Edited by Kim Chrisman
Veterinary medicine today is facing several challenges, especially in the era of increasing corporate influence. America has over 31,000 veterinary hospitals, clinics, and emergency care centers. Approximately 18% or roughly 5,580 of those are corporately owned, presently. Despite that low percentage, the impact is profound on the industry, both positively and negatively. Pet parents feel those effects in terms of higher cost of care, extended appointment availability, losing their favorite veterinarian due to increased caregiver turnover, and diminished access to specialized treatments. In addition, the challenges in the veterinary field have been exacerbated by a surge in pet adoptions during the pandemic, leading to an increased demand for veterinary services in an industry that isn’t graduating enough new veterinarians to keep pace. This makes it more difficult for pet parents to find affordable and timely care for their furry family members
Considerations:
Let’s take a closer look at the impact that corporate consolidators and venture capital groups are having in veterinary medicine. Over the past decade, as veterinarians approached retirement, investment firms recognized the resiliency of the industry. Veterinary medicine has, until now, been a monetary haven, including during the recessions of the last two decades, making acquisitions of veterinary practices financially appealing. It was recognized that leveraging business expertise would increase profits, the acumen of which many independent veterinarians did not possess.
Effects of consolidators’ offerings on the industry:
Pro: Consistent Quality – Corporate-owned practices adhere to standardized protocols, ensuring consistent care across many locations. For instance, PetSmart/Banfield has had this model for decades.
Con: Focus on compensatory “production quotas” – This may have a detrimental effect on that care. Again, with Banfield as an example, there is one way to do things, so veterinarians are seriously limited on offering clients treatment choices. Cancer is one example.
Con: Referral – Many times, treatment is referred to another facility, which is more costly to the client and uncomfortable because the client is unfamiliar with the provider.
Pro: Better economies of scale- By increasing their corporate presence, corporate groups can leverage more purchasing power to acquire lower prices from manufacturers, which can be passed on to the consumer.
Con: Layers of employment – This may be the case for corporate facilities, but the reality is that you, the pet parents, are not the recipient of these cost savings due in part to the additional corporate levels that need to be compensated
Pro: Professional management – Groups often bring in external professional management teams with expertise in business operations, which may improve the efficiency and profitability of the veterinary clinic.
Con: Loss of personalization – Interactions between veterinarians and pet parents are often diminished due to time constraints or even accessibility, which may affect your pet’s care. Whereas once you may have had your veterinarian’s phone number, now they are on a set schedule, and you have to maneuver through others to talk to them.
Pro: Access to capital – Corporate groups have greater access to money, which can be used for investments in technology, facility upgrades, and staff training, to enhance the overall quality of care.
Con: Non-clinical personnel involvement – The people with financial oversight start to interrupt or dictate the type of care, equipment, and workflow that has been the exclusive domain of the veterinarian, without understanding the premise of care. Most, if not all these groups employ Medical Directors who oversee the clinical aspect of the facility. However, they still get approval from the corporate executives, who expect profitability.
Pro: Better compensation- Corporate veterinary groups often offer higher salaries compared to independent practices. Higher salaries, along with benefits such as matched 401K’s, paid professional memberships, conference travel, and health insurance all play a part in attracting the best talent. Corporate groups have scheduled performance reviews and may also include automated pay increases to stay in line with inflation.
Con: Cost of individuality – Although these compensatory plans are quite attractive, there are certain pitfalls in working for a corporate company, like the loss of autonomy, such as how medicine is practiced, hiring decisions, and general adherence to corporate policies. Community engagement can also be affected by decisions as to sponsorships or local involvement.
These are just a handful of the many aspects of the corporate group’s impact on the veterinary medical profession. For instance, Mars Veterinary Health owns Banfield Pet Hospitals, VCA Animal Hospitals, and Blue Pearl Emergency Centers. Other large groups included Thrive Veterinary Healthcare and the National Veterinary Associates (NVA).
In conclusion, as a pet parent, you are faced with myriad of decisions on how to best care for your pet. From nutrition to more serious issues, you are their advocate. How you relate to their caregiver and what is a priority to you is what governs their well-being. Ask questions. Find out if your pet’s doctor is corporately owned or individually, and what that means for care. There are a multitude of well-run independently owned veterinary practices that provide exceptional care with up-to-date equipment and a well-trained staff that are loyal to providing you with the very best care for your pet. If this is your preference, find one in your community and build a relationship with them. This blog is going to be posting the most common and important issues that you will face to help you do the best you can for your pet.
Stay tuned…
