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Key Metrics: Assessing Optometric Practice Performance & Best Practices of Spectacle Lens Management Report March/22/2018 TABLE OF CONTENTS PART 1 - Key Metrics: Assessing Optometric Practice Introduction Independent OD Performance in Primary Eye Care Market Total Practice Productivity Metrics Revenue Sources Managed Care Eye Exam Professional Fees Product Management Staffing Expenses and Net Income Additional Insights Other Practice Characteristics Part 2 - Best Practices of Spectacle Lens Management Report Introduction Capture Rate Product Mix Patient Profiling and Lens Recommendations Retail Pricing Eyewear Purchase Cycle Transaction Costs and Re-makes Patient Satisfaction Getting Started-Adopting Best Practices Appendix Glossary 4 7 10 25 31 36 39 61 63 68 70 73 75 84 100 107 110 115 118 122 124 127 5 1.2 MBA Practice Profile Research ince 2005, MBA has gathered comprehensive information on the characteristics and financial performance of over 1,900 private optometric practices in the U.S. When registering for an MBA educational seminar, participants complete a detailed questionnaire about office processes, revenue sources and expenses during the most recent calendar year. From the specificity of the responses (absence of rounding), it is clear that many MBA respondents refer to financial records to report revenue by source, number of exams performed by type, expenses and other quantitative production variables. Thus, the data is of higher quality than some other surveys that rely primarily on respondent memory or guesses. The MBA metrics database is believed to be the largest of its kind ever assembled. It includes practices across the entire spectrum of sizes and characteristics and both new and established practices. Unless specifically noted, however, the benchmarks in this report are for established practices. The median annual gross revenue of MBA respondents is $500000. Norms are reported by practice size, usually based on more than 100 respondents in each size category. After years of continuous measurement, it is apparent that there is year-to-year stability in most of the basic productivity ratios of optometric practice. Knowing this, to assure maximum reliability of the benchmarks, most of the normative data in this report, unless specifically noted, is based on the aggregate response of all participants in the Practice Profile research. The source of all data in this report, unless otherwise noted, is the MBA Practice Profile database. S 6 1.3 Using This Report his report is organized to facilitate a thorough assessment of practice performance. It will explain which key metrics are most revealing of the state of the business and how to calculate the same. It will present the spectrum of performance for these key metrics across all U.S. practices, enabling accurate rating of a practice’s performance on specific variables. It will provide guidelines for interpreting performance metrics and will suggest action steps for deeper analysis or for improvement. To make the best use of the report, follow these steps: 1. Calculate your own practice performance periodically through the link of the portal for each of the key metrics, and use the definitions in the report. 2. Calculate your performance index for each measure by dividing your performance value on each measure by the median value for practices of comparable size or by the overall MBA median. 3. Make a deficiency list of each of the measures in which your practice performance index is 85 or less, compared to your practice size group or the MBA performance median. If your practice performance is consistently at or above the median for all practices, develop a list of metrics for which your practice is not better than mid-range performance. 4. Take into account any unusual conditions of your practice, compile a rank ordered priority list of those areas you wish to concentrate on first. With the staff, develop an action plan to improve each priority area. T Note: The data represented in the graphs are until September 2017. 7 his section describes the market context in which independent ODs operate, providing background on the growth rate in primary eye care demand and independents’ market share of patients’ device purchases. The Vision Council conducts an on-going consumer research, monitoring demand for eye exams and vision correction devices, called the VisionWatch. These surveys provide the best analysis of primary eye care consumption trends. According to the Vision Council Market Analysis Report, the optical market in US generated $40,207 million in revenue in 2017, representing a decrease of 0.1% over previous year’s total. As per VisionWatch, there has been a 2.7% rise in revenue and 0.4% growth in volume for the ODs. As evident in the CPI Indexes of Eyeglass & Eye Care vs. Other Markets graph below, the eyeglass & eye care has a CPI index of 0.3%, relative to the 2017 CPI index for healthcare which was 0.6%, 1.5% for dental and 1.7% of medical care. $ 40,253 $ 40,207 2016 vs. 2017 -0.1% 2016 2017 0.30% 0.60% 1.50% 1.70% Eyeglass & Eye Care Healthcare Dental Medical Care CPI Indexes of Eyeglass & Eye Care vs. Other Markets T 2 Section: Independent OD Performance in Primary Eye Care Market Optical Market (In Millions) 10 his section discusses key metrics that reveal the overall productivity of the practice. Use the link of the portal to calculate your own practice performance for each metric and compare to the benchmarks shown. If your performance on any of these productivity metrics is sub-standard, you will need to dig deeper to uncover the variables responsible for the deficiency, as directed in the text. This will allow you to identify concrete corrective actions to improve performance. 3.1 Gross Revenue per Exam This is perhaps the single most useful measure of practice productivity, calculated simply by dividing your gross receipts by the number of comprehensive exams you provide in any time frame. Gross revenue per comprehensive exam is directly dependent on the internal processes of your practice, and can be immediately and significantly improved by your actions. Every well-managed practice should track this productivity measure monthly, and if not already well above median performance, should set aggressive goals for improvement. For all MBA practices, the median gross revenue per exam is $346. The top decile of practices achieved a median gross per exam of $512, the bottom decile achieved just $197 — a very large range of productivity. Variables which favorably impact revenue per exam include: • Above average usage of high-performance spectacle lenses, high-end frames and higher value contact lenses • Above average professional fees • Above average retail prices. Here are few examples of average retail prices as of September 2017: o Lenses- $151 o Frames- $131 o PAL- $263 o Single Vision- $101 • Above average capture rate of patients’ eyewear purchases o As of September 2017, the average capture rate was 44%. It has been observed that the average capture rate for ECPs with Essilor products is higher than the average capture rate for other ECPs • Above average multiple pair sale ratio o As of January 2017, 11.8 million multi pairs were sold. Latest findings reveal that when practices launch new offers, they see significant multiple pair sales increase with the customers T 3 Section: Total Practice Productivity Metrics 11 Evaluate your performance on each of these variables to better understand your revenue per exam productivity. 