Landmark VPI-Veterinary Economics study looks at financial health of veterinarians, practices

Do you know where you stand financially? Do you know how your financial health compares to that of your peers? The VPI®-Veterinary Economics Financial Health Study will help you answer those questions. Read on to download the White Paper we presented at the North American Veterinary Community conference on Jan. 19, 2014.

Like everyone else in the veterinary community, we at Veterinary Pet Insurance are keenly aware of the decrease in veterinary visits as well as the staggering burden of student loan debt. What we had not seen, however, was a hard look at how those trends were affecting the financial health not only of practices but more importantly, of veterinarians themselves.

That’s why VPI led an in-depth study to find those answers. Our intention is to provide the profession and individual veterinarians with benchmarking information we all need to make decisions for our own financial futures, and to start the conversation about what those decisions might be.   VPI and Veterinary Economics magazine developed the study, in cooperation with Brakke Consulting, which in 2011 produced the Bayer Animal Health veterinary care usage study. The VPI®-Veterinary Economics Financial Health Study builds upon the foundation of the Bayer study, interviewing more than one thousand veterinarians.

Download the White Paper by clicking here, and start taking charge of your own future, today. Join us for an expanded presentation and panel discussion of the study at the Western Veterinary conference.

4 thoughts on “Landmark VPI-Veterinary Economics study looks at financial health of veterinarians, practices

  1. A very disheartening report indeed. Can’t say I am surprised.
    From my perspective the next step is how did this happen? What differentiates those who are swimming from those who are drowning?

    The study doesn’t even touch on the fact that the children of those that are heavily in debt will be faced with college expenses themselves. God forbid they decide to enter an already indebted profession!

    I think we need to identify characteristics of those who are 9-10s not 5-6s. Our profession has a tendancy to shoot for “good enough” and there is no such thing.

    There are plenty of successful veterinarians. What do they do that our colleagues don’t do? The answer is that they appreciate the necessity of wealth accumulation.

    It is time we focus on what differentiates wealth accumulation from being mercenary. I am certainly not willing to write checks to cover people’s expenses but I am willing to share how I grew up a welfare child and became a multi millionaire as well as a leader of the profession. It is all about commitment.

    1. Dr. Paul, I agree. We need to help the next generation with skills that promote clear communication of value so they can gain client agreement to proceed with the best medicine possible for patients. Over and over, data supports the notion that clients will pay if they understand the value of services and products. Plus, we should be making sure life skills (retirement planning, basic financial acumen) is a pillar of the graduate program.

  2. While I have no quarrel with observations made in the collection of data, I think there has been some serious omissions in the scope of data being considered.

    For example, where is the data that shows that young veterinarians are unable to purchase a practice because of student debt? The lack of data to support this assumption is a serious matter and may result in discouraging many otherwise potential practice owners.

    I worked as a practice valuator and broker in four midwestern states since 1998. During that time I have participated in ownership transition of hundreds of practices. I know of TWO occasions where educational debt was so immense that the lender would not grant the borrower a loan to purchase a practice. Since more than 90% of our buyers are associates just 2-8 years out of school, this experience would suggest that to the vast majority, educational debt (as large as it is, and is still growing) is NOT a significant barrier to buying a practice.

    I believe that my personal experience is likely to be mirrored by 9 other Simmons offices around the country as well as practice brokers outside our Simmons group.

    In the summary report (White Paper referenced above) provided at NAVC, it suggests correctly that practice ownership results in significantly higher incomes for practice owners. I posit that a recent graduate who desires to own and is qualified to own a veterinary practice should BUY the RIGHT practice in order to retire his/her educational debt at a rapid pace.

    To cite specific language in the VPI-Veterinary Economics Study summary report, I note the following:
    “While many young veterinarians, especially males, would like to own a practice some day, burdensome student debt was the reason most often cited for making it unlikely that they will do so.”

    Comment: 1) In a VetPartners survey conducted several years ago, it was determined women and men were buying practices in nearly equal numbers. I have no reason to believe that has changed based on subsequent observation. 2) Where are young veterinarians getting the impression they cannot “afford” to buy a practice? I believe it is because of the widely held but unsubstantiated assumption that educational debt is the barrier. 3) Young veterinarians buy a practice with clean credit, 2-5 years of work experience, in spite of lots of educational debt and with abundant funding by lenders and sellers.

    “Practice owners feel more comfortable from a personal financial standpoint, compared to associates, no doubt in part to a significantly higher income.”

    Comment: This is precisely the reason young veterinarians, who have the desire and ability, should own a practice. The caveat of which they must be aware: they must buy the RIGHT practice. As noted in the study, many practices are struggling and should not be attractive to a young buyer.

    “Practice ownership is not realistic for many. While many associate veterinarians dream of owning their own practice some day, a majority consider the prospects unrealistic, due primarily to their high student debt load”

    Comment: This kind of published conclusion is not helpful. It is also not accurate. There is enough discouraging news in our industry without creating discouragement that lacks data to support it.

    If there is any doubt about the credibility of my observations, I invite the researchers in this project to survey lenders active in our industry and practice brokers who are active in the industry. They can, in turn, lead you to many new practice owners who recognized the opportunity of practice ownership and their ability to pay down their educational debt at a rapid rate.

    1. Dr. Goebel, you know we are very much in agreement on this point, and will be developing a blog post with your assistance on the topic of practice ownership. You are correct that we focused part of our presentation on this topic at WVC, and we intend to expand on that part of our offerings to the profession.

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