A key component to achieving technical staff utilization is the careful and close management of labor costs and labor utilization ratios. Practices can analyze labor costs in multiple ways, including analyzing revenue generated per staff member and labor costs as a percentage of revenue.
Additionally, practices can assess staff utilization by considering ratios such as the number of support staff to doctors, the number of transactions per staff member hour, and the number of technician appointments as a percentage of total appointments.
In the Resource sections, a spreadsheet is available that allows you to input the practice’s revenue, labor cost, and labor utilization data (all located on the first tab – ‘Input’), allowing easy visualization of how your practice is performing compared to industry standards (tabs 2-6). Aside from being able to input your practice, the remainder of the workbook is protected to maintain the integrity of the formulas.
This tool examines labor costs and labor utilization using the following ratios:
Revenue analysis:
Revenue per full-time-equivalent doctor
Revenue per full-time-equivalent support staff member
Staff labor costs:
Staff salaries and wages as a percentage of total revenue
Staff benefit costs as a percentage of total revenue
Total staff labor costs as a percentage of total revenue
Staff to DVM Ratios:
Technical staff to DVM ratio
Support staff to DVM ratio
Transactions:
Staff hours per transaction
Transactions per DVM hour
Transactions per FTE DVM
Tech Appointments:
Tech appointments as a percentage of total appointments
What Your Numbers Mean (and what to do about it):
Revenue
Revenue per FTE DVM (Full Time Equivalent is considered 40 hours per week).
Column C, row 6 breaks down YOUR average revenue per FTE DVM.
Column D provides a minimal average, while column E provides a maximal average based on benchmark data.
Is your Revenue per FTE DVM higher than Max?
GREAT JOB! Keep doing what you are doing, AND, identify what that is. You want to ensure you can replicate this process (as long as your DVMs are feeling balanced).
Now, take a look at the transactions tab. Are your DVMs exceeding the industry average on transactions per FTE DVM? – You might want to look at the caseload if they are. If they are underperforming, seek to understand why and search for opportunities to help them improve (DVM Mentorship, Chapter 5).
Is your Revenue per FTE DVM lower than Max?
If they are underperforming, seek to understand why and search for opportunities to help them improve (DVM Mentorship, Chapter 5).
Revenue per FTE Support Member: same as above, FTE is 40 hours per week, and the average minimal and maximal dollars are provided.
The recommendations provided above for DVMs can be applied to the support staff.
Labor Cost
Labor cost as a percent of revenue is a very important metric.
Column C, row 6 breaks down YOUR percent (non-DVM only)
Column D provides a minimal average, while column E provides a maximal average based on benchmark data.
Revenue per FTE Support Member: same as above, FTE is 40 hours per week, and the average minimal and maximal dollars are provided.
Is your % higher than Max?
You may have high-paid staff members or be overstaffed. Overstaffing often decreases efficiency and must be evaluated. If you have an average number of staff members (see the staff tab) but high-paid team members, revenue generators must be evaluated to ensure that the compensation of the staff is being covered by the revenue produced.
Is your % lower than Max?
You may have low-paid staff or be understaffed. Understaffing causes burnout and prevents revenue generation. Check the staff tab to see if you are over- or understaffed.
Staff
Technical staff are your CrVTs; Assistants and CSRs are the support staff.
Many practices will find that they may have a minimum of technical staff for veterinarians while the support staff is much higher. This is often the result of underutilizing credential technicians and having difficulty recruiting credential technicians for the practice.
If your practice has trouble recruiting credentialed veterinary technicians, consider growing them from within. See topic 5 and consider creative employee benefits that will transform your support staff into technical staff.
Many studies indicate credential technicians generate $150,000-$200,000 additional revenue per FTE veterinarian. It pays off to invest in your team with education and utilize them to their maximal skill capacity.
A word of caution: Review Chapter 11 to identify how your scope of practice impacts utilization within your team. Be sure to separate the duties of a CrVT from those of support staff. Allowing support staff to complete the same duties as a CrVT devalues their role and entices them to seek employment elsewhere, where duties are separated.
Transactions
The transaction tab is extremely useful for identifying efficiency opportunities. Based on the data presented, there may be opportunities to increase the number of transactions per hour. The more efficient the team is, the more clients can be seen without feeling overworked. IT efficiencies and infrastructure are critical to helping the team be as efficient as possible. Utilize this tab to identify how you can get your practice to the higher end of benchmarks, ensuring your patients are getting the care they need.
Tech Appointments
The technician appointment tab is probably the most beneficial tab of all on this spreadsheet. Most practices are at the lower end of utilizing their CrVTs for appointments and revenue generation. There are limitations that may prevent a practice from being able to achieve the maximum number of appointments, such as:
Lower-skilled or recent CrVT graduates
Difficulty attracting and retaining CrVTs
Lack of trust (by DVMs) in utilizing the technicians to their highest potential
Like a grab the new centers to generate technician appointment
The great news is that these limitations are actually opportunities, and the AAHA Technician Utilization Guidelines can help overcome them.
Review Chapter 1, pull the gap analysis and SMART goal sheets and start creating your plans to develop technician-level appointments that will generate revenue, utilize the team better, and build trust with the doctors