3.1.1 Best practices after assessing your performance for gross revenue per complete exam If your current performance is above average: 60th percentile or higher, $367 or higher • Doctors should prescribe multiple pairs in the exam room • Evaluate multiple pair sale ratio. If it does not exceed 40 - 50%, train staff to highly recommend prescription sun wear and special use lenses to appropriate patients • Review the Rx Analysis Report produced monthly from the Essilor lab. In that report, specifically review the usage of PAL, AR, high index, and photochromic lenses and compare it to industry norms. Select one or two lens types and train staff to present to appropriate patients • If sales of frames retailing for $200 or more is less than 40% of units, increase inventory of higher end frames 12 If your current performance is average: 40th - 59th percentile, $322 - $364 • Review the Rx Analysis Report produced monthly from the Essilor lab and compare eyewear gross profit margin to industry norms. If average or below, adjust pricing to increase profit margin • Compare frames sales mix by price point to industry norms. If sales of frames retailing for $200 or more is less than 40% of units, increase inventory of higher end frames • Review the Rx Analysis Report produced monthly from the Essilor lab. In that report, specifically review the usage of PAL, AR, high index, and photochromic lenses and compare it to industry norms. Select one or two lens types and train staff to present to appropriate patients. Repeat this process until all lenses are covered. • Compare exam fees to industry norms. If exam fee is at or below industry median, consider increasing fee. Access the link to view industry related articles. If your current performance is below average: 39th percentile or lower, $314 or lower • Evaluate eyewear capture rate. If below industry norms, consider upgrading optical dispensary • Review average eyewear retail sale. If average or below, compare usage of PAL, AR, high-index and photochromic lenses to industry norms. Select one or two lens types and train staff to present to appropriate patients. Also compare frames sales mix by price point to industry norms • Compare exam fees to industry norms. If at or below industry median, consider increasing the exam fees Appropriate patient Every patient is an appropriate patient. Current lifestyle requirements require every patient to have special use lenses in addition to indoor lenses and outdoor lenses. These requirements assure that every patient who walks into your practice is an appropriate patient. The table below provides information about special use lenses and associated appropriate patient categories for the same. 15 3.3.1 Best practices after assessing your performance for gross revenue per non-OD staff hour If your current performance is above average: 70th percentile or higher, $100 or higher • If gross revenue is less than $1 million and ratio of staff to OD hours is less than 3.0, or if gross revenue is $1 million or more and staff to OD hour ratio is below 3.5, evaluate increasing staff to improve patient service. Symptoms of under-staffing include low staff morale, administrative tasks frequently unattended, frequent patient waits of 5 minutes or more during office visits, doctor assumes some of staff’s testing or administrative duties to keep process flowing If your current performance is average: 30th - 69th percentile, $73 - $100 • If gross revenue per exam is at $286 or below, compare usage of PAL (Progressive Addition Lens), AR (Anti- reflective), high-index and photochromic lenses to industry norms. Select one or two lens types and train staff to present to appropriate patients • If gross revenue per exam is $287 or higher, staffing level is likely adequate, unless practice is above $1.5 million gross revenue 16 If your current performance is below average: 29th percentile or lower, $73 or lower • If staff to OD hour ratio is 5 or above, evaluate staff reduction or reduce number of hours staff works weekly • If active patient base is less than 3,500, increase marketing activity to attract new patients • If gross revenue per exam is at $286 or below, compare usage of PAL, AR, high-index and photochromic lenses to industry norms. Select one or two lens types and train staff to present to appropriate patients 3.4 Gross Revenue per OD Hour Gross revenue per OD hour reveals how effectively ODs use their time and how well they delegate tasks to their staff. It is calculated by dividing gross revenue for any specified period by the total number of OD hours worked during the same period. The median gross revenue per OD hour for MBA practices is $402. There is a wide range of OD productivity with the top decile of performers reporting a median of $673 of revenue per hour and the lowest decile reporting just $167. 17 3.4.1 Best practices after assessing your performance for gross revenue per OD Hour If your current performance is above average: 70th percentile or higher, $493 or higher • No action indicated If your current performance is average: 30th - 69th percentile, $296 - $479 and below average: 29th percentile or lower, $289 or lower • If gross revenue per exam is at $286 or below, compare usage of PAL, AR, high-index and photochromic lenses to industry norms. Select one or two lens types and train staff to present to appropriate patients • If active patient base is less than 3,500, increase marketing activity to attract new patients • If active patient base is 4,500+, ODs average 80%+ of office hours engaged in patient care, and exams per OD hour is below 1.0, then review exam process to identify ways to reduce average time ODs spend with patients • Compare exam fees to industry norms. If at or below industry median, consider increasing fee 20 3.7 Gross Revenue per Square Foot of Office Space Sales per square foot is a key productivity measure for most retail businesses. It reveals the efficiency of space utilization and indicates if facility overhead is under control. It can also be an indicator of foot traffic at a location and sales per transaction. It is a relevant consideration for optometric practices considering relocation or space expansion. The median gross revenue per square foot for all MBA practices is $339 with a median of 2800 square feet of office space, including 3.3 refraction rooms. These benchmarks are extremely useful when constructing a new facility or expanding an existing one. In order to determine the square footage for the new or expanded facility, first project revenue for five year after the renovation. Next, from the following graphs, determine the median revenue per square foot guideline for the practice revenue you project. Finally, divide your projected revenue by the median per square foot derived in step two. This will give you a rough guideline for the square footage you need. 21 The following graphs show the range of office square footage by practice size. While generalizations may not apply to every situation, the median square footage shown in the “largest third” graph could be used as guideline defining an excessive amount of office space for each size of practice. Range of Square Footage by Practice Size (Medium Third) Practice Size Quintiles Large $2.2M 4062 Medium Large $1.4M / 3000 Medium $1.1M 2616 Medium Small $790,000 1690 Small $509,000 1534 { { | | | | | | T T T T T T 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 11000 Median Sq. Ft. Range of Square Footage by Practice Size (Largest Third) Practice Size Quintiles Large $2.2M 5978 Medium Large $1.4M 4600 Medium $1.1M 3412 Medium Small $790,000 2331 Small $509,000 : 2280 | | | | | | | | T T T T T T T T 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 11000 Median Sq. Ft.  25 his section examines the revenue mix of independent optometric practices, revenue growth, composition of services rendered, revenue payers and exam fees. Use these benchmarks to compare with the revenue sources of your practice. 