s program allows you to use any frame in the dispensary it is not necessary true that we sell more frames other than the minumum requimrements needed to participate in the plan.

Just a few things to consider.

[DrKLP]

rep said:
...it is not necessary true that we sell more frames other than the minumum requimrements needed to participate in the plan.

Hi rep,

I apologize for butting in, but I'm new to this format. I know you're not obliged to educate me on the intricate details of vision plans. But, would you please elaborate on the above statement, especially the part about "minimum requirements needed to participate". Thanks in advance.

[Joann Raytar]

rep said:
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?

Discontinued frames are almost always a problem. We move a great deal of clip-ons and when a frame is marked clip on available or is known to always have had a clip-on available, running into the discontiued roadblock gets annoying. We also offer a year warranty no matter if the customer pays cash or uses insurance. If the frame isn't replaceable, that presents another headache.

You are right, there isn't a problem with overstock frames as long as they are a marketable style.

[paw]

Rep,

1. I agree with Jo. Offering a warranty is a must, and you can't do that with a discontinued frame. I can't imagine what you would tell a patient, even if he spent "just" $200 on a pair of (discontinued frame) glasses, if he broke his temple 6 months later. "Sorry, Mr. Smith, I can't fix your frame, but I can sell you another $200 pair of glasses." I'm sure he wouldn't be a repeat patient.

2. You said "Lets say that you do 2 managed care claims a day, 10 per week, 43 per month. That contributes $4300 more to the bottom line at the end of the month."

Sure, you have more money, but how much staff time did you spend submitting the claim, checking receivables, chasing delayed or incorrect payments? What really is your net gain? With insurances you just plain work harder for less money.

The scam is not on the insured person, it's on the self-pays who pay the higher price the doctor/optician must charge to recoup their losses from managed care.

[Jubilee]

I used to be a store manager of a video store...of course this was 3 years ago when I was down to only casual part time at the optical...since they were going to pay me lots more moola...

I was offered VSP for a "nominal fee" of $8 month. This translates to $96 a year...when put up with the cost of a decent pair of glasses at most places..not too shabby...BUT the problem is that the plan DID NOT completely pay for the glasses. You got your discounts instead or copay how ever you want to put it. Translated to 30% off on Cr39 in a $99 frame at the local vsp provider. For A/R lenses base cost was $149 for my script, frame was $99...total was $249 before VSP...VSP translated to 30% discount ...which meant I saved $74.70! WhooHoo...I saved almost $75 with my plan....the plan I paid $96 to have...so I would have actually spent $21 more....if I had taken the plan. If I had gotten an exam...There was a $15 copay...exam cost $40...ooh... I would have saved $4!

I have seen comparable savings if not more through those "premier health" and other type plans that get offered through credit cards and things like the people's prescription plan. Of course if I needed a multifocal or specialty lenses then it may have been worth taking the insurance but for the a lot of consumers, they are not really saving any money caring the vision service...unfortunately dental is the same way.

From the optician's point of view...our local GM contract allows us to charge a $35 copay for cr39 in any lens style, and under $99 frame. Then it gives discounts on frames past $99, upgrade to poly for $20, a/r for $40. So we sell the paitent a set of poly tri's w a/r in a frame for $149. Actual cash sale:$448 Patient pays $155; Ins pay: $55 total revenue: $210...a 53% discount from cash. Yeah, we might be making some money off of it..but not a heck of a lot. Then when you factor in processing the claims, possibly missing out on cash paying patients cause your exam slots are full of insurance and not self pays, etc...it can get on shakey ground where some practices are having to do more and more work to get to anywhere near what they did 5-10 years ago before all of these vision care plans crept up. If all we did was take care of GM associates, we would have to do more than twice the amount of business we did before to be in the same place. That kind of increase means an increase in staff to handle it all, and that means even less profit...so on and so forth. A never ending cycle....

Cassandra

[Johns]

Rep:

Your company (along with all the others) are the reason discontinued frames have no value. Wnat to add value ? Take them back for credit.

That's value!

[rep]

Hi Everyone:

First to Dr KLP

My companies current minimum requirement is $7500 dollars net purchases per year, 150 board spaces and a return rate of 20% or less. This equates to about 17% of the average dispensary's annual purchases. This is subject to change as there is a test that is mentioned elsewhere on the board that may result in the requirement being changed soon. If you want more information e-mail me and I can get you all the information you need.

regards,

Rep

[rep]

Help me out here Jo and Paw

Isn' t the prescription usually good for only two years?
Don't a lot of the lens warranties now state that they are covered for only two years.

Since my company warranties any frame from two years from date of purchase no matter if it is discontinued or not. Why are you so concerned about the frame lasting longer than the prescription or the coatings?

