Good fees, bad fees

Good fees, bad fees

Not all fees are created equal—as any client will tell you. To avoid invoices that aggravate, take a look at the service codes below to see which charges you should keep, toss, or modify.
Nov 01, 2009

In my opinion, there's a fine line between overitemization and underitemization on your invoices. Break out every IV set and suture pack as a separate line item—like a human hospital does—and clients will feel they're being nickel-and-dimed. Hand over an invoice that simply reads, "For services rendered: $825," and you're again facing a fuming client. But you don't want to—nor can you afford to—fail to charge for services rendered and costs incurred. The solution is to pass your fees on to clients in a palatable way, whether that means assigning a service its own line item or packaging it under another service code. To help reach that happy balance, here are my recommendations for revising your fee schedule.


I've been in a lot of veterinary hospitals and seen a lot of fee schedules, and these are the service codes that are most often missing—which means the practice is missing out on revenue.

In-hospital doctor examination fee

Let's take a patient that's been admitted to your hospital for vomiting and diarrhea. Initially, you would have seen the patient during an outpatient office or emergency visit. And you would have charged an examination fee. But what services would you bill for on the patient's second day in your hospital? You'd probably charge for hospitalization, fluids, medications, and so on. But would you bill the client for the multiple times you examined the patient?

If you think this charge is included in your hospitalization fee, try this exercise. Subtract what you charge for a comprehensive physical exam from your hospitalization fee. What's left is what you're truly receiving for hospitalization. Make this fee comparable to that of your medical progress exam. After all, that's what you're doing: a recheck. The only difference is that the patient is still in your hospital.

Operating room usage fee

The operating room is probably the most expensive room in your hospital, and it's the least used. So where are you getting the money to keep it open, not to mention the materials you use during procedures? You may think it's included in your surgeon's fee, but I bet it's not. If you charge $4 to $8 a minute for your surgery time, and you're honest about the time you actually spend doing surgery, the charge for the operating room costs is not in that surgeon's fee. And it shouldn't be. Break out this fee and charge, at a minimum, $35 to $45. This would cover the operating room use plus basic materials—cap, mask, gloves, one sutures pack, one scalpel blade, and so on. It would not include additional materials such as pins, plates, screws, or surgical staples.


Make invoices client-friendly
I won't argue that certain fees don't represent true costs to the practice and, thus, you shouldn't charge them. What I will debate is how you incorporate them into your fee schedule.