1: Protecting your people

First and foremost, uncontrolled inventory poses a risk to your staff. I never thought about it much growing up, but the reality is that my Dad was always an arm’s reach from a locker full of narcotics, some of which are deadly by design. And when I say ‘locker’ it’s a little bit of a misnomer. Like most practices, there were certainly times when that lockbox wasn’t locked. 

These days, the risk to staff from controlled substances is much more real. Levels of addiction in America have never been higher, as over 130 people die every single day from opioid related drug overdoses.¹ Some of these deaths occur within the veterinary community, as ready access to these drugs is sometimes a gateway to addiction, or the inverse: addiction becomes the reason to seek employment at an animal hospital. According to a recent survey, 12% of veterinarians are aware of opioid abuse or diversion by a staff member, so this isn’t something that leaders of practices are in the dark about.² Tragically, veterinarians are also 2-4 times as likely as the general population to take their own life.³  The causes for this trend are complicated, but ready access to narcotics provides a means for those who find themselves in a bad place.

Automated dispensing does not solve the opioid & suicide epidemics any more than seat belts solve car accidents. Neither is a 100% solution, but at the same time, not using them is needlessly dangerous. Smart cabinets significantly reduce staff risk in three important ways:

Each drug gets its own double-locked container

Fingerprint access – no keys

The option to require a second person’s fingerprint to access schedule II drugs

We see CUBEX smart cabinets as mandatory elements of a practice-wide effort to improve staff safety. 

2. Protecting Your Practice

Veterinarians are generally shielded from legal consequences of professional wrongdoing because, as heartless as it sounds, pets are considered property, and liability for harming a pet is usually the value of the property – a few thousand dollars at most. Employees, however, are people, and that’s a whole other ballgame. 

In the event of an incident of employee self-harm (overdose or suicide), it’s possible that the little plastic tacklebox or open lockbox that is so commonly used to store loaded syringes ahead of surgeries could be characterized as gross negligence or willful, reckless conduct. If the informal standard operating procedure of the practice (‘this is how we do things here’) provided a reliable, open-access source of narcotics, a wrongful death suit brought by the family of the deceased could potentially carry damages into the millions of dollars. 

With all of that added attention comes an increased risk of involvement from the DEA or state regulatory authorities. Federal fines start at over $14,000 per infraction, and there’s almost never just one. More dangerous, however, is the risk to the registrant’s DEA and medical license. As seen in a recent case in Colorado, a veterinarian can be forced to surrender their means to earn a living as part of a settlement to resolve the mishandling controlled substances.⁴

At our practice, smart drug cabinets show us exactly who had access to which controlled substances and when. There are no keys to be stolen or shared, since it’s a biometric, fingerprint-driven system, and records are kept automatically. When combined with other elements of a narcotics safety program, like cameras, regular background checks, drug testing, and most importantly, a formalized standard operating procedure, proper use of smart drug cabinets can help to protect your practice and your medical license from accusations of negligence and reckless conduct, potentially shielding you from a career-altering lawsuit. 

3. Protecting Your Profit

When I take the legal hat off and put the business management hat on, I look at the top and bottom line of the P&L. Inventory controlled by smart cabinets helps in both places.

Top line – missed revenue, missed profit. 

Think of how easy it is in your practice for the staff to grab medications when asked, then forget to put those charges on the client invoice. It happens daily! Your staff is focused on patient care first, and sometimes things just get busy.

AAHA found that 17% of charges are missed when tracked manually

Industry consultant Mark Opperman looked at 300 practices and saw over $64,000 in missed revenue per doctor, per year, $7,000 per year ($23 per day) from just injectables alone.⁵ 

Service codes are often recommended as a remedy for missed medication charges and we certainly make use of this approach at Pathway, but it still doesn’t create a physical control on the inventory. A smart cabinet that’s integrated with your practice management system will automatically bill the client whenever a medication or other item is dispensed, and closing that loophole has massive implications for your P&L and your balance sheet.

Bottom line – too much cost, at the expense of profit.

When you’re tracking inventory manually, you never really know how much you have, and as a result you carry more than necessary so you don’t run out. Prior to automating our inventory in 2010, we had back stock all over the place. It occupied space that we now use to generate revenue: exams, lab diagnostics and imaging. Inventory automation with smart cabinets allowed us to dramatically reduce the amount of inventory we carry thanks to the fully automated, high-density storage of our CUBEX system. The difference between what that space earned us as storage (essentially nothing) and what it earns us now is tens of thousands of dollars a year.

Smart cabinets are also very effective at reducing waste and overuse. When there’s a big pile of supplies sitting in the open, human nature is to grab more than we need. Putting those items behind a door, with a recorded quantity, makes everyone more conscious of waste, with the added bonus of preventing pilferage. All of this reduces COGS (cost of goods sold). 

COGS is an often quoted but frequently misunderstood part of the P&L. When the time for transition finally comes, your EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) will be center stage because your practice’s sale price will largely be determined by your EBITDA multiplied by a number (your ‘multiple’). That multiplie recently has generally been between five and ten. 

