Veterinary Medicine, Incorporated

Photo Credit: Flicker CC, sagesolar, upwardTwo giant corporate players have been making veterinary headlines as of late.  Mars, Incorporated, the candy maker (M&M’s, Snickers, Twix, etc.), pet food manufacturer (Royal Canin, Pedigree, Iams, Whiskas, etc.), and owner of Banfield Pet Hospital with its more than 900 locations has plans to acquire VCA Antech and its almost 800 veterinary hospitals. The purchase price is said to be $9.1 billion. Pending approval of federal regulators, this mega-deal is set to close before the end of 2017.

Corporatization of veterinary medicine is nothing new. It’s been going on for decades. The more recent trend is the consolidation of veterinary corporations. To date, the Mars-VCA deal is the largest such transaction on record.

Another relatively new trend is the consolidation of independent veterinary practices. The first large-scale merger happened in 2010 when 17 facilities joined together to create Companion Animal Practices, North America. This company grew to 56 locations before being acquired by VCA Antech. Mixed Animal Veterinary Associates North America (MAVANA) has been another successful merger in which 21 mixed animal and equine veterinary practices spread across 10 states joined forces. Dr. Scott Spaulding, founder of MAVANA stated,

It seemed to me there was an opportunity to put together some practices to develop a corporate structure to pull a lot of the business administration part out of the practice at the local level and put it at the corporate level. By pooling our resources, we can hire experts in those fields, and that’s what we’re in the process of doing right now with MAVANA.

The good

While it’s tempting to view large veterinary conglomerations and corporations as a Darth Vader character in a James Herriot story, they do have a bright side. Reinvestment of profits gleaned from improved business practices and economies of scale (a proportionate savings in costs created by an increased level of production) can provide bigger and better state of the art veterinary facilities and technology. This translates into improved diagnostic and treatment options.

Additionally, large veterinary corporations have the ability to gather data from their literally millions of patients and turn this information into meaningful research that can benefit animals wherever they receive veterinary care.

Lastly, without corporate buyout options, most veterinarians who own really large veterinary hospitals would not be able to come up with a financially feasible exit strategy for themselves. Few veterinarians have the capital required to make a multi-million dollar purchase.

The bad

Although an estimated 85-90 percent of veterinary clinics and hospitals within the United States remain independently owned, in some regions of the country, corporations own a disproportionately high percentage of veterinary facilities. For example, the San Francisco bay area supports a large number of veterinary specialty practices. VCA Antech (soon to be Mars) owns all but a couple of them. Such monopolies take choice out of the hands of the consumer.

VCA is a publicly traded company, meaning its business metrics and acquisition activities have been public knowledge. Such information can be useful in terms of the business of running a veterinary hospital. For example, private veterinary practice owners might derive reassurance that their financial “slow season” seems to match up with VCA’s “slow season.” All such public information will go underground once VCA’s approximately 800 hospitals are acquired by Mars.

The ugly

Having nonveterinarians call the shots can be worrisome in terms of the best interest of the patients. Banfield Pet Hospital and VCA have both been criticized for tying the hands of their veterinarians, requiring that they follow strict medical protocols rather than making decisions based on the needs of individual patients and clients. In fact, a recent Bloomberg Businessweek article featured a veterinarian accusing Banfield of pushing its employees to prioritize profit over the health and safety of the animals they are treating.

Reactions within the profession

Reactions to the Mars-VCA merger from those involved in the veterinary profession have been mixed. Dr. Eileen Jefferson is the owner of Ethical Veterinary, a mobile practice in Stone Ridge, New York. She is concerned that,

Veterinary medicine stands to be reduced to the financial interest of shareholders in a candy company, and at the expense of veterinarian-owned hospitals. Using a fast-paced, cookie-cutter retail model has the potential to undermine the science and ethics central to traditional veterinary practice. More than ever, animals are regarded as family members. As a veterinary practice owner, I see that clients are increasingly interested in time spent with the veterinarian, thoughtful education, continuity of care, and patient-tailored medical decisions. The trend toward corporate veterinary practice doesn’t seem to to match what clients are actively seeking for their animals.

