m
Recent Posts
Connect with:
Saturday / February 15.
HomeminewsOptical Doors Stable, Little Chance of Price Gouging

Optical Doors Stable, Little Chance of Price Gouging

A study into the optometry landscape has flagged a surplus of optometrists, which will maintain competition and potentially push salaries down in coming years.

The number of optical doors in Australia had slightly increased according to the study, which was commissioned by the Federal Government and found a total of 2,978 practices, compared with 2,949 practices identified by mivision in 2012.

Of those, 1,914 were independents (including 870 practices in buying groups) and 1,064 were either corporate or franchised practices. In 2012 mivision identified 1,917 independents, (including 864 in buying groups) and 1,032 franchised/corporate practices. There is currently one optometrist for every 7,142 people in the country.

The report, conducted by ACIL Allen Consulting, was commissioned prior to the May Federal budget in an effort to understand the market implications that would result from changes in indexation of the Optometric Medicare Benefits Scheme (MBS) and removal of the cap on fees chargeable above the MBS fee. It specifically aimed to assess whether customers in regional and remote Australia would be disadvantaged by the changes due to a lack of competition among optometry practices.

With 25 per cent of practices having at least five competitors within 500 metres of their own location and 77 per cent of optometrists having at least two competitors within two kilometres of their practice, Michael Jacobs, CEO of Eyecare Plus, said “there is plenty of competition in rural areas and therefore no fear of optometry practices being able to price gouge”.

Genevieve Quilty, CEO of Optometry Australia said the report aligns with the Association’s expectations. “A key element of the report was that it showed that, in most regions across Australia, there was relatively good access to optometry services and healthy competition. This aligns with what Optometry Australia believed prior to the report. For the Government, we believe this confirmation was important as they wanted to ensure removing the cap on Medicare fees wouldn’t see fees rise significantly in areas with limited competition.”

If anything, according to business consultant Mark Overton, the report confirms a full market for supply of optometric service that will help keep fees down and could potentially reduce salaries as well. “Practices require about 8,000–10,000 patients to be financially viable, so 7,149 patients as reported is adequate, but on the low side. We’re seeing the effects of an over-supply of optometrists already. In 2012, it was the graduating students calling the shots when it came to employment. Last year for the first time ever, I had graduates asking whether I knew of any jobs. As more students emerge from Deakin and Flinders in 2015, I predict we’re going to see a shift in supply of labour and salaries are likely to come down.”

Mr. Jacobs said that the report failed to consider important issues that would impact competition such as practice size; turnover; number of optometrists employed, hours of employment, opening hours and specialties practiced. “Thus the results are of limited value to the industry and only served to confirm numbers already reported by other sources. The only new data was the focus in practice location… It is a shame the government didn’t work with Optometry Australia for example to come up with a
more meaningful survey that could have benefited the whole industry,” he said.

Ms. Quilty agreed there were limitations to the research and analysis, “Importantly for rural and remote areas the analysis is only telling us where services are provided without an indication of how frequently services are accessed – services could be daily, weekly or even annually, and that is not clear from the analysis. Overall, however, it does provide a useful picture of where services are provided across the country, including in rural and remote areas,” she said.

DECLARATION

DISCLAIMER : THIS WEBSITE IS INTENDED FOR USE BY HEALTHCARE PROFESSIONALS ONLY.
By agreeing & continuing, you are declaring that you are a registered Healthcare professional with an appropriate registration. In order to view some areas of this website you will need to register and login.
If you are not a Healthcare professional do not continue.