A couple of months ago I wrote a post mentioning that my average contact lens patient saves about $100 buying their annual supply of contacts through Costco vs. private practice (PP). In that article I promised to post some figures comparing the cost of coming to our practice and buying glasses/contacts through Costco, as opposed to using vision insurance at a private practice for your eye care needs.
I was first clued in to this subject by my brother who lives in the area. He signed up for vision insurance through his work specifically so he could receive an eye exam from me at the private practice where I used to work. After I took over ownership of my Costco practice, he told me that it had cost him so much extra to go the vision insurance route that he would have been better off doing everything at Costco with no insurance, writing me a personal check for $200, and we both would have come out ahead! That sort of statement got my attention, especially coming from someone who generally felt he had great benefits through his work.
In order to make direct financial comparisons, I of course have to make a few assumptions and use figures that are based on my experience with vision insurance and private practice but will by no means be correct for all cases. There are absolutely instances where patients will benefit financially by using their vision insurance at a private practice instead of paying out of pocket with us, especially if they pay no premiums at all for their vision coverage. I would suggest, however, that MANY people could save money by ditching the insurance and driving to Costco 🙂
It is important to realize as well that most vision insurances give no coverage whatsoever for medical eye visits – red eyes, etc – which are instead billed under general medical insurance. All most people get from their vision insurance is an annual eye exam with co-pay and a small allowance toward glasses or contacts.
For starters, let’s consider someone who is coming in for a comprehensive exam and new pair of single vision (not bifocal) glasses. Assuming that person pays a $10/month premium for vision insurance and has a $10 exam co-pay, they’re in $130 just for the exam. Assuming their insurance covers $120 toward a frame and gives a 20% discount on anything above that, they would pay $64 for a $200 frame (typical mid-range cost at PP). Vision insurance generally covers a standard plastic lens without any additional treatments. Since Costco glasses come standard with non-glare lenses, we’ll need to add on the cost of non-glare to compare apples to apples. If non-glare is an additional $60 under vision insurance, that patient is now responsible for $130 exam fees plus $64 frame cost and $60 for non-glare plastic lenses, or $254 total for exam and glasses.
If that same patient came to our practice for a comprehensive exam for glasses, they would pay $69 for their exam. On average, frames at the Costco optical cost only $70, with many nicer brand names like Oakley and Nike running $99. Again, all lenses at Costco come standard with their proprietary non-glare treatment, and single vision plastic lenses are only $45 for the pair. Combining the $69 exam with a $99 frame and $45 lenses, this patient pays $213 total for exam and glasses.
So, for a comprehensive annual exam and standard plastic lenses with non-glare treatment in a moderately priced frame, we’re looking at savings of about $40. Without crunching every number for every situation, suffice it to say that as you get into more expensive lenses, materials, and treatments – progressives and bifocals, transitions, thinner and lighter high index lenses – the savings tend to go up. For transitions, Costco’s add-on price will be around $35, versus more like $60 for PP vision insurance. For 1.67 high index lenses, the Costco upgrade is around $50, versus upwards of $100 or more with PP vision insurance.
Using all the aforementioned figures for vision insurance premiums, a patient coming in for a contact lens exam will again be paying $130 in premiums and co-pay. They will generally also have to pay an additional contact lens fitting fee, which can range from $30 to around $100 for standard soft disposable contacts. This figure may be even higher for bifocal lenses or lenses for astigmatism. Using the average annual cost of three commonly prescribed disposable lenses, a supply of contacts for the year will be around $220, with an insurance benefit of $120 bringing that down to $100 out of pocket. In all, this patient will pay about $295 for premiums, co-pay, contact lens fit, and year’s supply of contacts.
At our practice, this same patient would pay $99 for a comprehensive contact lens exam ($119 if fitting for astigmatism, bifocal lenses, etc, but we are comparing apples to apples here). The average cost of those same three brands of lenses when purchased at Costco is $144 for the year, yielding a total cost for exam plus year’s supply of contacts of $243. Total annual savings of just over $50 compared to PP vision insurance.
In this last example, we were looking only at standard soft contacts that correct nearsightedness or farsightedness, with an average cost difference of about $75 for an annual supply. Averaging my seven most commonly prescribed brands – including daily disposables, lenses for astigmatism, and bifocals – the average annual savings buying at Costco over PP is actually about $100. Factor in a more expensive fitting at PP for those specialty lenses as well (versus just $20 extra in our practice) and you’re saving even more money.
Again, situations certainly exist where vision insurance can help people save money, especially for cases in which the employer provides the benefit at no cost to the employee. I simply invite you to crunch the numbers for your own situation and see if we might be able to save you some money!
Costco Eye Doctor 