MAVANA founder, Dr. Scott Spaulding, views the VCA-Mars merger as potentially positive for the veterinary profession. Based on his experience as a practice management consultant and member of the AVMA Veterinary Economics Strategy Committee, he recognizes that one of the largest financial hurdles most practices deal with is the lack of capital. Pertaining to the the acquisition of VCA, Dr. Spaulding stated,

It’s a capital-intensive business. We have to have facilities and a large enough staff. We also invest heavily in surgical facilities and the latest diagnostic technologies. With $9.1 billion coming into the veterinary industry, I think that is definitely needed by veterinary medicine and that it will have a tremendous long-term impact.

In response to the VCA-Mars transaction, the American Veterinary Medical Association (AVMA) issued forth the following uber-politically correct statement:

We support every veterinarian engaged in veterinary medicine, no matter where they practice. In addition, regardless of practice ownership, the interests of the patient, client, and public require that all decisions that affect diagnosis and treatment of patients are made by veterinarians in the context of a veterinarian-client-patient-relationship, and veterinarians must have the authority to exercise professional judgment in making clinical decisions.

How do you weigh in on this topic?

Best wishes,

Nancy Kay, DVM

Diplomate, American College of Veterinary Internal Medicine
Author of Speaking for Spot: Be the Advocate Your Dog Needs to Live a Happy, Healthy, Longer Life
Author of Your Dog’s Best Health: A Dozen Reasonable Things to Expect From Your Vet
Recipient, Leo K. Bustad Companion Animal Veterinarian of the Year Award
Recipient, American Animal Hospital Association Animal Welfare and Humane Ethics Award
Recipient, Dog Writers Association of America Award for Best Blog
Recipient, Eukanuba Canine Health Award
Recipient, AKC Club Publication Excellence Award
Become a Fan of Speaking for Spot on Facebook

Please visit http://www.speakingforspot.com to read excerpts from Speaking for Spot and Your Dog’s Best Health.   There you will also find “Advocacy Aids”- helpful health forms you can download and use for your own dog, and a collection of published articles on advocating for your pet’s health. Speaking for Spot and Your Dog’s Best Health are available at http://www.speakingforspot.com, Amazon.com, local bookstores, and your favorite online book seller.

 

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17 Comments on “Veterinary Medicine, Incorporated

  1. I have mixed feelings about this. We travel from coast-to-coast all year long with our dog and it’s nice to know that his information can be easily referenced no matter what corporate clinic we visit. Also, since most of these clinics are adhering to accreditation standards set forth by the American Animal Hospital Association, it’s a win for pets and their humans. I never worry about cleanliness, safety, etc.

    On the other hand, when we do visit these “chain” clinics they are definitely a cookie-cutter system that’s not really helpful when your dog’s issue isn’t a by-the-book case. Because Speaking for Spot” has taught us to be good advocates for our dog, if we don’t get what we want out of corporate medicine, we leave and choose independently-owned AAHA hospitals instead. It’s that easy for us, because we travel in our RV. For those folks bound to one town or city, I feel for the lack of choice they have.

  2. This is very unnerving and scarey. I would trust my vet with my life and of course I do with my dogs lives. He is extremely knowledgeable and caring. He kept my one dog alive and as healthy and happy as possible for two years. He always personally returns my calls with answers to my questions I left for him. He never has someone else call me back. He always explains and discusses with me everything that he wants to do and why. He does extra things as well like giving me medications from his special stash!! All this will disappear!!!
    VCA and Banfield in my area have terrible reputations for their high costs over individual vet offices and the care is no where near what I get with my vet. Many vets left when their offices were bought out by VCA because they could no longer give the time and care to their clients like they were use to doing.
    If pets were legally considered as family members rather than property and vets could be sued for medical mal practice, then maybe it would be different. However as long as the bottom line is the almighty dollar rather than good medical care, you will not find really good vets at these groups.(They leave) I am worried about even getting another dog for fear of not finding a vet I can fully trust after my vet retires!!!

  3. It’s not just business people in charge of vet groups that are a problem. Even with a vet at the helm of a group of practices, policies and protocols favor the profit side, not the patient or the client.

    Ideally, a practice should work with clients cooperatively to produce the best outcome for the patient rather than rely on protocols. Some owners can’t afford “pull out all stops” care… run bloodwork and imaging studies every time… so what do those people do with their animals when “That’s our policy”…. Let them suffer or die?

