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what to tell clients when you raise prices

what to tell clients when you raise prices

what to tell clients when you raise prices

What to Tell Clients When You Raise Prices

By Wendy S. Myers, CVJ, President, Communication Solutions for Veterinarians

A practice owner told me he hasn’t raised prices in two years and worries how clients will react. While he knew procrastinating was a mistake, the situation is quickly getting worse. The U.S. inflation rate rose to 7.5 percent in January 2022, reaching a 40 year high.[1] The cost-of-living surge has been the biggest since 1982, when Michael Jackson released his groundbreaking album “Thriller” and gas was 91 cents a gallon.[2]

Economic changes have triggered laboratory and vendor price increases as high as 12 percent in the veterinary profession.[3] Costs are rising everywhere, from gas to groceries. If your hospital hasn’t raised prices yet, do it now. But what should you tell clients?

tell employees before you tell clients.

Your team needs to understand the “why” behind fee changes. You don’t want employees to stumble when responding to clients. Have a consistent message, which will make it easier for employees to explain price increases and for clients to accept them. Your message should be concise and empathetic. Don’t apologize because raising prices is a normal aspect of running a business. Your products and services provide excellent value, and you should charge accordingly.

create a script of what employees should say.

If clients question fee increases, you want frontline workers to be able to answer. Never say, “You’ll have to talk to the manager or doctor about prices.” You risk creating angry clients if the manager and doctor aren’t immediately available. Every employee must share a concise, confident response. Watch my YouTube video on “Raising Prices? What to Tell Clients” at https://www.youtube.com/watch?v=gev5cwb1ni8&t=11s.

Your script should include four points:

1) Express Empathy: “I understand that you’re concerned about the cost of veterinary care for your pet.” The word “concerned” shows empathy.

2) Be transparent and state reasons for fee changes. Like many businesses, our hospital has had price increases in the products and services we buy from vendors. We also invest in our employees’ ongoing education, so they learn about medical advances to improve patients’ comfort and treatment outcomes.” These two statements about vendor price increases and investing in staff training concisely state specific reasons for fee changes. The statements also show you are transparent about prices.

3) Explain how the price increase will benefit the client and pet. We strive to keep fees affordable while sourcing the best products and supplies to ensure we deliver the high-quality veterinary care that you and your pet deserve.” Emphasizing high-quality care explains how the price increase will benefit the client and pet.

4) Show appreciation for the client’s loyalty. “Thank you for your feedback. I will share it with the doctor and manager. You’re welcome to reach out to Dr. Smith or our manager, Amy, with further questions. We appreciate the opportunity to care for Max.”

Your team also can share information about preventive care plans, third-party financing, and pet insurance to help pet owners manage the cost of care.

how should you answer, “why is your hospital more expensive?”

Every employee needs smart responses when clients or phone shoppers question your fees. 

Say this (See key words in bold): “Our hospital offers affordable fees. Our surgical fee may be higher than another hospital that you contacted because we have the latest monitoring equipment, include preanesthetic testing and pain-relief drugs with the surgery, and have an experienced staff with ongoing continuing education. I’m confident you will see value in the quality of care that our team provides. Let’s schedule a presurgical exam so you can meet our doctor. The veterinarian also will share our surgical protocols and answer your questions. When can we meet you and Charlie? I have an appointment available at 9 a.m. Monday or 2 p.m. Tuesday. Which do you prefer?” 

The client service representative (CSR) explained how the quality of care will benefit the pet. She used positive phrases such as “Our hospital offers affordable fees” and “I’m confident you will see value.” The CSR had an inviting approach of “When can we meet you and Charlie?” instead of the yes-or-no choice of “Do you want to book an appointment?” She offered the next two available exams, which leads the caller to schedule now.

position your hospital as a premium provider.

You get different service and quality from a steakhouse compared to a fast-food drive thru. We all dine out and may choose a restaurant based on convenience, price, experience, and quality. Likewise, your community has low-cost veterinary care providers, shelters, private and corporate practices, and emergency and specialty hospitals. Each serves a need and niche.

A premium practice would include preanesthetic testing and pain medication in procedures while a low-cost provider might offer these services as options. A premium practice blocks urgent care slots in its daily schedule to see sick patients while another provider might tell clients its schedule is full and advise seeking care at an emergency hospital.

raise prices whenever products or vendor fees go up.

While this seems obvious, it can happen without processes in place. A technician unpacks products, updates the quantity in the inventory module of the practice-management software, stocks shelves, and passes the invoice to the bookkeeper. The bookkeeper pays and files the invoice. No one confirmed whether the unit cost on the vendor invoice matched the unit cost in the inventory module.

