In a lot of states, only veterinarians can own veterinary practices.  Maine is one of them.  The stated reason is that doctors will be motivated by "the medicine" and ANYONE else especially corporate investors will be motivated by "profit."  I think the real reason is small practices don't want to compete with "big box" veterinary centers.  And traditional small practice owners run state licensing boards.  That's fine on the surface, but it does cause some problems.

First let's look a little at the "logic" of the stated reason,  I have news for you, your veterinarian is motivated by profit.  She didn't devote eight years to college and rack up a quarter-million dollars in debt (risking she may never pass the test) to come out on the other side with a job that doesn't pay well.  And just as investors might be looking too hard at quarterly numbers and putting pressure on the veterinarian, a veterinarian-owner's spouse might be looking at the upcoming tuition bill for Junior and saying "Honey, we need to come up with $40,000 in six weeks."  I think we can agree that everyone who hasn't taken a vow of poverty is motivated to some degree by profit.

The other problem with the premise is it assumes profitable medicine and good medicine are at opposite ends of the spectrum.  Actually, they are one in the same.  There's an old saying in veterinary medicine, "You can practice good medicine, or cheap medicine.  You can't practice both."  Good veterinarians are the most profitable.  Those who run the right diagnostic tests to help their patients, and use high-quality medical supplies and charge a fair price draw more of the "right" kind of client than anyone else.  The "right" clients are those who take regular care of their pets and who are willing to spend some money when something goes wrong.

There are two extremes that really don't seem to earn a lot of money.  Doctors who try to pad every bill by running unnecessary tests or sell products at outrageous mark-ups don't keep good clients.  On the other hand, veterinarians who cut corners tend to have bad outcomes and attract the folks who don't believe in taking good care of their animals.

Now if practicing good medicine is the best way to make a buck in this business, and both veterinarians and investors like to make money, doesn't it make sense that it doesn't matter who owns the company?  In the alternative many veterinarians cut diagnostic corners and use cheap supplies.  Would it make any difference if it was a veterinarian or non-veterinarian dictating cheap medicine?

I contend it doesn't matter who owns a veterinary practice, what matters is who owns it.  In other words, as long as ownership is dedicated to practicing good medicine, it really doesn't matter what the company structure is.

We could debate the merits of corporate ownership until we're blue in the face.  In fact, I don't really know where I stand on the issue.  I could really see benefits if big companies were in this business -- like having the wherewithal to construct and maintain state-of-the-art facilities then staff them with really good people (with ongoing regular training) and freeing the veterinarians of all the "business" duties.  On the other hand, I can see a future where corporate investors suck the life out of veterinary medicine too.

One place that I do have an opinion and a vested (well, hopefully someday vested) interest is spousal ownership.  Let's say a veterinarian, we'll call him Dr. Smith, owns a vet practice in Privilege, Maine.  We'll call it Mopang County Veterinary Services, LLC (a one-member LLC).  His wife, Mrs. Smith, owns the building and real estate in a company called Mopang County Realty, LLC (also one member).  So the veterinary practice leases the building from the real estate holding company -- on paper.  In reality, the husband and wife are running their small family business together.  She hires and fires the employees, pays the bills, orders supplies and markets the business.  He performs the doctor duties and thinks he runs the place.  The practice is pretty average so they gross $500,000 in annual revenue, employ ten people full and part time, and pay $300,000 in wages, payroll taxes and benefits.  (Yes, 60% is about average for non-doctor employee costs at a veterinary hospital.)

Let's now kill our imaginary Dr. Smith....  "Dr. Smith was killed to day in a bizarre pumpkin chunkin accident.  He was an avid pumpkin chunker and was survived by his wife, Mrs. Smith and their son Junior who has a really big tuition bill due soon."

Now what?

Mrs. Smith, if this was a regular business, would hire a new veterinarian (after appropriately mourning) and continue to run the small family business she had built with her husband.  But she CAN'T.  It's ILLEGAL.  She can only sell the business to a veterinarian and charge her rent.  Only there will be nothing left to sell.  You see, the clients will find NEW veterinarians while the office is closed.  In six months, at least half the clients are gone, in a year they are all gone.  Veterinary practices are valued based on client count, revenue per client, client turn-over and historic revenue.  The minute you close the doors, you can't truly evaluate the value of the practice and it becomes worthless.

Ten jobs? Gone.

You say "Just do it anyway, they won't put a widow in jail."  That's true enough, but there is a problem.  Mrs. Smith hires Dr. Jones to come in to work until they can sell it, or maybe for the new doctor to eventually buy.  Mrs. Smith is guilty of practicing veterinary medicine without a license, something the State of Maine has probably never prosecuted, and I'm pretty sure wouldn't bother wasting taxpayer money for this case. 

Dr. Jones is guilty of assisting Mrs. Smith in practicing without a license, also not likely to be prosecuted in court.  The problem is the licensing board would revoke Dr. Jones' license.  Ops.  You see that doesn't take a lot of resources, or even the kind of due process you'd get in court.  Dr. Jones will never come to work for Mrs. Smith.  Keep in mind we are talking about veterinarians who won't prescribe an antibiotic without an exam for fear of loosing their license and entire livelihood. 

So what to do?  I don't know.  I know the state law needs to be changed.  The lack of continuity planning really does make investing in a veterinary practice a troubling for spouses in particular, but also veterinarians.  I don't know how much this is costing the state in capital investment and jobs, but I promise you it is costing something -- needlessly.  Beyond family ownership, I don't know what's appropriate.  Employee ownership could make sense (do they still have ESOPs?).