Wellness Plans: An interview with Dr. Karen Felsted

Q: Why are wellness plans important for clients and practices?

A: I think they’re important to both pet owners and veterinary practices, for different reasons.

For pet owners, the single biggest reason is that wellness plans spread the cost of veterinary care over 12 months. For example, it’s hard for the average pet owner to visit their vet and write a $600 check. However, $50 a month over the year is a lot easier to budget for and more financially manageable. Also, we now live in a subscription economy. That’s how our phone and internet plans, mortgages, car loans and gym memberships work. We’re now used to the ease of just paying over time on our card.

For staff in a veterinary practice, the key benefit is being able to provide better care for patients. Wellness plans help keep pet owners on track with compliance because they think of it in terms of what their vet needs to do for their pet over the course of the year — not just when an emergency happens.

Q: Do wellness plans bond clients to practices?

A: It makes sense that they do, but it’s a bit too soon to really know how much. What is clear is that there is a lot of potential for wellness plans to bond clients to practices. At this point, there’s quite a small percentage of practices that offer wellness plans, but I think we could reach a point in the future where clients choose a clinic because they do. I see this giving the practices that offer wellness plans a competitive advantage.

Q: Does automated communication help strengthen wellness plans offerings?

A: I agree that scheduling repeat visits and reminding clients through automated communication helps support wellness plans on the administrative side of the practice. For example, being able to send reminders out to clients and say “Hey, you haven’t used your second exam,” or “You haven’t had your pet’s blood work done” help build higher levels of customer satisfaction. The relationship is strengthened when clients come in as a result, as you’re seeing them more often.

Q: Do wellness plans improve compliance?

A: Yes, they definitely build compliance for the services that are offered as part of the wellness plan. That is one of the beauties of them — practices can focus on the clinical aspects they feel are most important.

Q: How are things for the veterinary industry generally and how can wellness plans contribute?

A: “How is the veterinary industry doing?” is a tough question to answer right now since we are in the middle of the COVID-19 pandemic and there is so much uncertainty! Some practices have seen a dramatic fall in revenue, while others are thriving.

Practices have been feeling pushback from clients over the cost of veterinary care for some time, even during the recent strong economic period, but this coronavirus situation makes it worse. Wellness plans are a good way for clients to manage affordability of pet care and treatment at all times, but especially when there are economic challenges. Being able to pay over time, instead of having to make a large one-time payment, is a huge benefit when times are tough.

Q: When did the push towards preventive care and wellness plans begin?

A: It started with Banfield Pet Hospital, which has since grown to become one of the largest corporate veterinary groups with over 1,000 hospitals. They offered wellness plans in 1988 to provide affordable preventive care to owners. It’s since spread to other veterinary groups and independent practices. The 2011 Bayer veterinary care usage study showed that pet owners were definitely noticing the size and frequency of price increases at their veterinary clinic and wanted more predictability in the cost of care. This helped push wellness plans and it was a hot topic for a while. However, when the economy strengthened practices focused on other things, to some extent because veterinarians found them hard to implement. However, there has definitely been a renaissance over the past year.

Q: Were wellness plans initially a commercially driven exercise?

A: I think that was a part of it. They were initially seen as a way to address the cost concerns of pet owners. However, it’s moved on from there and the primary reason practices now offer them is to provide better long-term care for patients which, of course, also drives the financial health of the practice.

Q: Do you think every veterinary practice should consider wellness plans?

A: Wellness plans are not a quick-fix marketing ploy. However, I am a big fan of them and think every practice should have a good look at how they’re doing and how profitable they are. For example, does the practice have a high level of profitability and are they seeing strong growth in new clients, revenues and number of transactions? Wellness plans are a good way to grow a practice and increase profitability. They may not be for every practice, depending on their client base, but they should at least consider introducing them.

Q: What’s your message to practices about wellness plans?

A: Wellness plans have become more sophisticated and customizable these days. Every practice can adjust them to fit their client base and culture, so there’s every reason to have a good look at wellness plans and see if they are a good fit for your practice.

About the author

Dr. Felsted is a CPA and veterinarian and has spent the last 20 years working as a financial and operational consultant to veterinary practices and the animal health industry. She is also a past CEO of the National Commission on Veterinary Economic Issues. She is a well-known speaker and author both nationally and internationally, a member of the VetPartners Board of Directors and active in other organizations as well.