APL Accounting News July 2016
There certainly are a lot of changes happening in the industry at this point, and it’s time to take proactive action if you want to keep your practice flourishing. With the corporate onslaught now gaining momentum, we have spent a lot of time assessing what needs to be done to carry on business in a profitable manner! Don’t worry, large corporate or small independent practice, there certainly are actions that you can take to carry on growing in spite of the changes.
In fact, taking action now and planning for what is to come will benefit all sizes of business as long as the management is proactive. Change is not a bad thing; it simply re-shuffles the deck allowing the proactive to get stronger and the inactive to fall.
In this article we will discuss one of the many key areas where we think you should react – health plans.
Let’s ‘make a plan’ – a closer look at health plans
A health plan or wellness plan is currently a very loose term to define a payment plan that allows pet owners to pay a monthly fee and spread their costs for routine services. What is or is not included in these plans varies considerably as well as whether services and products are completely included or just discounted.
We have been watching health plans very closely and monitoring the movement in other countries to carefully assess how and when to put these into action and what should be included. Let’s face it, whether you like them or not, health plans for pets are on their way in. Corporate veterinary groups LOVE them, and although there may be a significant number of arguments against them, large veterinary groups are using them as a marketing tactic to establish a clear point of difference to smaller independent practices.
So at this point it seems at least prudent to have a foot in the water when it comes to having a health plan for your practice. But how exactly do you achieve this when you consider:
- The administrative overhead they can create
- How do you manage payments and deal with cancellations in a clear and efficient manner?
- How much should you offer and at what price?
- Should you be discounting products, giving products for free or a combination of both?
- How do you promote them and make sure that clients are clear with regards to what is included vs what is not included?
- Should you use a third party provider to do this and pay a hefty commission or handle the financial side yourself?
All these questions need to be answered when you decide to initiate a wellness plan in your clinic. And all these issues can be overcome if one believes the significant increase in client spend that is currently being talked about in the UK.
But there are clearly correct and incorrect ways to do this. It is possible to offer too much and risk the workload of the clinic increasing exponentially with client spend! Imagining a significant increase in client spend, but the bulk of that spend is on over the counter products and pet food. On the back end the business is offering free consultations and blood testing which results in exponentially higher costs in wages and materials. These are careful considerations that need to be looked at.
We will keep you updated as we brainstorm and continue to research this space over the next few months with a view to having a health plan created for all clinics who attend our level 2 workshops this year. For now, remember these careful considerations:
- Don’t be afraid of wellness plans, it is likely that you will have to implement them in the near future
- Technology is likely to come to the rescue when looking at the administrative overhead of these plans – every month subscription and direct debit software improves, and there are likely to be solutions out there which although not perfect, will be good enough.
- There are also options of farming out the administration to a third party provider
- Be careful of offering too much on a plan – it’s easier to add features later rather than take features away. So we would advise a conservative approach initially.
- To keep yourself in the game with the corporate onslaught, having a foot in the water with health plans is a smart move.
We will be discussing wellness plans at our workshops. Places are filling quickly for both venues, so please contact our office and book your place to avoid disappointment.
The dates are:
Brisbane – 2 September 2016 (Level 1)
Brisbane – 3 September 2016 (Level 2)
Sydney – 28 October 2016 (Level 2)
Sydney – 29 October 2016 (Level 1)
Level 2 is recommended if you have attended 2 previous workshops with us.
There are so many benefits that come with staying on top of your business and KPIs on a regular basis that we have decided to offer monthly reporting. Also, so many people have asked us for a monthly reporting service, that we have now taken action and are happy to offer monthly reporting to those of you who want it.
The main difficulty you would find with monthly reporting is that it requires that you get information together every month – and we all know how busy things can get, so sometimes this becomes really difficult.
But now there is a solution to this! For those of you wanting monthly reporting, we will install SmartVetApp in your practice. This will automatically extract all the data from your system, so there will be no more time consuming digging around finding KPI’s and reports, it will all be done for you! All you will have to do is turn up for your monthly meeting.
If you are interested in going over to a monthly review, please let us know.
It’s worth being ‘chilled out’
Zack is a dog who is a couch potato and has an unusual life experience. His owners who were once exciting vets have now become boring accountants. They used to bring him into the exciting vet practice every day, now they bring him into a boring accounting office every day. This gives him a unique dog’s eye view on both professions.
Pictured above: Recovering in the APL office after my hospital ordeal, surrounded by get well soon party balloons from all the staff – like I care.
The weirdest thing happened last month! I was diagnosed as having congestive heart failure! Not only as a result of being somewhat mature, I have a congenital heart defect. It really got me thinking about offering the best to all patients, because I’m one of the lucky ones.
I needed some lumps removed and a lameness investigated, so before the anaesthetic, Dr Andrew had a listen to my heart and there was a murmur. Something that was not there before and could easily have been attributed to my age and investigated no further. After all, I am a healthy (although somewhat lazy) individual and I do go jogging once or twice a week (although my dad has complained that I am a bit slow).
However, as a key member of staff at APL, I have medical insurance (comes with the job), and Mom was insistent that I go see a specialist (Dr Brad at VSS). On presentation, Dr Brad’s attitude was just like everyone else, commenting that I do have a significant murmur but that I was asymptomatic. After all, while he was listening to my heart, I almost dragged everyone across the room to try to get to that drawer of liver treats that every vet I visit has. Nevertheless, we decided that it was prudent to scan my heart.
What a surprise that was! I have a patent ductus arteriosus and a dodgy left ventricular valve. I am also in fact in severe heart failure (although in truth it has never bugged me – you see, I was born with it and somehow now I have compensated). Even Dr Brad was very surprised that my lifestyle had not been affected significantly and that I was still as happy as ever. But a few lessons learned from this experience:
– Pet insurance rocks, now that I’m on Vetmedin I really get my value for money
– Don’t ASSUME that a case is ‘just an old dog murmur’, or ‘just a lipoma’ etc. Offer the best diagnostic approach and let the owner decide.
– Last but not least – IT PAYS TO BE CHILLED OUT – probably the only explanation as to why I have been asymptomatic beyond everyone’s belief is that I spend 90% of my day relaxing.
So all of you reading this newsletter, take a moment, a deep breath and remember that your health comes first.
Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances. In particular, please note that ‘Zack’ is a dog and does not have opposable thumbs so has to type with his nose.