This practice improved scheduling and compliance, established a solid staff management team, developed written standards of care, and more. Not only is Loving Hands Animal Clinic stronger- and ready to move into a new facility-but it made money along the way.
"The money was not my focus," says Dr. Joanne Roesner, Dipl. ABVP, owner and medical director. This statement seems hard to believe, coming from a woman who spearheaded the growth of her veterinary practice from $1.4 million to almost $2 million in three years. But spend only minutes talking with Dr. Roesner, and you know for certain that it's true.
Left to right: Dr. JoAnne Roesner, Dipl. ABVP, owner and medical director; associate Dr. Karen Ellis, certified veterinary acupuncturist and practitioner of traditional Chinese medicine; associate Dr. Vanessa Lee, focused on avian and exotic medicine, and associate Dr. Catherine Byars.
"The driving force in my practice is the desire to do right by my patients and to take care of the people who own them," she says. "I believe that what we're supposed to do while we're on this earth is leave it a better place. I absolutely believe that some pet owners want and will pay for excellent veterinary care delivered with an attitude of compassion. Somewhere along the line, I ended up with a $1.7 million practice."
Of course, Dr. Roesner's seemingly unending energy when it comes to caring for pets and their people sets the stage. The team at her four-doctor practice, Loving Hands Animal Clinic in Alpharetta, Ga., maintains a high standard of care and builds strong doctor-client bonds. And Dr. Roesner is dedicated to growth—for the hospital and her staff members.
When her practice started to outgrow her 3,000-square-foot facility in 2000, she started thinking about building. "To give the people I wanted to work with the tools to accomplish their goals—and for me to do the same—we needed more space," she says. "I saw our current facility getting in the way. For example, our quality of service declined because we didn't have enough exam rooms."
Dr. JoAnne Roesner
Besides the space crunch, Dr. Roesner's practice had experienced organizational and systematic issues. "I wasn't getting where I wanted to go with the practice systems in place. I felt we were overlooking tremendous untapped income because of lost charges. And I wasn't convinced that we always provided all the care that was in animals' best interest." At the time, the practice manager held the only staff-management position.
Faced with the goals to expand, grow her profits to support that expansion, catch missed opportunities, fix organizational issues, and satiate her drive to create the best practice she could, Dr. Roesner called in a consultant. She asked me to help her take the practice to the $2 million level and beyond. Here's how our efforts unfolded over a three-year period.
In 2002, the practice generated about $1.4 million in revenue. A thorough analysis revealed opportunities to strengthen the practice's foundation and opportunities for growth. Dr. Roesner and her healthcare team set these goals for 2003:
We developed a business plan to accomplish these goals. They implemented these changes in 2003:
Financial management. A fee structure analysis and review of pertinent financial information showed places that needed improvement. We:
Employee development. Dr. Roesner wasn't satisfied with the practice manager's performance. After several months of working together to resolve the issues, they came to a mutual agreement that the manager would leave. Here are some other changes we made:
Medical development. To enhance consistency and assist with new staff members' training, the medical team created written standards of care. As part of that effort, the team:
Client development. To improve client compliance, we focused on proactive scheduling and on improving the clients' response rate to reminders. Specifically, staff members:
Facilities and equipment. The management team formed a committee to develop an organized, step-by-step plan for becoming a paperless practice. And Dr. Roesner started planning for her new facility. The building project represented a significant financial investment, of course, and she wanted a strong plan in place to ensure success.
Results. By the end of 2003, revenue grew to $1.5 million. Dr. Roesner invested the increased revenue in raises for staff members and doctors, and computers for all exam rooms. Plus, she accelerated the repayment of debt.
Dr. Roesner and her team established these goals for 2004:
Using the Management Statement, we again identified opportunities for growth and developed a business plan for 2004. They implemented these changes:
Financial management. We again reviewed fees and financial processes and made the following changes:
Employee development. The management team experienced some upheaval in 2004. The client care coordinator resigned. Dr. Roesner and the practice manager decided she was better suited to the client care role, so she made the move. The ward manager wanted to pursue certification as a practice manager in the hopes of filling the role. Dr. Roesner agreed to support her efforts and give her added management responsibility to evaluate her capability of assuming the role.
