Cyber bullying cancels America's Favorite Vet | Read this week’s CVP Animal News Roundup

Cyber bullying cancels America’s Favorite Vet

The issue of declawing cats “hijacked” America’s Favorite Vet contest this year. According to an AVMA news release:

One contestant, for example, was called “a whore, a butcher, a mutilator, a hack, an animal hater, a disgrace to the profession.”  Other contestants were subjected to the circulation of fraudulent negative advertisements, negative reviews, and threatening phone calls.

Have you had any experiences dealing with aggressive social media campaigns? Comment at our website.

If you’ve been forwarded this edition, you can subscribe here.

Michael

The Top Story
Social Media Story

AVMF cancels America’s Favorite Vet Contest

The American Veterinary Medical Foundation (AVMF) today decided, reluctantly, to halt its America’s Favorite Veterinarian Contest and declare all 20 finalists “America’s Favorite Veterinarians” following a vicious cyber-bullying attack which disrupted and contaminated the final election process.
Read the AVMA news release
Read the article in the Gainsville Sun

More Veterinary Industry News
What Your Clients Are Reading

Dogs Naturally Magazine: Tick Bites are Not the Cause of Lyme Disease

Researchers estimate that only 10 to 20 percent of tick bites will lead to stage 1 Lyme disease. If untreated however, 30% of stage 1 cases will lead to stage 2 (where bacteria can infect the skin, joints, kidneys and sometimes the heart). So your dog has about a 1% to 2% chance of stage 2 Lyme disease… the kind of Lyme disease that can really make him sick.

Read the full story at Dogs Naturally

New Products

Veterinarian Launches Cannabis Anti-Anxiety Product

Therabis will be undergoing clinical trials at the University of Pennsylvania School of Veterinary Medicine as well as field trials in over a dozen hospitals in New York.

Read the press release.

Dogs in the News

Bear the Black Lab Sniffs Out Electronics in Jared Fogel Search

Special dog sniffs out electronics in Subway spokesman pornography case. Bear is almost unique; there are only two other dogs with his skill in the entire country.

Read the story in Dogster

Veterinary Schools

Cornell Veterinary Student, Expelled from over Dog Bite, Loses Lawsuit

A former Cornell University veterinary student lost her $500,000 lawsuit claiming the school wrongfully expelled her because her dog bit a student during an examination.
Read the full story at the Syracuse Post Standard
R
ead the legal decision

Practice Management

Practice Manager of the Year from Alabama

Wesley Taylor, MPA, of Mercy Animal Hospital in Gardendale, Alabama, has been chosen as the 2015 Veterinary Economics Practice Manager of the Year in a contest sponsored by Nationwide.
Read the full story at DVM360

Community Veterinary Partners works with veterinarian owners who want to continue running the medical side of their practices, but want help with the day-to-day administrative and team management tasks. We help create a long-term strategy and a sustainable way for your practice to continue thriving — well into the future. Contact us to learn about how to partner with CVP and secure your financial future and the legacy of your hospital.

What % of Your Clients Will Pay for the Big Surgery?  | Read this week's CVP Animal News Roundup

Family Yes, but …

A new survey shows what we all know — pet owners see their dogs and cats as members of the family. But it may surprise you how many say they are unwilling to pay for a necessary expense if they can’t comfortably afford it.

How do you talk to pet owners about expensive procedures? Comment at our website.

If you’ve been forwarded this edition, you can subscribe here.

Michael

The Top Story
New Survey

Survey: Americans Love Their Pets, but Not the Expenses that Come with them.

Americans love their pets — so much that nearly eight out of 10 (78 percent) cat and/or dog owners view them as family members. However, our four-legged companions also require love from our wallets, according to the latest COUNTRY Financial Security Index.

Read the full story here.

More Veterinary Industry News
Practice Management

Dr. Jennifer Fletcher: How to Launch a Wellness Plan at Your Practice

By creating a comprehensive plan and thorough training of our staff to embrace “wellness,” we now have a foothold in moving our practice towards preventive medicine.  We implemented our program two years ago at the Animal Hospital of Dauphin County and have seen many benefits of transforming the way we approach wellness in our patients.
Read the full story at Community Veterinary Partners.

