Corporate Influence

HAHD_Big_Vet_IncVeterinary practices are fast succumbing to large-scale corporate ownership and influence. There is a disturbing and growing trend whereby huge, impersonal multinational conglomerates are swallowing up the smaller-scaled, personalized care veterinary practices of the past. The patient-centric, private practice veterinary model is being replaced by a corporate management philosophy which prioritizes profits and stock market value over the well-being of the patient. Diagnoses based upon years of training and experience have been subjugated to a standardized, one-size-fits-all computer printout. An often unnecessary, always expensive, set of tests are prescribed regardless of their benefit to the patient. Treatment which may or may not be of therapeutic value, but will most assuredly maximize the bottom line, is recommended, e.g., spay and neuter. We explore this relatively new phenomenon in veterinary medicine and offer suggestions (e.g., informed consent) which will ensure that your best friend’s health and welfare don’t get lost in this latest sweep of veterinary corporatism, and always remain of the utmost importance.

In January of 2017,  Bloomberg reported corporations now own 15-20 percent of America’s 26,000 pet hospitals. Much as Veterinary Centers of America (VCA) purchased independent practices and consolidated them under their corporate umbrella, other corporations are currently escalating the trend. In September of 2017, the Washington Business Journal reported that Mars Inc. had just purchased VCA Inc. and its 800 small veterinary hospitals in the U.S. and Canada, its animal diagnostic imaging company and its doggy day care and overnight camp franchise Camp Bow Wow. The Mars Petcare line already included Banfield Pet Hospital, BluePearl Veterinary Partners emergency and specialty clinics, Pet Partners Veterinary Hospitals, as well as associated pet product companies (e.g., Iams, Nutro, Pedigree, Royal Canin and Whiskas).

“Mars Inc.’s pet-care segment has entered veterinary clinic markets in Japan and Brazil, and revamped its management structure to reflect its rapidly growing stable of veterinary properties and services around the world…The biggest U.S. veterinary company [Mars] also has expanded its presence in the United Kingdom by acquiring another practice group there… Mars also has amassed a presence on the European mainland with last year’s purchase of Sweden-based AniCura, which has 270 clinics across the continent… Antech Diagnostics, one of the largest veterinary laboratories in North America; and Sound, a major purveyor of veterinary diagnostic equipment, have been shifted from VCA to the international unit [of Mars], reflecting Mars’ intention to grow its diagnostic services internationally.”

In the US, there is concern among state regulators, some veterinarians, as well as the general public over this establishment of a sort of “monopoly”. It is clear establishing a majority market share may allow Mars, Inc. to not only push fees ever higher, but essentially establish their own “standard of care”.  In California there exists an explicit conflict-of-interest, with corporations being allowed to own veterinary premises and practices. Due to these concerns, the California Veterinary Medical Board (CVMB OR VMB) undertook an evaluation of the current situation. In February of 2018, attorney Tara Welch of the Legal Affairs Division, Department of Consumer Affairs for the State of California provided a legal opinion (see page 85) to the California Veterinary Medical Board. To quote her opinion:

Current statuatory and reguatory law does not explicitly prohibit general corporate ownership or operation of a veterinary medical practice or influence over the standards of veterinary medicine practice

 “Accordingly, national corporations are purchasing veterinary premises, registering the premises in the corporate name, operating the veterinary practices housed at the premises, employing veterinarians as Licensee Managers of the premises, as well as general practitioners, and, ultimately, practicing the licensed profession of veterinary medicine. Such corporations have unlicensed officers who also manage the payroll department and negotiate employment agreements entered into between the general corporation and veterinarians and veterinary staff working at each premises. The employment agreements contain net revenue percentage incentives to sell the corporation’s animal care products,including vaccinations, flea treatments, vitamins, shampoos, dental products, and prescription pet foods and services, which may or may not be in the best interest of the animal. Consequently, these employment agreements, and the commission-based fee structures therein, create an environment where veterinarians may believe their employment is at risk if they are not selling the corporate animal care products and services to the client.

“In addition, veterinarians who own a veterinary practice may enter into contracts for the provision of management services that may be provided by the corporate premises owner, outside management services organizations, or even as corporate partners in the veterinary practice. These arrangements also potentially allow for corporate control over veterinary medical practice.”

Attorney Welch went on to propose a number of administrative rules/regulations intended to conservatively remedy the problems presented within California law.

