The clinical and financial advantages of purchasing OCT - why it is worth investing in such expensive equipment?
An optical coherence tomography scan (OCT scan) is an invaluable diagnostic tool used in the early detection of many eye conditions. An OCT allows optometrists the additional clinical benefit of having a view of what’s going on beneath the surface of the eye through a cross section image of the eye which isn’t possible with other methods of imaging. The clinical benefits of such tests are significant as they allow early detection of a range of potentially sight threatening conditions such as glaucoma and macular degeneration. Having an OCT allows optometrists to have extra confidence in their clinical decisions, enhancing patient care. With OCT being one of the biggest clinical developments in recent years, it’s important that practitioners keep up with the technological advancements in the sector to help them thrive by maintaining and growing their patient share.
How to go about purchasing - the financial considerations and options - buying outright, Hire purchase, renting etc.
There are many different suppliers of OCT machines and it’s important that optometrists do their homework on researching which OCT is best for their needs. OCT prices vary, and with a mid range machine typically priced at around £30,000, it represents a significant investment for a practice to make. Given recent changes to capital allowances, funding an OCT on Hire Purchase or outright purchase may be allowable against taxable profit within your Annual Investment Allowance in the year of acquisition. Hire Purchase also provides outright ownership of the OCT once all repayments are made and allows an optometrist to spread the cost over a term that suits their cashflow. Funding an OCT with Braemar brings with it fixed rate repayments allowing for easier cash flow budgeting, and financing the investment enables existing funds to be used in the business elsewhere preserving cashflow. As Opticians need to carefully consider their VAT position, we would always recommend that independent accountancy advice is taken to consider the Optician’s specific tax and financial circumstances. As appropriate Braemar are able to provide finance options that mitigate the impact of VAT and VAT de-minimis.
How a practice can benefit financially from purchasing OCT, such as charging more for eye exams.
Many optometrists recommend OCT scans for all of their adult patients as part of their ocular health care but particularly if they are considered higher risk due to having previous eye conditions or for example suffer from Diabetes. It’s no secret that due to advancements in medical care, life expectancy has never been higher meaning patient demand is becoming greater. According to statistics and projections produced by Office for National Statistics (ONS) through the latter half of the 20th Century, the UK population has been steadily getting older and this trend is projected to continue in the future. In 2016, there were 11.8 million UK residents aged 65 years and over, representing 18% of the total population – 25 years before, there were 9.1 million, accounting for 15.8% of the population. Looking ahead 25 years to 2041, the 1960s baby boomers (aged in their 50s now) will have moved into older age and by 2066 there will be a further 8.6 million projected UK residents aged 65 years and over, taking the total number in this group to 20.4 million and making up 26% of the total population. This presents a great opportunity for optometrists to invest in the technology needed to support our aging population and meet customer demand. With an OCT test not being part of a standard NHS eye test, many optometrists charge around £30 for an OCT scan as part of an enhanced eye test, therefore it’s clear to see the financial benefits to a practice of the investment. Based on just 10 scans per week at £30 each, revenues of £78,000 are achievable over a 5 year period. Compare that potential income against the monthly repayments to finance a OCT machine costing £30,000 on either a Hire Purchase or Lease facility over the same period of 5 years and the potential profit after repayments before tax relief could be in excess of £40,000.