Estimating Contact Lens Fees at the End of the Century

A CONTACT LENS SPECTRUM STAFF REPORT
July 1999

Like last year's survey, over 40 percent of this year's practitioners indicated that they increased professional fees to counteract decreased material fees.

This year's edition, our 6th, is a report from 71 optometrists, 11 opticians and one ophthalmologist from a broad array of modes of practice from around the United States. They estimate that on average, about 10 percent of their contact lens income comes from RGP lenses and another 10 percent comes from soft conventional lenses, while just over 22 percent of their contact lens income comes from 1- to 3-month replacement lenses and over 30 percent of their contact lens income comes from 2-week disposable lenses. Nearly 10 percent of their contact lens income comes from soft toric contact lenses with bifocals accounting for only 3 percent.

Contact Lens Practice Profit

Prior to last year, two-thirds of those who responded to our survey thought that spectacle-only patients were more profitable than contact lens patients (who also should purchase spectacles), but last year, this dropped to 45 percent. This year, only half of our respondents thought that spectacle-only patients were more profitable than contact lens patients. Numerous studies have demonstrated that contact lens patients are more loyal, have examinations more often and are more profitable than spectacle-only patients. Perhaps this is becoming an accepted belief; over the long term, successful contact lens patients are more profitable. And it's hard to provide the best care without profit.

Last year, our readers thought 40 percent of their income was from contact lenses. This year, the average estimate was 35 percent. Forty-three percent of the respondents increased professional fees in the past year (versus 44 percent in 1998), while 35 percent decreased material fees - up from 26 percent in 1998. Competition, mail order, managed care and seeing more patients were the most common reasons cited for these fee adjustments. It does appear that over the last few years there has been an expected reduction of fees for disposable contact lens materials due to competition and high volume, which is hopefully made up for by increased professional fees and greater volume.

Table 1 illustrates fees from our 1996 and 1997 surveys. Table 2 illustrates fees from our 1998 and 1999 surveys. Table 3 illustrates fees from our 1996 and 1997 surveys and Table 4 illustrates the 1998 and 1999 survey data. Note: these fees do not include comprehensive eye examination fees.

Emerging Trends

There are few major trends to observe in the past years once you've accounted for variability in the data. There may be a trend toward lower fees for materials for soft torics and multifocal lenses, probably driven by the expansion of disposable contact lens availability.

The great variety of lenses available, the ever changing competition from various sellers of contact lenses and the vast array of modalities of wear make fee assessment more difficult than ever.

Fifty-five percent of our readers indicated over 30 percent of their patients are contact lens patients.

Our readers offer their contact lens candidates contact lenses always, 28 percent of the time and sometimes, 53 percent of the time. Two-thirds of our readers say they always offer contact lens prescriptions when asked.

There is essentially no increase in the offering or suggesting of contact lenses to patients who do not ask about them, despite our many studies which show better safety, more convenience and more profit with contact lens patients than with spectacle- only patients. The risk of greater chair time for contact lens patients seems to be the inhibitor.

We conclude that it is difficult to determine exactly what contact lens fees are and where they are headed at the end of the nineties decade due to the dynamic nature of the field and the vast competition and alternatives available. Overall, fees are stable. However, this could change with extended wear being reinvented and lower price pressures of daily disposables.

How much more will the new high Dk lens extended wear care cost the patient and reward the practitioner for the value of safer, uninterrupted vision? One could estimate at least $100. Is that enough to compete with the hundreds of dollars reward for co-managing a refractive surgery patient? We'll find out in the early part of the next century. Can practitioners in the USA find a way to talk about and promote the use of daily disposable lenses the way their British counterparts do? Daily disposable lens use in the USA can grow if practitioners talk about the cost as "about a dollar per day" and according to monthly cost, not annualized cost. Practitioners who encourage the purchase of an annual supply of contact lenses speak very favorably of this approach both for the patient's well-being and for their bottom line.

Income from contact lenses in many practices may increase in the next 5 years due to expected growth in specialty lens categories. Emphasizing to the patient that specialty lenses require more care due to their design and fitting requirements is the key to success. Keeping the patient in the practice by offering convenience and competitive fees along with valuable products and care is of greatest importance.