In previous CPA firm, out of six-hundred physician and dental entity clients in New England, only one was found to be using production-based compensation methods. All others were paid a combination of salary and performance incentives.
But, NCVEI reports that 47% of it’s veterinary survey respondents were paid based on a percentage of production… (that’s because we all love a formula!!!)
Elevate all employees in client’s eyes to “professionals”-is associate cemented to veterinarians?
Use compensation as a communications tool
Teach employees about business management-educate to involve them, not to intimidate them. “Open-Book Management” does not have to “give away the store”
Recognize and promote everyone’s success
Does everybody remember Jordan’s Furniture taking 3 full Boeing 727’s of employees to Bermuda for the day?
You pay veterinarians a salary??? Consider termination of contract Consider termination of contract Consider salary cut and/or time reduction Consider salary cut and/or time reduction <=85% Consider termination of contract Consider salary cut and/or time reduction Consider salary cut and/or time reduction Rev up contingency plan 85-89% Consider salary cut and/or time reduction Consider salary cut and/or time reduction Implement contingency plan Rev up contingency plan 90-94% Consider salary cut and/or clinic time reduction Implement contingency plan No action No action 95-99% Pay incentive and consider pay increase Consider pay increase No action No action >=100% Q4 Q3 Q2 QI Business Plan % Goals
Medical errors, according to the Institute of Medicine, cause an estimated 44,000-98,000 deaths a year in the United States.
According to Kaiser Permanente CEO Robert Pearl, MD, it is likely that an avoidable medical error happens at least once every day in Silicon Valley.
The Institute of Medicine and Institute for Healthcare Improvement have called for all hospitals and doctors to report all medical errors as well as “ near misses ”, events that potentially could have caused harm or death.
The top 47 “wired” hospitals in the U.S. are also tops in medical care based on:
ability to save lives
reputation among specialists, and
a commitment to nursing excellence.
The survey conducted by Hospitals & Health Networks did not prove that technology actually causes better patient outcomes, but it shows that there is a strong connection. There was a 7.2% lower mortality rate on average at the “wired” hospitals.
30-44% of patient services on-line (review test results, prescription renewal, appointment scheduling)
41-59% use of wired tools by doctors (clinical guidelines/protocols, lab/radiology/pharmacy orders)
34-77% use electronic surveillance as a backup alert system (in CCU, step-down and surgery/medicine areas)
St. Luke’s Medical Center in Milwaukee uses off-site remote safety monitoring with intense-focus cameras, vital sign monitors, and EMR access (meds given w/times, notes, lab results, X-rays, CT, MRI, ultrasounds)
In the physician world, structuring the joint venture requires compliance with anti-kickback statutes, Stark laws, Medicare rules and regulations and laws governing tax-exempt entities (as hospitals are generally not taxed as 501(c)(3) charities).
Veterinary practices have much less stringent regulatory compliance imposed on them.
Will veterinary medicine experience the same early transitions?
According to Veterinary Economics, 62% of states allow non-veterinarian ownership of veterinary practices, with most non-ownership states allowing exceptions in the case of DVM estate and corporate ownership.
Non-DVMs who have been integrally committed to the growth and continued success of a practice should be allowed ownership.
Donative transfers (to family/key employees) of the veterinary practice may be facilitated by the creation of a class of non-voting common stock, thus separating voting control from equity ownership. Positive attributes of the transfers may be:
The practice owner may be more agreeable because control is not relinquished
Valuation discounts may be applied for the lack of voting power
S Corporation status will not be terminated because of voting and non-voting share classes.
The practice owner’s voting shares can be exchanged upon exit for the non-voting shares.
Harvard Medical School's major Boston teaching hospitals are adopting detailed procedures for physicians to openly acknowledge medical errors and other bad results to their patients, and provide for training in apologizing.
The Joint Commission on Accreditation of Healthcare Organizations (JCAHO) requires hospital caregivers to tell patients about the most serious of these situations, but doesn't go beyond that.
Emergence of veterinary malpractice lawsuits is driven not just by Americans' deep emotional bonds with their pets but also by advances in veterinary medicine that have raised expectations that pets will live longer.
Someday, veterinary judgments may be awarded on par with human court cases.
Beyond malpractice insurance, asset protection (not tax evasion) strategies may provide some relief to entities experiencing financial threats.
Set up a Colorado LLC to own practice land and a Nevada LLC to own the business assets. The ownership of the LLC and the land trust are transferred to a Nevada APT trust. So now you have the LLC and the land trust, owned by the Nevada trust, which is owned by the Colorado living trust (s).
Place each property in it’s own separate Virginia land trust. Then form a Wyoming LLC which will now own the beneficial interests of the Virginia land trusts. This LLC is inserted between the land trusts and the Nevada AP trust. The owner of the LLC is the Nevada asset protection trust. That’s all for this step.
Next, you will form a C corporation in South Dakota. The owner is either a Nevada asset protection trust or the living trust of one of the spouses. Treasury regulations require that the other spouse is not a director, officer, shareholder, or employee. The corporation could provide services to the Colorado LLC, which owns the business, as an independent contractor. This corporation could also manage the rental property for the Wyoming LLC and receive compensation for doing so.
Physicians and dentists have traditionally had poor showings in offering sophisticated retirement plans to employees due to the impact on their own levels of mandatory contribution to employee accounts.
SEP and SIMPLE (Savings Incentive Match Plan for Employees of Small Employers Plans) IRA Plans have seen limited utilization.
But 401(k) plans now have much more reasonable fees, on-line control, and greater flexibility
IRS regulations permit companies to over-weight benefits to practice owners and other highly compensated employees.
Uses the process of cross-testing to satisfy the discrimination rules. Cross-testing converts contributions made today into equivalent benefit accrual rates and allow owners increased flexibility in their contributions.
Ideal for practice owners who:
Are older and earn more than most of their employees
Want largest possible share of plan contributions allocated to own accounts, and
Desire contribution flexibility of profit sharing plan.