    IMO, the increased (over?) reliance on diagnostic tools, especially by management dictate, decreases the ability to think critically. I have experience with a vet who runs certain diagnostics because his business manager promotes them, not because there is solid research to support their value, which escalates the cost of care substantially without a corresponding benefit.

    I don’t think the value of research offsets the negatives of corporate management. Around here, when someone says “Banfield”, it’s usually followed with a cringe of sadness for the mistreated animal. The value of research is only there if the research is done. I don’t see groups like Banfield or VCA as willing to invest profits into research but I guess we will see.

  4. My long time vet works at a VCA location that acquired the private practice she worked at, about 10 years ago. She promptly lost more than half her clients after their first encounter with her at VCA, due to the ridiculously expensive fees they charged. For instance, a typical routine dental with pre-anesthesia blood work, including x-rays, went from around $375 to a “minimum” of $2,000 at VCA!! The cost of every single procedure/service went up drastically, and most people just couldn’t afford it. This particular location is very old and dingy, which doesn’t make it feel like you are even getting state of the art care! I have three special needs dogs, and only stay because I love and appreciate my vet. But with 5 hairless dogs, and two hairless cats, my vet bills on a “routine” year are always at least $12,000. I’m concerned about what the costs will be when the Mars acquisition happens.

  5. Call me old fashioned but as a veterinary technician/assistant, I like working with the actual owner of the clinic. Yes, there are pro’s and con’s of that but ultimately, I get to know the owner well. As an employee, I feel like I can be heard better and really feel like we are a small unit which I like.
    I don’t like that all these Corporations are buying out the little clinics from the old retiring vets. At first it was okay but I don’t like seeing it becoming the trend of the future. The clinic I am working at right now has been tetering on the fence about selling to one of these corporations. Why is this all happening? Is it that this generation of veterinary students have grown up in more of a privileged era where they feel like they just want to show up for work and leave when their shifts are done? When emergency clinics started opening up in my area, private clinics were happy since they could always refer them to these places to “have a night off”. They also tended to be more equipped for higher level treatment. Somewhere along the line, vet’s just started getting “lazy” and auto–referring their clients after hours. This is where the current trend is going but what seems to be happening is that this corporation niche has become more prevalent. It is almost like the old time industry is giving up its rights. Corporation put lots of pressure on the “bottom line”. They pressure veterinarians into doing lots of diagnostic tests that could probably be postponed when a veterinarian can use their own thought process to weed thru. I have recently worked with an “old time” vet where they chose not to be high cost. He never owned a bloodwork machine and didn’t do all these fancy hook ups of sPO2 , EKG, catheters and bloodwork for young animals scheduled for routine procedures. It was mainly in the geriatric dentals or other surgeries where we did that sort of thing. I worked there for 16 years and only knew of a few deaths. In contrast to this type of practice, I now work in a place that is also privately owned by an older vet that tries to practice modern medicine with lots of this upcharge of diagnostics and monitoring. I have seen more deaths in just over a year that I did at the other place where I was employed for 16 years. I do like the idea of using catheters as a “just in case” but sometimes people just can’t afford these extras. I don’t feel they need to be shoved down people’s throats which is what these corporations will do for the sake of the bottom like. Hogwash to ‘liability”. I think the more you piss people off with cost, the more likely they are to sue. In both of the clinics, I have seen cases where the animal died and could probably have won their case but they never did. Why? I think most of it has to do with really getting to know who your client is. Building that rapport and gaining trust. In both cases for me , two types of management were in place but in neither clinic have I seen a lawsuit. Overall, it was the clinic that didn’t push services and costs that seemed to have the happiest clients. We were bustling and booming there. I watched that clinic grow from tiny to a very busy practice in those 16 years. It was the combination of care, costs, rapport and being reasonable that I feel have been the contributing factors.
    I think that the corporation serves its purpose in this industry but I don’t want to see the private clinics dwindle away. Sadly, that is what I think will happen if we don’t motivate these veterinarians to get out “on their own”.