On March 21, 2019, Animal Policy Group (APG), whose clients include MARS and Zoetis, provided a letter to the Veterinary Medical Board stating the proposed administrative rules to clarify and restrict corporate practices in California were unnecessary based upon current protections in the Veterinary Medicine Practice Act (Practice Act). In summary, the letter asserted the concerns raised in the February 2018 legal opinion as being speculative with no evidence.

In April of 2019, in the interest of getting a full view of the situation, the VMB wanted to solicit some comments from actual veterinary practitioners, veterinary students, as well as the public. The Veterinary Medical Board (VMB) had not received a high volume of complaints regarding this issue; and concluded this may be due to the non-disclosure clauses that are included in the employment contracts between the corporation and the veterinary medicine practitioner. It was postulated that veterinarians and registered veterinary technicians (RVTs) who entered into these contracts may not feel free to come forward.

These concerns were not speculative, as the VMB had feedback from at least one veterinarian who refused to sign a VCA contract in 2016 and was willing to go on the record. This occurred in the time frame when VCA was acquiring privately held practices, before VCA was acquired by Mars, Inc. When asked why he/she refused to sign the contract, the vet stated (page 50):

“Specifically, they requested us to sign a loyalty oath to VCA and their best interests (as opposed to adhering to our client’s or patient’s best interests), and they required us to sign that these contract demands were ‘reasonable.’ They have a confidentiality clause in their contract that restricts us from even discussing the information in the contract.”

To encourage individuals to share their experiences without fear of retaliation, the Subcommittee arranged for individuals to telephonically participate in the October 8, 2019 MDC discussion. During the October 8, 2019 meeting, the MDC continued its consideration of issues surrounding the corporate practice of veterinary medicine, with a focus on the issue of whether there is a need to promulgate legislation and regulations to address corporate practice problems. The MDC received public comment from four veterinary medicine practitioners and two veterinary students, who expressed the following concerns with corporate practice of veterinary medicine:

  1. Corporations that own or operate animal shelters may be asserting control over the provision of veterinary medicine services where the managing licensee (MGL) may lack the ability to control the practice.
  2. One corporation restricted the practitioner’s ability to use some laboratory services. The corporate owner unfairly and unnecessarily dictated what veterinarians do on annual basis. One practitioner was forbidden and reprimanded when she sent lab samples to other, more qualified companies.
  3. Many individuals would not participate in the MDC meeting in fear of retaliation.
  4. Corporations are telling veterinarians how to do things, such as vehemently pushing care club products and requiring standard annual radiographs not otherwise indicated as necessary.
  5. Corporate owners are incentivizing untrained secretarial staff to push the corporations’ animal care products.
  6. Corporations have prepaid pain management programs that provide insufficient pain management to spay/neuter patients; either the veterinarian has to give inadequate pain meds or charge more for additional pain medications that infuriates the clients. In some of these instances, the patient records are not reflecting the actual pain medications dispensed so the client is not charged for the medications.
  7. Corporate owners are preventing drug and equipment purchases from better vendors.
  8. In some regions, corporations own 50% of the hospitals, are influencing the practice of veterinary medicine, and are pervasive enough to make it difficult for veterinarians to find other jobs. Others are terminated for refusing to comply with corporate policy which goes against their medical judgment.
  9. Veterinarians have reported being concerned about having to practice within standards required by the non-veterinarian owner that do not meet the minimum standards set by the Practice Act.
  10. MGLs are responsible for ensuring the practice complies with the minimum standards of the Practice Act. When a non-veterinarian owns a practice and influences the practice and premises standards, the named MGL may be disciplined if the owner’s standards do not comply with the Practice Act.
  11. Large corporate practices are rapidly changing the practice and creating a different practice culture. Because of the large market share held by the corporations, students have to go into these practices to meet the required training.
  12. Corporations are setting metrics and benchmarks that veterinarians have to meet; consumers should be concerned about these benchmarks and corporate care that may undermine the value of veterinary care and the veterinarian-client-patient relationship.
  13. Veterinary students are worried about their professional autonomy in a corporate veterinary setting and being able to make good decisions for animal patients.
  14. There is no problem with corporations owning veterinary premises, but there is a concern with the corporate influence on veterinary practice.
  15. There is a disproportionate misuse of students who are supposed to be receiving education training but, instead, the corporate premises owners are manipulating how these students will practice in the future.
  16. There is a misperception that students do not want to engage in running their own veterinary practice; students want options in the marketplace and do not want to go into veterinary medicine with limited options with only corporate owners.
  17. Veterinary students fear veterinary medicine becoming like human medicine with the loss of autonomy and confusing and compartmentalized health care system. These students want to be able to provide the best medical care and decisions for animal care. They want to be able to control what they practice and within their best medical judgment.
  18. Veterinary students expressed an interest in outcomes of extremely strict regulations prohibiting dictation of veterinary practice whether in private or corporation settings.