Veterinary Science

Veterinarian says dogs feel no shame

There is little double online do shaming is a popular phenomenon, but a veterinary scientist says that while some dogs may cast an apologetic look to their owners, they do not actually feel guilt.
Read the full story.

Non-Compete

Veterinarian seeks to prevent mentor from opening nearby clinic

A Pennsylvania veterinarian is seeking court orders to stop the former owner of her clinic from opening a competing clinic in neighboring Fayette County.
Read the full story at the Pittbsurgh Tribune

Wellness

Banfield Study Shows Misconceptions About Vet-Client Relationships

Veterinarians believe “preventive” care is vaccines, spay/neuters and parasite control. But pet owners think it’s more about their pets’ diets, exercise, care and emotional well being, 
See the full results of the study.

What Your Clients are Reading

Catster Magazine: Do Cats Really Need Vaccines Every Year?

In fact, there are answers to the question of how often cats need vaccines, but they’re not very satisfying. Some plausible answers to that question include: It depends. Nobody knows. It varies depending upon life stage, lifestyle, geographic location, and immune system function.
Read the full story at Caster.

Climate Change

New Study: Climate Change Impacted Canine Development

Climate change impacts ecosystems and how they evolve. The same holds true for canines within those ecosystems, a new study suggests. And it all has to do with elbows.
Read the full story at AAHA.

Community Veterinary Partners works with veterinarian owners who want to continue running the medical side of their practices, but want help with the day-to-day administrative and team management tasks. We help create a long-term strategy and a sustainable way for your practice to continue thriving — well into the future. Contact us to learn about how to partner with CVP and secure your financial future and the legacy of your hospital.

Join Us For Our 2015 Fall Meeting!

You’re Invited To Our 2015 Fall Meeting!

Overcoming Behavior Obstacles in Our Patients, Our People, and Our Practices

Please join CVP, Ceva Animal Health and The Calico Group for an entertaining and enlightening day on the impact of behavior on our day-to-day practice lives.  In what promises to be outstanding event, we’ll review and discuss the importance of the many interactions between all parties in the doctor-patient-client relationship. The day will be a unique mix of clinical, practical, and management concepts and provide attendees pragmatic ideas for tackling common problems.

In addition to a fantastic line up of speakers and topics, enjoy the day in one of the most unique venues in our area, meet some of the staff of the Elmwood Park Zoo and get a one-of-a kind view of one of the area’s most popular family attractions

Event Details:

Sunday, September 20th, 2015
9 am to 3:30 PM

Elmwood Park Zoo
Canopy Gardens Hall
1661 Harding Blvd
Norristown, PA 19401

ce event

Please RSVP to your local Ceva Territory Manager or to Dr. Travis Meredith at travis.meredith@cvpco.com.


Vets Using 3-D Printing to Improve Surgery Outcomes | This Week's CVP News Roundup

Amazing Technology

The big news this week is how veterinarians are using 3-D printing to prepare for and adjust surgery techniques.

Would you use 3-D printing to improve your surgery outcomes? Comment below.

If you’ve been forwarded this edition, you can subscribe here.

Michael

The Top Story
Technology

Student Uses 3-D Printer to Improve Veterinary Surgery

A Kansas State college student turned CT scans of animal bone fractures and deformities into full-scale 3-D prints that veterinarians at the university’s College of Veterinary Medicine are using for teaching, to plan surgeries and to find more cost-effective ways to treat four-legged patients.

Read the full story at NewsWise

More Veterinary Industry News

Animal Health Public Markets
Petco Announces IPO

Retail chain Petco has spent much of the last two years remodeling its stores to emphasize its new focus on pet health and wellness, which included adding an online pharmacy service courtesy of its 2014 acquisition of online retailer Drs. Foster & Smith. Now Petco, which was taken private in 2006 in a $1.8 billion private equity deal, is taking the story of its reinvention back to Wall Street, filing on August 17 for an initial public offering.

Read the full story at the New York Times
Read the full S-1 filing at the SEC website

Association News
AVMA Announces New President

Dr. Thomas F. Meyer has been named president-elect of the American Veterinary Medical Association (AVMA). Meyer, who was elected to the post by the AVMA House of Delegates (HOD) at its summer session on July 10, succeeds Dr. Joseph H. Kinnarney, who has officially assumed his role as AVMA president.

Read the AVMA press release

AVMA Elects Record Number of Women

Lori M. Teller, DVM, DABVP (canine and feline), has begun her tenure as one of the 11 members of the American Veterinary Medical Association (AVMA) Board of Directors, bringing the total number of women on the board to an unprecedented six.

Read the story at DVM360

AAHA Accredits First Zoo

Tampa’s Lowry Park Zoo has become the first zoo in the United States and Canada to earn accreditation by the American Animal Hospital Association (AAHA).

Read the full story at AAHA.

Food Recall
Frozen Raw Cat Food Recalled

Northwest Farm Food Cooperative has issued a voluntarily recall of frozen raw cat food that may be contaminated with salmonella, which can affect the animals consuming the product and poses a risk to humans handling the product. To date, no pet or consumer illnesses from the cat food have been reported.

Read the full press release from the FDA

Practice Safety
Vet Bitten by Rabid Dog

A Greenbrier, Ark., veterinarian was bitten by a dog last month that had been infected with rabies.

Read the full story from KNWA

Community Veterinary Partners works with veterinarian owners who want to continue running the medical side of their practices, but want help with the day-to-day administrative and team management tasks. We help create a long-term strategy and a sustainable way for your practice to continue thriving — well into the future. Contact us to learn about how to partner with CVP and secure your financial future and the legacy of your hospital.

Is your vet hospital growing as fast as the industry? Read this week's CVP Weekly

 

The big news this week is the high revenue growth showing up in the industry. We’re seeing the same trends with our family of hospitals. Some of it could be just great comparisons against last year’s results, which really suffered due to the tough winter on the East Coast. But my gut is that something more is going on. There’s a lot of wind at our backs.

If you’ve been forwarded this edition, you can subscribe here.

Michael

The Top Story
Industry News

Fast Growth Hits Small Animal Hospitals

Two news stories this week highlight the fast growth hitting our industry. VCA reported 6 percent growth at its hospitals during the 2nd Quarter, and Gatto McFerson, the west coast accounting firm, said the 175 practices it tracks in California were up double digits in June.



Read the VCA press release.

Read the Gatto McFerson press release.

More Veterinary Industry News
Regulatory Issues

Popular as ever, veterinary compounding poised for change

New guidance issued by the FDA has the potential to significantly alter the way veterinary compounding is practiced and the players and training involved.

Read the full story by VIN.

Read the pharmacy regulations for your state at the AVMA site.

Read the full guidance from the FDA.

Technology

App lets veterinarians, pet owners consult live online

A new regional mobile app is providing a virtual veterinary service allows pet owners to consult with a veterinarian at any time. But the convenience of bypassing an office visit through Vet24seven or similar apps now available might not allow for adequate animal care, some Sacramento-area veterinarians said. Participating veterinarians could violate state regulations if they offer virtual treatment for an animal they’ve never physically seen.

Read the full story at the Sacramento Bee.

Pharmacy

Zoetis Receives a Conditional License from USDA for Canine Atopic Dermatitis Immunotherapeutic

Zoetis announced that the U.S. Department of Agriculture (USDA) has granted the company a conditional license for Canine Atopic Dermatitis Immunotherapeutic, an antibody therapy to help reduce clinical signs associated with atopic dermatitis in dogs.

Read the new release from Zoetis

Read the news release from the USDA

What Your Clients Are Reading

How Advanced—and Expensive—Can Veterinary Care Get?

With the completion of a $5-million expansion this spring, an 80-year-old D.C. hospital—which already provided primary and 24-hour emergency care—doubled in size and became the only veterinary facility in the District with MRI and CT-scanning machines, an underwater treadmill for post-surgery hydrotherapy, a new intensive-care unit, and board-certified specialists in areas such as neurology and pathology.

Read the full story in the Washingtonian.

