A client who can’t foot the bill need not leave you out of pocket too, if you implement these simple financial solutions.
Concerns about clients’ finances are not the kind of distraction you need when you have a waiting room full of anxious animals and owners. If a client presents with financial difficulties there are some tried and tested options you can recommend they pursue.
Garry Edgar, of the Australian Veterinary Association’s (AVA) Practice Management group, says that in his experience people tend to mentally exaggerate the costs of a procedure. Quoting up front can be a good way forward. The AVA website (www.ava.com.au) has excellent HR advice and resources.
Garry says that third party finance is probably the best option to recommend, as the decision whether or not to approve is then taken out of your hands.
“So whether that client qualifies or not isn’t a judgement you’re making—it’s being made by the financier. You’re not the bad guy saying no and they’ve probably got more experience than you anyway. Generally, if the client qualifies, the bill is paid there and then electronically.”
Vet Pay and GE both carry payment solutions that can be applied for online and processed quickly. Often the turnaround is less than 24 hours, so these payments are popular with emergency services.
A less secure approach is to offer in-house lines of credit. Traditionally these are tools offered by financial institutions to cover overdrafts or provide funds for which interest is charged only on money used. However Garry recommends that vets, who are not usually financial experts, should be wary of this option. If you’re extending a line of credit to good customers, you’re basically letting them run up a bill, and to maintain good will, you might not charge interest.
“You’ve got to be really careful you’re working with what’s legal. Working out interest rates on monies used is a particularly delicate situation. You need to get your facts right.”
If you do elect to extend a line of credit, there are fairly simple guidelines to follow.
“Most clinics tend to have a rough and ready sort of approach. They’ll often ask clients to sign a stat dec indicating what they’re paying for and how they’re going to pay it off, so there’s a lot of good will on the vet’s side. Mostly you’ll find it’s an existing client who has a good track record with you and there’ll be a list of red flags for people who don’t, because they’re the same people who would default on those things as a rule.”
Quoting up front is vital. This will have the effect of dawning reality on prospective clients and will often help you to make the decision as to whether a line of credit should be extended.
“If you go through the ins and outs of the procedure and offer a quote, and then they say they can’t afford to pay the bill, well there’s your first red flag.”
John Campbell of the Keen Street Clinic in Lismore agrees.
“We used to extend credit quite liberally but we got burnt too many times so now we have a policy with Vet Pay. Costs are discussed up front and, if anyone has an issue with them, we recommend they go with Vet Pay.”
In Garry Edgar’s view, pet insurance is the next best option. He says it’s up to the client to make an informed choice on the most suitable policy.
“It’s impossible for the vet to make a judgement on what’s the right policy, so the client needs to decide what’s their risk, what’s their exposure, do they need accident insurance, do they need illness? Do they need a breed-specific policy because they’ve got a Labrador and therefore some things aren’t covered?”
There are 57 policies on the market, so it’s a process of elimination for the client. Again, there are legal guidelines on the AVA website if you wish to give advice.
Basic policies tend to cover non-life threatening injuries, lab tests, hospitalization, radiology and drugs, while the premium fees cover more exotic surgeries and illnesses. For pre-existing conditions, pregnancies and other elective procedures, clients who are out of pocket might have to be referred back to third-party finance.
In rural areas, insurance can create specific problems, going on John Campbell’s experience.
“A lot of the feedback I get is that there are too many hoops for the client to jump through to be reimbursed. Always get them to read the fine print too because in this area they won’t cover, for example, paralysis ticks.
“When a pet gets crook it hasn’t been budgeted for like a holiday. It’s often a situation where the client gets home for the weekend, the dog’s got tick paralysis and its going to cost $1000. So, in that case, we try to be as fair as possible.”
Above all, simplify matters by quoting up front. Gary Edgar cites a recent experience.
“We had a woman come in with three dogs and a bunch of problems. None were life threatening, so we gave her a ballpark figure, so she could go home and think about it. That’s important because if we’d just admitted the dogs, done the work and then found out later that she couldn’t pay, we’d have looked really stupid.”
Otherwise, if people simply need a little time to pay, taking a ‘lean’ on the animal can be a simple and effective option.
“If it’s simply a case of it’s the weekend and the client can’t get to the bank, you might board the animal without charge over the weekend and, come Monday, they can go to the bank and sort out their finances.”