Corporate Ownership Drives Up Veterinary Costs, Study Suggests

The rising cost of veterinary care, a significant concern for pet owners across the United States, is being influenced by the growing presence of private equity and large corporations in the veterinary sector. Companies such as Mars, the parent company of confectionery brands like Skittles, have become major owners of veterinary clinics, contributing to increased expenses for pet parents.

Escalating Veterinary Expenses

While inflation plays a role, advancements in veterinary medicine mirror those in human healthcare, leading to more complex and costly treatments for pets. Procedures once unheard of, such as MRIs for cats, are now common. However, the surge in prices is not solely due to technological progress. Corporate entities and private equity firms have recognized the deep emotional bonds people share with their pets, often viewing them as family members, and have aggressively entered the veterinary market.

This shift has transformed the landscape of pet care. Traditionally, veterinary practices were independently owned. Over the past 10 to 15 years, however, a significant consolidation has occurred. Mars, through its ownership of brands like VCA, Banfield, and Blue Pearl, now operates around 2,500 veterinary facilities. This corporate ownership accounts for an estimated 33 to 50 percent of all vet clinics in the U.S., a substantial increase from less than 10 percent a decade ago.

Impact on Pet Owners

Employees of large veterinary chains have reported routine price increases occurring every six to nine months. A recent investigation in Britain by the Competition and Markets Authority (CMA), the UK's equivalent of the Federal Trade Commission, found that private equity and corporate ownership contributed to an additional billion pounds spent on pets over five years. The study also indicated that prices at corporate-owned veterinary practices were approximately 16 percent higher than at independent clinics.

The financial strain on pet owners is considerable. Routine care, such as spaying or neutering, can cost several hundred dollars annually. More significant procedures, like dental cleaning under anesthesia, can start at $1,000, with tooth extractions adding to the cost. Major surgeries for conditions like spinal disc herniation can easily exceed $10,000, and even overnight observation can cost thousands of dollars per night.

Pet owners are exploring various strategies to manage these escalating costs. Some travel with their pets to other regions or countries where veterinary services are less expensive. Pet insurance, while an option, can be costly and subject to significant annual premium increases. A 30 percent increase in insurance premiums for a two-and-a-half-year-old dog with no known health issues highlights the financial burden.

Furthermore, unlike human health insurance, pet insurance policies often do not have a preexisting condition clause, leading to situations where insurers deem certain ailments as preexisting, denying coverage. This can leave owners facing unexpected and substantial out-of-pocket expenses.

Difficult Decisions

The financial pressures have led some owners to incur debt or utilize buy-now-pay-later services for veterinary bills. In more difficult circumstances, some owners are forced to surrender their pets to shelters, a trend that shelters report has increased in correlation with rising veterinary costs. The emotional toll of these choices, often pitting financial constraints against the well-being of beloved pets, is immense. The emotional connection people have with their animals is precisely what makes them vulnerable to high costs, as owners are willing to pay nearly any price to keep their pets healthy and pain-free.