  6. too many Vet offices are about the money NOT saving lives and helping pet owners. Pet parents are turning their animals (mostly dogs) in to the local pound because they can’t afford to take care of them at the high cost of Vet care. Our local pound has been killing dogs (whitewashed by calling it euthanasia) for years at the rate of 100 PER DAY times two locations due to space. Pet parents have no choice and the odds of the animal making it out alive was 50/50. Medicine cost is outrageous. I recent had Mometamax – ear antibiotic, from the Vet $51.00, I later checked on GoodRX.com and price was $22.61. Even at $22 dollars the company had to be making some profit. Mark up of 100% plus by Vet office. Unacceptable.

  7. Regardless of health care for people, animals, health food stores, anything and everything has NEVER been improved by corporations. My experience (health care), corporations ultimately exist for the corporation. They make decisions for profit, for CEOs, and do not care for clients or employees on the front lines actually doing the hands on labor.

  8. Thank you very much, Dr. Kay, for addressing this high-profile topic in your customary thorough, balanced approach based on real facts! I was saddened in late ’16 by the news that because they are near retirement, my wonderful vet had, along with his partners, sold the practice to VCA. No independent vet wanted or could afford to buy the practice and enable retirement. I take some comfort in the positives you’ve identified.

  9. The lack of capital is understood and very real. The larger organizations have the expensive, specialized equipment that can help with so many conditions, but access to such can sometimes mean repeat visits to a location that involves hours of travel for our pet (not always the best option). However, the #1 priority for a public corporation is boosting shareholder value, and that comes before anything else. Always.

  10. I just read the article in the most recent BARK magazine that address this whole topic. It has given me pause about spending $1000 in testing and medication to treat incontinence and a UTI with anti-biotics for my 12 year old dog and then followed by a prescription for rimadyl. The cost seemed so excessive to me. The good news is my dog appears to be doing a lot better with more pep in her step.

    I also now question the overuse of vaccinations which I have given to my other 2 dogs consistently since I’ve been their guardian. Are yearly vaccinations overkill? How do I decide? What do others think? Unless I am mistaken, my two 10 lb. chihuahua mixes are getting the same dose as my 80 lb. collie.

    I honestly don’t know who to trust for a vet now. In my area the cost of veterinary care varies widely. Any suggestions how to determine if I am being treated fairly when it comes to cost? As a pet guardian who loves her babies, I am feeling very vulnerable.

  11. This is sad news for me. In the last few years, my long time relationships with excellent independent vets have changed as they have retired. I’ve looked for other alternatives, including VCA. There is a clinic near my home that offers extended hours 7 days a week… that is an attractive feature. The vets I’ve seen there have been excellent, willing to work with knowledgeable owners, and the techs are very competent too.

    In the last few years, VCA has bought out a number of practices in this area, including specialty practices all over the large three county metro area where I live.

    That said, when I needed urgent care for a geriatric dog recently and went to VCA, it would have been very helpful to get an in house blood panel run. Unfortunately their blood processing unit was out of service, and repairs were not scheduled for several days. Worse, the vet we were seeing was not aware that they could not run labs. He was not pleased to learn about this at all. We ended up leaving there and going to a different ER clinic instead.

    The original “Banfield vet” Warren Wegert was an excellent veterinarian that my family took our pets to from the time he opened his original clinic. Once it became a corporate entity under Scott Campbell however, with ‘wellness plans’ and what seemed to be a revolving door for staff, complaints about the company escalated. I remember one Banfield vet who was employed at the closest clinic to me being arrested for animal neglect when her two horses were found locked in a decrepit barn in manure up to their hocks, seriously underweight, and generally neglected. One horse could not walk. Knowledgeable pet owners in this area do not take their pets to Banfield.

    Campbell went on to create “Hannah the Pet Society,” which was essentially a very expensive ‘rent-a-pet’ service that ended up under scrutiny from the Oregon Attorney General due to the complaints that were filed regarding their business practices. The pet rental portion of his business was discontinued.

    Mars has also come under scrutiny for their business practices.
    https://www.bloomberg.com/news/features/2017-01-05/when-big-business-happens-to-your-pet

    http://www.confectionerynews.com/Commodities/Mars-Nestle-and-Hershey-face-fresh-cocoa-child-labor-lawsuits

    I guess I’ll be looking for other vets again…. thanks for the heads up Nancy.

