Dr. Julia Connors from Clear Eyes Cataracts Clinic is thinking about expanding her clinic, by considering...

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Dr. Julia Connors from Clear Eyes Cataracts Clinic is thinking about expanding her clinic, by considering different options: first, she could keep her physical facility as is and expand the hours. Second, she might expand space in the same building she owns, with additional equipment and fixtures within her building. The third option is to expand to a new location. The fourth alternative, which is the focus of this study, would increase volume by increasing the yield of potential patients, most of whom drop out before completion. This alternative would require only minor increases in capacity and avoid the expenses of physical expansion as well as the personnel risks of extending the hours of operation. As the first step in determining whether the fourth option was even possible, Dr. Connors uses the process flow diagram (Exhibit 2) to calculate utilization for each category of staff and also the yield from initial inquiries through surgeries. Annual non-surgeon minutes capacity (5 days*48 weeks*8 hours*60 min) = 115,200 minutes Receptionist utilization = 26,678/115,200 = 23.2% PSR utilization (per person) = 347,742/115,200 301.9% /4 workers for this job title = 75.5% Technician utilization (per person) = 168,638/115,200 = 146.4%/3 workers for this job title = 48.8% Cleaner utilization = 41,049/115,200 = 35.6% Annual surgeon minutes capacity (5 days*48 weeks *7 hours* 60 min) = 100,800 minutes Staff surgeon utilization = 92,220 /100,800 = 91.5% Dr. Connors also calculated the capacity utilization of the two examining rooms at 50% and of the three surgical rooms at 66%. Task, Annual Demand, and Demand (# Job titles patients) Initial patient call 22% defect after this point Mail paperwork Call to remind 28% defect after this point Arrive at clinic for intake 14,345 11,189 11, 189 8,056 Calculations = 14,345*78% =11,189*72% 74% insured, 26% cash payers Remind call 40% reschedule call 30% insured defect, 47% of cash payers defect Check-in at clinic First follow-up 8,056 Surgery, clean-up, record 5,283 21% defect after first follow-up 5,283 5,283 =8,056*65.58% 3-week follow-up 4,174 = 5,283*79% Yield from initial inquiries through surgery: 5,283/14.345= 36.8% This 65.58% represents those who return for surgery after completing intake. It is calculated as a weighted average of the patients paying with insurance and cash and their different propensities to defect. (.74 insured *.70 insured retained) + (.26 cash payers*.53 retained cash payers) = 65.58% Based on the information presented in the case and above, please answer the following questions: 1. (20 points) What are some of the factors specific to ClearEyes Cataracts Clinic that make the clinic so profitable despite the apparent low barriers to entry for this procedure? Please list as many factors as you can think of, but no less than 6 factors. Explain their contribution to the success of the clinic. Dr. Julia Connors from Clear Eyes Cataracts Clinic is thinking about expanding her clinic, by considering different options: first, she could keep her physical facility as is and expand the hours. Second, she might expand space in the same building she owns, with additional equipment and fixtures within her building. The third option is to expand to a new location. The fourth alternative, which is the focus of this study, would increase volume by increasing the yield of potential patients, most of whom drop out before completion. This alternative would require only minor increases in capacity and avoid the expenses of physical expansion as well as the personnel risks of extending the hours of operation. As the first step in determining whether the fourth option was even possible, Dr. Connors uses the process flow diagram (Exhibit 2) to calculate utilization for each category of staff and also the yield from initial inquiries through surgeries. Annual non-surgeon minutes capacity (5 days*48 weeks*8 hours*60 min) = 115,200 minutes Receptionist utilization = 26,678/115,200 = 23.2% PSR utilization (per person) = 347,742/115,200 301.9% /4 workers for this job title = 75.5% Technician utilization (per person) = 168,638/115,200 = 146.4%/3 workers for this job title = 48.8% Cleaner utilization = 41,049/115,200 = 35.6% Annual surgeon minutes capacity (5 days*48 weeks *7 hours* 60 min) = 100,800 minutes Staff surgeon utilization = 92,220 /100,800 = 91.5% Dr. Connors also calculated the capacity utilization of the two examining rooms at 50% and of the three surgical rooms at 66%. Task, Annual Demand, and Demand (# Job titles patients) Initial patient call 22% defect after this point Mail paperwork Call to remind 28% defect after this point Arrive at clinic for intake 14,345 11,189 11, 189 8,056 Calculations = 14,345*78% =11,189*72% 74% insured, 26% cash payers Remind call 40% reschedule call 30% insured defect, 47% of cash payers defect Check-in at clinic First follow-up 8,056 Surgery, clean-up, record 5,283 21% defect after first follow-up 5,283 5,283 =8,056*65.58% 3-week follow-up 4,174 = 5,283*79% Yield from initial inquiries through surgery: 5,283/14.345= 36.8% This 65.58% represents those who return for surgery after completing intake. It is calculated as a weighted average of the patients paying with insurance and cash and their different propensities to defect. (.74 insured *.70 insured retained) + (.26 cash payers*.53 retained cash payers) = 65.58% Based on the information presented in the case and above, please answer the following questions: 1. (20 points) What are some of the factors specific to ClearEyes Cataracts Clinic that make the clinic so profitable despite the apparent low barriers to entry for this procedure? Please list as many factors as you can think of, but no less than 6 factors. Explain their contribution to the success of the clinic.

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