Knowing Your Client

Veterinary Clients Show High Loyalty When Considering Elective Procedures

A new study financed by CareCredit shows that 2/3 of veterinary clients will use their current veterinarian for elective procedures — a higher percentage than for dentists, optometrists and other medical professionals.

Read the full news release at CareCredit.

Read the full study.

State Regulatory Issues

Veterinarians mobilize against legislation to tax medical care for pets

Practitioners in North Carolina and Connecticut recently have rallied against legislative attempts to tax veterinary medical care.

Read the full story at VIN.

Community Veterinary Partners works with veterinarian owners who want to continue running the medical side of their practices, but want help with the day-to-day administrative and team management tasks. We help create a long-term strategy and a sustainable way for your practice to continue thriving — well into the future. Contact us to learn about how to partner with CVP and secure your financial future and the legacy of your hospital.

 


The first CVP Weekly – A roundup of the latest small animal news

 

Welcome to the very first issue of CVP Weekly — a weekly roundup of the latest news from the small animal veterinary industry. Every week, we compile a rundown of the most important and vital news in the business and deliver it directly to your inbox. We don’t just cut and paste press releases. Instead, we search for real stories that directly impact your daily work life. You can expect to dig into national reports, information on regulatory issues, news on general animal health, examinations of new products and ideas in practice management.

What do you think of our inaugural issue? Email me at michael.raphael@cvpco.com.

If you’ve been forwarded this edition, you can subscribe here.

Having trouble viewing this email? View it in your browser.

Michael

The Top Story
Industry News

AVMA delegates reject changes to veterinary school accreditation process

At the annual meeting of the American Veterinary Medical Association (AVMA) House of Delegates in July, the house voted against four resolutions related to the accreditation of veterinary schools by the AVMA Council on Education (COE).

Read the full story from DVM360.

Read the full story from VIN.

More News
Your Clients are Reading This

Why vets are getting away with murder

The veterinary profession is broken and it isn’t about to change any time soon. Our pets are being over-serviced and we’re getting fleeced. We pay for the unnecessary vaccinations, the overly-processed, synthetic prescription pet foods that contain ingredients from China, and we pay for drugs and chemicals that are damaging to the immune system.

Read the full story from Dogs Naturally

Hot Topic

What to do about ShotVet?

Many in the veterinary community are asking what can be done to stop the low-cost mobile veterinary vaccine service associated with Walgreens drug stores. The answer may be nothing.

Read the full story from DVM360.

Practice Management

Should you buy that latest, greatest piece of veterinary equipment?

Many factors are essential to the practice of quality medicine and surgery; including an appropriate range of high-quality equipment for both diagnostics and treatment.

Read the full story by Dr. Karen Felsted.

Veterinary Schools

Foundation donates $100,000 for Penn Vet scholarships

The University of Pennsylvania School of Veterinary Medicine said the Thoroughbred Education and Research Foundation, or TERF, will donate $100,000 to create an endowment for student scholarships.

Read the full story from the Daily Local News.

People

Texas A&M veterinarian to lead AAVMC

Dr. Eleanor Green, the Carl B. King Dean of Veterinary Medicine at the Texas A&M University College July 24, of Veterinary Medicine & Biomedical Sciences, has begun her term as president of the Association of American Veterinary Medical Colleges (AAVMC).

Read the full story from Bovine Vet Online

Opinion

Dr. Robert Marshak: Long live the veterinary teaching hospital

The proliferation of veterinary colleges with limited or no research base, existing outside of a community of scholars, and pursuing a distributive model of clinical education, not only undermines the fabric of American veterinary medical education but also the economic status and future of the profession.

Read the full story from VIN.

Regulatory

FDA takes steps to prevent sales of unapproved kidney drugs for dogs and cats

The United States District Court for the District of Nevada entered a consent decree of permanent injunction against Bio Health Solutions LLC, of Las Vegas and its manager and co-owner, Mark Garrison, for selling RenAvast, an unapproved animal drug.

Read the full story from the FDA

Regulatory

Four Multistate Outbreaks of Human Salmonella Infections Linked to Live Poultry in Backyard Flocks

CDC, public health, veterinary, and agriculture officials in many states and the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service (USDA-APHIS) are investigating four multistate outbreaks of human Salmonella infections linked to contact with live poultry.

