Quality of surgery defined as more than just the visual outcome

In this report from the OSN IOL Economic Summit, Shareef Mahdavi discusses the concept possibilities of customizing the patient experience.

Issue: September 15, 2006

ByShareef Mahdavi

Shareef Mahdavi

In today’s competitive world, you probably have heard many experts use the word “value” when describing what’s important to manufacturers and consumers. This concept can be applied to the business of refractive surgery. It’s important that surgeons look back at what has happened over the past decade in trying to determine what might happen over the next decade.

This analysis should begin with a key question, which as an ophthalmic surgeon, you need to ask yourself: “What business am I in?” Apply this question to Starbucks, and I can promise you the answer is not, “We sell coffee.” Sociologists have given Starbucks an interesting distinction in society as “the third place”: a safe place to socialize and hang out besides your house and your work. That is a far cry from just selling coffee.

Defining quality

Surgeons may define quality as one thing: the outcome. How good a visual outcome did we achieve for our patient? This is a good thing.

However, we have all heard the phrase, “Think outside the box.” I would like to propose that we think beyond the clinical outcome, because our patients certainly are. Patients define quality differently. They are evaluating you (and your clinical expertise), based on many non-clinical items, including your “bedside manner,” the responsiveness of your staff to their questions and the neatness and organization of your reception area. In addition to how well they see, these other questions affect their perception of the value of what they receive from you as their surgeon. Just as with Starbucks, it’s not only about getting a cup of coffee.

Reflect for a moment on the last time you made a significant purchase. For me, a recent example began several years ago, when I first saw the clarity of a high-definition television. I said to my wife, “I have to have one of those.” She was not as interested as I was, but through the art of persuasion, time and seeing more commercials, I went through the classically defined consumer decision process, moving from awareness to interest to consideration to actually purchasing one. We have it, we love it, and we show all our friends.

This process holds true in refractive surgery for your patients. They have heard about it; LASIK is pretty much a household word now. When they pick up the phone to call your practice because they are interested in LASIK or some form of refractive surgery, that is the start of the process of interest. Eventually that leads to coming in to seeing you, having a procedure and, hopefully, afterwards telling friends and family.

First impressions

How are we greeting our patients when they show up or when they express interest? My firm did a survey and has studied well over 100 practices in the past year. We “mystery shop” called them and recorded every call with their permission. We then reviewed them on 13 criteria. Those practices considered the premium ones, the top 50 in the country, scored only about 42 points on a total of 100 possible points. A good call would have been considered 57 or higher.

Even good practices have a lot of work to do in terms of how well they are capturing the interest that comes with that first phone call. What kind of first impression are we making on people who we are asking to spend $5,000 to $10,000.

If we were to ask Jessup Cellars, a small boutique winery in Yountville, Calif., what business they are in, they would not respond, “Well, we take expensive grape juice that has been fermented and sell it to you.” That is not the answer. When you go to Jessup, the first impression is typically like walking into someone’s house. They greet you like family. Their goal is to build relationships and build business one customer and one conversation at a time, with each wine pour. They want to turn that first impression into a customer for life. And one note to surgeons: They don’t give away that tasting; they charge for the wine pour, choosing to create value in different ways than simply a free sip of wine.

The patient experience

Typically, after LASIK or a successful IOL implant, the patient is happy. They like what you have done for them. We need to take some of that joy and pull it into other steps along that decision process that I mentioned earlier. It can happen in any company, in any industry and any category. Those who have shopped at Whole Foods know that they are about turning the drudgery of grocery shopping into entertainment. I had a chance recently to fly Jet Blue, and it was fun, especially in contrast to what happens on other commercial airlines. These are category leaders in customer satisfaction because they have defined the business they are in differently.

In taking a look at LASIK procedure volume and pricing over the past decade, we are shown a dramatic increase in procedures each year up through 2000 and then a decline. Following that decline, procedures have started to come back up over the last few years. If you look at average pricing around the United States, it is apparent that it, too, went up before decreasing dramatically over 20% starting in the year 2000.

Achieving greater value

Traditional economics would say that when you lower the price of something you should sell more of it. However, LASIK and refractive economics tell a different story. When prices came down per procedure, volumes came down, as well. The implementation of wavefront technology and femtosecond lasers, which were more expensive to provide, caused surgeons to raise their fees. As a result, the number of procedures performed increased.

There is something about the way that patients define quality and what they want, and what they are telling us is they do not want low prices.

I would like to talk specifically about value and how companies are achieving greater value today. Let us take my daughter’s birthday, for example. My daughter turned 10 this year, and we had a birthday party. My wife could have made the cake from scratch, costing about $1.50 for the flour, sugar, water, egg and the time in the oven. Alternatively, she could have gone and bought the Duncan Hines cake mix at the grocery store and for just about $3 and an egg could have made that same cake. She also could have gone to Costco and paid about $25, which is about eight times as much, and bought a pretty cake that would have had my daughter’s name on it. However, we did not choose any of those options. Instead, we spent $250 having the party at Club Libby Lu, and that did not even include the cake. The point here is that moving up the value chain is what companies that want to gain greater economic value are doing.

How does this apply to refractive surgery? It is identical. Every patient should be having a customized experience. This is not just because it is custom ablation or a custom IOL, however; it is also because each patient is an individual with only two eyes. The more you differentiate what you do, the more relevant you can be in meeting your patients’ needs, the closer you are to offering an experience rather than just delivering a service or offering a product called a refractive IOL. Focusing on delivering a unique and highly memorable experience puts you in a position to reduce the “comparison shopping” your staff tells you patients are doing and command higher fees over time.

Conversely, the more that surgeons treat refractive surgery as a commodity, as seen with ads proclaiming $299 an eye for LASIK, the more damage is done to the reputation of what you do and what you deliver. Yet even stopping it is going to be long residual in the minds of patients out there, many of whom call and wonder why it is not $299.

Future outlook

What is interesting about the Baby Boomers is that they are now between the ages of 42 and 60. They are going to develop presbyopia and they are going to develop cataracts for the most part, and that is good news. The even better news is when you look at their financial situation. They are generally past their peak debt and are moving into their peak net worth in spending and investments. Thus, these are good tail-wind dynamics for you as surgeons.

I think we have the technology, and it is only going to get better. We have, no question, patients and Baby Boomers who want to stay, look and feel young.

What I am not clear on is whether are we able to maintain and increase the value of how we are perceived by our patients? It is important because we are going to look back 10 years from now and ask ourselves, “What happened with the refractive IOL? What was the growth rate trajectory?” Do nothing and we will have growth just simply because the population is growing. If you focus on your service basics, however, I think your practice will be even better because you are focusing on delivering better service and a better overall experience — the key tents of value — to your patients.

For more information:

Shareef Mahdavi, president of SM2 Consulting, has spent his career learning how to increase adoption of new medical technologies, including refractive surgery. He can be reached via his Web site at www.sm2consulting.com, which houses a library of original articles and reports covering marketing of elective procedures. Mr. Mahdavi also offers a free newsletter, Ideas in Action, with tips to help providers and manufacturers improve the customer experience.