Progressive Focus©
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Progressive Focus© Newsletter

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Volume 1, Number 1 Fall, 2000
Helping You Manage the Expectations of Managed Vision Care

Welcome to the initial issue of Progressive Focus©. This quarterly management tool is sponsored by Essilor Labs of America (ELOA). We have designed "Focus" to give providers knowledge and insight into managed vision care programs that we deal with today, and those that will emerge in the future.

Each issue will address topics ranging from updates on legal or regulatory matters to advice on helping providers and payers improve quality of care and patient satisfaction while reducing administrative hassles. Specific segments will include contracting guidelines to assist Eye Care Providers in making important managed care decisions. Additionally, each issue will highlight one of the prominent, national managed vision care groups, offering easy to understand facts, figures, and explanations about their programs and services.

I've asked Gil Weber, MBA, a nationally known consultant in managed vision care and practice management, to serve as executive editor and principal author. His background working with HMOs, third party vision plans, and as Director of Managed Care for the American Academy of Ophthalmology, plus his experience as a dispensing optician gives him a unique perspective in our industry.

It is ELOA's hope that you find this communication beneficial, and that this will serve as an ongoing resource to assist you in "Managing the expectations of managed vision care."

Steve Brewer, ELOA Director of Managed Care Sales

Quotables...

"If supplies of healthcare services cannot show convincingly that they offer superior quality, buyers are forced to assume that standards are equal, and so they focus on price."

E.J. Freeman, III, Director Managed Care,
University of Florida College of Medicine

What Makes One Managed Vision Care Plan "Better" Than Another?

One can't help but feel the impact of third party vision care benefit plans. Plans serving optometric interests; plans for ophthalmologists and/or opticians; plans inviting all three. Programs sponsored by HMOs; programs created and run by providers; programs created and run by entrepreneurs.

Did You Know...?

In 1998 vision care providers reported they were contracted to an average of 6.8 managed care companies that provided them patients under an average of 8.8 vision plans?

Source: Managed Vision Care Report ‘99/’00, Jobson
Optical Group, page 15

And the number is growing with the spread of managed care. It can be difficult to sort through the promotional paperwork and get to the bottom line issues for providers and payers.

chkbx.gif  How will the XYZ vision plan help grow my practice, increase my bottom line numbers, and minimize my staff's time dealing with non-revenue generating administration?

chkbx.gif  How will the XYZ vision plan bring quality and value to our enrollees (employees), and simplicity and cost savings to our healthplan (company)?

Sadly, many vision plans don't and won't. Despite every vision plan's representations and promises in promotional materials, in many cases it's illusory rhetoric — hyperbole. Too often vision plans fail to live up to their own win-win-win billing.

This regular feature will help providers and purchasers sort through the hyperbole and dig down to the truth: What makes one managed vision care plan "better" than another?

It's Much More Than Reimbursement Or Cost

Let's start with two simple facts — often under appreciated if not ignored.

1)  Reimbursement is not the only factor providers need to consider.

Yes, it's important, and if a vision plan doesn't compensate you reasonably for your work, that's a plan you probably don't need. Obviously, "reasonably" will differ for each provider. But....

chkbx.gif  If plan "X" pays more than plan "Y" for identical services, that doesn't automatically mean that the former plan is the one you should join. For example, if plan "X" consistently pays in 45-60 days but plan "Y" pays in 14 days, that's a significant cash-flow consideration favoring "Y."

chkbx.gif  Or if plan "X" has a reputation for putting calls "on hold" when staff tries to verify eligibility while plan "Y" lets staff quickly verify eligibility electronically, that's another significant differentiation favoring the plan paying less.

But too few providers consider such factors. Instead, they turn to the provider agreement's reimbursement exhibit and base the entire decision on a few lines on one page.

2)  Cost is not the only factor payers need to consider.

Naturally payers seek contracts offering the lowest price. But that does not necessarily equate to best value. Unfortunately, far too many HMOs and self-insured employers have no vision-experienced staff to sort through the proposal details and differentiate form from substance. In that environment lowest price often becomes the default discriminator.

Enrollees (employees) want and expect quality, selection, service, access, and convenience. So the decision to contract with vision plan "X" or "Y" should be made, in significant part, on how effectively it addresses these expectations. They're crucial if the vision plan is to support corporate goals for growth and membership (employee) retention.

And for HMO managers, your decision should be based, in significant part, on how the vision care program and its providers will interface with your primary care physicians and medical/surgical ophthalmology services. This is crucial if your HMO has a bifurcated delivery system with routine vision care contracted to one entity or panel/group of providers while medical/surgical eye care is contracted to a different entity or panel/group of providers.

Quality Of Care And Patient/Provider Satisfaction Issues

A provider should not join a vision plan simply on the prospect of adding incremental new patients. A quick decision could be a bad one, and getting stuck with the collateral damage of staff frustration, patient disappointment, and administrative hassle is worse than not participating at all

Similarly, when anxious to finalize the choice of vision care vendors and presented with a seemingly incredible price, purchasers need to look past slick brochures and self-serving statistics. Tying your plan or company to the wrong vision vendor — perhaps in a multi-year agreement — could prove disastrous.

Among the many factors impacting quality of care and patient and provider satisfaction, three stand out in particular under managed vision care: covered lenses, covered frames, and choice of optical fabrication labs. In this premier issue we'll look at labs. In the next issue we'll look at covered lenses and covered frames.

Did You Know...?

In 1998, 40% of physicians, 76.8% of optometrists, and 47.8% of opticians reported that on average 2.0 of their vision plans required them to use a specific lens lab?