There are similar issues with Management Service organizations, as outlined in an article in DVM360 magazine (page 44), a magazine for practicing veterinarians:

“It doesn’t look like very many state attorneys general or most secretaries of state throughout the United States are exceptionally concerned with how these veterinary MSAs are being implemented. But they should be. Since a rapidly increasing number of veterinary practice jobs are to be controlled by these documents, it’s extremely appropriate that regulators monitor the degree of professional autonomy (or lack thereof) that employed doctors have.”

Although perhaps well intentioned, any modifications to current California law, excepting an absolute ban on non-veterinarian owned corporate veterinary practices, we believe are destined to fail. Based upon their direct correspondence to the California Vet Med Board during this process, corporate interests believe non-veterinary organizations should be able to control fees and the standard of veterinary practice. Historically, here in California and elsewhere, state agencies are not willing or able to police these corporations strictly enough to prevent undue influence on the standard of care, or the rapid escalation of fees.

Some would argue that there is certainly great corporate influence upon human medicine here in the United States. However, we do have malpractice litigation as a deterrent and also a remedy for failure to provide informed consent and/or not meeting the standard of care. With our dogs, litigation as recourse in cases of malpractice or failure to inform is impractical as dogs are treated as personal property in our legal system (much like a car or furniture) and not as a loving member of our family. By the time one factors in attorneys’ fees and all the other expenses, the cost of going to court will probably exceed the amount of any award received. One only needs to look at the cost of malpractice insurance for physicians as compared to the cost of malpractice insurance for veterinarians to confirm this disturbing fact. For a family practice doctor (with no surgery) in California, the average annual malpractice insurance premium is $7,881. The premium for a general surgeon is $27,700. On the other hand, the cost of malpractice insurance with similar levels of coverage for a veterinarian who treats predominantly small animals and is covered to do surgery is $367.

Always consider the following before retaining the services of a veterinarian for your cherished pet:

  1. Do your homework. There are reputable sources on the internet that can give you an idea as to the potential diagnoses of your pet’s ailment/problem so you can be prepared with questions/concerns.
  2. Ask around. Referrals to a top notch veterinary practice from friends/acquaintances who have already been there is always a good idea.

Corporate ownership of veterinary clinics and the conflict of interest they present certainly limits your ability to protect you and your canine family member. The most powerful tool you have is the legal concept known as “informed consent.” By law, if the guardian is not provided full disclosure of the information surrounding a test or procedure, they cannot legally consent to it. Full disclosure refers to the requirement to provide risks, benefits and alternatives/options from the vet when a test or procedure is prescribed. See our “Informed Consent” page for a more thorough explanation of this important requirement.

The idea of requiring that the risks of a test or procedure be disclosed seems fairly obvious. However, it should be noted that the UC Davis Vet Med Teaching Hospital acknowledges the requirement for informed consent does exist for vets, but they alone as a teaching hospital are exempt from that requirement. This leaves one to wonder if the practicing veterinarians who trained at UC Davis School of Veterinary Medicine take this requirement as seriously as they should. Personal experience with our dog Billy’s medical problems found more than one veterinary provider failing to reveal serious risks of proposed treatment.

Explaining the benefits of a test or procedure allows the dog guardian to weigh and balance the risks with benefits as part of their decision-making. Another really important reason for requiring an explanation of the benefits is to prevent the vet from running tests or procedures solely for their financial benefit. Any proposed test or procedure must provide tangible benefit to the dog in question.

With respect to alternatives or options, feedback from our readers indicates very few dog guardians are provided full disclosure with respect to spay and neuter. The benefit of preventing pet overpopulation is a given, but a failure to disclose the risks is indefensible. Further, had the vets provided guardians information about alternative methods to prevent their dogs from breeding (i.e., vasectomy, tubal ligation or hysterectomy) while avoiding the risks associated with spay/neuter, many guardians would likely choose to avoid spay or neuter. In fact, most visitors to our site are distraught to think the negative side effects they and their dog are experiencing post spay/neuter were entirely avoidable. Generally these pet guardians are angry they were not provided the option of vasectomy or tubal ligation/hysterectomy. Based upon our own experience in veterinarians’ offices, as well as at UC Davis Vet Med Teaching Hospital, the doctrine of “informed consent” is rarely practiced, let alone even mentioned. You will need to ask your vet specifically for risks, benefits and options/alternatives in order to be an effective advocate for your dog.