The good folks at Bloomberg have discovered what I reported on 9 years ago, which is that the once-independent veterinary trade is rapidly consolidating into a small number of for-profit chain-store businesses, owned by holding companies, and with consultants driving a pure-profit business model based on upcoding, medically unnecessary testing, and price-gouging.
In a post entitled Veterinary Trades Say It's Time to Rip-off the Rubes, I noted:
"As time goes on, more and more veterinarians are slipping to 'the dark side.' Corrupt practices such as bill padding, kickbacks, price-gouging, and prescribing medically unnecessary procedures are becoming normalized. Young veterinarians are being told, 'this is the way you do it.'"
So what did Bloomberg discover on their deep dive into corporate veterinary care? A few bullets:
- Corporations now own 15 percent to 20 percent of America’s 26,000 pet hospitals despite laws in most states banning corporations from owning veterinary practice .
- Banfield Pet Hospital is America’s biggest chain of veterinary clinics. It started out as a franchise, but is now owned by the Mars candy company, and it is reportedly using strong arm tactics to force franchises to sell their operations back to the core company at prices far below true market value. .
- Banfield puts its hospitals inside big-box retail PetSmart stores, "turning medical care into a product to be purchased along with dog food and chew toys — just another item on a one-stop shopping list."
- Banfield uses a software-driven scheme called PetWare to both standardize care and maximize billing. Banfield was not willing to share the current PetWare manual with Bloomberg, but the old PetWare manual "makes for interesting reading". Bloomberg notes that "In one example, explaining how the software is used to prescribe treatment, the book shows a checklist of therapies for a dog with atopic dermatitis, or itchy skin. Doctors are encouraged to recommend a biopsy, analgesics, topical medications, antibiotics, a therapeutic dietary supplement, an allergy diet, and a flea control package. They’re required to recommend antihistamines, shampoos, serum allergy testing, lab work, a skin diagnostic package, and anti-inflammatories. It’s a treatment course that might run $900 for symptoms that, in a best-case scenario, indicate something as prosaic as fleas. In bold print, the manual reminds doctors: “You cannot change items that were initially marked Required. They must remain required.”
- Vaccines are at the core of Banfield’s main product which is a selection of preventive-care packages they call "wellness plans". For a monthly fee of $30 to $60, a wellness plan covers exams, office visits, diagnostic tests, and shots for dogs and cats. Call any Banfield hospital, and you’ll be told it’s the vaccines that make the plans such a good value, because à la carte, they are as much as $40 each, along with $50 for each doctor visit. Not said: after the first year of vaccines, and with the exception of an every-three year rabies booster that can be had for $10 at any animal shelter, vaccines are not needed at all. Canine vaccines are good for the life of the pet.
- Last year more than 2 million pets were covered by a Banfield wellness plan, and every dog gets basically the same treatment, regardless of whether it’s a 10-year-old miniature poodle living in a high rise or a 2-year-old Labrador retriever that runs free on a farm.
- Bloomberg writes: "If the wellness plans make medicine into a standardized product, Banfield’s pet drop-off policy is what allows a hospital to hum at maximum efficiency. Pet owners are required to leave their dogs and cats all day when taking advantage of the plan’s twice-yearly comprehensive exam. For some people this is exactly why Banfield is so appealing — no more interrupting your work schedule for a vet appointment. For Banfield it’s a way to squeeze exams into the gaps between surgeries, walk-ins, and other appointments."
- "While pets wait for treatment, they’re warehoused in a wall of kennels at the back of the hospital—sometimes without water, because animals that drink need to urinate. Donna Smith, a licensed technician at a Banfield facility in Waterbury, Conn., who was fired in 2014, says staff at her hospital worked like a 'pit crew,' with all the hurry and commotion that connotes. But instead of changing tires and refilling tanks, they were pulling dogs out of cages, giving vaccines, taking blood and fecal samples, and rushing through physical exams that might take no more than 90 seconds. 'I once saw a doctor vaccinate the wrong dog because we had paperwork everywhere and so many dogs lined up,' Smith says." .
- In contrast to human medicine, in which everything is mandated and overseen by a web of government agencies, veterinary medicine is largely unregulated. There are little or no fraud protections.
- Most pet owners pay cash and vets don’t deal with insurers haggling for better prices or questioning whether that vaccine or ultrasound or blood panel is actually necessary. .
- "When veterinarians make fatal mistakes, they face no real financial consequences... Damages paid to owners whose pets have been killed or injured are so low that a typical medical malpractice insurance policy for a veterinarian costs less than $20 a month. Damages are so low, in fact, that few pet owners can find a lawyer willing to take even the most egregious case of veterinary malpractice." .
- The cost of veterinary care in the U.S. has risen even faster than the cost of human health care, more than doubling since 2000, according to the U.S. Bureau of Labor Statistics. .
- In corporate medicine, the bottom line is the bottom line and the core business strategy is to leverage the customer base by increasing the number and intensity of the services received during each visit. Most practices set out treatment, package and procedure goals centered around billing rather than individual canine needs. Wendy Beers, a veterinarian who resigned from VCA Animal Hospitals which operates over 750 facilities nationwide, reports that “Every month they would print out things to say how many packages you sold, how many procedures you did. And if they came out and said, ‘This month we want everyone to do 20 heartworm tests,’ and you only did eight, well, next month you have to do better. I don’t feel when they’re lecturing us that their chief interest is to make sure animals get the best care.” .
- Annual postcards are a core part of the business plan to sell unneeded vaccines outside of the guidelines established by the American Animal Hospital Association, which itself is on the payola of veterinary vaccines companies, drug makers, and equipment and device companies (this last point is not reported by Bloomberg).
Read the Whole Thing at this link.
If you want to know what you can DO to save money, search veterinary care and scams on this blog. The previously mentioned post from 9 years ago (reposted in 2014) is a good place to start.