If revenue remains constant, COGS and EBITDA become inversely correlated. Every dollar of COGS reduction usually goes right onto your EBITDA, meaning that $10,000 in reduced annual COGS translates into $50,000-$150,000 in your pocket when the practice is sold. Having just gone through this process, I can say the reduced COGS from CUBEX had a very positive impact on our transition from a financial perspective.  

The last word

Smart inventory cabinets will tbe one of the biggest trends of the 2020s in veterinary hospital management. They’ve been standard of care in human health for decades, and are finally making serious inroads into our industry thanks to improving technology, falling prices, and increased attention from manufacturers. If you’ve considered these in years past but put them on the wish list or the back burner, it may be time to re-consider; it’s a whole new decade and automated inventory is more important and affordable than ever. 

1.   CDC/NCHS, National Vital Statistics System, Mortality. CDC WONDER, Atlanta, GA: US Department of Health and Human Services, CDC; 2018. https://wonder.cdc.gov.

2.   “Prescription Opioid Epidemic: Do Veterinarians Have a Dog in the Fight?” Derek S. Mason, MPH,  et. Al, Am J Public Health. 2018 September; 108(9): 1162–1163

3.   Suicide among veterinarians in the United States from 1979 through 2015, Suzanne E. Tomasi DVM, MPH et al, Full Text Journal of the American Veterinary Medical Association, January 1, 2019, Vol. 254, No. 1, Pages 104-112

4.    https://www.justice.gov/usao-co/pr/veterinarian-pays-226000-and-surrenders-license-resolve-allegations-he-failed-properly

5.   http://veterinarybusiness.dvm360.com/veterinary-practices-miss-64000-fees-each-year

About the Author

My father, Dr. Mark Magazu, founded Saint Francis Veterinary Center back in 1986, so I was raised in a veterinary practice.  We’ve come a long way from that first tiny clinic, ultimately becoming the only three-time Finalist for AAHA Accredited Practice of the Year for North America, winning first place in 2019.  

When I was considering careers, I went my own way and studied economics, public policy, management and the law rather than veterinary medicine – and still I found my way back to the family business . 

Our recent ownership transition to Pathway Vet Alliance has furthered this continued pursuit of innovation designed to increase efficiency and profitability, giving me a unique perspective on how technologies like Cubex are shaping our industry in the wake of increased consolidation and other market trends.  

The post Smart Inventory Cabinets: Trend of the 2020s appeared first on Cubex.

Experiencing an internal or external theft or significant loss of controlled substances from your practice can elicit all types of emotions; from anger, to fear to betrayal. It’s hard to imagine how you can find the time or resources to deal with a controlled substance issue, when you must manage your practice, see patients, perform surgery and deal with HR issues all day long.
Unfortunately, veterinary practices can be easy targets for theft, loss or diversion of controlled substances. A national survey conducted by drugabuse.com in 2015, showed that 22.1% of drug theft is caused by employee pilferage, 6.2% is caused by armed robbery and 2.2% is caused by customer theft. We must remember that drug addiction has no societal or monetary boundaries and can affect any employee or client in your office today.

The Centers for Disease Control and Prevention states “Drug overdose deaths continue to increase in the United States. From 1999 to 2017, more than 700,000 people have died from a drug overdose. Around 68% of the more than 70,200 drug overdose deaths in 2017 involved an opioid. In 2017, the number of overdose deaths involving opioids (including prescription opioids and illegal opioids like heroin and illicitly manufactured fentanyl) was 6 times higher than in 1999. On average, 130 Americans die every day from an opioid overdose”. An article published by AAHA.net in 2013 stated that “over one-half of AAHA members surveyed said they have worked with a veterinary professional that had an addiction problem”.

Unfortunately, just being aware of the problem won’t help you during an actual theft or substantial loss, you must be prepared to take action, as there are various timelines you must meet to stay compliant with state and federal regulations. Therefore, I have complied an actionable checklist that can help you minimize your risk and protect your practice now and in the future.

How Do I Know If It’s A Theft Or A Significant Loss?

A break-in or robbery is easier to recognize but determining if you have experienced a significant loss can be more difficult to identify. The DEA provides us some critical variables to consider when determining if you have experienced a significant loss. Regulations can be found below and in 21 C.F.R. § 1301.74(c).

(1) “The actual quantity of controlled substances lost in relation to the type of business;
(2) The specific controlled substances lost;
(3) Whether the loss of the controlled substances can be associated with access to those controlled substances by specific individuals, or whether the loss can be attributed to unique activities that may take place involving the controlled substances;
(4) A pattern of losses over a specific time period, whether the losses appear to be random, and the results of efforts taken to resolve the losses; and, if known,
(5) Whether the specific controlled substances are likely candidates for diversion;
(6) Local trends and other indicators of the diversion potential of the missing controlled substance”.