Let’s say a vendor increased an item from $10 to $11. The practice incurred a 10 percent increase that didn’t get passed along to clients and cut into profits.

To prevent this error, use the purchase order feature in your practice-management software. In AVImark, this lets you “receipt the order,” specifying which items were received, any price change, which vendor sent the products, and apply shipping and taxes that were charged.[4]

make small increases to professional services quarterly.

While it’s smart to raise prices when vendors charge you more, when was the last time you raised professional fees for exams and procedures? 

Owen McCafferty, CPA, CVPM, and founder of Owen E. McCafferty CPA Inc. in Ponte Vedra Beach, Fla., advises hospital leaders to stay ahead of inflation with quarterly fee increases and to monitor staffing. Let’s say your exam fee is $55, and you want to raise it 12 percent. Increase the fee 3 percent or $1.65 each quarter to $56.65, $58.30, $59.95, and $61.60 respectively. Clients are less likely to notice small increments compared to an escalation from $55 to $61.60. 

Many practices are operating short-staffed and want to reward loyal employees with raises. Because employee wages and benefits average 48 percent to 52 percent of costs, you can’t give raises without upping prices, advises McCafferty. Take care of core employees who stick with you when times get tough, he says. Good wages and benefits will help you retain and recruit employees.

be competitive on shopped items.

Consumers shop prices on three veterinary drug categories: 1) Flea and tick preventatives, 2) Heartworm preventatives, and 3) Long-term drugs for chronic conditions such as arthritis and allergies. Parasiticides represent the largest market share of pet medications with 42 percent of sales.[5] Most of your prescription approval requests from internet pharmacies are flea/tick and heartworm preventatives. 

The Veterinary Fee Reference, 11th ed., reports a 65 percent average markup on flea/tick and heartworm preventatives compared to 107 percent on other prescription medications.[6] If you markup preventatives 107 percent, you will lose sales to third-party pharmacies and other area hospitals. 

Don’t procrastinate to review and raise prices regularly. Available from the American Animal Hospital Association, The Veterinary Fee Reference is a resource to benchmark your fees against national averages (https://ams.aaha.org/eweb/DynamicPage.aspx?site=store&Action=Add&ObjectKeyFrom=1A83491A-9853-4C87-86A4-F7D95601C2E2&WebCode=ProdDetailAdd&DoNotSave=yes&ParentObject=CentralizedOrderEntry&ParentDataObject=Invoice%20Detail&ivd_formkey=69202792-63d7-4ba2-bf4e-a0da41270555&ivd_cst_key=00000000-0000-0000-0000-000000000000&ivd_cst_ship_key=00000000-0000-0000-0000-000000000000&ivd_prc_prd_key=7F0F61F6-5D44-4BDE-A54C-C38CF8066FFA).

Clients will be more comfortable with small, steady increments instead of large fee hikes. Most pet owners will anticipate increased costs in the future. They know costs are rising everywhere, from gas to groceries. You need to keep your practice financially healthy, too.

want to learn more?

Enroll your team in the 1-hour course: What to Say When You Raise Prices.

References:

[1] Bartash J. U.S. Inflation Rate Climbs to 7.5% After Another Sharp Increase in Consumer Prices. MarketWatch. Available at: https://www.marketwatch.com/story/coming-up-consumer-price-index-11644498273. Accessed Feb. 15, 2022.

[2] List of 1982 Significant News Events in History. The People History Home. Available at: https://www.thepeoplehistory.com/1982.html. Accessed Feb. 15, 2022.

[3] McReynolds T. Inflation Hitting Veterinary Practices. AAHA News Stat. Published Jan. 12, 2022. Available at: https://www.aaha.org/publications/newstat/articles/2022-01/inflation-hitting-veterinary-practices/?utm_medium=email&utm_source=rasa_io. Accessed Feb. 15, 2022.

[4] AVImark User Manual. Inventory List: pp. 86.  Available at: https://softwareservices.covetrus.com/wp-content/uploads/2019/09/AVImark-user-manual.pdf. Accessed Jan. 14, 2022.

[5] McReynolds T. Veterinarians Outselling Online Retailers When It Comes to Pet Meds—But Not For Long. AAHA NEWStat. August 2019. Available at: https://www.aaha.org/publications/newstat/articles/2019-08/veterinarians-outselling-online-retailers-when-it-comes-to-pet-medsbut-not-for-long/. Accessed March 29, 2021.

[6] The Veterinary Fee Reference, 11th ed., AAHA Press: 2020;229,230,228.

 

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Why Your Front Desk Team Sucks

Why Your Front Desk Team Sucks

Why Your Front Desk Team Sucks

Do you remember the first time you told a pet owner that her dog was dying?

