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News & Press: PVMA Programs

The Complex Cost of Veterinary Care

Wednesday, November 22, 2017   (0 Comments)
Posted by: Cristina Keef
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November 22, 2017

 

The Portland Veterinary Medical Association is a professional membership organization representing 600 veterinarians and their practices across the Portland Metro area. The PVMA is dedicated to supporting and representing its members and the local veterinary community. Along with many other local organizations and agencies, we strive to educate the general public in an effort to improve animal welfare and promote the human animal bond.

 

The recent Fox 12 News call for followers to submit their veterinary bills in an effort to determine variability between costs is concerning to the veterinary profession and may be misleading to the clients and communities we serve. The claim that there is no state agency that regulates veterinary prices is true and we are disappointed in the lack of understanding of common business practices that was portrayed in this initial post. In fact, the Federal Trade Commission restricts veterinary practices in the same community from collaborating on prices, as that would violate pricing fixing laws. As stated on the FTC website “...the antitrust laws require that each company establish prices and other terms on its own, without agreeing with a competitor.”

It is no secret that the cost of veterinary medicine has been on the rise over the past several decades. Much of this increase is due to increased overhead costs to run a small business and significant advances in veterinary medicine—with these advances, we are able to prevent many of the diseases that killed so many of our patients 20 years ago, and our patients are living longer, happier, and healthier lives.


Both privately-owned and corporately-owned veterinary practices strategically set and frequently evaluate prices based on demographics, practice size, overhead costs, and services offered. Some prices are determined by what the market will bear or are loss leaders (such as exams, spays, neuters, and often dental prophylaxis), and others must be priced to make up losses from those services. Overhead costs differ greatly depending on rent/mortgage, taxes, utilities, inventory including pharmaceuticals and medical equipment, and wages/salary/benefits of the staff. Many clients don’t realize that a veterinary hospital typically must offer a “complete” hospital under one roof—including radiology, lab services, pharmacy, anesthesia and surgery, dentistry, and all of the equipment and professional staff to offer those services. Veterinary hospitals that are accredited by the American Animal Hospital Association are evaluated against over 900 standards, and will also have higher overhead costs to meet those higher standards of care.


The comparison of veterinary prices on their own ends up being a comparison of apples to oranges. Among privately-owned practices, hospital cultures, standards of care, services and products offered and business strategies vary greatly. Hospital A might have 40-minute appointment times and use a fear-free patient approach with lots of personalized client and patient care, including follow-up calls, while Hospital B might be a low-cost, high-volume clinic, with 10-minute appointments. Even if the invoice items are identical--a physical exam, a rabies vaccine, and flea/heartworm prevention, the costs are likely to be different, because the services provided are dramatically different. Shorter appointment times often don’t allow for time to address minor or slowly-progressing issues that could indicate more significant health problems, like nutrition, weight loss/gain, behavior changes, etc. Likewise, not all clients are in the market for the same level of care for their pets. Some clients just want to update vaccines and be on their way, and others want to discuss further preventive or proactive care to help their pets live longer, healthier, happier lives. Some owners will elect to refer pets with health problems to board-certified specialists, such as surgeons, cardiologists, etc., where both cost and level of care may be substantially different. Some veterinary hospitals may decide to minimize profit on a particular service—like fecal testing, for example—if they have seen a recent increase in giardia-positive patients, so clients are more likely to test their pets.


Some services, like radiography, anesthesia, or dentistry may be even less comparable. Some veterinary hospitals will have all of their patient radiographs (x-rays) reviewed by a board-certified radiologist, to ensure that nothing is missed by a general practitioner (similar to what happens in human medicine). Other hospitals will only send out radiographs they have questions about, or not even offer that service at all. Likewise, training and certification among members of the veterinary support team may vary widely. Some hospitals’ standards of care require that a Certified Veterinary Technician (CVT) or even a Veterinary Technician Specialist (VTS) is dedicated to monitoring anesthesia on all patients, where other hospitals do not have any CVTs or VTSs on their teams or may not have a dedicated team member monitoring anesthesia. (CVTs undergo specialized schooling and certification, and CVTs can be further trained and certified in a specific area as a VTS.) In addition to varying anesthetic standards of care, further widening the price range for dental procedures is that some veterinary hospitals will perform full-mouth radiographs (and additional dental radiographs after any dental extractions) for every dental procedure, while other hospitals may perform dental cleanings and extractions without radiographs or detailed charting of teeth.


Just as variable are the wages and benefits of veterinary support team members. These Certified Veterinary Technicians, veterinary assistants, and client care team members are the backbone of each veterinary practice. Many of these team members do not make a living wage, and don’t get health or dental insurance benefits. Overhead costs for veterinary support team members are often a significant factor in costs of care. These amazing team members spend most of their day on their feet, take the brunt of client complaints, and deal with urine, feces, anxious patients, and grieving for pets during end-of-life care. 


Although many people think that the bulk of what they pay for their veterinary visit ends up in the veterinarian’s pocket, that simply isn’t true. Many veterinary hospitals’ net profit is less than 10 cents on each dollar earned, while the rest goes to operational costs. Profit, if there is any, often is reinvested in the business, in areas like training or development, support team wage increases, equipment upgrades, or facility improvements. Specialty and emergency veterinary hospitals often have operational costs that are 30-40% higher due to hours of operation, additional training and support team members, additional equipment, etc.


According to 2016 data compiled by the American Veterinary Medical Association, the average student loan debt of a veterinary student graduating from a US vet school is nearly $144,000, with some students having debt burdens $200,000 - $300,000 at graduation. With an average starting salary of $73,000/year, the debt-to-income ratio is often over 2:1. Specialty certifications usually mean 4 more years of schooling (low-paid internships and residencies) and additional debt . This debt load is one contributing factor to the sad statistic that veterinary medicine is the profession with the highest rate of suicide—a recent American Veterinary Medical Association study reported that 1 in 6 veterinarians has considered suicide, which is 3 times the national average. Other big contributing factors include struggles for work-life balance, cyber-bullying, compassion fatigue, financial constraints of clients, and the heart-breaking difficulty of end-of-life decisions for their patients, especially those due to financial restrictions. This is truly a profession of compassion and service. Every veterinary professional enters this field because of a fundamental love for animals, with a mission to advocate and care for animals, help clients, and serve the community in which we work and live.


One of the best ways to help make veterinary care more affordable is through pet insurance. Pet insurance can help clients be prepared for unexpected veterinary expenses, and some plans will pay veterinary hospitals directly, which means pet owners aren’t waiting for reimbursement, and lack of funds doesn’t delay immediate treatment. Perhaps Fox 12 could help by getting the word out about pet insurance options that are available to pet owners. There are over a dozen options, and some plans have different fee/deductible options to meet clients’ individual needs.


Thank you for taking the time to understand why the costs associated with veterinary care are such a complex issue. Our biggest fear is that reducing veterinary care to just numbers and cost could be misleading to pet owners. We encourage you to reach out to us at the Portland Veterinary Medical Association if we can help further clarify this issue.

 

Executive Board

Portland Veterinary Medical Association

 

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