The “DEA recognizes that there is no single objective standard that can be applied to all registrants–what constitutes a significant loss for one registrant may be construed as comparatively insignificant for another. The DEA strongly encourages registrants to use additional factors beyond what DEA suggests evaluating whether your loss is significant”.

The DEA goes on to say that the “registrant shall design and operate a system to disclose to the registrant suspicious orders of controlled substances. The registrant shall inform the Field Division Office of the Administration in his area of suspicious orders when discovered by the registrant. Suspicious orders include orders of unusual size, orders deviating substantially from a normal pattern, and orders of unusual frequency.” Therefore, best practice would strongly suggest keeping a very tight ordering & receiving system, accurate closed and open logs, daily current counts and a discrepancy log. To save time, increase security and reduce your risk, I would strongly suggest using an electronic recordkeeping system, such as a CUBEX to help you prevent theft and determine if your drug loss was significant.

How To Report A Theft Or Significant Loss Of Your Controlled Substances

1. Call the police immediately to report the theft or loss. Be sure to have as much detailed information as you can for the police officer and the DEA. This includes date, time, location, suspect ID, substances and amounts lost, witnesses, etc.
2. You have one business day to call your local DEA Field Division Office to report your theft or loss.
3. The registrant must also complete and submit to the local Field Division Office in his or her area, DEA Form 106 regarding the theft or loss. Thefts and significant losses must be reported whether or not the controlled substances are subsequently recovered, or the responsible parties are identified, and action taken against them. Access the DEO Form 106 here.
4. Some states require that at you notify your Veterinary Board of the theft or significant loss. Check to see if you are one of those states.
5. Call your business insurance and/or your professional liability insurance agents to report your loss.
6. Keep a copy of the police report, your DEA Form 106 and any other supporting documents filed, you may need them later.
7. Educate your staff about the theft or loss, as failure to do so may cause unnecessary fear and gossip throughout your hospital. Ask your staff if they have any details about the theft or significant loss. But do not mention any details of the theft to your staff, as you do not want to compromise the integrity of the ongoing investigation. Be sure and let your staff know that you will be pressing charges to the furthest extent of the law when the intruder has been identified. This very important comment will let your staff know that you will not tolerate an internal or external theft or significant loss of any kind.
8. If you suspect that your employee has stolen or caused a significant loss of your controlled substances immediately contact your lawyer, HR consultant and/or your EAP (Employee Assistance Program) professional.
9. If you catch an employee in the act of stealing, causing a significant loss or diverting your controlled substances, call the police immediately and fire that employee as the police officer escorts the employee out the door. Don’t forget to document the entire event in complete detail and place that information in the employee’s file for future use. Additionally, if an employee is fired for egregious and provable reasons, most unemployment offices will not allow that employee receive unemployment benefits.

Quick Prevention Tips

1. Form a Safety Committee

Get your staff involved by forming a safety committee. Have them help you plan and execute a quick and easy safety plan to keep everybody safe. They need to know how to act, and what to do in case an intruder/active shooter enters the building while they are working. An active and well-rehearsed safety plan with identified safe rooms and a fast escape route will make everybody feel much safer.

2. Contact the Police

Most local police departments have education officers that will gladly come out and walk through your building with you to help you understand where your potential areas of risk may be. This is usually at no charge.

3. Use Local Resources

Have that same police officer talk with your staff at your next staff meeting. He/she can describe in detail what they can do to protect themselves if an intruder or active shooter enters your building in the future. From previous experience, this in-service was one of the most well-received staff meetings I held.

4. Perform Background Checks

Perform background checks on all current and future employees.

In Conclusion

These quick and easy prevention tips can give both you and your staff a feeling of well-deserved security in the event of an unfortunate incident in the future.

If you have any further questions, please feel free to contact me at jwoods@cubex.com and/or come back to this website frequently for helpful information, blogs, webinars and live speaking dates in your area.

The post Someone Has Stolen My Controlled Substances! Now What? appeared first on Cubex.

One of the newest members of the CUBEX team is Jan Woods, Professional Services and Regulatory Affairs Manager. With increased compliance regulations and inventory management standards, veterinary practices are being challenged to update processes. Jan’s background and expertise allow her to mentor clinics on compliance best practices.

Jan shares her insights and expertise on managing controlled substance costs in veterinary practices.

As a former veterinary practice co-owner, hospital administrator, public speaker and management consultant, I understand the daily expenses associated with controlled substances —ordering, logging, counting and dispensing—are significant, especially when you factor in the complex regulations and overhead costs. In most veterinary practices, it takes approximately 1.5 hours daily to manage controlled substances using manual processes. Automated dispensing systems save time and increase accuracy, but carry a lease or purchase cost that can be an obstacle for some practices.

However, there are three key ways veterinary practices can manage controlled substance expenses and turn them into a profitable portion of business:

• Add a separate ‘controlled substance handling fee’ or ‘narcotics safety fee’ to the controlled substance codes in your PIMS
• Increase your existing dispensing or administration fees for those codes
• Increase the mark-up on controlled substances to account for additional cost

Controlled Substance Dispensing Fees

Given the risks and administration time required to dispense controlled substances, does it make sense to charge the same fees for a narcotic like fentanyl as an antibiotic like Baytril?

