By Paul Klein, OD, FAAO
Patients who fail to show up for appointments cost your practice essential revenues. Calculate how much these “no-shows” cost you, and implement an action plan to fix this drain on your revenues.
Are No-Shows Inevitable?
A patient, from time to time, simply fails to show up for an appointment. Try as we might, we can’t rid ourselves of no-shows.
How much are no-shows costing an optometric practice? The amount of lost revenue depends on per-patient average revenue. Practices can compute their per-patient average by dividing the total number ofexams by the gross revenue. In the case of my practice, Broward Eyecare in Ft. Lauderdale., Fla., per-patient revenue is $300.That means that if I average the lowest managed care patient exam only with the highest self-pay exam plus, plus, it comes to $300. Therefore, every no-show represents a $300 loss to me.Other practices have different fees and charges, so their per-patient revenue will be lower or higher.
Track the no-shows
My anecdotal experience, confirmed by discussions with colleagues in other parts of the country, is that the incidence of no-shows is related to the socio-economic level of practice. Practices in high socio-economic communities tend to have a lower no-show rate. My impression is that is true because these patients value their eye care services more and are ready and prepared to pay for them as needed. Patients in lower socio-economic levels may want and need the services but are much more subject to economic urgencies that may arise unexpectedly and distract them. In addition, patients in provided managed care plans (by employer, Medicaid or Medicare) with no loyalty to their provider, and with no deductibles, or small deductibles, seem to express little guilt if they don’t show.
In my practice, my no-show rate is two patients per day. Some, but not all, re-schedule at a later date so some of the revenue is recoverable, however overhead costs are not. That computes to a potential daily revenue hole of $600. Time loss for thedoctor is one hour of revenue production loss. Value of per-doctor revenue loss can be calculated by dividing total monthly doctor revenue by the total number of doctor hours assigned to patient care. Staff time loss is about 45 minutes per patient. This includes time spent in setting appointments, verifying patient insurance information, appointment reminders and technician time. Staff time value can be calculated by dividing total employee monthly hours by employee gross pay, plus benefits costs.
Practice consultants recommend calculating opportunity loss values based on “chair time cost.” I’m not in favor of utilizing calculations of chair time cost as this does not take properly into account the actual patient pool of the practice community. Chair cost is a fixed cost. How can a practitioner actually reduce chair cost if the practice is in a community that is very heavily managed care? Where are you going to get high-paying patients to fill the chair?
Implement aStrategyto Minimize No-Shows
Pre-appointing. Pre-appointing is an oft-recommended strategy to reduce no-shows.This may work well in small communities where everyone knows everyone and the shame level ofcheating your doctor is high. I’m not sure it works well in urban communities. In my case, I tried it and when patients were recalled a year later and reminded that they made an appointment they were very irate, insisting they never made that appointment.
Virtual appointments. My strategy was to create a virtual appointment. My recall letters gave each patient a day and time of a “tentative” appointment that they could call to confirm or re-schedule in advance if necessary. This worked better but not perfectly.
Recall postcard. Most doctors just send out a generic recall postcard and follow up with a reminder phone call. Every practice management guru claims “success” with their recommendations of pre-appointing and follow-up contact. Unfortunately this isanecdotal. No one has bothered to do a controlled study to determine either overall recall effectiveness or effectiveness with specific methods.
Reminder call. Most patients definitely do not like to be reminded to return for their annual exams. That’s because they associate the exam visit with: “I have to spend money for glasses and I’m seeing just fine.”In addition, those covered by third party plans have to research their benefits to determine if they can continue to be covered by their previous provider, and whether that will have coverage for their visit and materials. This is a daunting impediment to setting and keeping an appointment.
Re-booking fee. A friend of mine recently instituted a $20 fee for re-booking an appointment that was either missed or not rescheduled within 24 hours. The patient can schedule another appointment, but they will have to pay the fee to get that appointment. This is explained in detail upfront when patients book an appointment. My friend figures that patients who resent that policy are not desirable and not wanted. Those who understand are the ones who value his time. It is still too early to determine the success of this strategy, but at least it is a serious attempt to solve a persistent no-show problem
It is interesting that the public has accepted the airline policy of a hefty fee for re-booking a previously booked flight without much resistance.Why is our empty chair less of a loss thanthat ofthe airlines? I challenge my colleagues with this latter suggestion: Will a re-booking fee (which works well for airlines) work for an optometric practice? What is stopping us from trying it?
Paul Klein, OD, FAAO, is owner of Broward Eyecare in Ft. Lauderdale, FL. He lectures and publishes widely. To contact him: drklein@browardeye.com.
