The cost of running a veterinary practice ...

Complaints about vet charges are common, but are they justified?  

We investigate the reality of running a veterinary practice and give some tips on lowering your vet bills ...

According to the Association of British Insurers, in 2012 a total of £452 million was paid out by insurers to cover vet bills across the country with the average cost of treatment now standing at £300. One of the biggest criticisms levelled at vets is the apparently high cost of veterinary care.

Whilst we as pet owners are happy to praise vets for delivering high quality treatment, we are equally likely to bemoan the high prices and perceived poor value offered. 

There is a perception that the veterinary business model contains many examples of treatment and procedures that are significantly overpriced.  These can be anything from unnecessary follow-up consultations to the high cost of prescribed drugs and specific procedures. Whilst no-one should deny vets the right to earn a living, many pet owners believe that the profession as a whole exploits the emotional bond between dog and owner to maximise profit.

But is there any truth in this? 

What are the hidden costs associated with running a busy veterinary practice?

Is it a license to print money?

And what can we, as dog owners, do to help reduce our veterinary bills?

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There is no NHS for Pets...

 

The first and obvious point to make is that because there is no NHS for pets, the cost of treatment delivered reflects the harsh commercial reality.

If you have ever had medical treatment on a private basis you will know that most medical procedures, however routine, are extremely expensive. The NHS's 'free at the point of consumption' model has inured us to the real costs involved – a straightforward hip replacement operation can cost upwards of £10,000. Although unrealistic, it is therefore not surprising that we expect a similar level of value when we visit our local veterinary surgery.

The veterinary business model is just that: a business. In order to pay its staff, maintain its premises, pay for its professional indemnity insurance and purchase the necessary equipment, it must collect an amount each year at least equal to that total. If it fails to at least break even, it will fail. 

Time is money ...

Veterinary surgeons, like lawyers, operate on a time basis. The only product they have to sell is their expertise for which they charge on a time-incurred
 basis.

In order to qualify, vets need to undergo a six-year period of study after which they can typically expect a salary of between £25,000 and £40,000. Although these sums are above the national average, given the duration of qualification and the long hours worked they do not equate to the sort of sums associated with other similarly qualified professionals.

According to Adrian Caunter MRCVS, ❛vets routinely undergo 50 hour working weeks. Whilst it is a privilege to help the animals in my care, the average hourly rate works out at about £11.50 which is not a significant sum given the amount of study that is required in order to qualify. The overwhelming majority of vets join the profession because they want to help animals.❜

Apart from staff salaries, there are numerous costs associated with maintaining a modern veterinary practice. Judy Matthews, practice manager at Downes Veterinary Practice 'We have to maintain the fabric of the buildings as well as ensure that our equipment and staff training are kept fully up to date. Veterinary equipment is not just confined to the things visible to the client. Most surgeries are quasi-hospitals and that means having to make a significant investment in surgical equipment and X-ray machines and the like, many of which cost tens of thousands of pounds. Without an NHS-style arrangement, the cost of this sort of investment will ultimately be borne by the client like in any other type of business.'

"The mark-up on medicines is in reality very small .."

But what about the cost of medication and the fact that there are online pharmacies that sell drugs much more cheaply than can be purchased at your local surgery? All the vets with whom we spoke in the course of researching this feature stressed that the online pharmacies could sell medicine to the public cheaper than surgeries where able to purchase it wholesale. The buying power of a global pharmacy will dwarf that of even the largest multi-site practices.

Adrian Caunter said, 'The mark-up on medicines is in reality very small. Economic reality dictates that practices will look to make a small profit on the
 drugs they prescribe but any suggestion that we prescribe treatments unnecessarily just to make a profit is well wide of the mark. Your dog will only be prescribed medicine which, in the view of the presiding veterinary surgeon, is in the best clinical interests of the animal.'

One of the biggest complaints expressed by pet owners is the charge levied by surgeries to prepare a prescription for use in online pharmacies. There is a clear perception that is a 'money for old rope' charge although all of the vets with whom we spoke were keen to refute this suggestion.

Administration fees...

All of these surgeries charged a Medicines Determination Fee (MDF) or equivalent administration fee. This sum is charged to recover the costs incurred on all matters connected with the selection, ongoing advice and service surrounding medicine usage. This fee is automatically included in medicines provided by some practices and is shown separately on invoices and receipts. The sort of things typically covered by this fee includes the cost of initial evaluation and ongoing review of medicines, complying with pharmaceutical legislation and registration fees, review of any adverse reactions and communications with pharmaceutical companies and the Veterinary Medicines Directorate (VMD).

Judy Matthews said: 'It is not always appropriate to dispense the same medicine adinfinitum. In deciding whether to write a repeat prescription, the vet must examine the underlying condition and decide whether the current treatment remains appropriate. Many medicines have serious side effects arising from long-term use and the vet will need to consider these in the context of the animal's treatment. In addition, the VMD imposes certain protocols which require us to physically see an animal after a certain period of time before we can continue with long-term prescriptions. These considerations rely on the vet's professional judgement – it is not simply a question of signing a piece of paper.' Each surgery will have a different charging structure in place, so it pays to shop around.

Repeat fees...

By far the biggest complaint, however, that is brought to our attention is the practice of some surgeries to charge repeat fees for follow-up consultations. Again, this varies considerably across the country both in terms of price and frequency. Some surgeries will charge the full fee regardless of whether the consult relates to a first appointment or a subsequent visit to check on the progress of treatment. Many surgeries justify charging the full fee by stressing the fact that clients are paying for both the vet's time and their expertise which, in the final analysis, is the only thing they have to sell. Other practices will only levy a fee if they have made a medical intervention and will not charge simply for monitoring progress or undertaking similar post-operative work. It is, however, clearly something which dog owners feel strongly about. Several people have advised us that they have even attended basic canine first aid training courses in order that they can deal with simple ailments without having to reach for their debit card.

 

So what can we as dog owners do to reduce the cost of veterinary treatment?

First, make sure that you have appropriate medical insurance in place for your dog. As with most things in life, you tend to get what you pay for so make sure you do your research thoroughly on the levels of cover offered under the policy and most importantly, what is not covered. Alternatively, many surgeries run schemes which, in return for regular payment, afford participants a range of benefits including discounts on the cost of treatments.

Be Proactive 

Prevention is better than cure! Keep your dog fit and healthy with regular exercise and a balanced and nutritious diet. There are many healthy dog clubs run by veterinary surgeries some of which are free, so take advantage of the advice and help given.

Act quickly 

You are usually the best judge of your dog's wellbeing, so if you are concerned, do not wait until the condition has worsened. There are many ailments which cost very little to address successfully if identified early but are extremely expensive if allowed to proceed untreated.

Use the telephone 

It is not always necessary to attend the surgery with your dog. If you have developed a good rapport with your local practice who knows your animal's medical history, you should not hesitate to pick up the telephone and seek advice.  'Responsible veterinary surgeons are always happy to talk with worried owners,' said Adrian Caunter. 'If I or any of my colleagues are aware of the medical history of the animal in question by virtue of them being at a patient at our surgery, it will sometimes be possible to reassure the owner without them having to attend the surgery.' Your vet is a valuable part of your dog's life, so make sure you use their expertise.

Shop around

The veterinary industry is hugely competitive. Margins are extremely tight as an ever-increasing number of practices fight for your custom. If you do not like the pricing or standard of care at your current vets, visit the Good Vet and Pet Guide for advice and find another surgery who will provide the standard of treatment and value for money that you demand.

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