Read the full story from the CDC.

And there’s this

41-pound cat loses over half its weight

A former 41-pound cat dubbed Skinny has lost more than half of his weight to become the darling of a Dallas veterinary clinic.

Read the full story from the NY Post

Community Veterinary Partners works with veterinarian owners who want to continue running the medical side of their practices, but want help with the day-to-day administrative and team management tasks. We help create a long-term strategy and a sustainable way for your practice to continue thriving — well into the future. Contact us to learn about how to partner with CVP and secure your financial future and the legacy of your hospital.

Copyright © 2015 Community Veterinary Partners, All rights reserved.

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CVP Partner Hospital Connects With NY Community By Providing Veterinary Care for Government Agency Dogs

Written By: Brian Miller, Receptionist and Social Media Specialist, Liverpool Animal Health Center

Sargent Cicora & Devitt
Sargent Cicora & Devitt
McGinn & Devitt
McGinn & Devitt

Another unique group of patients we treat at Liverpool Animal Health Center are government agency dogs.  The New York State Police, United States Border Patrol and the City of Oswego bring some of their K9 officers in to be treated by our doctors.  This relationship was not designated by the agencies themselves, but rather, by the individual handlers.  According to Dr. David Clegg, the first K9 officer we treated was owned by a trooper whose other dog was already a patient with us.  The doctors were immediately impressed by the bond shared between the partners.  This particular K9 officer eventually needed to have his spleen removed, and his handler was very happy with the end result.  Through him, word began to spread about our practice, and we began to see more of these four-legged officers.  Dr. Clegg says that “Each handler we see here is great.  They love their dogs and will do whatever they can to follow our recommendations.”

One of the officers who began bringing his animals to LAHC was New York State Trooper Jeff Cicora who has been stationed in Central New York for over 20 years, and was chosen to become a K9 handler in 2001.  He and his wife began coming to our practice in 2005.  At the time, they owned a cocker spaniel, and Officer Cicora’s partner, “Devitt.”  Sgt. Cicora says that they had tried other local offices, but “When we finally tried LAHC we were pleasantly surprised at the friendly service provided by the staff and doctors.  If it was really busy, the awesome receptionists (Patti, Robbi, and Brian) would find a way to fit us in.  They went above and beyond to help us with our veterinary needs.  When we got in to see the doctors we were treated with respect and given medical information in a way that we could easily understand.  In all the years that I have been going to LAHC with my K9 partners, I have never questioned their ability to give my dogs the very best care available!”

When it came to Devitt, as well as treating Sgt. Cicora’s next partner “McGinn” and all of the other officers that came through our doors, Dr. Clegg states that the doctors have to be aware that the animals are working dogs and need to be able to perform their job.  “They are no different than a service dog for someone who is deaf or blind.  Being able to work is part of their life, and we need to acknowledge that the dog cannot simply stay home and lay on the couch for two weeks.”  This type of care was not lost on Sgt. Cicora.  “We were always treated like family and if Devitt or McGinn ever had a medical problem the staff and doctors at LAHC took immediate action and treated the problem,” says Cicora.   “We certainly didn’t request or demand special treatment but the doctors always seemed to take a special interest in us.  They seemed to know the importance of the job and duties that we performed on a daily basis and did everything they could to make Devitt and McGinn comfortable and get them back into service as soon as possible.”  He goes on to say, “Our K9 partners’ health is very important and you should always feel comfortable in knowing that your dog is getting the best treatment available.  You should be able to trust your vet just as much as you trust your dog.  Police work is inherently dangerous and you must be able to trust that your vet is trained and prepared for the worst case scenario if your dog goes down.”  Sgt. Cicora finishes with a statement that is not only a wonderful compliment, but succinctly summarizes the feelings we yearn for all of our clients to have.  “We have found ourselves in the office quite frequently over the years for a myriad of reasons and built a great rapport with the staff and doctors. If I ever had leave either of my partners, I knew they would be well taken care.  I trusted that the doctors and animal caretakers would protect them like I protected them. I never had any reservation about their care.  I am proud to say that I consider the staff at LAHC to be a part of our family.”

