By Mark Wright, OD, FCOVD,
and Carole Burns, OD, FCOVD
June 30, 2021
Providing the best possible care should always be our top priority. If you are a practice owner, or an optometrist whose wages are based on the number of patients seen per day, it is important to determine how efficient the doctor-staff team is working. A topnotch, really efficient doctor-staff team will solve more patient problems resulting in more care delivered. The metric that tells us how well the doctor-staff team is working is called Doctor Efficiency.
How to Calculate Doctor Efficiency
There are two numbers necessary to calculate Doctor Efficiency:
1) Calculate the number of full-time-equivalent doctors in the practice by taking the average number of hours worked by all doctors in the practice and then divide that number by 40. In a two-doctor practice, in which one doctor works an average of 40 hours per week and the other works an average of 30 hours per week, the calculation would be 70/40 = 1.75 full-time-equivalent doctors.
2) The other number needed is the annual gross revenue collected minus any returns or refunds.
Doctor Efficiency is calculated by dividing net gross revenue collected by the number of full-time-equivalent doctors in the practice. For example, in a two-doctor practice, in which both doctors are working 40 hours per week and the total net gross revenue collected is $1,000,000, the Doctor Efficiency is $1M/2 = $500,000.
Now, we can compare the Doctor Efficiency of the practice in front of you with the national benchmark number. The median for Doctor Efficiency is $700,000. Knowing the benchmark number, the practice Doctor Efficiency of $500,000 from the example above is below median. The practice in our example has a lot of room for improvement.
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You should also know that 5 percent of doctors will have a Doctor Efficiency of $1,400,000. One percent of doctors will have a Doctor Efficiency of over $2,500,000.
What would increase the Doctor Efficiency number?
There are at least two major ways to increase the Doctor Efficiency number. They are:
1) Increase the gross revenue collected without increasing the number of full-time-equivalent doctors.
So how do you accomplish this?
• Increase fees on things not covered by third parties.
• Increase the number exams per day. (Start with one extra exam in the morning and one in the afternoon.)
• Prescribe everything patients need to improve their quality of life, which will increase the number of multiple-pair sales.
2) Decrease the number of full-time-equivalent doctors without decreasing the gross revenue collected.
So how do you accomplish this?
• Become more efficient by delegating work the doctor is doing to team members, thereby reducing the number of hours a doctor needs to see the same number of patients.
• Reevaluate the schedule by eliminating times that are hard to schedule and, then, compress the schedule to see the same number of patients.
Conclusion
The key to Doctor Efficiency is to do something about it. The goal in practice should not be a spot in the middle of the pack (the median), but instead to be the best – to deliver the best care to the most people. Knowing that, calculate your Doctor Efficiency and then do something about it if necessary.