4.1 Revenue Sources Independent optometric practices derive 35% of revenue from professional fees and 65% from product sales, including 37% from eyewear and 17% from contact lens sales. Average revenue mix has changed little over six years of measurement. Medical eye care revenue has not been consistently measured in MBA surveys, but there are indications that it is slowly gaining share of optometric practice revenue. T 4 Section: Revenue Sources 26 4.2 Revenue Growth by Source Over the past 7 - 8 years contact lenses have consistently grown faster with a compound annual growth of 1.8% in 2017, compared to other part of the practice such as glasses which had a compound annual growth of 0.9% in the same year. According to a study conducted by Mark Ritson, Ph.D., of Melbourne, Australia, it has been observed that at one given transaction, a spectacle lens patient is more profitable than a contact lens patient but over a 10 year window a contact lens patient is more profitable. Part of the reason is that contact lens patients tend to return more frequently to buy more products including back up eyewear. A best practice to consider for contact lens sellers is that the doctor and staff should always present to their patients contact lenses “and” glasses instead of contact Lenses “or” glasses. As evident in the Optical Market graph below, with revenue of $12,581 million in 2017, RX lenses prove to be the strongest in the optical market. 27 The Independent Optical Retail graph below confirms that both lenses and frames make up the bulk of revenue for independent optical retail, eye exams are a close third with over $4,241 million in revenue. 4.3 Percent of Complete Eye Exams by Type Typical independent optometric practices conduct twice as many complete eye exams for patients who only wear eyeglasses than for patients who wear contact lens. An average of 10% of exams are performed for patients not requiring vision correction. A contact lens exam ratio below 20% usually indicates that a practice does not routinely recommend contact lenses to candidates, unless patients initiate a request for a trial fitting. $ 9,705 $ 12,849 $ 4,802 $ 4,171 $ 860 $ 1,909 $ 5,958 $ 9,709 $ 12,581 $ 5,026 $ 4,187 $ 887 $ 1,809 $ 6,009 2016 vs 2017 : 0.0% 2016 vs 2017 : -2.1% 2016 vs 2017 : 4.7% 2016 vs 2017 : 0.4% 2016 vs 2017 : 3.1% 2016 vs 2017 : -5.2% 2016 vs 2017 : 0.9% Frames for Rx RX Lenses Contact Lenses Plano Sunglasses OTC Readers Refractive Surgery Eye Exams . 2016 2017 Optical Market (In Millions) $ 5,133 $ 6,887 $ 1,911 $ 155 $ 33 $ 4,187 $ 5,181 $ 6,820 $ 2,010 $ 156 $ 35 $ 4,241 2016 vs 2017 : 0.9% 2016 vs 2017 : -1.0% 2016 vs 2017 : 5.2% 2016 vs 2017 : 0.3% 2016 vs 2017 : 5.1% 2016 vs 2017 : 1.3% Frames for Rx RX Lenses Contact Lenses Plano Sunglasses OTC Readers Eye Exams 2016 2017 Independent Optical Retail (In Millions) Medical Eye Care Visits by Type (% of Total Medical Eye Care Visits) 30% 24% 25% 20% 14% 10% Glaucoma _Dry Eye Ocular allergy Adds to 100% 15% 14% 4% 4% Ocular Cataract Refractive Foreign body Infection co surgery removal management co management Annual Medical Eye Care Visits by Type per 1,000 Active titi) Eye Care Visits by Typ Dry Eye Ocular Infection Ocular allergy Glaucoma Cataract co-management Refractive surgery co-management Foreign body removal Total Average 17 27 9 17 8 14 16 31 14 18 1 3 2 4 67 114  31 ndependent optometric practices receive 29% of revenue payments from health and vision insurance plans, 16% from medicare and 55% directly from patients. The sources of payments vary widely across practices. 5.1 Percent of Exams Provided with Managed Care Discount MBA OD participants reported that a median of 64% of the exams they performed had a managed care discount. I 5 Section: Managed Care Percent of Exams Provided with Managed Care Discount ee ena e ENCE! Percent of Gross Revenue from Direct Patient Payments Low Median High cola) 25th Sli} tia) cs 0ia) Esl} ost) rishi) cs 95th ee cera ma Cat aL Average=44% ee ree ENCE!  35 Following are some of the common issues faced by ECPs related to managed care along with their best practices to address the same: 1. When patients want to buy products which are only covered under the insurance plan: ECPs should address the issue by helping the patients determine those products that will improve their quality of eyesight and then considering what falls under the insurance plan. 2. Understanding how vision insurance plans reimburse the practice: This can be addressed by focusing on the pricing strategy as well as strategies related to managing the frame board. 3. When the third party is below or at the break even cost: The practice should address this by changing the strategy of dealing with the third party (e.g. see more patients per unit of time, limit the time of day that can be scheduled with a patient etc.) or stop being a provider for that third party. 79.5% 53.2% 69.7% 68.6% 56.7% USA % MVC: 65.5% INDEPENDENT RETAIL & OTHERS SV BTF PAL Share of Subsidized Sales by Purchase Type 36 he fees charged by independent optometric practices for direct-pay patients vary widely across practices, the decile of practices with the highest fee charge roughly three times what the decile with the lowest fees charges. Practices generally charge the lowest direct-pay exam fee for non-contact lens patients, for which the median fee is $135. T 6 Section: Eye Exam Professional Fees Contact Lens New Fit Exam — Sphere (direct-pay) Contact Lens New Fit Exam - Soft Toric (direct-pay) Median na és) Sth ceeltG) elt} sii) crelti} sta) Lee cerca ema Sadar) Average=$246 Contact Lens New Fit Exam — Soft Multifocal (direct-pay) Median High  40 7.2 Eyewear % of Gross Revenue Eyewear sales produce an average of 44% of gross revenue in independent optometric practices. 7.3 Eyewear Revenue per Pair The median retail sale for a pair of eyeglasses among independent optometric practices is $240, including both complete spectacle Rxes (frames and lenses) and Rxes re-using an existing pair of frames. The 10% of practices realizing the highest retail sales per pair achieve an average sale of $410, which is 71% higher than the median. 41 If your practice’s average eyewear sale is at or below the median of $240, improvement of this metric should almost certainly be a top priority of your practice. This is because eyewear is the leading source of revenue in nearly all practices and improving the average sale will have a dramatic favorable impact on financial performance. 7.4 Eyewear Gross Profit Margin % The average eyewear Rx generates a gross profit margin of 62% - equivalent to a mark-up of 2.6x times cost of goods. Practices that achieve above average gross profit per eyewear Rx do so primarily by selling higher value products rather than by taking significantly higher mark-ups, although both variables contribute. 