Dr. David King recalls a day in vet school in Texas, in the late ’80s, when it hit him how little he knew about the business side of his chosen profession. It was during a large-animal rotation as his group bandaged a horse’s leg. More candid about money matters than most at the time, the teacher asked, “How much would y’all charge for that?”
The students guessed: $10? $15? The teacher shook his head and answered, “That might cover the first-aid materials alone.”
“I didn’t know a thing,” King says. “We never saw any of the business side of it.”
These days, King regularly meets veterinarians dealing with the consequences of too little business knowledge. His own veterinary work, still a passion, is a sideline to his job with Simmons & Associates, a national firm that helps veterinarians buy and sell practices. Part of the job is appraisal, often for professionals wishing to sell their practices as they near retirement.
All too often, these vets have structured their businesses in ways that hurt their value. For example, many have failed to choose real estate wisely, have priced services too low to cover costs, and have paid themselves higher salaries instead of recording higher profits—unaware that low profits translates to a low selling price.
“The sad thing is that they’re getting to a point where they’re about to sell, and they have no idea what the value of their practice will be based on,” King says. “They may have secured themselves a job all these years by operating that way, but in the end, that’s it. Their practice has no value.”
Alumni struggles, as well as rising overall awareness of the challenges of being a veterinarian in a persistently sluggish economy, are driving vet schools and other groups to boost the emphasis on business education. The need has long been acknowledged, but determination to address it has grown in recent years. Reasons include some alarming statistics reported by the American Veterinary Medical Association, such as the fact that veterinary school students are graduating with an average of roughly $134,000 in student debt. And, for more than half of newly graduated veterinarians who land full-time jobs, starting salaries are under $40,000.
A milestone came in 2011, when the North American Veterinary Medical Education Consortium, or NAVMEC, issued a report recommending priorities for action in addressing economic challenges in the profession. Business education was a strong theme.
Still, questions of how to add or bolster business education are being tackled school by school. Cuts to state funding compound the challenge, as many administrators and professors bristle at the idea of pulling scarce resources, as well as students’ time and attention, away from already-rigorous lineups of courses that teach science and technical skills.
Students Take a Lead Role
Most veterinary schools require at least one course that covers business issues, and many offer multiple business-focused electives. A few have gone so far as to construct dual-degree programs in which students earn MBAs along with their DVMs. Other options come via the student-led Veterinary Business Management Association, which has chapters at all 28 accredited vet schools in the U.S.
When Kristen Britton became aware of the VBMA during her first year at Washington State University’s vet school, she jumped at the chance to be involved. She had worked for a veterinary practice before enrolling, and emphatic advice from colleagues was still ringing in her ears.
“All they wanted to tell me was that even though you may not feel very confident initially in your medical skills, that will come with time. But no one is going to teach you the business skills you need unless you go seek [them] yourself.”
VBMA chapters seek business education by booking a steady stream of expert speakers. In the past, members have attended for enrichment alone. Last fall, however, the organization rolled out a certificate program that offers proof of participation that members can put on their résumés. The program emphasizes five educational categories: finance, practice ownership, business operations and management, employee management and leadership, and career path and preparation. Members who attend 15 hours of programming get a silver certificate, and members who attend 30 hours get a gold certificate.
Essential or Elective
It would be hard to find anyone in the veterinary community who isn’t a fan of the VBMA. The organization also has an impressive list of corporate sponsors. But some business-education advocates worry about the risk of relying so much on a student group. As students come and go, VBMA activity on any given campus can rise or fall in quantity and quality. And while it’s impressive that the VBMA counts roughly a third of current U.S. veterinary students as members, what about the two-thirds who are not members? Such advocates also worry that if business courses are electives, students will see business education as optional.
Dr. Richard DeBowes, associate dean for veterinary development and external relations at Washington State, favors requiring all students to take the one class WSU offers on practice management, which he teaches. He notes that 80 to 85 percent of WSU vet students go to work in small businesses or private practice. Other leaders’ views have prevailed, however, and that class remains an elective, which roughly 30 percent of students choose to take.
What is required are two semesters of course work in clinical communication, which many people regard as a key business skill. Employer critiques of externs and job applicants often cite deficiencies in this area as untenable, even when medical knowledge and skills are excellent.
WSU teaches clinical communication in a particularly advanced way, using a lab that has 10 pairs of mock exam rooms and observation rooms with one-way windows and video cameras. In the mock exam rooms, students encounter actors who play the roles of clients to discuss real cases. They then review video recordings of the exchanges to get feedback from “clients” and receive critiques from peers. The goal is to ensure all communication is accurate, supportive and efficient, which can be difficult as clients grapple with emotions about an animal, difficult decisions regarding treatment and issues of cost.