At Liverpool Animal Health Center, we not only strive to exceed our client’s expectations, but to set ourselves apart from our many competitors.  By defying convention and providing some of the aforementioned services that others do not, we continue to prove why our hospital is the premiere destination for animal care in Central New York.


CVP Welcomes Manhattan Cat Specialists to Their Family of Partners Hospitals

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Community Veterinary Partners is proud to announce a new partnership with Manhattan Cat Specialists and Arnold Plotnick, DVM, MS, ACVIM.  Located in New York City’s Upper West Side, Manhattan Cat Specialists is CVP’s first feline-only veterinary partnership.  “At CVP we are extremely excited to partner with Manhattan Cat Specialists and Dr. Plotnick” Says Scott Kirker, Vice President of Finance. “Their level of service and devotion to the cats of New York City is truly one of a kind, and we can’t wait to see what the future holds for our partnership.”

Dr. Arnold Plotnick received his veterinary degree from the University of Florida in 1988 and then completed an internship in small animal medicine and surgery at the University of Pennsylvania.  He worked as an associate veterinarian at the Cat Hospital at Towson in Md., and then returned to academia and completed a residency in small animal internal medicine at Colorado State University.  Dr. Plotnick became board certified in internal medicine in 1997.  He served as chief of staff of VetSmart Pet Hospital in Columbia, Md., before returning to his home town of New York City to become vice president of Animal Health at The ASPCA.

Dr. Plotnick is also a well-known writer. He authored CatFancy’s “Ask the Veterinarian” column for many years and is a frequent contributor to Catnip magazine. He is a co-author of The Original CatFancy Cat Bible, and is the current author of “Body Parts” in Catster magazine. He is also the writer of the popular blog “Cat Man Do.” Dr. Plotnick is extremely passionate about veterinary medicine as well as New York, “After the tragic events of September 11, 2001, I was inspired to play a part in the renewal of New York by founding Manhattan Cat Specialists in January 2003.” Says Dr. Plotnick, “I have devoted myself solely to feline medicine since then, and Manhattan Cat Specialists has blossomed into the premier feline-only veterinary practice in New York City.  I am proud to move forward with Community Veterinary Partners.”

About Community Veterinary Partners
Community Veterinary Partners invests with veterinarian owners who want to continue running the medical side of their practice, but want help with the day-to-day administrative and team management tasks. CVP currently has 14 partner hospitals in its family. Find more information about Community Veterinary Partners and its family of veterinary hospitals at www.cvpco.com  


Dr. Karen Felsted: A Belief in Marketing Also Drives Veterinary Visits

As mentioned in the last post, the Bayer study identified a number of attributes that practices which continue to grow during this post-recession economy have in common.  Not entirely surprising is that two of those attributes are marketing related:  the first is a belief by the practice owner that marketing and advertising were critical to the practice’s success and, secondly, that the practice is an active user of social media such as Facebook.  The study also looked at attributes associated with practices who are experiencing declines in visits and found that both of those factors were marketing related:  the veterinarian felt that advertising undermines his/her credibility as a veterinarian and the practice lacks referral arrangements with other pet service providers.

What IS surprising is that 74 percent of veterinarians do not completely agree that marketing and advertising are important tools in running a successful practice today.  Without that commitment, it’s unlikely those practices will be effective in using marketing strategies to attract new clients.

What do you think?  How much time do you spend on marketing and advertising?  What have you found to be most successful?

See all of Dr. Karen Felsted’s blog posts.


Should You Buy That Latest and Greatest Piece of Veterinary Equipment?

Written By: Karen E. Felsted, CPA, MS, DVM, CVPM, CVA

lasersradiology

Many factors are essential to the practice of quality medicine and surgery; including an appropriate range of high-quality equipment for both diagnostics and treatment.  The decision to purchase some pieces of equipment may be an easy one—for example, it may be clear that the practice needs a new anesthetic machine.  Because the practice already uses this equipment on a daily basis and the cost isn’t too great, the decision is clear cut to replace the current unit.  The purchase of more expensive assets or those not previously used in the practice, however, requires more planning and forethought than does the purchase of equipment or supplies with a much shorter life, lower cost and for which there is an undisputed need.