By Wendy S. Myers, CVJ, President, Communication Solutions for Veterinarians

You were sweating bullets, struggling to find the right words, and tried your best to be honest and compassionate. I’m going to have the same conversation with you. Your front-desk team is in critical condition. If you don’t resuscitate these employees, client relationships will die.

Every client interaction begins and ends with your client-care team.

From the phone call to book an exam to collecting payment at checkout, your front-office staff impacts your hospital’s revenue and client relationships. Here are your team’s ailments and how to cure them:

They don’t know your standards of care.

As a mystery caller, I explained I recently moved from another state and received an email from my previous veterinarian that my dog was due for a checkup. I asked which vaccines would be needed in our new community and the cost. The employee replied, “The shots are always up to you but we usually do leptospirosis, distemper, rabies, and bordetella.” Describe core vaccines with confidence rather than “shots are up to you.”

Miscommunication of basic medical information is commonplace. In another call about a 16-week-old kitten, an employee told me rabies vaccination should be given at six months of age. Another time I explained that I adopted a 12-week-old puppy, shared which vaccines were given, and noted the puppy was treated for “worms” at the shelter. I asked how to prevent my puppy from getting “worms” again. The employee replied, “That would be something you would need to talk to a doctor about. I’m just a receptionist.” As the caller, I heard, “I don’t know anything, and I can’t help you. I just work here.”

Every employee must confidently communicate the preventive standards of care that your veterinarians have set. Create a quick-reference guide of your standards of care for puppies and kittens at 8, 12, and 16 weeks of age, along with adult and senior pets. List questions to ask, services to describe, and prices to quote. This will save significant time during calls and help you consistently and accurately quote services and prices. Protocols would differ for a 16-week-old kitten compared to a 16-year-old cat.

Have doctors conduct a refresher class at least annually, so front-office teammates can discuss commonly asked questions and have consistent messages when describing professional services and products. Have pharmaceutical representatives train your client-care team twice a year on vaccines and parasites, so they know essential product facts.

Too often, client service representatives had never been invited to venture beyond the front desk. As part of new hire orientation, have them rotate through the lab, pharmacy, treatment area, and surgical suite. Letting non-medical personnel observe surgeries will give them confidence when describing services over the phone. Have seasoned front-desk employees watch one surgical and dental procedure at least annually. This hour away from the front desk will have them witness patient care first-hand, seeing every professional service from preanesthetic testing to nursing recovery care. How can you expect them to accurately describe a neuter or dental treatment to callers if they’ve never watched the procedure?

You didn’t teach them manners.

When I approached the check-in counter with my cat in a carrier, your employee was typing on the computer. I waited several minutes for her to acknowledge me. She stared up at me with an exhausted expression and said, “Sorry, I was just entering a prescription refill. How can I help you?” If you have a 10 a.m. appointment for a kitten and I walk through the door at 10 a.m. with a cat carrier, you can easily greet me and my pet by name.

Stand up for service. Your body language communicates you’re ready and eager to help. Say, “Good morning, Wendy. We’re excited to meet your new kitten, Alex! Did you bring his adoption papers and a stool sample for us to test?” After the client responds, show your team is prepared and ready to deliver medical services. Say, “I will let Dr. Lavallee and her technician, Sue, know that you have arrived. I’ll take the stool sample to our lab, where we will begin the test and have results during today’s exam. I’ll add Alex’s vaccine information to his medical record. What questions may I answer before we get started?”

Simple gestures of appreciation such as saying please and thank you, making eye contact, and using “you’re welcome” in place of “no problem” are the difference between ho-hum and five-star service. If Chick-fil-A can teach manners to Millennials, so can you.

You don’t provide ongoing training.

Veterinarians and credentialed technicians must earn continuing-education credits for licensing requirements. Receptionists only expand their knowledge when a sales professional sponsors a lunch-n-learn session at your office. How can you expect employees to improve if you don’t grow their skills?

Your front-desk team must polish and perfect telephone and client-service skills. If your hospital is in Pennsylvania, veterinarians need 30 hours of continuing education every two years while technicians need 16 hours. Have client-care employees earn at least eight hours. Incorporate CE requirements into performance reviews. To be “raise eligible,” staff must complete a specific number of hours of training each year. Learning could include webinars, conferences, in-clinic lunch-n-learns, and sponsored dinners. If employees are constantly growing their skills, they are constantly growing your hospital.

No one directly supervises the front-desk team.

Sure, your hospital manager handles client complaints, sets work schedules, and trouble-shoots questions from frontline teammates. Your receptionists work solo without daily elbow-to-elbow leadership.