Because most controlled substances are not price shopped and are dispensed directly to your patients, it makes good financial sense to consider the dispensing fees you have in place for these drugs. The increased controlled substance dispensing fee should cover your allocated overhead expenses, including your technician’s time associated with ordering, storing, logging, counting, measuring and reporting. If you have an automated system, it should cover the cost of the lease or subscription, typically $15-$35 per day depending on usage.

Your controlled substance dispensing fees can be increased anywhere between $5.00 to $10.00 per script, dependent upon the dispensing volume and manual labor required. Given increasing scrutiny and tightening regulations, proper narcotics safety has required additional investment. This fee increase coincides with investments in electronic dispensing systems. The opiod crisis is complex and requires a community effort, so tangible security measures are reasonable for managing these powerful medications. Increasing your controlled substance dispensing fees correctly allows you to upgrade equipment and better support your staff for improved patient care.

Not sure you’re hitting are the right measurable numbers for increased profits in your clinic? Use our KPI workbook to make sure you’re hitting performance targets:

Download Workbook

Controlled Substance Administration

If you do not dispense controlled substances to your patients but rather administer them directly while they are in-house, consider adjusting your injection fees and/or oral medication fees to help balance drug costs and technicians’ time.

Current dispensing fees in a typical veterinary clinic cost between $7.00 and $10.00 per legend drug dispensed. Dispensing fees help decrease your expenses and increase your profit margin. Legend drugs can be competitive though, remember to do your homework and check your competition, such as local and online pharmacies, to avoid pricing yourself out of the market.

Questions about new fees or fee increases are likely to arise. Be honest with your clients: as a result of the opioid crisis, veterinary practices are under increased pressure to ensure they accurately log and report on narcotics. Investing in dispensing systems like CUBEX helps your practice automate those tasks and increase patient safety through securely dispensed controlled substances. It’s important to communicate that better patient care is the goal as you implement new regulations and safety measures.

In the following months we will explore more ways to manage your controlled substances. Subscribe to the blog to get the latest updates and posts. If you have regulatory or practice management questions, send it in and I’ll follow up with you directly.

Ask Jan

The post Controlling Your Controlled Substance Costs – Improving Profits in Your Veterinary Practice appeared first on Cubex.

Do you know how much daily revenue your veterinary practice is losing? Do you know how to fill those revenue gaps? The economics of a veterinary practice can be difficult to understand, but a simple metaphor helps us better understand ways to increase profitability. Think of the size of your veterinary practice as a bucket, the hose filling the bucket as revenue, and the ladles removing water from the bucket as costs.

Most practices focus solely on the top of the bucket, but profitability is most improved by taking a closer look at the bottom of the bucket. Every practice has two holes in the bottom of its bucket:

• Missed charges
• Unnecessary purchases (from theft, expiration, waste, etc.)

And one issue that threatens the integrity of the entire bucket:

• Poorly managed controlled substances

How big is the “missed charges” hole in your bucket?

Industry standards estimate that missed charges in a veterinary practice range from 5% to 20%. These percentages are often associated with your pharmacy/supply (30% of revenue) and diagnostics (20% of revenue).

For every million dollars a practice does in revenue, the missed charges hole could be leaking anywhere from $25,000 to $100,000 a year. Looking at inventory alone, this can be anywhere from $15,000 to $60,000 a year in lost profit to the practice. That’s about $50-$200 a day walking out the door.
How big is the “unnecessary purchases” hole in your bucket?

An average veterinary practice’s Cost of Goods Sold (COGS) is about 20%. This amounts to an additional $8,000-$16,000 a year of losses in a practice operating at $1 million in revenue. The daily losses could run between $25-$50. Survey results showed that many practices believe an average of 4%-8% of their lost cost of goods is attributed to theft, expiration, hoarding, and general waste.

How does your practice compare?

Generally, about 5% of a practice’s gross revenue is being lost each day in inventory missed charges and unnecessary purchases, with about another 2.5% being lost from missed diagnostics. Want to calculate the numbers for your practice? If you are a $1 million-dollar practice, you average a loss between $75 and $250 a day in inventory alone – $23,000-$76,000 gross. Missed charges from diagnostics total between $33,000-116,000 of gross revenue (average 7.5% of gross).

Calculate your practice’s average missed charges—Use your annual gross revenue and these industry averages to see how much profit could be leaking from your practice.

How can you stop your practice from hemorrhaging these profits each year?

Once the holes in the bucket are identified, your practice still has to take action to reduce the leaks and increase profitability. How do you do this without addressing vendor costs or year-over-year revenue? Implementation of controls.

Hardware and software solutions that streamline your practice’s processes can have significant impact on profitability. Over the last decade, practices have begun to rely too heavily on software-only controls. Though it’s a critical component in controlling revenue gaps, software alone can never be the solution. While one can function without the other, efficiency and performance are most improved when a hardware plus software solution is implemented.

