Diagnostics is one of the fastest-growing profit centers in veterinary hospitals and clinics. These tests represent a huge opportunity for a practice to give pet owners and pets the best care possible. Appropriate diagnostic tools are critical for identifying the presence and cause of disease and for determining an appropriate course of treatment for your patients. Accurate diagnostics can help eliminate wasted treatments, target therapy to those patients that need it and allow therapy to start sooner. But before you buy, consider these factors.
After-purchase support. Some capital equipment companies sell lab diagnostics with support and some don’t. “You might get a quote for $50,000, but when it’s all said and done, it’s going to cost $60,000 because they never told you it’s going to cost $10,000 for a seven-year service agreement,” says Paul Camilo, CVPM, of Veterinary Consultation Services. Make sure you know exactly what you’re getting.
Contract terms. Some companies will place their equipment in your practice for free if you agree to a service commitment for a certain length of time — often five to seven years. Camilo likes to negotiate these contracts in terms of dollar amount utilized, not time. “That way the clinics that do well and outperform their agreement have the option of renegotiating early,” he says. “It’s an important thing that most people overlook but you can negotiate it in there.”
Outright purchase or lease options. Andreas Pahl, MBA, CVPM, of Burzenski and Co. Veterinary Financial Advisors (veterinaryfinancialadvisors.com), would rather have his clients avoid the service contract altogether if it means buying reagents and other supplies only from the manufacturer. “You wouldn’t buy a car and agree to only buy gas from the Ford dealer,” he says.
Pahl suggests buying a piece of equipment outright, even if it’s on a separate lease, then purchasing reagents as you need them from your favorite distributor. You will probably come out ahead over the five or six years the contract term would have covered. “Nothing is really free,” he says.
Integration with software. “Everyone claims they integrate, but everyone has a different definition of what integration looks like,” Pahl says. “Some claim that a PDF upload into the medical record is good integration.” Look for greater sophistication, such as lab values that populate into the medical record fields so that the charges are calculated when the sample is run.
Finally, before you purchase and promote diagnostics, determine your goals for adding tests. Once you’ve established these, you’re ready to improve patient care and achieve financial success.