As Eye See It

As Eye See It – VSP’s Not For Profit Organizational Structure

Friday, February 27, 2015

A question I often hear is, “I thought VSP lost their not-for-profit status?” In today’s installment, I will try to clear this question up and then talk about a new and emerging force in our industry, private equity and venture capital.

Here is the VSP Global mission statement:  “VSP Global is a community benefit based not-for-profit that was established to provide access to cost-effective, high-quality eye care and eyewear to as many in the community as possible. We help people see, and our community is the global community.”

VSP has been a voluntary not-for-profit vision care plan since its inception. It has always been about bringing together a high-quality panel of doctors with a community of patients who need high-quality, cost-effective eye care. The not-for-profit structure is very important because, as the bylaws state, “No director, officer, or any private individual shall be entitled to share in the distribution of any corporate assets or in any surplus. Such surplus, if any, shall be used by the Corporation to pursue …the promotion of social welfare by improving and expanding services.” In other words, surpluses are reinvested in the system to provide additional cost-effective, high-quality eye care for additional community benefit.

Most, if not all of VSP’s competitors work under an entirely different system, wherein, a major goal is to provide return on investment for stockholders and other investors. And now, as I am sure you have seen, large investments from sources outside our industry have been pouring into the eye care industry. Private equity investment seeks to take an existing company and restructure it to optimize financial performance. Venture capital investment seeks to cause a disruptive optimization of individuals to impact the bottom line. If we apply these principles to our industry, both private equity and venture capital seek to buy low and sell high and are focused on a quick return on investment. That means that patients become consumers and doctors become components with profits being the main goal.

It is safe to say that a rapid infusion of cash can quickly enable an entity to become a disruptive competitive force. Seemingly overnight, the focus can move from doctor and patient centric to profit centric. It is also safe to say that the health and welfare of doctors and their practices may be threatened by such activity, particularly if they do not have organizational support and a plan to compete. In fact, I would go so far as to say that a strong managed care ‘ecosystem’ is the secret sauce for the individual practice, providing stability, support, and financial buffer. VSP is certainly focused on providing patients and opportunity to provide service.

As I See It, VSP’s focus is on providing cost-effective, high-quality eye care. The goal is to connect doctors and patients in a mutually beneficial delivery of care. Surpluses are reinvested in the system to provide stability and stimulus for additional community benefit. VSP’s not for profit structure makes certain that the community, the patients, and the doctors are considered with every strategic decision and effort and is in stark contrast to many competitors who have a for profit organizational structure and investors to answer to.

The Power of Counting Steps

Friday, February 13, 2015

There is an old adage: “If you want something to get better, you measure it.” I believe this is absolutely true. In fact, I suspect that incremental measurement may be the most important step toward improvement.

I started wearing a pedometer and counting steps last year. One thing is certain: I now take far more steps each day. I even have “internet counting friends” to keep track of and compete with. I walk, I count, and I closely monitor my progress. If I happen to lag behind, I sometimes even go round and round the family room to catch up.

So what is so unique about a pedometer? It simply provides continuous incremental feedback as I progress toward my goal.

I believe this principle applies perfectly to goal setting in our practices. I think we tend to set goals which are too large and too distant to get maximum effect. We overlook the motivational power of counting steps.

Here’s an idea: What if we took our large goals and “broke ‘em down”? As an example, in the latest VSP Practice Report, we see an opportunity to increase our frame capture rate. To achieve our annual goal, we’ve set a monthly goal to increase eyewear sales by 12 pairs. Consider an ascending incremental reward program, whereby, the first few sales would net a smaller contribution and later ones were worth more on the way to 12 and beyond. Then post for all of your staff to see and watch your large goal come into view.

As I see it, small incremental goals are more motivating than large, unwieldy goals. If my goal is 20,000 steps, I get there one step at a time. So, my advice is to count those steps with your staff and watch those larger goals become more attainable.

Do We Still Need The Doctor?

Friday, January 23, 2015

Millennials—those born between the early 1980s and the early 2000s—represent a growing percentage of most of our patient bases. The Millennial Generation has ever increasing access to information via the internet and social media. They come to us with expectations and opinions which have been shaped, largely, by organizations seeking to sell product, all of which makes it more difficult to consult with our patients and to get them to follow our recommendations. Technology is being trumpeted as the answer; the critical role of the doctor is less apparent.

That last part did not feel great to write, but I/we need to accept the reality that our millennial patients think differently, act differently, and make decisions regarding who they do business with differently.

Dr. Scot Morris discusses a number of technology and consumer-based trends in a column that appeared in  the December 2014 issue of Optometric Management, entitled “Eye Care: The Next Generation.” He suggests that because of “the continuous evolution of digital handheld technology, social media, and most recently, wearable technology, that the consumer will soon dictate healthcare delivery.” He concludes by viewing these technological advancements as a “tremendous opportunity” if we (doctors) are willing to change with the times.

I couldn’t agree more with the assertion that doctors need to embrace change. But just how, or what are we supposed to change?