Below are five areas in your practice that can be improved with controls.

1. Treatment Area Injectables: Veterinary practices often move at a fast pace, making quick medication access important. However, whether software workflows are in place or not, this means treatments can be administered without charges ever being invoiced.

Controls: Integrating your software and hardware controls can save you thousands of dollars a year. With CUBEX integrated into your software, medication can be accessed once a billing item is created for the injectable.

Don’t have workflows in place? Download our Controlled Substances Checklist to get started.

Download Checklist

2. Fluid Treatment: As technicians and staff get busier throughout their daily practice processes, it’s easy to switch out a fluid treatment and forget to add the additional charge. In one case, a large emergency hospital recognized $5,000 to $10,000 more revenue per week in fluids alone once they implemented controls.

Controls: A software and hardware combination allows for quick access but also ensures charges are accurately recorded. Using biometrics fingerprint access, CUBEX systems provide secure access to fluids, without slowing down your practice’s administering process.

3. Diagnostics (In-Hospital and Reference Laboratory): Practices that don’t adopt electronic requisitions for their outside laboratory suffer significant revenue loss from diagnostics. Reference lab diagnostics are frequently missed due to requisitions being sent without invoiced charges or additional testing being done after billing is completed. In-hospital laboratory diagnostics often do not have a paper trail, causing them to be missed even more frequently.

Controls: Whether you use an outside or inside lab, adopting a mixture of hardware and software controls can give your practice significant savings. For diagnostics, properly integrate processes with your practice management system and ensure that test access is limited until there is a billing item created.

4. Preventatives: Loss of preventative medications, such as tick and flea treatment, is often due to missed charges and theft. The open access to these preventatives is tempting when they would otherwise be costly. In addition to theft, missed charges are common on preventatives, which creates greater loss in this area.

Controls: With secured access to preventative medication through hardware implementation, losses can be reduced. Pairing software controls with your hardware helps monitor the access to further reduce risk.

5. Controlled Drugs: The opioid crisis creates significant risks for veterinary practices. Low security storage of these controlled drugs, whether it’s a countertop safe or cabinet, allows staff or clients to access stocked narcotics quickly and easily. These uncontrolled environments open practices up to risk and lead to increased drug diversion. While diversion may not be the largest leak in the bucket, potential DEA liabilities threaten to make the risks larger.

Controls: Tightening your daily practice process is key – don’t leave your narcotics safe unlocked during the day and limit who can access the safe. Additionally, find hardware and software solutions that reduce the risks associated with narcotics safety and missed charges. Consider adding a “Controlled Substance Handling Fee” commensurate with the additional measures required to keep your practice, your patients, and your pet parents safe. CUBEX has built two solutions around these needs: CUBEX Mini and CUBEX MiniPlus. Both systems accurately capture charges, log inventory, and secure drug accessibility.

For more help improving financial health in your practice, download our KPI Worksheet to start identifying missed revenue opportunities:

Download Workbook

If you are interested in a FREE detailed assessment of your practice and benchmarking of your practice, contact us.

The post Fixing a Leaky Bucket: Improving Veterinary Practice Profitability through Inventory Management appeared first on Cubex.

When it comes to inventory management, it’s hardware + software for the win.

Of the leading practice management software platforms, each has its selling points and unique approach to financial management, client and patient records, and payment processing. DMV360 offers a useful comparison chart of the leading veterinary PIMS software packages.

Whichever PIMS solution may be the right fit for your veterinary practice, three things are clear:

• Adoption and usage of the tool is more important than selection of the tool itself
• Cloud-based solutions are simplifying on-boarding and opening up new opportunities for integrations
• Inventory management requires more than just a software solution

Approximately one in four veterinary practices relies on their PIMS to manage inventory, second only to ‘the clipboard’—manual records. While it makes sense to use all available functionality of such a core investment, a software-only approach to inventory management can:

• Open the practice up to DEA compliance risk
• Lose charge captures, resulting in lost revenue
• Bloat inventory spend, cutting into profit margins

After more than 20 years in inventory management, CUBEX recognizes that, regardless of type and size of practice, a comprehensive solution is required. While most veterinary practices who utilize their PIMS for inventory management believe this is an effective solution, those practices still can realize additional 5-10% net income with the implementation of a CUBEX solution.

DEA Compliance Risk

Software-only inventory management fails when it comes to narcotics management. DEA compliance requires both specific standards for hardware, and extensive logging and reporting. PIMS inventory modules alone will not require your staff to change your drug controls.

Without automated controls on hardware and software, you’re susceptible to errors and diversion, and at risk in a DEA audit.

Lost Charge Capture

Pharmaceuticals and supplies account for 30% of the revenue in most veterinary practices. By utilizing your practice management software for invoicing, you’re reliant on reactive billing.
Some practices focus on the hardware for inventory management and narcotics management. While proper physical storage is important, this approach relies on manual transcription of charges.

