The cost of care conversation continues

💰
The Cost of Care

If one thing is for certain, the cost of care is the story of 2024. It seems that more weeks than not big news outlets are reporting on the cost of veterinary services. From the UK investigation into the cost of veterinary care to the ongoing reporting in North America, the entire Western world is seemingly enamoured with the issue.

If you haven’t been following along, here are the broad strokes on the issue:

• Due to inflation, just about everything in the world is more expensive these days.

• However, the cost of veterinary care has risen proportionally more than most other sectors.

• Frustration has boiled over among consumers, so news outlets have been covering it repeatedly.

• Some articles blame the veterinarians themselves, the evil animal haters out to make a buck, while others look at the problem more holistically.

• Recently, the media has latched on to the issues associated with private equity and corporatization and have been exploring their roles in raising prices.

Last week we linked you to an article from Yahoo! Finance on the operations of Mars and their pet health business. This week, we have more on Mars’ business courtesy of The Guardian. Mars is a leader in the pet industry, playing a role in all aspects of a pet’s life, from food to medical care. As such they see the value in promoting an increasing role for pets in society. After all, more pets means more profit. With 60% of their $50 Billion revenue in 2023 coming from their pet care operations, business is booming. Loic Mouteault, the Global President of Mars Petcare is quoted extensively in the article, including discussing the rising cost of veterinary care. He attributes it to owners wanting to do more given the role of pets in the family. This combined with the advancing medical care has caused veterinary bills to grow.

However, none of that explains how visits to veterinarians are down almost 2% year over year, while revenue is up 2% (Vetsource).

Those numbers are owed, at least in part, to the fact that veterinary costs have increased 60% in the last decade according to reporting this week from the New York Times. This article is the result of a past request for information from reporter Katie Thomas who was looking for information on big vet bills. Thankfully, the great people on the front lines of our profession are not the ones implicated. Instead, Thomas takes aim at private equity and corporate roll ups of veterinary practices as a cause of pushing higher priced care to ensure profitability.

And because nothing is ever as straightforward as it seems, the latest episode from the great team at the Veterinary Innovation Podcast makes the case that private equity partners and leading with sound business principles is a net positive for our industry as it is driving organizations to create culture, keep people, and figure it a pricing model that works for the industry.

No matter what you believe, it is clear there are downstream effects. ABC reports that Americans are traveling to Mexico to seek more affordable pet care. Hopefully these folks will also know about the changes to US travel laws with respect to dogs which are enacted on August 1.

It’s clear that the cost of care is not going anywhere, so let’s keep the conversation going… Reply to this email and let us know how you think we can we reduce the cost of care for our clients and maintain high quality care?

🤖
This week in AI

It has been a while since we have covered the latest in Artificial Intelligence. We know it can be a polarizing topic, but there were a few good stories this week that deserve some attention.

First, this week, Obi co-founder Ryan Appleby, had the pleasure of speaking with VIN news service about AI. In an article discussing AI based pain scoring tools, Ryan discussed the challenges associated with safety and ethics for veterinary AI systems, including how all AI systems should be supported by similar types of evidence and information.

While veterinary medicine is a bit of the ‘wild west’ when it comes to rolling out AI systems, guidance for any healthcare AI product exists from the joint efforts of the FDA, Health Canada and UK MHRA. The Good Machine Learning Practice (GMLP) and Transparency for Machine Learning Medical Devices documents provide a roadmap for AI companies to provide specific information to end users like veterinarians. Sadly, this information is lacking in most instances in veterinary practice.

Other news making waves in the AI world is an article in the New England Journal of Medicine: AI (NEJM AI) which discusses the emerging role of Chief Health AI Officer for healthcare institutions. Thought leaders in the veterinary field have already noted the similar needs of our institutions, but of course the job will look vastly different in vet med. With no regulations to speak of, veterinary CHAIOs will have to chart a course for their organization and establish ethical principles and codes of practice as they relate to AI. Veterinary CHAIOs will also face an uphill battle on improving AI literacy in veterinary practice, ensuring that all team members are up to speed to harness the power of AI and mitigate risks wherever possible.

🚀 
Quick Hits

Here are some of the other stories that caught our eye and we're following this week from around the veterinary world and animal kingdom: