More Ways to Pay: How Expanding Payment Options for Your Clients Is Good Business
by Paula Fitzsimmons
No veterinarian wants to deny an animal medical care because of a client’s inability to pay. You chose this profession to heal animals, after all, not for financial gain. As a service-based business, however, financial stability is essential to your hospital’s survival and growth.
Balancing veterinary care with financial discussions is not always easy, but it’s manageable. “It is my primary obligation to advocate on behalf of beings who cannot advocate for themselves. As part of that advocacy, I also have an obligation to the client to articulate priorities when the optimal plan cannot be accomplished all at once,” said Robin Downing, DVM, MS, DAAPM, DACVSMR, CVPP, CCRP, hospital director at AAHA-accredited Downing Center for Animal Pain Management in Windsor, Colorado.
Navigating payment options with clients can help forge stronger relationships, create a more profitable and efficient business, and ultimately let you focus on providing quality veterinary care. Best of all, it’s surprisingly simple to implement.
Improving the Client Experience by Talking About Payment Options
This may seem counterintuitive because money is such a sensitive topic, but clients actually expect to have these discussions with their veterinarians. “Pet owners told us that they would be more likely to have pet insurance coverage if their vet spoke to them about it,” said Kristen Lynch, executive director of the North American Pet Health Insurance Association (NAPHIA). A NAPHIA study showed that 50% of additional pet owners would purchase pet health insurance if their veterinarians advised them on it.
“This proactive approach helps to mitigate the negative emotions that arise when owners haven’t been appropriately counseled about what to expect and how to strategize for those future expenses,” says Wendy Hauser, DVM, assistant vice president of veterinary relations for Crum & Forster Pet Insurance Group (which administers American Society for the Prevention of Cruelty to Animals pet insurance).
Talking to clients about payment options has been a positive experience for Patrick Mahaney, VMD, CVA, CVJ, owner of California Pet Acupuncture and Wellness in Los Angeles. “I feel that being proactive in helping clients find the means by which to pay their invoices does show that veterinarians are willing to go the extra mile to help their patients receive the best care.”
Should You Discount Your Services?
If not planned carefully, it can have a significant impact on a practice’s profitability. “This hurts not only the business but everyone who is employed in the practice, as the discount negatively impacts profit margins. This can mean less money for reinvestment in the veterinary team, such as training, incentives, and increased wages. Less profitable hospitals are less likely to invest in capital improvements to the facility or equipment. Finally, they are ill equipped to ride out financial downturns,” said Hauser.
If the practice is strategic about it, however, discounts can help establish goodwill. “We have predetermined discounts that our hospitals have agreed to honor on emergency, including active military, veterinary professionals—both veterinary technicians and veterinarians—and nonprofit rescues,” said James Barr, DVM, DACVECC, chief medical officer at BluePearl Veterinary Partners. (BluePearl has a network of hospitals across the country that vary in their AAHA accreditation status.) Active full-time BluePearl associates also receive employee discounts, he said, and “if a client cannot afford the recommended treatment, we do have programs that offer free stabilizing services to give the owner an opportunity to find another veterinarian, as well as humane euthanasia to prevent the patient from chronic, long-term suffering.”
Other practices employ different approaches. “I have a practice that sends an accounts-receivable Christmas letter, forgiving any outstanding balance [in the] seasonal spirit, which has usually gotten more than 60% of the recipients to start repayment,” said Thomas Catanzaro, DVM, MHA, LFACHE, chief executive officer of Veterinary Consulting International in Lakewood, Colorado.
AAHA-accredited Angell Animal Medical Center in the Boston area offers discounted pricing for service dogs (whose owners must show proof of certification), military, and nonprofits, says Ann Marie Greenleaf, DVM, DACVECC, Angell’s chief of staff. “I do think these discounts (and available funds) help attract people to our practice.” Angell also offers discounts in extenuating circumstances. “On occasion we will cap a bill for someone who has paid a lot of money toward their pet’s care for a single incident or illness and have reached an impasse financially. Our thought is that they have invested so much toward their pet, that it would be wrong to stop care when they just have a little further to go to get their pet home.”
Payment Options to Consider
“Having multiple payment options available for your clients to consider is the ideal,” said Amanda Donnelly, DVM, MBA, a nationally known veterinary business consultant, author, and speaker. “Some options are going to be better for one client than they will for another. So if, for example, a client can’t qualify for CareCredit for some reason, then maybe they’d qualify for one of the other payment options.”
Here are a few to consider speaking about with your clients.
Not only are clients more inclined to purchase pet insurance if they’ve discussed it with their veterinarians, but there’s another important incentive. “We found that the number-one reason for vets to consider educating pet owners about pet insurance is that people who have it tend to spend more in the practice,” said Lynch. A NAPHIA study shows that dog owners with pet insurance spend 29% more per year; cat owners spend 81% more.
“We talk to every single client about pet insurance and the importance of signing on before the pet has a pre-existing condition. Unfortunately, this remains a struggle, as national data continue to reveal,” said Downing. Although pet insurance is a growing industry, NAPHIA reports that just 2.43 million pets—about 1%–2%—in North America were insured by the end of 2018.
Pet Wellness Plans
“If a hospital has a clear understanding of what the service truly costs, sometimes there is some strategic benefit in creating a slightly discounted service bundle, such as wellness plans,” said Hauser. Pet insurance companies also offer standalone pet wellness plans or combine them with insurance coverage.
A prime benefit of pet wellness plans is their focus on preventive care. For example, “Just last week we found a complicated crown fracture on a major tooth in a canine patient who had presented for her every-six-month preventive care examination. That compromised tooth provided an open channel for bacteria to ascend up the root and set up an infection in the dog’s skull below the eye. Instead of that terrible outcome that would have complicated resolution, we were able to intervene this week, remove the offending tooth, and prevent a periodontal catastrophe,” said Downing. An added benefit is a potentially reduced invoice for the client.
A hospital can establish its own 501(c)(3) organization to help needy clients. “The 501(c)(3) works in harmony with the practice, and in many cases, happy clients start to support the 501(c)(3) entity with bake sales and community donation drives,” explained Catanzaro.
Or a practice can partner with outside nonprofits. “I highly recommend a close association for practices that are not willing to establish their own 501(c)(3) service center,” Catanzaro said. “As an example, San Antonio veterinarians have set up a rotation at the local shelter to do community population-control surgery for greatly reduced prices, with money retained by the shelter.”
National nonprofit RedRover offers grants (typically between $200 and $300) to low-income individuals and domestic abuse survivors, relying solely on private donations and grants. “They are meant to fill a small gap in funding that is keeping an animal from receiving urgent and emergency care. They do not cover basic veterinary care or diagnostic work. Typically, the smaller the gap between the funds the client has and what they’ll need to get treatment done, the more likely we’ll be able to help,” explained Nicole Forsyth, president and chief executive officer of RedRover.
Because there’s such high demand for grants offered by nonprofits, they shouldn’t be considered a main payment strategy, says Hauser. “Pet assistance programs can help to bridge the gap between what the owner can pay and what the services will cost.”
Veterinarians Weigh in on Veterinary Lien Laws
Veterinary lien laws are controversial, and with good reason. The veterinarians interviewed for this article explain their thoughts on why holding an animal for payment should be avoided.
“I don’t agree with lien laws and feel it creates further bad blood between the client and veterinary practice if a practice were to hold on to an animal until a debt has been paid.” —Patrick Mahaney, VMD, CVA, CVJ, owner of California Pet Acupuncture and Wellness
“We never have and never will keep an animal until the bill is paid. It is unethical and only serves to run the bill up further while we continue to care for a pet [who] could go home.” —Ann Marie Greenleaf, DVM, DACVECC, chief of staff at AAHA-accredited Angell Animal Medical Center
“As a clinical bioethicist, I can assure readers that veterinary lien laws are completely ethically indefensible. Full stop. Such hostage taking violates the foundational principles of clinical bioethics for both the client and the pet—respect for autonomy, nonmaleficence (do no harm), beneficence, and justice/fairness. There is simply no excuse for our profession to be complicit in such activity.” —Robin Downing, DVM, MS, DAAPM, DACVSMR, CVPP, CCRP, hospital director at AAHA-accredited Downing Center for Animal Pain Management
“We try to finalize payment or solidify a payment arrangement prior to discharge, but BluePearl does not keep any pet in the hospital because of a client’s inability to pay their bill. If the client is refusing to pay, we will discharge their pet and send the bill to collections.” —James Barr, DVM, DACVECC, chief medical officer at BluePearl Veterinary Partners
“Some veterinarians allow clients to get treatment done with a percentage of the total estimate down, and then make arrangements on the remaining balance due. We often suggest held checks or setting up a debit from the client’s account to ensure payment,” said Forsyth.
In-house plans are not a good option for all practices, however. “With payment plans, we rarely have people who follow through, and it requires more staff to administer such a plan. We did this historically and created huge debt for our hospital,” said Greenleaf, whose practice offers third-party payment provider CareCredit. “We have been using CareCredit since it first emerged onto the market. It takes the burden of payment plans from us, but we do have to pay a fee per case for our clients to be able to use the plan,” said Greenleaf.
Downing, who likes CareCredit for its ease of use, speaks to every new client about the importance of having it for unexpected medical crises. “While I am not sure that our acceptance of CareCredit helps us acquire new patients and clients, I do believe it helps us to keep those clients because we make using CareCredit so easy for them.”
CareCredit is essentially a credit card with a revolving line of credit that clients can use to pay any provider within their network of more than 22,000 veterinary hospitals, explains Boo Larsen, general manager, veterinary medicine, for CareCredit. “CareCredit offers promotional financing for treatments more than $200, which can help pet owners with larger out-of-pocket expenses.”
A benefit of using CareCredit is its ease of application. “Clients can apply in minutes online, by phone, or by using their mobile device. Credit decisions are provided instantly. Once the application is approved, the account holder can use the card multiple times without the need to reapply if the purchases are within the approved limit,” said Larsen.
Donnelly says third-party payment companies are a great resource for veterinarians. “They have tools and resources as well as representatives in the field who can come in and do lunch-and-learns to help with training.”
Having Tough Discussions Is Not as Complicated as You May Think
“I think what happens is that teams are afraid they’re going to offend the client by saying we have all these payment options. In reality, the opposite may be true,” said Donnelly.
Here are some suggestions on approaching the subject with your clients.
Explain the Value of Your Services
To avoid disconnects, Donnelly recommends explaining why a pet needs a particular service, whether it’s to prevent disease progression, keep him healthier longer, or alleviate pain. “It’s not just about giving them payment options, but about communicating the value of the services so that they understand why they would pay it in the first place.”
Ask One Simple Question
“All [you] have to do, and it’s simple, is ask, ‘Do you have pet insurance?’ when they become a client or go to pay,” offered Lynch. If they don’t have it, she suggests replying with a statement like, “You know what, I’ll have one of the receptionists or technicians put a couple of brochures in your package.”
Ask Open-Ended Questions
Another approach is to ask questions that will motivate your clients to open up. For example, Donnelly recommends asking, “Tell me, what concerns do you have about Sophie’s treatment plan that I’ve presented?” “At that point, the client might say, ‘I can’t afford it today,’ and the team could reply with, ‘I understand medical care is expensive. We have several payment options to help you afford care. May I review those with you now?’”
Make Sure All Staff Members Are on Board
Regardless of the size of your practice, everybody on staff, including the veterinarians, technical staff, nurses, and front-desk staff, should be trained to talk about payment options, says Donnelly. “It might take a client time to make a decision, but I would say if you have a well-trained staff to talk confidently about money, at most, it would probably only take five minutes longer.”
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Paula Fitzsimmons is a content writer and journalist who writes extensively about pets as they intersect with topics such as health, nutrition, technology, and lifestyle. Her client list includes names such as PetMD.com, PetCoach, Chewy.com, Lucky Vitamin, and Prevention magazine.
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