Why I don’t recommend pricing PRK the same as LASIK or SMILE
Recently, at the Forefront Refractive Surgery Course, Dan Reinstein shared his approach to pricing refractive surgery procedures like ReLEx SMILE, LASIK, and PRK. He charges the same for all three to remove bias from the surgeon and the patient. While his method is based on solid economic principles, it made me think about some other pricing ideas that fit better with today’s world.
Different Ways to Think About Pricing
Adam Smith’s Cost-Plus Model
Dan’s view aligns with Adam Smith’s model, where pricing is tied to the cost plus a margin. This model works well for commoditised products and services. For instance,
- PRK needs more prep and post-op care, which raises its delivery cost.
- LASIK and SMILE might cost less to perform but offer different patient experiences and recovery times.
From this viewpoint, pricing based on cost and time makes sense. However, this model might not fully capture how patients perceive value.
Carl Menger’s Subjective Theory of Value
Enter Carl Menger and the subjective theory of value. Menger argued that value isn’t inherent in the service or product or tied to the labour invested. Instead, they perceive value by evaluating the likelihood of achieving their dream outcome over the time it takes and the effort and sacrifice they must make.
In refractive surgery, patients don’t buy the surgery. They buy the life-changing results that arise AFTER the surgery. Their perception of value varies. A patient might value SMILE or LASIK’s fast recovery and convenience over PRK. This is true regardless of the technical complexity involved.
How Marketers and Producers View Pricing Differently
This highlights a critical difference between producers and expert marketers. Producers often see price through the lens of cost, while marketers understand that value is subjective. Patients are willing to pay more for procedures they see as better. They do this regardless of the cost.
While I respect Dan’s approach to equal pricing to avoid bias, I view pricing as reflecting the value patients place on each procedure. It’s not about the cost of delivery but how patients value their outcomes.
Final Thoughts
While cost-based pricing is straightforward, using a value-based pricing strategy that considers how patients perceive value and market dynamics can lead to better results for both your practice and your patients. Avoiding bias is important, but it can be done without using the same price for everything.
What are your thoughts on this approach to pricing lenticule extraction, LASIK and PRK?
Pricing can vary significantly across different countries, cities, and markets, so it’s important to get it right. If you are uncertain whether you are underpricing or overpricing your services, I recommend you book a free 15-minute compatibility call with Laura today! We can clearly explain how to adjust your prices to maximize your profit based on your location and marketing efforts.
NOTE: The best way to answer that nagging question about practice growth or marketing or patient volume in the back of your mind is to book a free 15-minute compatibility call. Get some options and go away with a clear idea of what’s possible.
About the author
Rod Solar
Founder & Scalable Business Advisor / fCMO
Rod Solar is a co-founder of LiveseySolar and a Scalable Business Advisor for its customers. Rod mentors and coaches eye surgery business CEOs/Founders and their leadership teams to triple their sales, double their profit, and achieve their “ideal exit”.
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Meet our Co-Founders
Rod Solar
Founder & Scalable Business Advisor
For over 20 years, I’ve helped ophthalmology entrepreneurs scale their private practices. I specialise in doubling revenue within three years by offering a proven framework, hands-on experience, and a team of experts who implement what works. We take the guesswork out of growth and scale, so you can focus on delivering exceptional patient care while maximising the value of your business.
LiveseySolar completely transformed the way we were approaching this… We’ve gone from having just the dream of having a practice to having a practice up and running with people making inquiries and booking for procedures… It’s extremely pleasing. We feel lucky we connected with LiveseySolar.
— Dr Matthew Russell, MBChB, FRANZCO, specialist ophthalmic surgeon and founder of VSON and OKKO
Laura Livesey
Founder & CEO
I’m the co-founder & CEO of LiveseySolar. I’ve developed powerful eye surgery marketing systems that increase patient volumes and profits for doctors, clinics, and hospitals, since 1997.
Rod and Laura know as much about marketing surgery to patients as I know about performing it. They are an expert in the field of laser eye surgery marketing. They know this industry inside out. I believe that they could help many companies in a variety of areas including marketing materials, sales training and marketing support for doctors.
— Prof. Dan Reinstein, MD MA FRSC DABO, founder of the London Vision Clinic, UK