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Survey results paint portrait of trends, technology’s effect on cataract practice
As a new-start technology, the advent of femtosecond laser usage in cataract surgery is approaching nearly 3% of all U.S. cataract procedures, according to respondents of a recent survey.
By Liz Meszaros
As of the first quarter of 2013, laser cataract surgery comprised about 2.3% of all cataract procedures performed in the United States, according to the 2013 Laser Cataract Survey by SM2 Strategic.
The survey-sponsored by Alcon Laboratories, Bausch + Lomb, LensAR, and OptiMedica-culled data from more than 200 cataract surgeons and 275,000 cases. Industry experts convened to discuss the results in a recent web seminar, and included Shareef Mahdavi, president, SM2 Strategic Inc., Pleasanton, CA; Michael Lachman, strategy consultant and market researcher, Lachman Consulting LLC, Walnut Creek, CA; and Matt Jensen, executive director of Vance Thompson Vision, Sioux Falls, SD.
“This is the second survey of this kind, dedicated completely to femtosecond-based cataract surgery, its use, and how it is being brought to market across the United States,” began Jensen. “Our findings last year were critical in uncovering current trends and norms, and many providers found that the data provided a lot of confidence related to how they planned to set up their programs.
“This year has been just as anticipated; the data set . . . is deeper, meatier, and more complete than any other study related to this rapidly changing category,” he added.
“We had participation by 65 centers, use by [more than] 200 surgeons, and this response rate of 49% we believe not only is a great response rate to any survey, but is very representative of what usage patterns look like across the country,” Mahdavi said.
“Surgeon averages for cataract procedures per year is 660, just [more than] 50 per month, and the mix of premium implants (toric and presbyopic) was 22%, which is above the national averages of 14% to 15% traditionally seen,” Mahdavi explained.
When breaking down these 278,300 procedures according to implant type, it was found that conventional implants accounted for 78%, toric for 9%, and presbyopic for 13% of implants-numbers that were consistent with last year’s survey.
When looking at data from only the first quarter of 2013, the percentage of conventional IOL procedures in which premium lasers were used is the lowest (20%), with toric higher (55%), and presbyopic (74%).
“This should not come as a surprise to any of us that the highest percentage of laser procedures are in the presbyopic-correcting IOL category,” noted Lachman, adding that the total numbers of procedures in these three categories are very different.
“But these three pies-conventional, toric, and presbyopic-are not really the same size. Conventional procedures make up 78% of all procedures. Even though the 20% penetration is lower than the 55% or 74% we see with the two premium IOL categories, when you take into account that the size of that pie [is larger], what you see is that 20% of the large pie is similar to or slightly higher than 55% plus 74% of these two smaller pies,” he explained (Figure 1).
“When the blended average of the toric and presbyopic, what we found was about a 66% combined penetration of premium IOL procedures,” Lachman said. “The weighted average across all three lens types was a 30% penetration.”
Femtosecond laser is expanding the premium channel in cataract surgery. When asked whether the adoption of the laser affected their use of premium IOLs, 45% reported no change, while 46% reported an increase, and only 9% a decrease.
The financial outlook for these lasers is encouraging, with most of them exceeding the volumes needed for positive return on investment (ROI), and an average volume of three times the break-even amount. In addition, most single-surgeon centers are achieving at least near-break-even volumes, and nearly all multisurgeon centers are doing so.
A break-even analysis (based on actual usage) showed that the per-case revenue was $859. Minus the per-case disposable costs ($327), this equaled a per-case margin of $532 (Figure 2). Fixed costs included laser equipment ($438,200) plus service totals over 2 to 5 years ($165,200), which equaled a total 5-year fixed cost of $603,400.
Total laser cases needed to break even was 1,134, and the break-even volume was determined to be 19 cases per month, and 227 cases per year over 5 years; average laser volume actually reached 57 per month. Total cataract cases that needed to be done per year in order to reach 30% penetration were 757.
In all, 65 centers were included for the survey’s break-even analysis. A full 71% of these centers reached breakeven or better. In further breaking this down, 59% of single-surgeon centers (13 of 22) and 95% of multisurgeon centers (41 of 43) reached near breakeven or better.
Practices with lasers are ramping up quickly in the first several months, according to Lachman, with an average of 30% laser penetration. When asked about the effect of the laser on their cataract practices, 53% of respondents said it had not changed, 44% reported an increase, and only 3% reported a decrease.
“Overall, given the ROI, the break-even analysis that we’ve done, and what doctors are reporting, there is an encouraging financial outlook, with many lasers [with] an average volume of three-times the break-even rate, and most lasers exceeding not only break-even but doing very well,” Lachman said.
Surgeon perception of ROI varied, but most survey respondents (48%) had a positive outlook, even though they have not yet reached the break-even point. A full 35%, however, reported that they had surpassed breakeven. According to 3% of respondents, the laser has already paid for itself, while 12% said it is too early to tell, and only 2% were concerned about breaking even. A full 83% of surgeons who use the femtosecond laser for cataract surgery are likely to recommend to their peers that they become involved with and begin performing laser cataract surgery.
“What we see now, in just the second year of availability in the United States, is that we’re already penetrating-with laser-2.3% coming up on 3% of all U.S. cataract procedures. That’s phenomenal for a new-start technology,” Lachman said.
“Just to put it into context, when the femtosecond laser first came out to make flaps in LASIK, it was at that 1% to 2% in that first year,” he concluded. “When I fast forward on a trajectory, and take the experience of a decade ago with Intralase technology and see where this can go, it is a very, very bright future, and I am encouraged by that.”