Practice Overhead Comparison

[bergmistro]

Hi everyone,

I'm looking at various new job opportunities and wanted to get an idea for the difference in overhead between practice types and specialties. My understanding is comp tends to be 50-60%, cornea/refractive can be up to 70%, retina similarly can be closer to 70%, plastics is lower around 30-40%.

I'm plastics and considering plastics only group vs multi-spec and trying to negotiate a contract with different pay structure compared to their standard comp contract.

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[MullerCell]

Overhead % is almost entirely dependent on revenue generation per unit time by a physician. Other factors like staff/admin cost, rent, etc create fixed costs that vary by location and certain aspects of a practice, but overhead is a doctor specific number and the overwhelming factor that determines overhead % is productivity. Certain subspecialties will generate significantly more average revenue per encounter and allow for more patients to be seen per unit time and this leads to differences among different types of ophthalmologists. A busy retina specialist can have overhead below 30%. A slow one could have overhead of 70-80%.

 

[dantt]

You may be able to negotiate a different base or a different bonus percentage but it will be near impossible to negotiate a different compensation structure to everybody else.

 

[TheLesPaul]

multispecialty groups are where oculoplastics goes to die

you won't have much in common with your colleagues and you will eventually have serious disagreements about call and overhead bc your emergencies and your equipment don't really intersect

oculoplastics 50% on average
high ant seg much much higher + lasers and drugs etc

 

[linevasel]

I'm interested in hearing more about the knock on multi-specialty for oculoplastics. It would seem that you just need a group that understands the differences in how Plastics generates compared to your ant seg and retina colleagues and hopefully would compensate (high percent of collections; less or no call burden; Use of PA to assist in OR and clinic).

What other attributes would you want to see a multi-specialty practice incorporate to make it more friendly to oculoplastics ?

Obviously we are trying to hire...lol

 

[Ophthodoc2018]

I still don’t know how overhead can be high for comprehensive practices, it’s not like you are buying a new IOL machine or OCT or slit lamp every year. I work for a PE and I know prior to buy out the overhead was 25% and the office is basically falling apart. Of course the PE will just put duck tape on broken chairs (literally) to maintain low expense… and not to mention they pay the staff minimum wage and the turn over is probably every 3 months.

 

[TheLesPaul]

I'm interested in hearing more about the knock on multi-specialty for oculoplastics. It would seem that you just need a group that understands the differences in how Plastics generates compared to your ant seg and retina colleagues and hopefully would compensate (high percent of collections; less or no call burden; Use of PA to assist in OR and clinic).

What other attributes would you want to see a multi-specialty practice incorporate to make it more friendly to oculoplastics ?

Obviously we are trying to hire...lol

#1) there should be different % of collections for cosmetic fees vs functional reimbursement
#2) have to be willing to invest in patient marketing
#3) have to be willing to invest in a dedicated clinic area that doesn't look like an "eye doctor's office"
#4) have to make sure external referrals are sent back to other practices even if the patient has a cataract after their bleph is done
#5) don't make the oculoplastics person pay for your femto/lasik machine, and conversely let them get whatever lasers they want as long as they cover the purchase from their own collections
#6) don't make them see your glaucoma bombs when they take practice call, bc you are definitely not going to be resuturing their dehisced blephs
#7) allow them to operate at a surgery center more amenable to oculoplastics (i.e., one that has ENTs or other specialties and can actually do general anesthesia unlike most eye-only ASCs)
#8) ideally separate phone tree, webpage, SEO for the oculoplastics division

true oculoplastics is not really ophthalmology and the patient demographics tend to be much younger, and tend to get turned off by going into a very "medical-looking" facility like most ophtho practices are

 

[eyeeye_captain]

#1) there should be different % of collections for cosmetic fees vs functional reimbursement
#2) have to be willing to invest in patient marketing
#3) have to be willing to invest in a dedicated clinic area that doesn't look like an "eye doctor's office"
#4) have to make sure external referrals are sent back to other practices even if the patient has a cataract after their bleph is done
#5) don't make the oculoplastics person pay for your femto/lasik machine, and conversely let them get whatever lasers they want as long as they cover the purchase from their own collections
#6) don't make them see your glaucoma bombs when they take practice call, bc you are definitely not going to be resuturing their dehisced blephs
#7) allow them to operate at a surgery center more amenable to oculoplastics (i.e., one that has ENTs or other specialties and can actually do general anesthesia unlike most eye-only ASCs)
#8) ideally separate phone tree, webpage, SEO for the oculoplastics division

true oculoplastics is not really ophthalmology and the patient demographics tend to be much younger, and tend to get turned off by going into a very "medical-looking" facility like most ophtho practices are

The obvious answer is you should join a PE group and let the suits figure it out 😉

Really good stuff here. There are fewer moving parts to hiring surgical retina for a multispecialty, but not by much. I’d say the glaucoma folks also need a different contract if they’re taking the tough cases for the LASIK/lenses folks. This is why multispecialties get weird fast - the practice patterns, equipment, and reimbursements are so different. The strictly comp people have it relatively easy but also tend to have higher overhead, which makes for an odd dynamic. It gets even stickier when they want to do aesthetics/lids/injections.

*side note: who are these retina practices supposedly running 70+% overhead? There’s no way it’s the worst. When I used to do a weekly visiting clinic for a multispecialty, I needed 1.5x the staff to do around half the volume I usually do, and they were all sorts of stressed out.