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HOW VETERINARIANS ARE PAID
Veterinarians that are partners or sole owners of a veterinary clinic generally pay themselves from whatever profits their clinic makes after all their expenses have been taken care of. Many veterinarians, especially those early on in their careers, however are not in this situation. They instead are associate veterinarians working for someone else. Associate veterinarians usually sign a contract with the clinic they work at. Those contract include regular performance reviews to ensure that the arrangement is working for both parties. Associates may be paid either an annual straight salary, a combination of a salary plus a commission, or they may be paid on a straight commission basis. In the USA, almost 75% of veterinarians working as associates are paid on some form of commission basis. The 2016 figures from Canada revealed that around 15% of veterinary associates were being paid in this manner, the majority of whom work as specialists at corporate referral clinics. There are pros and cons to both a straight salary or commission based payments. In 2016, the figures from Canada revealed veterinarians paid on commission earned 14% more on an annual basis compared to those paid on salary alone. When it comes to the associate veterinarians who work at the specialty referral centres in Canada, the vast majority work for VCA.
If an associate is paid a straight salary, they have certainty as to what their take home pay will be. If, however they are paid solely on commission or on what is also called a production basis, they have no guaranteed income and so no sure financial safety net. Any source of income generated however by the associate veterinarian for the clinic while seeing a client is used to calculate their commission or “production.” Hence, the final number on the owner’s bill, which covers the cost for all laboratory tests, x-rays, CT scans, surgical procedures, biopsies and/or medications supplied to the pet during the visit forms the basis on which that associate’s commission will be paid.
Some will say that this method of commission based pay is healthy as it offers an associate an incentive to work hard. Who could seemingly argue with that? However, the method by which a veterinarian gets paid doesn't get more clients in the door of a veterinary clinic, so the question I am forced to ask is, how are associates being paid on commission generating 14% more income than their peers being paid by salary? Are they seeing more clients per shift and therefore spending less time with each animal they see or are they generating more income per client visit. In that last scenario, how are they managing to do that?
Salaried veterinarians have no real personal financial incentive to order tests or procedures that are of borderline or little benefit to an owner. Veterinarians being paid on commission on the other hand clearly do and studies from the world of human medicine have long ago established that switching physicians from a salaried to a commission based method of payment increased the cost to the system overall. The September 2016 article in the Canadian Veterinary Journal suggests that the same increased costs occurs in the world of veterinary medicine. Pet owners therefore need to ask veterinary clinics how they are paying their veterinarians and they should not be denied an honest answer to that question.