This is the first of three articles on veterinary care, pet insurance and managing vet expenses.
Veterinary Care - “The Price You Pay”
By Barbara Dwyer
Recently, the cost of veterinary care has risen faster than human healthcare. Although there are many reasons, a favorite is that more owners view their pets as family members. For example, 40% of dog owners would choose a dog over a human as their only companion on a desert island, and 93% would risk their own life to save their pet (Brandon Gaille, 2017*). In 2011, a study “found that 68% of dog owners said that they would maintain spending on pet health regardless of any downturn in the economy. To put this in perspective, spending on Mother’s Day declined by 10% when the economy slowed” which begs the question, “Are our pets recession proof?” (Pet Life Today, 2018*).
Let’s start with some general statistics from the 2017-18 American Pet Products Association (APPA, 2017-18*). There are 89.7 million dogs in the US living in 60.2 million households. On average, dogs in the US visit the vet 2.7 times per year; the average annual cost is $257. The average cost for surgery is $474 (Pet Life Today, 2018*). You can add to those figures the expense of over-the-counter medications and supplements at $58/year and flea and tick control at $85/yr. Emergency room visits in 2015 were on average $349/year for dogs (Pet Life Today, 2018*). Not included in these figures are things like heartworm testing, medications, special diets and spay/neuter.
Veterinarians are recommending pet health insurance for their patients to help client’s manage costs and reduce the financial risk of facing a serious and expensive illness/accident. Vets believe that having insurance might save dogs whose owners can’t afford the $10,000 expense for cancer treatment and so have to resort to euthanasia. Of course, clients will be more willing to pay higher prices in general if they are offset by insurance payments. In 2015, fewer than 1% of owners bought pet health insurance, but the market is growing rapidly. The average annual cost of the insurance is $518 (APPA, 2017-18*) which would be over and above expenses for wellness exams, pre-existing conditions, spay/neuter and often genetic defects. Most plans are similar to major medical plans for humans. Also, the cost of insurance increases based on the dog’s breed type, age, where you live and inflation. But, more on that in our spring newsletter.
The mean income for a veterinarian is $101,530 and ranges between $53,980 and $198,340. It is not as high as medical doctors yet requires similar extensive post college education. The most expensive areas for vet care are Hawaii, Washington DC, New Jersey/New York area, Nevada and Los Angeles (Occupational Employment and Wages, 2017*)
Expenses for veterinarians and their clinics include: staffing, benefits, rent/mortgage, technology, medical supplies, cleaning, taxes, legal and accounting fees, insurance, equipment, office, products for resale. A large expense is student loan repayment. The average student debt for those graduating now is $160,000. “Student debt has continued to increase at a higher rate than starting salaries for the past 15 years” (Villalobos, A., 2014, Veterinary Practice News). Income is derived from veterinary services, boarding fees, sale of goods and other items that vary from clinic to clinic. Advances in veterinary technology and equipment have contributed to both sides of the balance sheet. New equipment and training can be expensive, but vets are now able to treat conditions they previously could not.
Are veterinarians’ being squeezed between offering the quality of care they’d like and financial reality? A study by the Centers for Disease Control and Prevention from 1979-2015, found that female vets were 3.5 times more likely to commit suicide than the general population, while the ratio was 2.1-to-1 for male vets” (NBC News, 2018*). There are a variety of reasons postulated for this such as overwhelming student debt, low salaries, demoralization, long hours and easy access to euthanasia medication.