42 7.5 Optical Dispensary % of Total Office Space One reason that patients of independent practice ODs choose to take their prescription elsewhere is that they perceive that a practice does not specialize in dispensing eyeglasses and has a limited selection of frames. This message is unintentionally conveyed when the amount of space devoted to the dispensary is small. It’s easy for ECPs to overlook the fact that down the street from the practice there is an optical superstore that devotes 3,000 square feet to a sophisticated display of eyeglasses. Most patients have browsed these superstores and know about the range of choice available. When patients unconsciously compare the small space in a practice devoted to the dispensary with what they have seen in the superstores, they are tempted to delay purchase and shop around. MBA surveys show that independent optometric practices typically devote about 25% of their total office space to the optical dispensary. Smaller practices have a higher proportion of office space devoted to the dispensary (typically 32% or more), compared to larger practices. No-Glare (anti-reflective) Lenses (% of eyewear Rxes) Improvement High Median Performance Oppurtunity ~ — em ~ Sri} ei) ta) elt} Losin) rei) ret) esta) eee amc LSAT] Average=55% High Index Lenses (% of eyewear Rxes) Improvement High Median Performance Oppurtunity Sth aro) Poti) 35th ei) et) Set) sii 75th creu) est) Lee cers a tema CALLA Average=13% Photochromic Lenses (% of eyewear Rxes) Improvement High Median Performance Oppurtunity Sli} tia) cs 0ia) Esl} ost) rishi) cs 95th ee cera ma Cat aL Average=23%  46 7.8 Spectacle Lens Mark-Ups Independent optometric practices mark-up single vision lenses more than progressive lenses and mark-up Rxes with fewer lens features more than advanced lens types. Average mark-ups provide guidelines for planning spectacle lens retail pricing strategy. 47 Frames When your patients upgrade from lower cost frames to branded or designer frames, it results in large increase in practice revenue. 7.9 Frames Inventory The median MBA practice had 1,035 frames in inventory, valued at $78,896, and reported dispensing 2332 complete pairs of spectacles (including new frames) during the previous calendar year. This translates to a median frames turnover of 2 annually. Larger practices enjoy much higher frames turnover than smaller practices. Compare the number of frames in your inventory to the median for practices of your size. 50 7.11 Frames Mark-Ups Independent optometric practices mark-up lower cost frames more than the high-end frames. The average mark- ups provide guidelines for planning frames retail pricing strategy. 51 The average retail mark-up multiplier for frames sold by independent practice ODs was 2.6x times the wholesale frames cost based on OD estimates of their retail sales mix by price point and average frames wholesale cost. This is the same median mark-up multiple calculated for total eyewear sales by ODs, based on their estimates of eyewear sales and cost of goods. 7.12 Frames Average Wholesale Cost per Pair The median independent practice OD estimates that the average wholesale cost of the frames they held in inventory was $66. Practices with an average frames wholesale cost of $54 or below are likely to have an opportunity to improve sales of higher end frames and increase the average eyewear sale. 52 Plano Sunglasses 7.13 Plano Sunglass Inventory Large practices are not likely to stock plano sunglasses than small practices. The average number of plano sunglass pairs in stock among those with any inventory was 127. Even the largest of practices maintained relatively small inventories of plano sunglasses. Contact Lenses 7.14 Contact Lens % of Gross Revenue Contact lens materials generated 14% of the total gross revenue in the average independent optometric practice, with little variation by practice size. A contact lens sales ratio below 12% is symptomatic of one or more of the following conditions: • A patient population with 50% or more who are 55 years of age or higher • A failure to consistently offer contact lens trial to candidates currently wearing eyeglasses-only • A low capture rate of contact lens purchases by patients (under 80%) • Low retail pricing • Aggregate usage of specialty lenses (soft torics, soft multifocals, colors, RGPs) with less than 25% of 55 7.17 Contact Lens Product Usage Upgrading patients from first generation materials and from spherical to specialty lenses results in large increases in practice revenue. Prescribing monthly and daily disposable lenses can also increase revenue per contact lens patient because of the higher patient compliance with replacement regimen and the higher retail price per box of these modalities, compared to two week lenses. Compare your usage of high value contact lenses to the benchmarks for independent optometric practices. In most practices, there are many opportunities to upgrade patients. Focus first on categories for which your usage is at or below the industry median. Multifocal lenses remain a category that is underutilized in a majority of practices, as are daily disposable lenses. Toric Lens Wearer % of Contact Lens Wearers orerovement High Oppurtui Performance Soft Multifocal Lens Wearer % of Contact Lens Wearers Improvement High Oppurtunity Median Perfarmance Average=11% RGP Lens Wearer % of Contact Lens Wearers 57 7.18 Soft Lens Patient Refit Ratio A median of 21.5% of soft lens patients having an eye exam are refitted with a new brand, material or lens type during their eye exam visit. 7.19 Soft Lens New Fits per 100 Contact Lens Exams A median of 11 of every 100 patients having a contact lens exam are fitted with contact lenses for the first time by independent optometric practices. 7.20 Soft Lens Gross Profit Margin % The median gross profit margin from sales of soft lenses is 37% among independent ECPs. The range in gross profit margin is fairly narrow with 60% of practices achieving margins in the 21 - 47 range. 60 The Soft Lens Inventory Requirements table below provides guidelines for soft lens inventory by practice size. 7.23 Percent of Contact Lens Patients Purchasing Eyeglasses Independent practice ODs estimate that a median of 19% of contact lens wearers purchase a pair of eyeglasses during their exam visit. 61 8.1 Staffing Levels by Practice Size In typical independent OD offices there are four staff members for every working optometrist. The ratio of staff hours to OD hours increases as the practice size increases. Section: Staffing 8 62 8.2 Staff Compensation The median hourly salary paid to staff members for all MBA practices was $33. There is little variation in hourly rates paid by practice size. COMING IN 2019 COMING IN 2019 65 9.4 Occupancy Cost The median annual occupancy cost per square foot of office space reported by MBA participants was $24. Sixty percent of practices experience occupancy costs between $16 and $33. 9.5 Net Income % of Gross Revenue The median net income as a percentage of gross revenue is 32% for independent ODs. At the 75 th performance percentile, net income percent is 39%. 66 9.6 Net Income % of Gross Revenue by Practice Size The unweighted average net income % of gross revenue for all MBA practices is 32%. 9.7 Annual Marketing Spending per Complete Exam Independent ODs spend a median of $3 annually for marketing per complete exam they conduct. 67 9.8 Accounts Receivables Accounts receivable days outstanding is calculated by dividing total accounts receivable by annual gross revenue, divided by 365. The median practice had 21 days accounts receivable. Another key metric related to receivables is the aging of the uncollected amounts due. A universally true rule is that there is an inverse correlation between the probability of collection and the number of days a bill remains unpaid. 