In Stay, Please, AAHA’s white paper on retention and attrition, the top factor for veterinary team members considering leaving practice was fair compensation.  

AAHA’s research found that associate veterinarians and credentialed veterinary technicians are most likely to be dedicated to veterinary medicine—but not necessarily to a particular practice.  

These roles are also considered the hardest to replace. It is therefore important to find ways to encourage techs and associate DVMs to stay. Here, we look at an example of providing fair associate veterinarian compensation and how an experienced practice owner is making it work.  

Fair associate pay—“Make it work!” 

Pam Nichols, DVM, CCRP, CFI, past president of AAHA Board of Directors and practice owner of more than 25 years, gets very excited when she talks about veterinarian compensation.  

She opened her first practice in 1999 and has owned several practices and dog daycare centers since then, employing 12 associate veterinarians over the years. While she agrees that a lot goes into being able to pay veterinarians appropriately, her formula for calculating associate veterinarian salaries is “simple, and it works.”  

Nichols wants to be able to pay her associate veterinarians well. While she acknowledges that geographical differences in cost of living can affect salary to an extent, she stresses that veterinarians have doctorates and should be paid accordingly. “If not,” she argues, “what did we do all that for?”  

A formula for paying associates 

How does she decide what a reasonable salary for a full-time veterinarian should be? She thinks about what it takes to make her feel good about devoting the time and energy into the work that she does.  

“I don’t want to get out of bed for less than $200,000 a year,” she explains, so that’s what she wants all her associates to aim for.  

Here, Nichols provides some of the details of her formula—and what it takes to make it work: 

• Hire new associate veterinarians at a “decent” salary. Nichols starts associates off at about $130,000 (with no production) for six months. Her goal is to give the associate the resources and incentive to be able to produce a salary of $200,000 on straight production by the six-month mark. In some cases, the associate sees how much they can produce and asks to be transitioned to production pay before the six-month point. 

• Calculate associate pay at 20% of gross revenue (except for prescriptions, over-the-counter products, and diet sales, which are compensated at 8% of gross). Benefits are not included in the 20%, but they should account for about 5% of gross revenue. In this formula, Nichols does not leave much room for negotiation.  

• Maintain a high support staff-to-doctor ratio of 8:1, including all members of the team. This means that, on average, doctors have four technicians working with them at a time, allowing the associate to focus on “doing more doctor stuff,” getting out of work on time, and having a great quality of life, while still producing the revenue needed to support their salary. 

• Prioritize support staff pay. Nichols says she averages about $5 more per hour than the industry average so that she can hire and retain great support professionals. Combined, veterinarian and support staff pay should be at 40% of gross revenue. 

• Provide paid time off for all members of the team (even when associates are paid on straight production). This way, everyone feels they have a great quality of life and will want to stay at the practice.  

• Aim for veterinarians to see around 20 patients per day, usually a combination of appointments and drop offs. Nichols says more than 20 leads to burnout, and fewer than 20 can lead to boredom (and inability to produce the revenue needed for the target salary). 

• Maintain a fee structure and client base that can provide the revenue needed to support what pay for the team. Nichols prioritizes being there for her clients and helping to solve their problems—and expects her team to do the same. This helps clients appreciate the value of the care she provides. 

• Train clients to love and appreciate the team as a whole, not specific doctors or other staff members. This means clients need to be comfortable seeing whoever is there on a certain day and communicating more with technicians instead of always having to talk to the doctor. 

• Show any member of the team the revenue they produce whenever they want. “I want them to know if they are making the practice money or costing the practice money,” Nichols adds, so that associates can make sure they get the compensation they want and deserve.   

• Aim for 15% profit and invest that back into the business in the form of raises for the next year, along with any needed equipment.  

Nichols clarifies that her formula can work even if a practice is not located in an affluent, high cost-of-living area. In fact, hers is not. Not only is it possible, she adds, but it’s necessary to help associate veterinarians feel valued and fulfilled in their chosen profession.  

“If you’re resenting your work,” she says, “you’re not getting paid enough.” 

This article is part of our Stay, Please  series, which focuses on providing resources (as identified in our Stay, Please  retention study) to retain the 30% of all veterinary professionals considering leaving their clinical practice. Here at AAHA, we believe you were made for this work, and we’re committed to making clinical practice a sustainable career choice for every member of the team. 

Emily Singler, VMD, is AAHA’s Veterinary Content Specialist.   

Disclaimer: The views expressed, and topics discussed, in any NEWStat column or article are intended to inform, educate, or entertain, and do not represent an official position by the American Animal Hospital Association (AAHA) or its Board of Directors.