Los Angeles, CA (PRWEB) June 02, 2012
Growth in the Optometrists industry persisted through the economic recession, mainly due to resilient demand from the aging population and eye diseases associated with diabetes and computer use. During the five years to 2012, revenue is expected to increase at an annualized rate of 2.9% to $ 14.0 billion. While low disposable income and high unemployment deterred some consumers from seeking eye care, operators maintained growth by reducing prices and catering to favorably shifting demographics. The slowly recovering economy is expected to foster stronger growth in 2012; however, revenue growth has not been paired with profit growth. Optometrists cut costs during the past five years, but payers did the same. Managed-care vision plans and government payers (i.e. Medicare and Medicaid) kept reimbursement levels for industry services flat or only moderately increased them.
Insurance coverage and disposable income will improve in the next five years, but mounting competition will suppress profit expansion. The proliferation of optometrist schools will cause the number of Optometrists industry operators to continue a growth trend of the past five years. Optometrist offices will also face rising competition from large chain retailers, such as Walmart. These behemoth companies will reduce the profitability of selling eyeglasses and contact lenses at industry establishments as they increasingly open eye centers in-store. Optometrists are forecast to focus more on providing the full scope of medical eye care as a result. The Optometrist industry is highly fragmented, with no players accounting for a significant share of the industry. Optometric practice options beyond solo practices are numerous and include small and large independent group practices, group practices managed by a management service organization, independent practice associations, and physician hospital associations. The roots of group optometry began as a result of governmental legislation involving price advertising in the late 1970s and early 1980s. The results of enacting legislation fueled the emergence of corporate eye care. Further, many graduating optometrists, who are burdened with debt, are joining group practices. Despite this, industry concentration has been declining during the five years to 2012. This may be attributable to smaller group practices and the financial incentives to open solo practices in rural areas. The encroachment of national retail chains, such as Lens Crafters, may also be adding to fragmentation within the Optometrists industry.
Concurrently, President Obama’s Patient Protection and Affordable Care Act is projected to cause the number of insured individuals to increase, particularly in 2014, when the health insurance exchange is planned to open. Vision care is expected to increase due to the Harkin Amendment, which prohibits its discrimination in health insurance plans. Rising insurance coverage and the aging population are forecast to be the main drivers behind growth during the five years to 2017. For more information, visit IBISWorlds Optometrists in he US industry report page.
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IBISWorld industry Report Key Topics
This industry includes practitioners that have a Doctor of Optometry (OD) degree. ODs examine, diagnose, treat and manage diseases, injuries and disorders of the eye and associated structures. Operators may also prescribe and sell eyeglasses and contact lenses. These practitioners operate private or group practices in their own offices or in facilities like hospitals. The industry does not include ophthalmologists (i.e. medical doctors who are also trained to perform eye surgery).
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