Bloated Inventory Spend

You’ve heard the term, “garbage in, garbage out.” The value of your PIMS for inventory management is only as good as the data. With manual, sporadic inventory counts, and concern over running out of critical inventory, you’re likely spending more than necessary on inventory. Check out our guide for key financial benchmarks.

Download Workbook

Controlled substances for veterinary health are frequently on backorder, so practices are stocking up when they can. Increased inventory levels can drive up your loss due to obsolescence (expiration) and shrinkage (theft). Inventory write-offs can drive up total clinic costs by 2-4%.

Improving Inventory Management with Your PIMS: CUBEX

CUBEX hardware + software systems are designed with veterinary practices and hospitals in mind, offering a variety of configurations to fit your inventory needs and processes. CUBEX unlocks the power of the PIMS, with bi-directional integration with most practice software systems.

Curious about how an integrated solution could work with your PIMS?

Request Consult

The post Why Your PIMS is Costing Your Practice Lost Revenue appeared first on Cubex.

Barbara Hersh, Veterinary Operations Manager at CUBEX, started her career as a veterinary surgical nurse and inventory supervisor. Today, she helps veterinary clinics improve their controlled drug management, meet DEA compliance, and increase profit margin.

Even the most conscientious veterinary clinics are likely making one of six common mistakes in controlled substance management:

• Securing the Controlled Substances. These drugs must always be locked up. Many times, they are removed for use and there is a delay before returning them to their secure location, or drawn up into a syringe and placed on a patient’s cage for later use. Lockboxes that are not secured to the countertop or wall are a no-go as well.
• An unlocked safe or secure area. In busy practices, we too often find that the safe or closet is left unlocked during practice hours, failing to meet the dual key requirement.
• A single drug log. DEA regulations require that practitioners maintain inventories and records of Schedules I and II controlled substances separately from those of Schedules III, IV and V, so that they are readily retrievable and separate from other business records.
• Failing to reconcile logs with inventory. Without reconciling, diversion isn’t always caught. Proper controlled substance inventory management requires daily reconciliation to make sure logs are up to date.
• Misinterpretation of DEA requirements. The DEA tells us what to do but is not always clear on how to do it. Most veterinary practices we work with have the best intentions, but fail in the required frequency of reporting, or the day-to-day application of their controls.
• Meeting federal compliance standards, but failing to review state law. In reaction to the opioid crisis, many states, such as VA, have recently issued laws with new requirements for drug management.

Some systems are flawed from the get-go. In one recent visit to a veterinary hospital, the DVM demonstrated the problem: their existing drug storage consisted of a small, under-counter refrigerator and a lockbox mounted to a shelf. To prove a point, he walked over, picked up the shelf, lockbox and all, and walked out.

In other cases, it’s the day-to-day that cause veterinary practices to fall short of DEA compliance. Clinic staff is focused on their top priority: patient care. If inventory management is laborious and manual, they’re likely to think, “I’ll just log it later.” Daily demands in a busy practice make it easy to share keys, forget to record transactions, and count inventory sporadically.

It’s these kinds of compliance gaps and misinterpretation of the complex DEA regulations that CUBEX solutions address automatically. CUBEX integrated solutions, a blend of hardware and software, provide:

• DEA-compliant weight and lock security
• Fingerprint scan to auto-log who accesses drugs, and when
• Automated data collection and reporting

Is it time for your clinic to simplify your DEA compliance? Learn how CUBEX can change your practice.

Request Consult

For DEA security requirements, visit https://www.deadiversion.usdoj.gov/21cfr/cfr/1301/1301_72.htm
For the complete DEA Practitioner’s Manual, visit https://www.deadiversion.usdoj.gov/pubs/manuals/pract/index.html

The post 6 Controlled Substance Mistakes Your Veterinary Clinic is Probably Making appeared first on Cubex.

An interview with Anton Visser, CUBEX CEO —

With 20 years of helping companies maximize profits through inventory management, CUBEX CEO Anton Visser shares his perspective on the challenges facing veterinary practice owners and veterinary staff, and what’s ahead for the veterinary market.

CUBEX has a long-established presence in human healthcare narcotics management. Why did you choose to enter the veterinary market?

My dad was a vet, so I grew up learning about the challenges in managing a veterinary practice. When we developed the CUBEX inventory management system, he was the first to spot the need for it in his clinics. Inventory management is a common problem, and as soon as he implemented a CUBEX system, his vet friends saw it and wanted it.

For veterinary practices, 30% of revenue comes from pharmaceuticals and supplies, yet the most common inventory management system for these valuable assets is a clipboard. There’s no process in place or strategy for how much and when to order. We often see:

• Bloated inventory
• Lack of visibility to profit margin
• Lost charge capture

Without a system, veterinary practice owners lack the data for an effective pricing strategy. They’re running a pharma supply within their business, but they aren’t able to manage it.

Our customers are recognizing the issue and they’re willing to implement a solution that lets them capitalize on this “business within a business.” They’re coming to the realization that missed charges and lack of data are not OK.

