Veterinary fees: Find the balance

Veterinary fees: Find the balance

May 01, 2002

Providing estimates on veterinary procedures can often tip the scales on acceptance or anger about fees.

But you should not be put on the defensive about charging appropriately for your time and experience, says Owen E. McCafferty, CPA, who runs an accounting firm focused on veterinarians in North Olmsted, Ohio.

Last month, DVM Newsmagazine reported on a panel discussion addressing pet owner complaints about escalating costs of veterinary services ("Pet owners moan about fees; experts say it signals a need for communication"). McCafferty was asked about the presentation of a veterinary billing statement and what veterinarians could do to improve client communications about fees.

No magic solutions

There is no magical solution to wiping out complaints about fees, but there are strategies that will help.

McCafferty explains, "Clients, by their very nature, want the best at little or no cost. This attitude toward consumerism has been brought about not by interaction with professions, but rather the relationship that the American public has with consumer-based activities, such as Wal-Mart, K-Mart, Home Depot."

The trick on not getting clients miffed is to take away any surprises about veterinary fees by presenting a detailed estimate.

"There are two sides to a bill; there is the estimate and the actual presentation of the fee for service. The biggest mistake practitioners make is they don't do the estimate," he says.

Without some understanding of costs associated with a veterinary procedure, it becomes understandable that some clients will walk away with sticker shock simply because costs were not addressed right up front.

"The proper time to do the discussion about a bill is in the estimate, before the service is rendered," he adds.

In the details

When a client is presented with an estimate, a detailed, itemized accounting of costs of services is very much warranted. It is followed-up with an oral presentation that provides the overview of the bill.

While he doesn't recommend estimates for general examinations, a work-up on sick animals is completely different.

How detailed do you want to get in the estimate? Assign costs all the way down to the sutures, McCafferty says. You want to show the client the true costs, he says, and allow a client to make choices before procedures are performed.

He also says that veterinarians, especially surgeons, are starting to assign costs based on the amount of time spent with a patient, which he thinks is very positive. Another positive is that even seasoned practitioners are charging more for their time as opposed to younger practitioners with less experience.

Keep it understandable

The hazard in providing so much detail is that a bill can become confusing to clients.

McCafferty explains, "Delineation of specific elements of service renders a communication, providing that communication is understandable by the client. The balance between too little and too much detail then becomes the point where minutiae becomes not a communication but confusion," he says. "At what point does the invoice that is generated by the practitioner not be a way to show the client what was provided, but rather confuse the client? Does the invoice communicate why things are being charged? Is the client experiencing angst and then, sometimes, anger for not fully comprehending the doctor's level of competency in providing the service?" he asks.

Practitioners will have to answer these questions and come up with a workable solution that clients will accept and understand.

If you are getting complaints, consider making changes to the way billing is handled.

"The level of details in a bill is an age-old debate that goes on in all professions," McCafferty adds.

Make the presentation

Who presents the estimate? Typically, it could be the job of a doctor or a technician who has excellent client communication abilities.

"In some practices, they have people who are trained to present these estimates. They know enough about the procedures that they can answer questions, and it works out very well."

McCafferty says, "The biggest mistake practitioners make is that they hire an entire army of introverts, and as a result of that they never are able to give the right kind of narrative that people can understand costs associated with these fees."

McCafferty says that problems with fees develop when the client is unaware of what is going on and what kind of fees they will be charged.

Through healthy communication before procedures are performed, and a detailing of the procedures and costs, most clients will not balk at the bill. After all, they went into the transaction knowing costs upfront, he adds. M