I know that optical is a different kind of business but I can assure you that you really cannot promise anyone that every frame you sell will have replacement parts and that is especially true for clips. My strong recomendation is to buy the clip on at least a few of the models and always always check to see if you can get the clip before you cut the lenses and find out otherwise.

PAW I still respectfully disagree. Claim filing is a 5 minute process per patient. Payments are recieved weekly or by weekly these days with checks directly deposited into your account. It use to be a big problem I know but things have changed considerably. Look for bulk processing for large volume locations in the future it's coming.

Competition dictates prices, not managed care. I don't know of anyone who prices their products based on losses caused by managed care. I have seen a few changes to try and keep the managed care reimbursement higher but I have seen more changes trying to match competitions 50% off sales.

In reality everything is harder to make a profit on than it was in the past and a lot of other business are far worse off than optical.

[rep]

Cassandra:

Your missing part of the picture here. VSP dictate the price you paid for your exam. If you didn't have the insurance you would have had to pay the doc's full usual and customary charges and I know of very few Od's and no Md's that have usual and customary exam fees of $40.

Most managed care plans reduce the prices off usual and customary fees for products and services before you pay your co-pay's so you really did save a lot more than you stated.

Some managed care plans are much more restrictive and have lower reimbursements than ours. You shouldn't judge them all by your experience with one.

[Joann Raytar]

rep said:
Since my company warranties any frame from two years from date of purchase no matter if it is discontinued or not. Why are you so concerned about the frame lasting longer than the prescription or the coatings?

Rep,
Your company's return policies are the exception and not the rule. I should let folks know that awhile ago we had an issue with discontinued Lux frames we didn't know were discontinued when we purchased them. It seems the rep knew he was going to leave Lux for a new company and I suppose didn't care. Well, the new Emporio rep came in, saw our stock and fixed the situation with no if's, and's or but's and he did so very quickly. He instantly rebuilt our trust in Luxottica. So far, he is doing a good job of maintaining that trust.

Not that anyone likes discount plans, but I also have to admit that EyeMed's provider reimbursement schedules are better than VSP's.

Competition dictates prices, not managed care.

I don't know about that. There was a stretch of a few weeks where on a given day we might have had 5 cash exams and materials purchases and the rest were VSP. That has tapered off but it did make us think about our price structure.

[paw]

Rep,

Three things to cover:

FIRST: I'm confused. You said, "Since my company warranties any frame from two years from date of purchase no matter if it is discontinued or not. Why are you so concerned about the frame lasting longer than the prescription or the coatings?"

How can you warranty a discontinued frame? To me, discontinued means that parts will no longer be available, once the stock is used up. So, if someone breaks a temple, how do you replace it if there are no more parts?

And who said anything about being concerned about the frame lasting longer that the Rx or the coatings???

But since you brought it up, our office IS concerned about the frame lasting longer that the Rx or the coatings because:

1. not everybody gets a new frame every 2 years, they will just have new lenses put in the frame. Whenever someone wants to do that, we always find out if the frame is discontinued or not. If it is discontinued, we warn them that they are investing in a new pair of lenses to put in a frame for which no parts are available. We leave it to the patient to decide if the risk is worth it.

2. even if they get a new frame, they will keep the old glasses as a back-up pair, and if a part breaks when the frame is past warranty, they are willing to pay for a new part.

3. if they get a new frame, sometimes they keep the old glasses and have the lenses tinted for use as sunglasses.

SECOND: Then you said, "...but I can assure you that you really cannot promise anyone that every frame you sell will have replacement parts and that is especially true for clips."

We DO promise our patients that every frame on our board has a 2-year warranty. That means we GUARANTEE that every frame we sell will have replacement parts, and the parts will be under warranty for a mfr defect for 2 years from the patient's date of purchase. We've NEVER had a situation where a part was not available, because we only carry current frames!

We do not warranty clips.

THIRD: I think you are giving claim-filing and the other work involved with insurance the brush-off. The workload is a lot more involved than you give it credit for. I repeat: we are working harder for less money.

You said, "Competition dictates prices, not managed care. I don't know of anyone who prices their products based on losses caused by managed care." Well, now you know someone, because we just raised our frame prices based on VSP change in frame reimbursement.

[paw]

Cassandra,

I do agree with Rep on one thing. You shouldn't judge all plans by your experience. Different employers will have different VSP plans, meaning the premiums the patient pays, and the patient's co-pays and overages will vary from employer to employer. One of our area's major employers has a VSP plan that is breath-takingly generous. The employer picks up 100% of the premium. The patient's exam co-pay is $10. They have no material co-pay, a $115 retail frame allowance, and progressives have no overage. These people are used to getting and exam and a nice pair of glasses for VERY little outlay of money.