The healthcare team developed the continuing education plan for the year with an emphasis on learning more about the importance of perception of value. I suggested conducting phone-based surveys of area practices to educate team members about the importance of a caller's impressions; inviting one or two clients to discuss why they chose the clinic and what factors affect their perception of value; and visiting another practice as a client and evaluating the experience, including the quality of care they receive and what they pay for it.
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Client development. The team didn't hit its 2003 goals for proactive scheduling and third reminder calls. So they refocused on these two areas again for 2004. They completed a compliance audit of their reminder system, found a significant number of errors, and worked to correct them. The client care staff decided to divide reminders into smaller batches and send fewer reminders weekly instead of a large batch monthly.
Facilities and equipment. Dr. Roesner continued planning for the new hospital, with the goal of breaking ground in 2005.
Results. By the end of 2004, revenue grew to $1.6 million. With the revenue growth and improved expense management, the amount available to compensate the doctors and reinvest in the practice improved by 31 percent, or $145,000. Dr. Roesner again accelerated the repayment of debt so she'd be in a good position for the construction project in 2005.
Dr. Roesner and her management team established the following goals for 2005:
Using the Management Statement we again identified opportunities for growth and developed a business plan for 2005. They implemented these changes:
Employee development. The management team experienced some additional change in 2005. The client care coordinator resigned and Dr. Roesner hired a new coordinator. "I'm optimistic about the skills my new coordinator brings to the practice," she said. "I think she'll be able to lead the client care team in the direction I envision." The ward manager resigned and relocated to another state. For now, the patient care coordinator will assume responsibility for managing ward attendants. Dr. Roesner also hired a new practice manager and is pleased with the employee development and organizational skills she brings to the table. "Now I've got the practice manager I've always wanted," says Dr. Roesner.
The healthcare team developed the continuing education plan for the year with a continued emphasis on the importance of perception of value and on strengthening the client care team.
Client development. The practice continues to focus on proactive scheduling and improving reminder compliance.
Facilities and equipment. Once we received the initial cost estimates, I completed an expansion analysis to help Dr. Roesner determine the financial viability of the new hospital. We projected changes in her expenses in the new, larger space and then developed a plan for revenue growth to support the new expenses. (See "Don't Get Lost in Increased Costs" at www.HospitalDesign.net.) They broke ground for the new facility in March.
Results. By the end of 2005, revenue grew to $1.7 million, and the amount available to compensate the doctors and reinvest in the practice improved by another 4 percent, or $26,000. Dr. Roesner hopes they'll move in to the new facility soon. And while she and her team have made great strides toward achieving their goals, they haven't stopped there.
They continue to do strategic planning and to work on improving the practice. "We've accomplished so much," says Dr. Roesner, "and I can't wait to see what happens in our new building!"
Thinking back over her practice experience, Dr. Roesner says resolutely, "The greatest reason for small business failure is lack of adaptation. If I'd been satisfied with keeping things as they were, I could have downsized, abbreviated growth, and stayed where I was. But I needed to address my lifelong desire to practice the best veterinary medicine I could. I found I was grossly limited in my current facility and my current systems. I wanted to be in a position to support the people I had and to attract the support staff that I wanted. I had to take a deep breath and move forward."
From her first 1,200-square-foot facility in 1993 to today, preparing to move into a 9,970-square-foot hospital, Dr. Roesner has stayed rooted in her ability to adapt—and in her mission for Loving Hands Animal Clinic. "Our clinic's our way to do good in the world," she says.
Not every practice is or should be a $2 million one. But the strategies used to improve this hospital apply to everyone. For example, you could:
Denise L. Tumblin, CPA, is co-owner and vice president of Wutchiett Tumblin and Associates in Columbus, Ohio. She'll lead a two-day seminar on transitioning into management and ownership, Aug. 24 and 25, at Progress in Practice in Kansas City, Mo. And she'll speak on setting fees, staff compensation, and more at CVC Central, Aug. 26 to 29 in Kansas City. For more information, visit www.thecvc.com
Denise L. Tumblin, CPA