Source: Managed Vision Care Report ‘99/'00
Jobson Optical Group, page 24

Optical Fabrication Labs

Lab choice is important to providers for obvious reasons including cost, quality, and service. But lab choice is also important, if indirectly, to the patient who has certain pre-conceived expectations, and who needs to be kept happy. Vision plans typically provide for lenses under one of two fabrication scenarios.

Did You Know...?

On average Ophthalmologists use 1.9 labs, Optometrists 2.2, and Opticians 2.1?

Source: Looking At Labs, 20/20 On-Line, November 1999

Provider Chooses Lab  Most plans allow providers to use the labs of their choice or an in-house lab, if any. This continues current relationships and supports existing ordering and delivery protocols. And it lets the provider with on-site production capabilities or a favorable local lab contract share in the cost savings and profitability, both important considerations in these times of increasingly squeezed reimbursements and lower margins.

Approved Lab List  Other vision plans require that providers obtain all lenses from a list of approved labs. Depending on the selection and administrative protocols put in place by the vision plan, this is not necessarily disruptive for provider or patient. Approved labs typically agree to a specific pricing schedule and performance standards, and vision plans are supposed to monitor lab compliance and performance to weed-out under-achievers.

If a provider's usual lab is on that list then everything involved in delivering lenses to managed care patients should be transparent for patient and provider. Even if one's preferred lab is not on the list, for the most part approved labs do a good job managing customer service issues.

The real problem, of course, is what happens when a mandated lab regularly does not perform to a provider's expectations, thereby delaying delivery of patients' eyeglasses? If there is another local lab on the list a quick switch may render the problem moot. But some lists of approved labs are quite limited, and some very restrictive vision plans insist that providers send all jobs to a plan-owned lab (often in another state).

In such cases there may be few or no alternatives to the poorly performing lab(s). That's certain to result in provider and patient dissatisfaction. Therefore, payers should insist that panel providers have an adequate selection of labs from which to obtain covered lenses, and that there are protocols in place to "cure" problems quickly if service from mandated (or owned) labs is deemed unsatisfactory by the provider.

There are, of course, many other factors providers and payers should consider when evaluating vision plans. Look for additional discussions in future issues of Progressive Focus©

Did You Know...?

In the past two years, providers most often changed optical labs for the following reasons:

Inadequate service................................27.3%
Poor product quality..............................18.2%
Unsatisfactory turn-around time.............14.5%
High prices...........................................10.9%

Source: Looking At Labs, 20/20 On-Line, November 1999

Vision Plan Profile — Eye Care Plan of America (ECPA)

To help providers and payers better understand the marketplace and players, Progressive Focus© will profile a vision plan in each issue. Here, we'll introduce Eye Care Plan of America.

ECPA was founded in 1981 and is a publicly held company trading on the AMEX exchange (FAH). ECPA is a licensed third party administrator and re-insurance company providing care to approximately 10 million primary members plus dependents in all 50 states, Puerto Rico, and D.C. The company markets vision programs under the ECPA name and also develops private label vision care plans for insurance companies or other benefits companies.

ECPA does not own lens fabrication labs or optical dispensaries, a buying group, or a mail order contact lens company. It does not import frames.

ECPA has seven regional sales offices and works through a national network of brokers. It markets two customizable vision plans: ECPA Select (insured, self-funded, and capitated plans) and ECPA Access (in which the patient pays directly). The company's national clients include IBM, American Airlines, Marriott, and Coca-Cola.

ECPA has a provider panel of over 8,200 locations. 57% are optometrists, 7% ophthalmologists, and 36% opticians. 63% of the panel are independent practitioners; 37% are national and regional retail chains.

Providers in virtually all parts of the country have potential access to a large pool of new patients. For example, covered lives in California, New York, and Texas are, respectively, approximately 1.02 million, 1.15 million, and 750,000. Even Alaska offers providers potential access to nearly 25,000 lives.

Providers verify eligibility through an automated telephonic system and can receive 24-7-365 benefits and authorizations via an immediate fax-back system. ECPA states that average clean claim payment is seven to ten days.

Effective August 1999 ECPA introduced a new Laser Vision Correction program. This provides a discounted refractive surgery benefit at no membership fee or additional premium cost to either patient or payer. Participating physicians must be Board Certified, have performed a minimum 1000 procedures, and cannot also dispense eyewear in their practices.

For additional information on ECPA call (800) 426-5481 or visit the website at http://www.ecpa.com/

E-Vision Resources

http://www.medicaldata.com/MCMap/default.asp
A site with good information on managed care penetration by state and city. Also includes some information on key managed care players in each state.

http://www.hcfa.gov
This federal government site includes a wealth of demographic information plus special sections on Managed Medicare and Medicaid programs.

http://www.ncqa.org
The best site for information on managed care quality assurance programs and initiatives. Downloadable files include HEDIS testing and reporting measures and clinical practice guidelines.

 

These materials are intended to provide useful information about the subject matter covered. The author believes that the information is as authoritative and accurate as is reasonably possible and that the sources of information used in preparation of the materials are reliable, but no assurance or warranty of completeness or accuracy is intended or given, and all warranties of any type are disclaimed.

The materials are not intended as legal advice, nor is the author engaged in rendering legal services. The materials are not intended as a replacement for individual legal or professional advice. Information contained herein is presented only for illustrative purposes, and it should not be used to establish any fees or fee schedules, nor is it intended and it should not be construed as encouraging any user of the materials to take any actions that would violate any state or federal antitrust laws, tax laws, or Medicare or Medicaid laws.

Copyright © 2003-2007, Gil Weber, MBA. No part of this newsletter may be reproduced or distributed in any form whatsoever without the author’s prior written authorization.

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