[Jubilee]

Rep: as far as the cost of exam...her basic fee is $40. I know because I worked for her and I did her insurance billing as well. Her thing was to breakdown the services. Basic includes overall eyehealth check, dialation if needed, refraction... Visual fields cost extra. Extended eye health (red-eye) cost extra.. Contact lens fits, etc,...so on and so forth...

I realize that not every plan in VSP let alone in managed care in general is the same... My point was that there is a lot of patients out there paying more money than they are actually getting out of it. I do not believe this is the case for everyone..but there is a siginificant amount who do...of course this is also part of the way insurance companies make money...

Cassandra

[paw]

I agree.

[rep]

I agree too. Many plans are based on capatation. (Ours are not) That means that they are betting that fewer will get services than pay for services. Not a lot of difference than life insurance.


PAW
Discontinued means just what it says that this particular frame is not going to be made any more and some time in the future there won't be any more. Not that we don't have anymore now. In fact many times discontinued items that are overstocked are sold as POM's (phased out merchandise) at less than half off. Things are run a little differently here because we manufacturer what we sell, where as an importer has different issues.

Sorry I don't buy it. Your telling me you never have a part or replacement you cant get. If so, your defying logic, must less a 30 years of experience from a lot of different accounts and operations....... If so your the first. Ta Daaaa.......

I recommend that you might consider changing your pitch because no manufacturer, that I am aware of, warranties frames from the time they are purchased by the consumer. The are warrantied based on the time sold to you the retailer. Check with your frame vendors and they will sheepshly admit that is the case. The reverse would allow you to keep a frame on the board for years and then sell it and maintain that the warranty just started.

Point taken regarding raising prices. If you can stand the competative price shopping that occurs with todays savy consumer raise them higher, but why were they lower to begin with?

J.
Again your acting like the employee has no choice and is forced by their employer to pay for these plans. I can assure you that is not the case with the majority of todays managed vision care employees.

Your doc may be shorting herself with a $40 usual and customary fee. I say that because many managed care plans pay $45-55 dollars and if her usual and customary fee is only $40 that's all she will be reimbursed because she has a usual and customary fee that is lower than the plan pays. Yikes!!!!

Thats why I suspect she charges a different price for private pay patients so she won't get killed by a low usual and customary exam fee.

[paw]

Rep, you said,

"Sorry I don't buy it. Your telling me you never have a part or replacement you cant get. If so, your defying logic, must less a 30 years of experience from a lot of different accounts and operations....... If so your the first. Ta Daaaa......."

I just remembered that there have been 2 times I can think of that a frame was discontinued within the span of time between when the pt bought the frame to when he needed something under warranty. It rarely happens, believe it or not. I think having a good frame rep helps, because he will take the frame off the board when it's just starting to be phased out. Also, while we keep re-ordering the best-sellers, we also order a lot of brand new styles that won't be discontinued any time soon.

You also said, "I recommend that you might consider changing your pitch because no manufacturer, that I am aware of, warranties frames from the time they are purchased by the consumer. The are warrantied based on the time sold to you the retailer. Check with your frame vendors and they will sheepshly admit that is the case. The reverse would allow you to keep a frame on the board for years and then sell it and maintain that the warranty just started."

No, no, no! It doesn't matter how long the frame is on the board. As long as it is a CURRENT frame, the mfr will warranty the frame. For example: the Luxottica Director frame. It's been around for years and years, but it's still current. What's the difference if the same frame is on the board for 10 years and I finally sell it to a patient, or if I just bought the frame yesterday and sell it to a patient. It's still current and it has a 2-year warranty. Now, suppose the Director had been discontinued last year, and I sell it to the patient (except I wouldn't because we don't sell discontinued frames), then I couldn't say to the patient that it has a 2 year warranty because it doesn't -- it's discontinued.

You also said, "Point taken regarding raising prices. If you can stand the competative price shopping that occurs with todays savy consumer raise them higher, but why were they lower to begin with?"

The reason our prices were lower to begin with is because we are trying to be attractive to our self-pay patients. At any price point one could say, why are your prices here and not $5 more? Providers find a point where they can charge the highest price and attract the highest number of patients. If you can increase the price without losing a substantial number of patients, then you found your new point. Hopefully we will have our new point rather than losing patients.

[Jana Lewis]

Hey Guys and Gals;

After reading this entire thread regarding VSP, I thought I might add that VSP strongly advises against selling discontinued frames, in fact they will tell their enrollees not to purchase them either.

[Johns]

Hey Guys & Gals !!

Guess what ? The best way to make $$$$ w/ VSP is to sell discontinued frames !! Buy them as discontinued, sell them as new. They're still in the Frames book, if they break you can give them another discontinued frame !! It's good enough for our VSP customers, but not for our cash pays. (NO, we don't do it, but I know many who do.) What a bargain their VSP customers think they're getting.


VSP has created a wonderful optical eutopia!!