Appoint a team leader who also works at the front desk. This manager leads by example, sets work schedules, provides in-the-moment coaching, delivers timely reviews, and creates training plans to elevate the team’s skills. If you don’t have a supervisor candidate yet, have the hospital manager help at the front desk once a week. The manager will see and hear interactions between employees and clients.

You treat them like “receptionists.”

This job description includes being a superior scheduler, multi-task master, problem solver, operator extraordinaire, bill collector, compassionate caretaker, retail marketer, and much more. Treat frontline employees with respect and as equal colleagues if you want them to look and act like professionals. Consider a title change that represents the “I do everything” job description. My favorites are client care coordinator, client service advocate, and client care specialist. Make your team feel like the superheroes they are!

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How Nurses Can Grow Your Revenue

How Nurses Can Grow Your Revenue

How Nurses Can Grow Your Revenue

What is the difference between an under- and top-performing healthcare team?

By Wendy S. Myers, CVJ, President, Communication Solutions for Veterinarians

Let’s say you schedule appointments every 30 minutes. In an eight-hour workday, one doctor sees 14 patients and has an average transaction of $160, generating $2,240 in revenue. Your average doctor transaction should be 3.2 to 3.5 times your exam fee, according to the Well-Managed Practice Benchmarks Study.(*1) If you leverage your nursing team and schedule time based on the reason for the visit, you could see 21 patients per day, producing $3,360 per veterinarian and averaging three patients per hour. Revenue rises when you add dental income that nurses deliver.

How can nurses help you grow revenue? Follow these steps:

Check your staff-to-doctor ratio.

Every employee feels the hospital is short-staffed. Chances are, you may have the right number of employees but are not efficiently using them. Aim for staff-to-doctor ratios of 4.7 team members per full-time veterinarian, according to WTA Consultants in Columbus, Ohio. (*2) This support staff includes two nurses, one veterinary assistant, one receptionist, and 0.7 managers.

Assign doctor-nurse teams.

Designate daily which staff will be outpatient nurses (exams) and inpatient nurses (treatment area). Pair two nurses or assistants with each veterinarian. This medical team of three works together the entire day. Define roles and tasks each support employee will perform. Doctors need support from the right person with the right skills at the right time.

Veterinarians should focus on three medical responsibilities:

  1. Diagnose health conditions
  2. Share treatment solutions
  3. Perform surgery and procedures

Nurses do everything else. Think of nurses and assistants as “staff extenders” to perform non-doctor functions such as client education, technical skills, and medical-record management. This approach lets you see 30 percent to 40 percent more appointments in the same amount of time. (*3)

Here are examples of outpatient and inpatient nursing duties:

Outpatient nurse duties

Inpatient nurse duties

Get patients’ vital signs

Collect samples for diagnostic testing prior to doctor entering the exam room

Take brief histories

Run lab work

Educate clients

Take x-rays

Fill medications

Perform dentistry

Be a transcriptionist, writing in medical records while the doctor explains exam findings and diagnoses

Place catheters

Review medication and treatment instructions with clients

Run and monitor anesthesia

Admit and discharge surgical and dental patients

Monitor hospitalized patients

Provide discharge and medication instructions

Administer medications and treatments to hospitalized patients per doctor instructions

Handle nurse appointments

Assist with surgery

(Expand and tailor this list of duties for your hospital.)

State laws vary on which duties credentialed veterinary nurses are allowed to perform. Check your state’s practice act here. You will use three types of nursing teams:

Outpatient nursing team:

You may use two credentialed nurses, one nurse and one assistant, or two assistants. For a 20-minute checkup, Nurse #1 spends the first five minutes gathering a brief history, getting the patient’s vital signs, and explaining services and products that will be delivered today. Confirm the reason for the visit at the beginning of each exam. Say, “I’m <name>, the nurse who will assist Dr. <Name>. For your pet’s checkup, we will do a nose-to-tail exam, vaccines, heartworm/tick screen, intestinal parasite screen, and refill preventatives. I will take a brief history, collect samples for testing, and get your pet’s vital signs. Then the doctor will begin the exam. Does your pet have any health or behavior concerns you want to discuss with the doctor?” If the client shares a concern, this becomes the chief complaint that the veterinarian will address before delivering preventive care. Watch my video on “The #1 Question to Ask to Keep Exams on Time”. Nurse #1 takes the patient to the treatment area where an inpatient nurse or assistant will help collect samples.

When the patient returns to the exam room, the doctor is ready to begin. The veterinarian will spend the middle 10 minutes of the appointment performing the exam, vaccinating the pet, discussing exam findings and test results, and answering the client’s questions. Nurse #1 stays to assist the doctor with the physical exam.