70 11.1 Instrument Penetration 11.2 Online Purchases Characteristics Here are few recent and interesting insights about the consumers who are purchasing eyewear online: • Most consumers use the internet to conduct research to help them purchase eyewear in-person. With the help of internet they try to understand the possible brands and retail locations from where they can make a purchase • The consumers who are not willing to purchase eyewear online, will most likely use the internet to examine the brands and the different lines of eyewear or compare the benchmark prices. A significant number of buyers reported that they use the internet to review the comments and satisfaction level of other consumers • Eyewear buyers who can access the internet to make purchases are most apt to buy Plano sunglasses directly online. A slightly smaller number of buyers with internet access are likely to buy Rx eyeglasses or Rx contact lenses online • Consumers who have used the internet while making an eyewear purchase in the past are likely to continue to do the same in future. If the internet friendly consumers have not used the internet to buy eyewear online yet, they will most likely at some point of time in future make an online purchase Section: Other Practice Characteristics 11 71 • The type of consumers who are more likely to buy eyewear online are men, younger Americans and high income group Americans The Evolution of Online Sales vs. Total Sales graph and Share of Online Sales by Demographics graph below provide recent online trends and market details for you to get a better understanding of online sales statistics when compared with total sales in the optical market. The sales for online purchases in 2017 were seen to be 6% higher than previous year, at 3.26 million pairs being sold. Also, 4.5 million pairs were sold online out of a total sales volume of 52 million readers. 11.0% 13.3% 11.9% 6.0% 1.6% 4.6% 0.9% -0.4% 3.1% 3.3% 3.7% 3.9% 2014 2015 2016 2017 Online purchases YoY growth All lens purchases YoY growth Share of online purchases Evolution of Online Sales vs. Total Sales 7.2% 4.8% 3.3% 1.6% 3.5% 4.3% 3.8% 4.0% %Online: 3.9% 18-34 35-44 45-54 55+ MALE FEMALE UP TO $60K ABOVE $60K .Share of Online Sales by Demographic 72 Part 2 Best Practices of Spectacle Lens Management Report 75 isionWatch reports that in recent years independent ECPs in the U.S. have slowly increased their share of eye exams performed as well as their share of eyewear unit sales. Independent practice optometrists have a big advantage over optical chains in selling eyeglasses to their patients. That’s because independent ODs usually have a long history with individual patients and can offer a higher level of personalized advice about eyewear, based on a deep understanding of patients’ needs. It’s also more convenient for patients to complete an eyewear transaction at the same location they receive an exam. But in some optometric offices these advantages are squandered. The independent’s edge is lost when all the focus of doctor and staff is on efficient clinical testing and diagnoses, and too little attention is given to the devices that provide vision correction. Doctors and staff sometimes forget that eyeglasses have a big impact on the quality of life and self-image of wearers. Obtaining a pair of glasses that is attractive, comfortable, durable, provides excellent acuity and is easy to keep clean is important to patients, this is a major reason they visit a practice. Because eyewear can be costly and is infrequently purchased, patients feel anxiety as they make eyewear decisions. They know that they will suffer the consequences of a poor decision every day for two years or more. When an office conveys no empathy and demonstrates little interest in helping patients to make good eyewear decisions, patients are more likely to seek help elsewhere. To improve the eyewear capture rate, all the sights and sounds of the patient experience in the office must convey the practice’s interest and expertise in dispensing eyewear. 2.1 Key performance metric: Eyewear Rxes per 100 complete eye exams A Management & Business Academy™ (MBA) practice production benchmark provides another vantage point for assessing eyewear capture rate. MBA surveys have consistently revealed that independent ECPs sell 60 pairs of eyeglasses for every 100 patients receiving eye exams. This metric is easily calculated by dividing the number of eyeglasses Rxes dispensed during any time period by the number of complete refractive exams performed during the same period, times 100. This productivity ratio does not correlate with practice size, but does vary widely across practices. The 10 percent of practices selling the most pairs of eyeglasses per 100 exams dispenses 108 pairs, compared to just 35 pairs among the least productive 10 percent of practices. The wide variation has little to do with differences in patient characteristics across practices and everything to do with office processes for presenting eyewear to patients. V 2 Section: Capture Rate 76 2.2 Eyeglass Sales and Wearers by Demography The Eyeglass Sales and Wearers 2017 by Age Group graph below provides insight on purchasing and repurchasing trends among different age group in the US market. It’s evident from the Eyeglass Sales and Wearers 2017 by Gender graph below that women purchased larger portion of eyeglasses compared to men, which is not a surprise as women wear eyeglasses more than men. In total, 83.1 million pairs of eyeglass frames were sold in 2017. 22.1 13.4 16.2 31.4 40.8 23.9 29.1 68.3 75.7 44.0 43.0 88.8 Repurchasing Cycle : 1.85 Repurchasing Cycle : 1.78 Repurchasing Cycle : 1.80 Repurchasing Cycle : 2.17 18-34 35-44 45-54 55+ . Units sold Number of Eyeglass wearers Population Eyeglass Sales and Wearers 2017 by Age Group (In Millions) 77 2.3 Percentage of American Adults currently wearing Contact Lenses and Readers by Demography 83.1 40.0 43.0 162.1 75.1 87.0 251.5 123.3 128.2 Repurchasing Cycle: 3.90 Repurchasing Cycle: 1.88 Repurchasing Cycle: 2.02 Total Male Female Units sold Number of Eyeglass wearers Population Eyeglass Sales and Wearers 2017 by Gender (In Millions) 26.6% 20.9% 15.3% 6.4% 12.9% 20.1% 13.9% 19.1% 16.6% 25.9% 20.4% 14.8% 6.4% 12.6% 19.6% 13.6% 18.7% 16.2% 25.8% 20.3% 14.8% 6.2% 12.6% 19.6% 13.6% 18.8% 16.2% 18-34 35-44 45-54 55+ MALE FEMALE Up to $60 $60 AND ABOVE TOTAL . 2015 2016 2017 Percentage of American Adults Currently Wearing Contact Lenses 80 uninterested in selling glasses. If the dispensing staff is not well-trained to guide patients to the best frame selection, patient anxiety grows, and some will decide to go elsewhere where selection is a more comfortable experience. • Assume that patients without a prescription change will have no interest in purchasing a new pair of eyeglasses. Stereotyping patient desires can be costly. Just because a patient’s Rx is unchanged and his or her glasses appear in good shape does not mean that he or she would not welcome a new look, an upgrade to improve vision or comfort, or a second pair of Rx eyewear for outdoor use. • Assume that contact lens wearers will have no interest in purchasing eyeglasses. Contact lens wearers need eyeglasses in their current prescription, but they may not think of this as they are being fitted with new contacts or purchasing replacement lenses. If the office does not remind contact lens patients to update their glasses, an opportunity is lost. • Too little space is devoted to the optical dispensary. Patients consider frames a highly visible communicator of their taste and personal style. When they make a snap judgment that the office’s array of frames is so limited that they are unlikely to find a style that complements their appearance, then the total eyeglasses sale is lost. • Frame selection is poorly organized, displayed and maintained. There are more than 10,000 retail optical chain locations in the U.S., many run by large corporations that have studied the eyewear purchase process in detail. Most patients have been exposed to the sophisticated eyewear merchandising of the optical chains. When patients see a chaotic frames display in an independent ECP’s office, they may be intimidated and choose to simplify the selection process by going to a better-managed setting. • Eyewear pricing is uncompetitive. Although this usually is not the most prevalent reason for walk-outs, when eyewear mark-ups are too high, some patients will decide to go elsewhere. Best Practices to Improve Capture Rate 1. Structure the sights and sounds of the office experience to create these impressions and feelings among eyeglasses-wearing patients: • This office wants to understand my unique vision requirements to be able to recommend the eyewear best for me. • I will receive individualized advice from people experienced at dispensing eyewear. • This office offers the latest lens technologies and frame styles. It understands both the fashion and function of eyewear. • My daily life is likely to be enhanced if I have different pairs of eyeglasses tailored for the different visual environments I regularly encounter. 