A Financing Checklist for Multi-Hospital Veterinary Groups

Wellness plans, monthly dues covering vaccines, checkups, and preventive care, are genuinely recurring in a way per-visit procedures never are. Don't blend the two when presenting your revenue to a lender; a hospital group with strong wellness plan enrollment but average per-visit revenue tells a stronger recurring revenue story than the reverse, and mixing them together obscures that. Report the two lines separately in your own management accounting even before a lender is involved, since it's a habit worth having regardless of financing plans.

It isn't, and this matters here specifically because veterinary wellness plans, even strong ones, rarely carry the annual, contracted commitment terms Capchase requires. Most run month-to-month with simple cancellation, which is closer to what Pipe underwrites. Applying to Capchase without checking this first usually just wastes time on an application that won't clear underwriting, time that's better spent building out the Pipe conversation properly.

A multi-hospital group's wellness plan enrollment can vary considerably by location, driven by local demographics, staff turnover, and how consistently each hospital promotes the plan at checkout. A lender evaluating the group will want that location-level breakdown, not just a consolidated total, since one or two strong hospitals can otherwise mask weak enrollment everywhere else in the group, making the whole book look stronger than it actually is location by location.

If your group is growing by acquiring independent practices, the financing need for those acquisitions is separate from working capital against wellness plan revenue, and it's usually the larger, more urgent financing question. Acquisition financing for veterinary roll-ups typically comes from a bank term loan or a lender who specializes in multi-location practice economics, not from a revenue-based advance product, and starting that conversation late is a common reason a strong acquisition target slips away to a competing buyer.

Some practices still run wellness plans informally, a recurring charge without a signed agreement or clear cancellation terms. Formalize the agreement before applying anywhere, since a documented plan with clear terms is materially easier for an underwriter to evaluate than an informal recurring charge, even when the actual patient behavior is identical.

Before applying anywhere, formalize your wellness plans with these elements:

• A signed agreement, so the plan reads as a documented commitment and not an informal recurring charge.
• Clear cancellation terms that an underwriter can evaluate.
• Enrollment and cancellation data tracked by hospital, since lenders will want location-level detail.
• Wellness plan revenue reported separately from per-visit procedure revenue.

Line up any offer against a clear baseline before signing it. Bank prime sits around 6.75%¹ with the fed funds rate at 3.63%², and a bank term loan for acquisition financing, secured by practice assets, typically prices well below an unsecured revenue-based advance. Don't skip this comparison just because a revenue-based product is faster to close.

As a veterinary group adds hospitals, the financing decisions, wellness plan terms, acquisition structuring, vendor negotiations, tend to outgrow whatever informal process worked at two or three locations. A general or operations manager, at a median pay of about $105,770 a year³, is a reasonable investment once the group reaches a size where financing decisions happen often enough to need a dedicated owner rather than being handled ad hoc by a veterinarian who would rather be in an exam room. Emergency and specialty hospitals in the group also deserve separate treatment: their patients arrive once for a crisis and rarely become recurring wellness members, so blending their numbers with general-practice locations understates how strong your actual recurring revenue is where it genuinely exists.

Rising pet insurance adoption is changing how some clients pay, but insurance reimbursement to the client, not the practice, doesn't create recurring revenue for you the way a wellness plan does; the practice still gets paid per visit either way, so don't conflate growing insurance adoption in your market with growing recurring revenue for the hospital group. Separately, enrollment often comes down to how consistently front-desk and technician staff actually offer the wellness plan at checkout, which varies by location culture as much as by market; a group that standardizes its enrollment script across hospitals usually sees enrollment gaps narrow within a year, a lower-cost fix than most groups initially assume.