“I’d say that clinical communication is more important than any other clinical skill we have,” DeBowes says. “Because if you can’t connect with [clients], they are not going to be interested in what you think, they are not going to let you run any tests … they are going to be out of there, and they’re not coming back.”
Collaboration and Creativity
At Iowa State University’s veterinary school, Associate Dean Claire Andreason also favors requiring business education, but isn’t consumed with relabeling electives as mandatory. She believes the future lies in more creative, collaborative solutions.
For example, in much the same way that elementary and secondary school administrators strive to make writing a requirement in all classes, Andreason says Iowa State is working to teach business literacy across the curriculum.
“Our faculty really are quite aware that it’s quite important in every course to talk about the practical implications of what students are learning, such as costs, benefits, client expectations and efficiencies,” Andreason says. “It’s also something that the students themselves recognize and ask for.”
Still, there is a place for dedicated business classes, and it’s difficult for veterinary students to find time for them. To make it easier, Iowa State offers courses at nontraditional times and in nontraditional formats. For example, a class on practice management is usually taught during the weekend. And the vet school and business school have worked together to ensure that business classes required for a minor in veterinary entrepreneurship are offered in the summer. In addition, the business school is converting some business course work into online modules that veterinary students can work on whenever they can get to a computer.
Signs of Progress
As a veterinarian and a practice appraiser, King takes encouragement from the growing emphasis on business education. He also finds satisfaction in knowing he has helped to contribute to it by working with the Simmons Educational Fund.
The fund is a nonprofit that Simmons & Associates founded in 2002 to promote business education in the veterinary community. Its highest-profile program is a scholarship contest that offers $3,000 to one student at each veterinary school who demonstrates outstanding business aptitude. Contestants submit papers on how they would solve a common veterinary business problem. School winners go on to compete for a $15,000 national prize. King is one of the preliminary judges.
This year’s national winner, Elisha Adkins of Oregon State University, researched and presented the pros and cons of purchasing digital radiography equipment for a specific practice. Her 16-page answer included feature comparisons, detailed charts showing how the purchase would affect net income year by year over 10 years, and an explanation of how an expiring tax benefit makes it better to buy now instead of later. She also threw in a slide show for use in explaining procedural changes to staff members and talking points for use with clients.
“It’s improving,” King says. “There’s still room for improvement, but people are starting to see that without good business, you can’t have good medicine.”
University Programs At A Glance
Here is a sampling of what some veterinary schools offer to equip students with business skills.
Iowa State University
Veterinary students get a required dose of business education as part of a course in veterinary law and ethics that includes lessons on contract negotiations and budgeting. Students can take electives in veterinary entrepreneurship and practice management within the vet school. They also have the option of pursuing a minor in veterinary entrepreneurship that requires classes in the university’s business school, or they can go all the way and seek an MBA to go with their DVM through a five-year dual degree program.
Louisiana State University
Third-year students must take one course on practice management and another on ethics and law. LSU also offers an elective on advanced practice management that delves deeper into such subjects as marketing and pricing structures. In another elective, called Practice Evaluation, students visit practices, examine particular challenges they face, and craft business and marketing plans with 10 to 12 recommendations.
Michigan State University
First-year veterinary students must take a course in career development and practice management. The course briefly covers a wide array of topics, such as how to compose a résumé, conduct a job search and craft a budget. Electives on practice ownership and the legal aspects of veterinary medicine explore such topics as buying and launching a practice, contractual issues and legal liability. Students in a final elective, a three-week clerkship, visit area veterinary practices and assess how they handle business challenges.
Oklahoma State University
Students may take an elective on practice management within the veterinary school. They may also opt to pursue an MBA in addition to a DVM through a dual degree program. The university’s business school has modified business courses for the MBA to be appropriate for students who haven’t studied business before. The veterinary school allows dual-degree candidates to complete their year of MBA requirements before, during or after their four years of veterinary studies.
University of Pennsylvania
The six-year dual MBA/DVM program at Penn looks beyond practice management, aiming to prime veterinary students for global leadership. The business side of the program focuses on the economic aspects of health care for food animals and teaches students to cultivate alliances, communicate persuasively and influence policies on issues, such as environmental stewardship and public health.
Washington State University
This school is strong in clinical communication. Veterinary students must study the subject for two semesters. Courses require students to interact with actors playing the roles of clients in common scenarios, then review recordings of their performances. Students also receive critiques and feedback from the “clients.”