2. Institute these office processes to create the desired impressions and feelings about the practice’s interest in eyewear dispensing: 81 Appointment Making • Ask contact lens patients to bring their current pair of eyeglasses to the office for the exam visit. • Ask eyeglasses wearers to bring their sunglasses and other special-use pairs of glasses to the office for the exam visit. Reception • On the medical history questionnaire, ask questions about patients’ daily vision environment (work and leisure settings and activities), vision problems and product interests. (See Patient Profit and Lens Recommendations.) • Ask all eyeglasses wearers, as they arrive at the office, if they intend to purchase a new pair of eyeglasses today. This signals the practice’s interest in dispensing eyewear and creates an upfront expectation that a purchase will be made. This will reduce the likelihood that patients without a prescription change will postpone purchase of eyeglasses until their next visit. • Address patients’ anxiety about eyewear selection. Tell each eyeglasses patient: “We know that choosing the right pair of eyeglasses can be confusing because of all the options. We’ll do everything to be sure we understand what’s likely to work best for you. We have some very experienced people to help you make the best choice”. • Briefly mention any recent arrivals of new spectacle lenses and frame styles to patients who are likely to be good candidates. Explain that the doctor and staff will explain and demonstrate these new products, if judged appropriate after the exam. • Display materials in the reception area showing the latest spectacle lens and frame introductions. Pre-testing • Based on responses to the medical history questionnaire, ask patients follow-up questions about their daily activities to learn additional detail about their vision needs and problems. o Do your eyes ever get tired from working at a computer all day? o Are you frequently in and out of doors during the day? o Are you ever bothered by glare and haloes when driving at night? o How much time is spent each day in reading and other close-up work? o Are there any problems with your current glasses? • To patients observed to be not currently wearing no-glare (anti-reflective) lenses, suggest that they consider them after hearing more about the glare-reduction benefits from the doctor and optician. Say: “I see that your current glasses don’t have the no-glare lenses that we recommend to all our patients who drive at night or use a computer. The doctor will explain more about how no-glare lenses can upgrade your vision”. • If scratches are noted on a patient’s lenses or frames show damage, point out the defects and say: “Your visit today is a convenient time to replace your worn glasses”. This comment makes it clear that defects that patients have come to ignore are noticed by others, providing motivation to replace their frame and lenses. • Explain to appropriate patients that their vision will be enhanced if they have two pairs of eyeglasses- one for inside and one for outside. (See Patient Profit and Lens Recommendations.) 82 Eye Exam • To address anxiety during subjective refraction, empathize with the difficulty and reassure patients that they are doing fine as they make subtle distinctions in clarity of vision. This will reduce patients’ hesitation to commit to an eyewear purchase. • The doctor recommends the highest-performance spectacle lens, linking the recommendation to exam findings and what has been learned about patient needs. • During the hand-off to the dispensary, the doctor personally conveys the lens recommendation to the optician. (See Patient Profit and Lens Recommendations.) Dispensing • Relate the benefit of spectacle lenses to the patient’s daily activities or vision problems, as eyewear is both ordered and delivered. • Convey enthusiasm about how the patient is likely to enjoy his or her new eyeglasses. • Compliment patients on their lens and frame choices. • Explain to patients that their satisfaction with eyewear is guaranteed. 3. To patients without a prescription change, encourage upgrade of their existing glasses. MBA faculty member Neil Gailmard, OD, recently recommended the following lead-in to a discussion of upgrading glasses: “Your prescription did not change much this year, which is always good to see, but there are some other aspects of your eyeglasses I want to talk with you about. There have been some amazing advancements in lens technology in the past year, which can improve your vision”. Dr. Gailmard then advises that the patient’s daily vision tasks be reviewed, his or her current glasses examined for missing features that can be added, and an upgrade recommendation made. Patients with no prescription change are also good candidates for a second pair of glasses for specialized use. For example: “Because your prescription did not change and your current glasses are in good shape, this would be a great time to consider a second pair of glasses to use when you’re working at your computer. Computer glasses provide a wide and deep field of vision at an intermediate distance between 18 and 24 inches, which is the normal distance between your eyes and the computer screen. You will find that you’ll see the screen more clearly and will not have to hold your neck in an uncomfortable position to see the screen best. Working on the computer will be a lot easier and less stressful”. Dr. Gailmard suggests a “Cash for Clunkers” promotion in which patients donate their old glasses to a charity (VOSH, Lions Club, etc.) and receive a credit towards a new pair. This may be effective to encourage upgrade among patients with no prescription change. 4. Devote at least 25 percent of office space to the optical dispensary. Maintain attractive, well-organized, well-lit, well-stocked frames and plano sunglasses displays. Attention to frames and sun wear merchandising will convince patients that the selection offered by the practice will satisfy their needs as well as any optical retailer. 5. To all contact lens patients at the conclusion of the eye exam, the doctor assumptively suggests an 85 ECPs can anticipate a steady stream of spectacle lens innovation in the years ahead, providing a continuing opportunity to upgrade patients to lenses offering superior performance and higher revenue per Rx. To maximize the return, it’s critical that practices keep up-to-date on lens technology. The exhibits shown here provide national usage estimates for lens designs and materials. In recent years, progressive lens designs, polycarbonate, high-index materials, advanced lens types and treatments have all gained market share at the expense of more traditional lenses. 