The end of the year often prompts veterinary practice owners to take stock, determine whether the business has met its goals over the past year, and prepare the company to meet its goals for the coming year. The critical nature of a year-end review makes it essential for owners to consult their legal counsel about the issues they should address during their review.
Business Structure and Compliance Review
Veterinary practice owners should ask themselves whether their practice’s current corporate structure still serves their operational, tax, and liability needs. Whether owners have organized their practice as a partnership, limited liability company, or professional corporation, evaluating whether the current structure still serves owners’ goals may indicate the need to reorganize the business in the coming year.
Furthermore, a business review should also confirm that the practice has kept its state filings, licenses, and local business permits up to date. Operating with expired licenses or registrations can open veterinary practice owners to professional discipline or other significant liability.
Employment and HR Issues
A year-end review should also include an examination of the business’s employment and HR policies to ensure compliance with state and federal laws, as well as other industry best practices. Owners should review current wage and hour rules and state employment law benefits so they do not deprive employees of their rights and benefits under state law.
Practice owners who work with independent contractors, such as other veterinarians, should also evaluate their relationships to make sure they’ve correctly classified those contractors under applicable employment and tax laws.
Finally, owners should review restrictive covenant agreements with employees, including confidentiality, non-solicitation, and non-compete agreements, to ensure those agreements continue to protect the business and check whether employees’ conduct may have violated their covenants.
Contracts and Vendor Agreements
The end of the year should spur veterinary practice owners to review the business’s ongoing contracts, including commercial leases, equipment leases or financing agreements, and supplier/vendor contracts. For example, commercial leases may expire in the coming year, requiring owners to prepare for renegotiating those leases or search for new locations to move to. Reviewing other contracts should include focusing on terms such as renewal provisions, delegation of liability, and termination clauses. Owners can work with legal counsel to identify potential risks in existing contractual relationships or opportunities for renegotiation.
Risk Management and Liability Protection
Veterinary practice owners should ask whether they have pursued every avenue to protect themselves and their practice from financial or legal risks. Standard risk management and liability protection tools for veterinary practices include:
- Professional liability coverage
- Commercial liability coverage (including property damage or liability coverage)
- Cyberliability coverage to protect against data breaches and misappropriation of client information or financial details
Risk management should also include ensuring compliance with regulatory requirements, including those related to the storage and use of controlled substances. Managing liability risks can also involve developing internal policies for handling client complaints before they escalate into malpractice claims or other legal action.
Planning for Growth, Succession, or Sale
Finally, practice owners should consult their legal counsel to determine what additional steps they should take to plan and prepare for their practice goals in the coming year. Owners must consider whether they intend to pursue the growth of their practice, succession of junior partners to leadership roles, or the sale of the practice as part of the owner’s retirement. The year-end review can cover investment or expansion opportunities, buy-sell agreements among partners, succession plans for junior partners, or possible opportunities to sell to other veterinary practices.
Contact a Veterinary Attorney Today
Conducting a year-end review can help prepare your veterinary practice for success in 2026. Contact Mahan Law today for an initial consultation with a veterinary lawyer to discuss the issues that you should address for your practice during your year-end review.