Practice Metrics

Practice Benchmarking: Which Metrics to Measure & How to Do It

By Brian O’Donnell

Jan. 24, 2018

Many metrics go into measuring how well your practice serves patients while generating a profit. My practice carefully tracks an array of performance numbers, and our entire staff analyzes them and discusses ways to make improvements.

Select & Track Critical Metrics
We track production, collection, total exams, full exams, new patients and optical production, which includes average per-patient sales for both existing and new patients. We also track profit on our optical sales, which is broken down between frames and lenses. We also carefully track number, type and profit generated from medical eyecare visits.

My wife, who is a member of my support staff in the office, has a deep background in IT and applications for business evaluations. She designed specific spreadsheets that track every possible practice metric, from the routine eyecare side ( such as optical profit) to the medical eyecare side (such as dry eye visits). We gather a wealth of  statistics on a daily basis through the proprietary program she designed.

Track Daily
We track our key metrics daily, which rolls up to weekly metrics, monthly metrics and overall yearly metrics. It’s all built into a spreadsheet generated within our data system. This spreadsheet also shows percentage increase/decrease over the prior month, and over the same month the prior year. An individual tab contains a series of graphs that show the different weekly stats graphed for the year.

Sometimes sub-metrics are tracked. For example, our production metric is tracked based on average insurance paid. This average is constantly reviewed by our office administrator, so that when production is entered for a particular patient’s billing code, it is a number that is realistic to what will actually be reimbursed, which when paid would be a very close approximation. Often what is billed as insurance reimbursement is less than what is actually paid, so we always have real-time, correct data, for immediate business assessment.  

Assign Staff Members Metrics to Track & Improve
Every staff member is assigned a specific metric, which measures productivity and performance.

We practice open-book management, meaning that any staff member can view any practice metric at any time. We hold a formal staff meeting monthly in which we review the prior month’s metrics, and create a plan for improvement based on our spreadsheet of performance metrics. We also solicit ideas to improve individual metrics. For example, we had high per patient sales in our optical a couple months ago, but the overall number of patients sold eyewear was down. I immediately established actions to asses that issue, and improve the number of eyewear sold.

Another example: Our new patient numbers were very high, but we were spending a lot of money to drive those patients in. So, we scaled-down our advertising costs with a less costly plan that we felt would get roughly the same effect.

Tie Staff Bonuses to Improvement of Practice Metrics
Bonuses are awarded on the basis of goals achieved, as judged by the metrics each employee is responsible for tracking and improving. Each staff member works toward their goal for the week, month and year individually, but will coalesce as a group to make sure the whole practice flourishes. For instance, one employee is responsible for tracking and improving the total exams metric, but our opticians are going to do everything they can to help that staff member improve the total exams number because if enough people aren’t coming in the door, they won’t have the opportunity to sell enough eyewear to meet their optical sales goals.

Weekly and quarterly bonuses are needed to drive employees toward a yearly goal. Also, it’s important to determine what motivates people. For example, one of our staff is getting married next year, so she is “banking” all of her bonus money to use for the wedding. We have also done games where we awarded spa days to the staff, and around the holidays, we tie the goals to paid days off. Other incentives have been dinners out with spouses, and group dinners with the office staff.

Set New Goals Each Year
We have a year-end meeting. At that meeting, we establish new goals for the coming year, as well as the bonuses tied to meeting those goals. Our bonuses are based on practice-metrics-growth goals, and can be achieved weekly, monthly and yearly. Often, we throw in various games to make tracking and growing the metrics more fun. For example, last year we held the “Summer 4th of July Blast,” a game in which each staff member was rewarded on July 4th if they reached a six-week goal by that date.

Put Efforts to Improve Metrics Into Context
Tracking and evaluating numerical benchmarks is an important part of evaluating and pushing practice performance. At the same time, it is important for staff to understand that our ultimate goal toprovide the best possible care to our patients. At every office meeting, we stress first why we exist–for our patients. Then we discuss our practice metrics. Certainly, knowing your business’s numbers is vital, but we emphasize that our purpose is making every patient happier when they leave our office than they were when they came in. To achieve that purpose, we have to have the right business policies in place, your goals set, and every member of your group working in unison toward that purpose.   

 

Brian O’Donnell, OD, owns New Era Eye Care in Shavertown, Penn. To contact: bod@neweraeye.com.

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