86 Photochromic sales are up for men, eyeglass wearers between the ages of 35 to 44, people from higher income households and eyeglass users with some type of MVC benefit. The Growth - All lenses vs. Photochromic lenses graph below provides a detailed comparison and growth trend for photochromic lenses. There has been increased purchases of AR lenses by people from higher income households and people with some type of MVC benefits or insurance coverage. A detailed growth trend for AR coated lenses can be inferred from the All Lenses vs. A/R Coated Lenses graph below. 1.6% 4.6% 0.9% -0.4% 1.6% 4.7% 0.3% 0.4% 2013 vs 2014 2014 vs 2015 2015 vs 2016 2016 vs 2017 . ALL Lenses Photochromic Lenses Growth - All Lenses vs. Photochromic Lenses 87 3.1 How much revenue should each eyewear Rx generate? The Independent Optical Retail graph below indicates that the total revenue from RX lenses in 2017 was $6,820 million, 1% less than the previous year and the total revenue from Frames for RX in 2017 increased by 0.9%. Management & Business Academy™ (MBA) transaction size benchmarks, calculated by dividing what independent practice ODs report as their annual eyewear revenue divided by the number of eyewear pairs dispensed, show that the average retail sale from eyewear prescriptions was $240 (including both frames and lenses). 1.6% 4.6% 0.9% -0.4% 3.6% 5.8% 1.3% 0.4% 2013 vs 2014 2014 vs 2015 2015 vs 2016 2016 vs 2017 . ALL Lenses A/R Coated Lenses Growth - All Lenses vs. A/R Coated Lenses $ 5,133 $ 6,887 $ 5,181 $ 6,820 Frames for Rx RX Lenses . 2016 2017 Independent Optical Retail (In Millions) Computer Lenses (% of eyewear Rxes) Improvement High Median Performance Oppurtunity F 1 ean 25th 35th 45th Ese) Fete) i] 65th 75th 85th Percentile Ranking Average=/% Prescription Sunwear (% of eyewear Rxes) Improvement High Median Performance Oppurtunity ye fersiig) Sli} tia) cs 0ia) Esl} ost) rishi) cs ta] ee cera ma Cat aL BNI ety  91 3.3 Patients want professional guidance to make informed lens choices. Unlike with most products people buy, when selecting eyewear, patients place heavy weight on the professional advice they receive and have little other information with which to form strong personal preferences for specific products. Consumer research and the experience of most ECPs suggest that few patients have any depth of understanding about technical features of spectacle lenses. Most presbyopic patients know the difference between progressive lenses and bifocals, and about half of patients say they are aware of no-glare treatments. But most know little or nothing about the characteristics of different lens materials, differences among lens brands, the pros and cons of the many designs available in progressive lenses or about polarized lenses. Some have acquired misinformation about spectacle lenses from past experiences with earlier generations of lenses or from discussions with misinformed acquaintances. As lens technology continues to advance and choices multiply, it becomes even more difficult for consumers to keep up- to-date about spectacle lenses. To upgrade the spectacle lens product mix, optometrists must become personally engaged in recommending the best lens solution for each patient and avoid delegating this role exclusively to staff. That’s what patients expect. There is an implicit trust in a doctor’s recommendation that simply does not develop when a staff member alone presents eyewear choices. Not only are eyeglasses wearers uninformed about spectacle lens options, they also have only a sketchy idea 8.3% 7.7% 8.9% 9.2% 7.3% 7.8% 8.3% 10.8% 6.6% 2.5% 2.7% 2.2% 3.1% 3.7% 2.0% 1.7% 2.7% 2.3% 6.3% 6.9% 5.8% 7.2% 7.4% 5.9% 5.5% 6.4% 6.2% 7.0% 7.5% 6.6% 7.1% 6.4% 6.9% 7.3% 6.5% 7.4% 6.3% 8.1% 4.6% 8.0% 5.9% 5.7% 5.6% 6.6% 6.0% 11.3% 9.7% 12.7% 15.9% 14.7% 10.6% 7.2% 10.1% 12.0% 32.0% 32.1% 31.8% 31.7% 33.9% 32.9% 30.8% 30.8% 32.7% 26.4% 25.4% 27.4% 17.7% 20.7% 28.1% 33.6% 26.1% 26.7% ALL Male Female 18-34 35-44 45-54 55+ Up to $60k $60k and above . Not sure AR Coating UV Coating Polarization Impact resistance Thinness Scratch resistance Weight/lightness Share by Most Important Extra Qualities for Lens Choice-Demographic Profile 2017 92 about what a pair of spectacle lenses should cost. Eyeglasses are infrequently purchased and incorporate so many variables that it’s difficult to comparison shop. Patients may see chain optical ads that feature two pairs of glasses for $99 (including frames), reducing perceived value of eyeglasses. Or they may assume that their vision insurance allowance should cover the complete cost of a pair of glasses, including the latest technology. It’s all very difficult for patients to sort out. That’s not to say that patients care mainly about limiting their eyewear outlay and place little value on superior performance of their eyeglasses. The truth is that American consumers are becoming increasingly discriminating and demanding about most products they buy, including eyewear. This is a result of increasing education and income and broader exposure to high-performance products from around the world. 3.4 Rising incomes and education raise eyewear performance expectations. Eyeglass repurchase cycle is highly influenced by age, the other factor which influences the repurchase cycle is income. Americans from households with annual income under $60K usually wait for 2.34 years between purchasing a new pair of eyeglasses. On the other hand, Americans from households with an annual income over $60K wait for an average of 1.68 years between their eyeglass purchases. Fortunately for the eyeglass industry, people from higher‐income households are increasing their frequency of eyeglass purchases, which is helping to elevate the market in total. Unfortunately, the number of eyeglass wearers from the lower income households is rising as compared to the number of purchasing activities among them. The following graphs explain the sales trend by household income for various glasses. 33.6 49.5 78.8 83.3 124.8 126.8 Repurchasing Cycle: 2.34 Repurchasing Cycle: 1.68 Under $60K Over $60K . Units sold Number of Eyeglass wearers Population Eyeglass Sales and Wearers 2017 by Income Group (In Millions) 95 series of choices of material, design and other treatments. This approach simplifies the purchase process and assures that a higher proportion of patients have the benefits of the latest technology. In presenting spectacle lens options to patients, the perception “less is more” definitely applies. Overwhelming patients with technical detail and add-ons creates indecision. • Spectacle lens packages should be presented to patients starting with the highest performance option with the assumption that patients want the best. What Goes Wrong • Assume that eyeglasses patients with no vision complaints, who need a prescription update, will want to purchase the same lens type as currently worn. In the rapidly changing world of spectacle lens technology, an “if it ain’t broke, don’t fix it” mentality quickly dates a practice. Patients who do not voice a complaint about their current spectacle lenses are not necessarily totally satisfied. People learn to accept small compromises in the performance of their lenses, usually because they are not aware that better alternatives exist. Eyewear patients put up with glare, have difficulty driving at night, accept age-revealing segment lines or wear heavy, uncomfortable lenses because no one ever bothered to present something better. People who tried first generation progressive or no-glare lenses and had problems are unlikely to ask about these lens types and probably do not know that the early problems have been eliminated in later- generation lenses. • Assume patients understand available options and wait for patients to express preference. Few patients take the time to explore lens options before visiting the office. They do not know what is best to satisfy their needs. They have