Imagine the manager of a Walmart or Target who has no idea what her profit margin or COGS (cost of goods sold) is for the store’s pharmacy. Now imagine she’s also OK with the 10% of dispensed items not being correctly charged for. That manager wouldn’t last long.

What’s the baseline today? Surely we’ve moved beyond the clipboard?

Of the 25,000 vet practices in the U.S., the clipboard is still surprisingly common.

The landscape is changing, of course. As corporations come in and consolidate practices, they see what we see—the significant opportunity to improve profit margins through improved inventory management. Market consolidation is accelerating as Baby Boomers are looking to retire, and this is an aspect of the business that can drive significant value for owners.

What’s your promise to the customer? What do customers see as the biggest impact to their practices?

There are two reasons customers make the decision to implement an inventory management system:

1. Narcotics safety
2. Profitability of their pharmaceutical supply business

Whether DEA compliance and PMP (prescription monitoring program) legislature is driving a change, or owners are recognizing the opportunity to improve margins, CUBEX can help identify solutions that fit their needs and practices.

We are committed to helping customers make the change and improve margins. Our inventory assessment and on-site implementation process help define a new workflow and successful staff adoption. We work side by side with customers to ensure a system that fits their practice.

What’s next for CUBEX in the veterinary market?

We’re helping veterinarians identify a true P&L for inventory. That’s a big goal. Business intelligence can help owners identify and take action to improve labor costs, markups and margins. With accurate metrics, owners can take control of this “business within a business” and that can have a big impact on EBITDA, which in turn drives practice valuation.

I’m focused on product innovation—building out a suite to deliver on that promise.

Compliance with DEA regulations for controlled substances is a huge issue right now—action to reign in the opioid crisis is one of the few things most politicians can agree on. With employee turnover and emerging requirements for narcotics management, vet practices cannot afford to use just PIMS or a software-only solution. These don’t require you to change your drug controls. They also tend to lead to reactive, not proactive, billing, which can mean a missed opportunity for charge backs.

So how do you balance security and workflow – isn’t there the potential for the system to ‘get in the way’ for simple, everyday items that aren’t narcotics?

Not all items require high security. Prescription dog food and morphine obviously do not require the same level of scrutiny. Products like the new CUBEX MiniPlus allow for flexibility in your supply cabinet, keeping active stock and back stock in separate sections with a steel divider in between for increased DEA compliance. For critical narcotics like morphine, secure access features such as witness requirement can be set up for even higher management protocols.

We’re also making great progress in integration with the rest of the business and supply chain. Real inventory management solutions must integrate with clinic software and the supply chain, with minimum and maximum levels for every supply. Our automatic ordering makes re-stock as easy as Amazon, and allows you to develop strategic sourcing, focusing on dollars not pennies.

To learn more about optimizing margin opportunities in your veterinary business, download our free workbook, 4 KPIS in Veterinary Standards for Inventory

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The post A Business in a Business—Optimizing Your Practice with Veterinary Inventory Management appeared first on Cubex.

Below, Barbara shares best practices and lessons learned from her work within and alongside veterinary clinics nationwide.

How did you get your start in inventory management?

I worked as a vet tech for 10 years before I moved into inventory management. It’s where I first came to know CUBEX. I started out managing inventory for just the office I was in, but as we implemented CUBEX, I could manage all four because of the remote capabilities the system offered. My job actually got easier as the responsibilities grew because of the increased efficiency and optimization with the CUBEX implementation.

Why is the inventory manager role so important in a large veterinary hospital system?

Inventory is the second largest spend in a veterinary hospital. Sage Centers recognized the impact of inventory management on their bottom line—I reported directly to the CFO.

I managed all the business intelligence for our finance committee and reported on:

• Inventory turns
• Cost of goods sold as a percent of revenue
• Redundancies
• Slow-moving inventory

How has the industry’s perspective on inventory management changed since then?

Larger corporations have always recognized the importance of inventory management. Independent hospitals like Sage are now recognizing the opportunity to improve margin and revenue as well. Lots of smaller hospitals struggle due to the fear of running out, and they’re unable to pull usage information. I enjoy working with them to put a system in place.

How did you make that change in the clinics you managed when you first worked with CUBEX?

We needed to learn about inventory conceptually. There aren’t a lot of good veterinary standards and best practices when it comes to running the business. We had to work through it, gather real data and then challenge ourselves to make it better.

There is a lot of good information in business publications like Forbes and Entrepreneur magazines about inventory management [see here, here, here, here], but the veterinary market has very little available.

What made you decide to make the move from veterinary practice management to CUBEX?

I loved the system, and had it running so well as a CUBEX administrator at Sage that when I saw the opportunity to move into account management, I jumped at it. I was interested in taking on a more technical role, working with the equipment and software. It was an exciting new challenge.

I enjoy working with clinics and supporting their efforts. Though the move from veterinary practice to CUBEX was a shift in mindset, I still have a client-facing role that allows me to help clinics improve their practice.

What’s the most challenging part of your work today?

