Private practice optometry can be very rewarding, but also comes with great responsibility. Managing a private practice requires a great deal of planning and strategy. I recently had the opportunity to interview Evan Kestenbaum, a leader in optometric management. Evan is the co-founder of the private practice management company Gateway Provider Network, which offers incredibly unique management software called The EDGE. In addition, Evan is the son of Dr. Kestenbaum of Optix Family Eyecare on Long Island; he grew up immersed in the culture of private practice and later became the office manager of Optix.
OS.com: Evan, tell us a little bit about yourself. I understand you basically grew up in your fathers’ optometry practice! Tell us the short timeline of how you grew up to get involved into what you are doing today.
EK: I started working in my father’s optometry practice when I was in high school. Before point-of-sale systems, I would sit on the floor and help separate receipts into MasterCard, Visa, and American Express so he could reconcile the day’s collections. During high school, I developed a spreadsheet that automatically reconciled the day’s business and i provided new metrics to measure how the business was doing. Efficiency and improving his practice was always fun for me. When I went to Binghamton (NY) University’s MBA program, I tailored my classes to concentrate on ways to help his practice—and therefore other independent optometric offices—stay ahead of the curve.
EK: I met with Jay Binkowitz, and Dr. Mark Stadlen. Jay had experience extensive experience in retail operations, merchandising & marketing, manufacturing & distribution, and technology development. Dr. Mark Stadlen had his own practice and had been practicing optometry for over 20 years. Our skills complemented each other’s greatly. Jay and Dr. Stadlen had maxed out the revenue and number of patients that they could see in their practice, so they spent time researching and developing new ways to expand the practice profitability internally. We combined our efforts to help our own practice, and it turned out that many other practices needed the same knowledge and help implementing that we discovered.
OS.com: We are trying to educate students about private practice optometry. What problems do people encounter most in private practice optometry? Is it efficiency, overhead, improper billing, dispensary problems or staffing problems?
EK: Doctors have been trained very well to be just that: doctors. What we found is they weren’t trained in a 2-4 year program to become leaders, managers, or to be running a retail business. There are many continuing education programs and consultants that help improve their medical and billing skills, but GPN’s niche is running the optical. From managing staff to understanding vision plans to merchandising to frame and lens procurement, GPN provides the infrastructure that independents need.
OS.com: What should students know before they decide they want to open cold or buy into a private practice?
EK: In my experience, there are very few recent grads that decide to open a practice cold. In today’s climate it would be a large, costly uphill battle. A better option would be to get involved in an established practice. Show the doctor you’re valuable by not only providing great patient care, but also focus your efforts on networking in the community and bringing new patients into the practice.
OS.com: What should students know about managing a private practice? What are 3 core lessons you can give students?
- Everyone looks up to the doctor. Read books on leadership and management. The more prepared you are to be in that role, the better.
- Find the right mentors and join organizations that support independents. There are many organizations that provide education and peer groups to independent ODs. IDOC, PRIMA, OD Excellence. Join an organization right away and take advantage of the experience of the other doctors you’ll meet and the support of the consultants that the groups recommend. You also don’t have to wait. In the meantime, sign up for Review of Optometric Business http://www.reviewob.com/ and find out what real problems and solutions are in advance.
- You don’t know what you don’t know. If you are starting cold or are buying a practice, the faster you increase the profitability the faster you can pay off those loans. Bring in an expert immediately for both the clinic and optical profit centers. The more time that goes by the more money your loosing to opportunity cost.
OS.com: You have lots of experience improving optical sales and helping practice owners and OD’s understand managed care and coding and billing. Can you summarize some of those lessons for students and provide somewhat of an overview?
EK: It’s not enough to sell a frame and lens to a patient who has insurance. The important part is, “What is the outcome of the sale?” If you bought a frame for $50 and ended up selling it for $60 after the insurance discount is taken off, you still actually lost money! What most doctors forget is that there is a cost to have a frame available for sale, Besides rent, and overhead for the practice, you have to:
- Order the frame
- Receive the frame
- Tag and price the frame
- Merchandise the frame
- Help the patient pick out the frame & lens
- Order the lenses with the lab
- Check the lenses when they come in
- Make the glasses (Or double-check that they were made made right)
- Notify the patient
- (Notify them again when they don’t come for awhile)
- Work with the patient when they pick them up
These costs must be considered just like “chair time”, when your opticians are working with patients in the optical.
OS.com: Staffing is critical in the optometric practice. What are a few things words of wisdom on staffing for students who want to run a private practice?
EK: Hire people with a good attitude and who share your vision. It’s easier to teach the skills you need then to teach passion, desire, and attitude.
OS.com: Do you feel that private practice ownership is still possible given the growing corporate presence in our profession?
EK: Absolutely. Large corporate optometry practices are a great example, as being a successful failure. They’re successful because they have a marketing department who speaks directly to the consumer; a merchandising department who sets their stores up in a great retail manner that promotes shopping. They’re vertically integrated so they have higher profit margins. But they are a failure in the sense that they can’t compete with the independent on quality of care and developing relationships with your patients. Typically the corporate players have higher staff turnover than the ECP, and the people who work in the ECP’s office have better hours, and a different level of ownership over their work.
OS.com: Do you have any advice for private practice owners regarding ways to compete against corporate optometry particularly the optical and dispensing aspect of the profession?
EK: You can’t be great at everything. Focus on being a doctor and bring in partners who have the experience to run or help you run a successful retail business. GPN provides services that will give private practice owners the same infrastructure as the corporate stores.
Be sure to stay tuned for more articles regarding private practice and practice management.
Optometrystudents.com thanks Evan Kestenbaum for taking the time to provide us with his valuable insight and share his experience with us.
For any questions for Evan, post below in the comments.