  12. I think this is a very bad idea. Don’t know if there’s anything we can do to stop it, but I see it as just one more step toward big corporate America at the expense of consumers. I treasure my relationship with my veterinarian – I can e-mail her nights and weekends, and even call her cell phone if it’s an emergency. You can bet that doesn’t ha[[en with Banfield or VCA.

  13. An intriguing story, Dr. Kay, thanks! I work in a box retailer and have been a Banfield neighbor for 10 years where I have observed three varieties of turnover apple, cherry, and staff. Vets appreciate the opportunity to cut their teeth with Banfield but quickly grow frustrated with the corporate “one size fits all” approach to medicine. Those who dare to step outside the box regarding treatment are quietly dismissed and never heard of again. Support staff, especially practice managers, come and go through a perpetual revolving door. Practice managers are responsible for the financial sustainability of the hospital. Their performance seems largely based on the ability to “up-sell” services that do little more than feed the corporate beast that is Mars.

    I have met some wonderful practitioners and support staff over the years that were hired by Banfield. Very few of them still around. On a personal level, I am looking for a practice that embraces a variety of treatment options and provides compassionate care from the moment we walk into the door. I don’t think you can teach that out of a three-ring operational binder written in a corporate cubicle housed in Candyland.

  14. Thank you for posting this article…one that effects the future of all of us pet owners (unless we live so far out from populations that we are in a different “zone” of vet care altogether). As you know, Nancy, just a yer ago I experienced a very blatant case of profit over client desires/best procedure for animal. I was left giving the PTS order AND with an inflated bill. I won’t forget it, ever, and I am sure that any other pet owners who have been ENTRAPPED in such a situation would agree: such an event is life-shaking and unforgettable. Unfortunately, corporate medical care for both humans and our animals has become a fact of life. We need to be aware. We need to CLEARLY AND INDELIBLY notify the vet corporation with which we are dealing of our desires and that the corporation MUST agree to RESTRICT themselves to obeying those….It would be helpful to have our own corporate attorney in the room to have paperwork signed, I know! This situation is going to be more and more of an issue…just as it is in human health care at times. Thanks for posting it.

  15. It was just a matter of time. The same thing has happened in human medicine in the USA, with big corporations and conglomerates taking over. We have a large emergency vet practice in our area. It’s good and it’s bad. Our vet does not have to be on call 24-hours a day, while the emergency practice is open 24-hours a day. They have the best, up-to-date equipment. However, I worry about the quality of the vets that work there. They mis-diagnosed my Kate when she had anaplasmosis and she could have died without the appropriate care.

  16. It makes sense that with the rise of pet parents and their concern for their pets evident in the amount of money they spend on them annually continuing to rise, that corporate efforts would demonstrate an interest. I don’t see corporate interests concerned for anything but their bottom line and profit. This proves itself over and over again no matter what the focus or product is. Corporate efforts do provide some good outcomes sometimes like employment opportunities. My concern is that “cookie cutter” approach to diagnosing and treating our pets. I want an integrative veterinarian who is open to discussion about what is best for my dog and that may be an option outside the dictates of traditional veterinarian care. I don’t believe that will happen in a corporate environment. We are still learning so much about our dogs and cats and other animals. We have barely scratched the surface with learning about them and what is best for them in the area of treatment. We are now learning about the impact of too many vaccinations and how nutrition is vital to our dogs health and that what we feed our dogs makes a huge difference in their well being. If profit drives this ongoing research and these treatments I will be looking hard for that small clinic and integrative veterinarian who can be there for me and my dogs.

  17. Thank you for this article Dr. Kay. As the founder and director of an animal shelter which started out as a hobby and now ending a fiscal year where over 900 pets have crossed our threshold I’ve dealt with many vets over the years. If asked I direct adopters away from what I’ve been calling “chain store vets” as I don’t feel they attract the best and the brightest. Also, when they first came to our area I noticed a lot of what I call “up servicing” which seems to be increasing throughout the veterinary community. The rescue pets are treated no different than my own and they go to the individually owned practices and to the best vet for that particular issue. Owners, now more than ever, need to shop around for a vet and not be afraid of second opinions and referrals to specialist. If your vet gives you a hard time about this THAT is when you need a new vet. Thank you for this opportunity to speak.

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