Managing expectations. We help educate clients on inventory management best practices for their clinic from early discussions through implementation. We offer support for the change management that needs to happen for a successful implementation. They know this is the right choice for their practice and their patients and it will improve the standard of care. We’re there to reaffirm that.

What are you most proud of in the work you do?

I enjoy helping clients manage the change and training their staff. The bottom line for all of us is patient care. It’s wonderful to see it come to fruition—to be involved in the whole process from sales to finance, pre-implementation to implementation, and to see the impact it has on the practice and standard of care.

Do you want to learn more about bringing CUBEX into your practice? Request a consultation to speak with one of our experts.

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Barb will be sharing more of her insights and best practices for successful inventory management. Subscribe to the blog or check back for more updates.

The post Meet Barbara Hersh: A First-Hand View on the Importance of Inventory Management appeared first on Cubex.

CUBEX, LLC, the leading provider of pharmacy and supply management technology to the animal health market, announced the introduction CUBEX®Tower, a solution for veterinarians looking to reduce the legal and financial risks associated with opiods and other controlled substances, while also driving profit through reduction of missed charges. Similar to CUBEX Mini, its sister product, CUBEX Tower offersautomated, biometric, DEA-compliant safeguards for storage of narcotics and other medications, alongside bi-directional integration with most practice software systems, and is available through a subscription, with no capital purchase required. As a free-standing unit as opposed to countertop-style device, CUBEX Tower offers over three times the storage of CUBEX Mini while maintaining the same compact footprint.

“The opioid epidemic is driving two tends the CUBEX Tower is built to solve,” said Anton Visser, co-founder and CEO of CUBEX. “First, CUBEX Tower automates the security and documentation required for narcotics management, which is critical now that federal and state authorities have zeroed in on veterinary practices as being at-risk for diversion. Second, since controlled substances are so frequently on backorder, practices are stocking up when they can. CUBEX Tower has a generous amount of space for ‘inactive’ or back stock of controlled drugs, in order to accommodate that need.’

Amid an increase in opiod abuse nationally, diversion of drugs such as tramadol and fentanyl by veterinary employees has attracted the attention of the DEA and state regulatory boards, leading to an uptick in audit frequency. Additionally, an increasing number of state-run PMPs (Prescription Management Programs) have expanded their requirements to include veterinarians, adding an additional reporting burden.

‘We chose CUBEX Tower because it has enough space to store all of our controlled substances, including back stock, but at the same time it has a very compact footprint.’ Said Dr. Alan Knott, co-owner of Animal Care Hospital of Clifton Park. ‘It’s the perfect balance. Automated dispensing and logging of medications is much safer, more accurate, and easier for everyone, and CUBEX is the right partner for us.’

CUBEX Tower is available now through a simple monthly subscription. Visit www.cubex.com/products/cubex-miniplus to learn more, or call 480-470-3284 to schedule a demo.

About Cubex^®

Cubex^® is a global provider of health care products and services that helps practices measurably reduce the total cost of ownership associated with pharmacy and supplies. The company develops market-leading technologies including Cubex SupplyBank automated dispensing systems, Cubex MedFlex and MedBank narcotic management stations, QBud wireless access devices, and the myQLink web-hosted software and business intelligence application. For more information on Cubex, please visit www.cubex.com

The post CUBEX LLC introduces CUBEX Tower appeared first on Cubex.

Each WellHaven practice will be centered on the CUBEX inventory management system. Replete with front-of-the-pack technology and cloud-based software, CUBEX uses predictive analytics and re-ordering automation to save heaps of time in paperwork and logistics.

“For us, pet health comes first, and we achieve this by putting top technology and resources in the hands of our principal doctors,” stated WellHaven Managing Partner, Thomas Reuss. “We’re excited to partner with CUBEX—they bring perspective and hard work that makes a difference.”

Another valuable benefit is the skyrocketing of safety and compliance as identity verification ensures that the right person withdraws the right dosage at the right time. CUBEX will outfit each practice with DEA-compliant storage and dispensary equipment for managing these controlled substances.

“WellHaven is building sophisticated technology into their foundation, and setting a high industry standard while they’re at it,” stated CUBEX CEO Anton Visser. “We’re proud to kick off this relationship that is sure to strengthen over time.”

About WellHaven Pet Health

WellHaven Pet Health owns and operates veterinary practices that exist to strengthen the positive ripple effect that derives from happy, successful vet hospital owners, clinics that truly address the needs of pet owners, and, by extension, happy, healthy pets. Because when the animals feel the love, everyone feels the difference. Learn more at wellhavenpethealth.com

About Cubex^®

Cubex^® is a global provider of health care products and services that helps practices measurably reduce the total cost of ownership associated with pharmacy and supplies. The company develops market-leading technologies including Cubex SupplyBank automated dispensing systems, Cubex MedFlex and MedBank narcotic management stations, QBud wireless access devices, and the myQLink web-hosted software and business intelligence application. For more information on Cubex, please visit www.cubex.com

The post CUBEX Forms Partnership with WellHaven Veterinarians appeared first on Cubex.