Thus the practice staffing increases as a percent of revenue. The make-work grows to fill the time, but the revenues in the slower months level off. Associates and staff adapt their work pace to meet the lesser demand.

While good to do when needed, this work does little to generate income to meet payroll needs. As workload decreases, the staff will find “make-work” projects such as cleaning and organizing workspaces. This higher level of staffing creeps in and gradually becomes the “new normal,” which goes unnoticed. However, when the schedule lightens, many owners and managers are hesitant to reduce the staffing hours when the rush is over. During the busy months, practice owners will often find themselves increasing staff hours or hiring additional staff members to meet the demand. If you need to dig deeper, or you want to prevent your staff costs from getting out of control, here are several common pitfalls to avoid: Not Adjusting the Hours to the Current Demandįor many general practices, the spring and summer months are much busier than fall and winter. If they indicate that you have an opportunity to improve, then you can take the time to dig deeper. The above provide different tools to assess your staffing expense. Therefore, it is sometimes helpful to also measure and track how much revenue the practice generates per hour of operation against the number of staff that it needs to support. Whether it is appropriate or not can be influenced by variations in hospital fees, average transaction costs, the types of services provided, and the levels of revenues generated by non-veterinary staff. There are limits on how applicable this reference is to individual practices. It is important to note that this is a reference point only. To calculate yours, divide the total staff hours by the number of doctor hours for the same period. Per AAHA’s “ Financial & Productivity Pulsepoints,” the average full-time equivalent (FTE) staff per FTE veterinarian is around 4.0. While less subjective than reviewing the actual expense, comparing your staff hours per veterinarian hour to the industry benchmark can be a meaningful reference. To properly assess this, it may be necessary to include a portion of the wages for those staff members who fill dual roles, such as technicians who also are responsible for inventory management or office managers who also work in reception. Regardless, as a general rule, the expense for the wages not including benefits should not exceed 2-3% of revenues. Depending on the practice size, this may be one person, or it could be multiple people. The non-owner management often includes hospital administrators, practice managers, and inventory managers. The benefit costs include all costs associated with health, dental, worker’s compensation, and other insurances, the retirement benefits, the owner’s portion of employment taxes, the continuing education, and any paid vacation, holiday, and personal days. This tends to break into 16-19% of income for the wages and 5-8% for the benefits. The total support staff expense in a financially healthy animal hospital (including benefit costs) is typically kept below 23-25% of revenues. Support staff includes all of the non-veterinary staff, including management and custodial. The following are several reference points that we feel are key to evaluating your staffing expenses. Doing so can help you avoid managing by feeling and focusing on objective data to assess whether staffing changes are needed. To objectively assess your staffing expense – or at least as objectively as possible –, it is important to rely on the more subjective measures. This inherent foundation creates the perception that there is always plenty of work to fill everyone’s day, even when a practice’s underlying issue is overstaffing. Even in actively managed practices, it still can be a struggle to get staffing to an optimum and replicable level.Īs we look into managing veterinary practice staff expenses, it is crucial to remember that the work will generally expand to fit the time available in most businesses. Staffing costs are one of the most significant expenses in a veterinary practice, and controlling these costs remains one of the most challenging issues for most practice managers and owners.

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