As with any equipment purchase, it is first necessary to understand what the goal of the acquisition is in YOUR practice.  Two of the most common reasons for purchase are:

-The new equipment will improve patient care
-The new equipment will increase profits

We can assume that a practice won’t even consider the purchase of equipment if the answer to the first question above isn’t yes.  This would appear to be an easy question to answer but it’s not always.  For example, it’s generally agreed that ultrasound is a great diagnostic tool; thus purchasing an ultrasound unit should improve patient care.  But this may not always be true.  What if clients don’t want to pay for the cost of this new test and decline the recommendation?  What if the doctors in the practice don’t have the skills to properly perform the imaging or interpret the results of what they see? In either of these cases, just owning an ultrasound won’t improve patient care.

A harder question is certainly if the new equipment will increase profits.  When replacing a piece of equipment the practice uses regularly (for example, an anesthesia machine), the expectation usually isn’t that this will increase profits.  The expectation is that the practice will continue to generate the profits that equipment already provides.  It’s a different story, however, when the practice buys something it’s never had before—a digital x-ray, an ultrasound, or a laser—something that allows the practice to expand the services it already provides.

Net present value (NPV) analysis is an excellent tool to help in understanding the potential profitability of the purchase—this analysis estimates the total cash outflows involved with the purchase of an asset compared to the total inflows.  A positive outcome equals a profitable purchase.  NPV analysis also incorporates the time value of money into the calculations.  While incorporating the time value of money gives more accurate information, it is also more difficult to do and many small business owners will enlist the aid of their accountant or financial advisor in performing this analysis.

This calculation should be be performed over the full expected life of the equipment in order to estimate the total profitability.  Any amounts expected to be realized from the sale of the equipment at the end of its life should be recognized as an inflow and any costs of disposal should be recognized as an outflow.  This is a particularly useful calculation when comparing the potential profitability of two or more pieces of equipment.  It’s important to remember, however, when comparing the profitability between two choices that the timeframes must be similar for the results to be the most meaningful; $100,000 in lifetime profits from a piece of equipment with a five year life isn’t the same as $100,000 in lifetime profits from a piece of equipment with a ten year life.

As with any analysis, good data is critical to good results.  A number of variables will be used in these calculations such as the cost of the equipment, the additional annual costs associated with the asset (such as a service contract or supplies), the expected cost savings to be obtained from usage or the anticipated increase in revenues.  If these items are not accurately estimated, the results of the acquisition analysis may be erroneous.  Some examples include:

– The cost of equipment does not just include the sticker price. Other components of cost include tax, installation, training, and interest costs if the asset is financed.

– One point that is always touted as an advantage of digital radiography is the ease of taking the images and the reduced staff time required. This is true but reduced time spend on imaging doesn’t always result in reduced costs.  Unless the practice actually cuts back on the number of staff hours, there will be no reduced staff costs from purchasing this equipment.  The staff may be available to do other work which can be advantageous but that is not the same as realizing a true cost savings.

– It’s easy to overestimate the additional revenue that the practice will bring in from the new services; one way to help get an accurate figure is to go back through a month’s work of cases and determine where the new service could have been used in place of what was otherwise done. Could an ultrasound have been done in-house instead of referring the client out?  Could laser treatment have been performed?  Of course, just because something is possible, doesn’t mean clients will accept it so those factors have to be taken into account as well.  In the case of laser therapy, will the potential inconvenience of having to bring the pet into the practice multiple times reduce acceptance?

One final comment about the financial aspect of buying a new piece of equipment—just because the new item may not do much more than break-even financially, it doesn’t mean a practice has to forego purchase.  However, the owner and manager need to understand the financial ramifications and not expect something that is not possible.  In cases like this, the purchase is no different than if the practice owner chose to use his or her profits to purchase a boat.  The purchase doesn’t necessarily add profits and value to the practice but it brings pleasure to the owner.  This is only a bad thing if there was an expectation that things would be different financially.  Pre-purchase financial analysis can go a long way in helping owners and managers manage their expectations and make a good decision.