difficulty even expressing their needs, not knowing what is possible. Although patients may recognize brands such as Varilux® and Transitions®, they know little about what distinguishes these products from others and are unlikely to ask for these brands by name. • No lens recommendation is made by doctor at conclusion of eye exam. In many office, all discussion of spectacle lenses occurs only after the eye exam and dialogue with the doctor is over. • Stereotype the eyewear budget limit of individual patients or let a patient’s vision insurance allowance dictate the lens recommendation. It’s impossible to guess accurately the value that individual patients place on eyewear. Stereotyping patients’ ability to afford eyewear surely will result in lower revenue and less satisfied patients. To avoid unpleasant discussion about cost with patients, staff has a natural tendency to propose eyewear that will cost no more than a patient’s insurance allowance. Staff members on limited household budgets themselves may have no personal experience with high-performance eyewear and be uncomfortable recommending what appears to be expensive. As you evaluate patients’ eyewear budgets, consider this fact: The average U.S. household spends just $200 per year for eye care, representing less than one-half of one percent of household spending. • Recommend mature-technology, moderate-cost lenses to most patients. To avoid sticker shock and reduce the number of unpleasant conversations about price, some offices recommend middle-of-the road spectacle lenses to most patients. This assures a sub-standard average eyewear transaction size and a low incidence of patients who have their expectations exceeded. 96 • Doctor’s lens recommendation is inadequately conveyed to dispensing staff. A doctor’s spectacle lens recommendation is seldom challenged by patients. But if the lens recommendation is not accurately conveyed to dispensing staff, it can be lost or distorted in the hand-off between the exam room and dispensary. If an explicit Rx is not conveyed directly from doctor to staff, there is risk that patients will have difficulty remembering the precise terminology of the doctor’s recommendation, opening the door to misunderstanding, confusion and disappointment. Poor hand-offs can sometimes result in staff contradicting a doctor’s recommendation, eroding trust in the practice. • Present advanced features as non-essential add-ons. When features such as lens material, no-glare treatments and photochromic lenses are presented as afterthought options and not as integral lens features, patients tend to view them as nice-to-have, but unnecessary and costly frills. Making the eyewear selection process a lengthy set of decisions confuses patients and causes them to postpone decision making. Best Practices to Upgrade Lens Mix 1. Script an explanation to patients with vision insurance that plan allowances cover only the most basic pair of eyeglasses. Confusion about eyewear insurance allowances occurs at two levels. First, many patients do not know the specifics of their coverage, which change from year to year. Second, they may assume that the allowance should cover the total cost of a high-quality, technologically-current pair of glasses. Well-managed practices make a habit of asking patients about their insurance plans as appointments are booked, then confirm the allowances before patients arrive at the office. As each patient arrives, he or she is informed of the current allowances. As this is done, the receptionist might say: “Your coverage pays for an exam and a very basic pair of eyeglasses, but it can be used to greatly reduce the cost of eyeglasses offering much better performance, which most of our patients prefer to wear”. “Your insurance will pay much of the cost of a pair of glasses with lenses and frames providing the best performance—the kind you’re most likely to be happy with”. “Your insurance will greatly reduce the cost of your primary pair of eyeglasses and make it much easier to afford a pair of computer glasses (or polarized sun wear, etc.) that will make your daily work a lot more comfortable”. These explanations create the expectation that there will be an outlay, before recommendations and decisions are made. 2. Have the doctor and staff wear high-performance spectacle lenses. Patients are more likely to appreciate the value of high-performance lenses when they observe them being worn by experts who dispense eyeglasses to dozens of people every week. When the doctor and staff wear no-glare lenses, 97 an effective demonstration aid of the no-glare and no-reflection benefits is readily at hand. Staff will be more comfortable discussing high-performance lenses if they personally experience the benefits. 3. Doctor makes a personalized recommendation about the lenses that will offer the best performance to each patient at conclusion of the eye exam. Recommending a specific lens type is much more powerful than merely listing a menu of options and letting the patient decide. After a brief recap of exam finding and what has been learned about a patient’s daily vision requirements and vision problems, the doctor should make a specific lens recommendation to each patient. This should be prefaced with the words “I recommend…” which signals to patients that the doctor is personally invested in the advice being offered. A brief synopsis of the benefits of the recommended lens type should be given, relating the benefits to what was learned about patients’ daily vision environments, vision problems and corrective needs. (See section 4 Patient Profiling and Lens Recommendations.) Pricing of the recommended lens type need not be discussed at this point. Prefacing lens recommendations with the words “I prescribe…” also helps to link the recommendation to exam findings and needs assessments. 4. Assumptively recommend lens materials, as outlined below: • Avoid presenting a menu of lens material options to patients. Patients look to you as an expert in lenses and will accept your recommendation without question. • Use polycarbonate as the standard lens material. There is no good rationale for use of CR39 materials in any prescription. The added cost to patients of polycarbonate is insignificant (usually $20 to $25 at retail) and is readily justified by its impact resistance (up to ten times that of other traditional plastics), its lighter weight and thinness (25 percent less) and its 100 percent UV absorption. UV protection should be a standard feature of all spectacle lenses prescribed. • Prescribe high-index materials to patients with these characteristics: o Desire rimless lenses: use 1.60 refractive index lenses. o Add a patient’s spherical correction power to his or her cylinder power requirement. When the sum is greater than 4.00D, then a high-index lens is indicated, because it is likely to be noticeably lighter and more comfortable for these patients. This is particularly a benefit when the astigmatism component is in the horizontal meridian. Use lenses with 1.67 refractive index for patients with a sum in the 4.00D to 7.50D range, and 1.74 lenses for patients with a sum of 8.00D or higher. o For highly complex prescriptions that are likely to be thicker and heavier lenses, use 1.74 lenses. • Explain the comfort and appearance benefits as you prescribe a high-index lens. Assume the patient’s acceptance of your recommendation. • Explain that no-glare treatment is a standard feature of high-index lenses because these lenses reflect more light. 5. Recommend progressive lenses to all presbyopes. Technologically advanced progressive lens designs have virtually eliminated the accommodation problems sometimes encountered with traditional