Low-cost benefits, big-time payoffs
It's not easy to build a top-notch team. In fact, it takes many practice owners years to find—and keep—skillful team members they can trust. With one little change to your practice's benefits policy, you could wipe out all the team-building you've accomplished. Think about it. Benefit cuts make for unhappy employees, and unhappy employees leave. When they do, it costs you roughly a team member's yearly salary to replace each one. That's not an attractive expense even during a banner year.
Of course, your loyal team members will stay on board regardless. But the reduced benefits will undoubtedly lower their morale. As a result, you may still hurt your bottom line even though you've reduced some expenses. Unmotivated, underpaid employees simply aren't as productive as those who feel taken care of and valued. If you cut benefits, you risk cutting revenue in the long run.So what's the answer to this perpetual conundrum? Offer benefits that cost you little to nothing—they may even save you some money—and keep your profit-making team. Here are three options.
1. Divvy out pet policies
Veterinary team members often swoon over the idea of getting reduced-price care for their pets. But the amount this benefit actually costs your practice might make you faint—and not in a good way.
Your practice pays fixed inventory costs and you lose out on revenue the doctors might have generated during the time they were treating employees' pets. There's also the IRS ruling stating that any employee discount of more than 20 percent needs to be counted as income on that employee's W-2 form. That's an administrative hassle for you and a tax liability for team members. And, of course, if you "forget" this rule and the IRS audits you, your costs will be much higher.
To continue offering this popular perk without hurting your practice, consider providing pet insurance. Many owners have opted to purchase a policy for one pet per team member. This staff benefit ends up benefiting the practice. First, you'll be reimbursed for the care you offer. Second, your team members will become more familiar with pet insurance, making them more likely to promote it to clients. Clients with pet insurance are more apt to comply with recommendations, so you'll be able to better care for their pets and generate revenue. Third, there's no worries if the IRS comes knocking.
The pluses don't stop there. Several pet insurance companies offer discounts on policies purchased by veterinarians or team members, so you'll be able to get a bargain price. What's more, some companies will send you reconciliation statements at the end of the year listing what you paid for the policies and what they paid you in reimbursements. This allows you to track exactly what the benefit costs—or earns. Earns? That's right, providing pet insurance policies as a staff benefit might actually net you a profit. Without pet insurance, if you gave your employees a 50 percent discount, you were losing 50 percent of your revenue. With pet insurance, you lose no revenue and the reimbursements might just outweigh the price you paid for the policies.
To maximize this benefit, consider offering additional policies as a longevity bonus. For example, you might provide insurance for two or three of a team member's pets if he or she has been with you for four years.