Meanwhile, Nurse #2 is starting the next appointment, allowing the doctor to consecutively work two exam rooms. Nurse #1 closes the first appointment, reviewing preventative or medication instructions and providing client education. This exam work flow lets your team see three or more patients per hour, significantly increasing productivity and income.

Surgical nursing team:

The veterinarian prioritizes today’s surgical cases. A nurse and two assistants support the surgical doctor. The nurse anesthetizes patients, places catheters, monitors patients, assists the veterinarian during surgery, and updates medical records. In the afternoon, the same nurse may discharge patients. Assistant #1 preps patients and moves them into the surgical suite. Assistant #2 recovers surgical patients. The veterinarian changes gloves and follows sterile surgical protocols between each patient. The nursing team calls, emails, or texts clients as each patient is recovered and confirms discharge appointments.

 

Dental nursing team:

By age 3, most dogs and cats have periodontal disease. (*4) Because doctors will diagnose dental disease daily and advise treatment, you want to schedule dental procedures Monday through Friday to meet the demand. The veterinarian performs pre-surgical exams, sets anesthetic protocols, oversees cases, and does oral surgery.

Nurses lead your dental profit center. The dental team includes one nurse and one assistant. The nurse anesthetizes patients, places catheters, and checks the assistant’s work. The assistant takes dental x-rays, cleans and polishes teeth, recovers patients, and updates clients.3 The veterinarian reviews x-rays and performs extractions and oral surgery. While employees will always help teammates when needed, the key to maximum production is simple: Nurses don’t do assistants’ work, and doctors don’t do nurses’ work.3

 

Schedule nurse appointments.

Use nurse appointments for admissions, discharges, and outpatient services that support staff perform. When clients walk in for nail trims and bandage changes, these unscheduled services may put additional stress on your nursing team and cause clients to wait when employees aren’t immediately available. To bring structure to walk-in chaos, create a column for nurse appointments in your schedule just as you have rows for doctor exams. Concentrate blocks of nurse appointments during afternoons and evenings such as 1:30 to 3:00 p.m. and 5:30 to 7:00 p.m.

Avoid nurse appointments for outpatient services during mornings, when your nursing team is preparing for surgical and dental procedures and checking hospitalized patients. Morning nurse appointments are limited to surgical and dental admissions. Let’s say you have six procedures today. Schedule admission appointments every 10 minutes from 7 to 8 a.m. Because doctor exams haven’t started, the assistant will admit patients in the privacy of exam rooms, where clients may comfortably ask medical and financial questions.

Set guidelines for nurse appointments so receptionists properly budget time:

  • 10-minute nurse appointments: Express anal glands, collect blood samples for drug monitoring or follow-up testing, perform intestinal parasite screens, insert microchips, provide Level 1 nail trims (cooperative patients), remove sutures, booster vaccines that don’t require a doctor’s exam, and check the weight of pets on weight-management programs.
  • 20-minute nurse appointments: Change bandages, clean ears, Level 2 nail trim (patient requires two or more nurses), administer subcutaneous fluids, collect urine, and perform laser therapy.
  • 30-minute nurse appointments: Take scheduled follow-up radiographs, provide grooming services for birds, and deliver services for multi-pet nurse appointments.

In my online course, “Be Efficient in the Exam Room,” I share flex-10 and high-density scheduling concepts along with exam flow by job type. Have your medical team evaluate every step of delivering outpatient and inpatient services. Ask, “Why do we do it this way?” and “How could we be more efficient?” When you leverage your nursing team, you can deliver more patient care, better manage your workday for less stress, and enjoy increased revenue.

References:

*1 – Tumblin D. Problem: Your Average Doctor Transition Is Low. Clinicians Brief, January/February 2018. Available at: www.cliniciansbrief.com/article/problem-your-average-doctor-transaction-low. Accessed Feb. 4, 2019.

*2 – DVM360.com staff. Benchmarks 2016 Shows Strong Revenue Growth, Higher Staff Levels. Veterinary Economics; Sept. 7, 2016. Available at: http://veterinarybusiness.dvm360.com/benchmarks-2016-shows-strong-revenue-growth-higher-staff-levels. Accessed Feb. 4, 2019.

*3 –  Catanzaro T. Veterinary Healthcare Services: Options in Delivery. Iowa State University Press, 2000:23-25, 52.

*4 –  American Veterinary Dental College. Periodontal Disease: Information for Pet Owners page. Available at: www.avdc.org/periodontaldisease.html. Accessed Feb. 4, 2019.

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