ASOA Certified Ophthalmic Executive (COE) Exam

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A practice manager is using benchmarking to evaluate performance. They note the practice's overhead ratio is 70%, while the industry benchmark is closer to 60%. Upon investigation, the staff-per-FTE-provider ratio is in the 90th percentile, and the revenue per encounter is at the 75th percentile. What is the most logical conclusion?

The practice may be profitable due to high revenue per encounter, but is likely overstaffed. The practice's occupancy and marketing expenses are too high. The providers are not seeing enough patients per day. The practice is efficient in converting revenue into profit.

Correct Answer:

The practice may be profitable due to high revenue per encounter, but is likely overstaffed.

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