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Which veterinarians are charging what?
The latest installment in the Nationwide Purdue Veterinary Price Index digs deeper into GP vs. specialist, corporate vs. "Main Street" practice, and urban vs. suburban vs. rural. It's all based on millions of receipts from the pet insurance provider's database from 2009 to 2017.
This is not Ye Olde Fee Schedule. This is not what veterinarians, practice managers and team members say they charge-which doesn't take into account discounting and other changes in pricing before a veterinary client hands over the credit card.
The Nationwide Purdue Veterinary Price Index uses data from claims submitted by Nationwide pet insurance holders. The data is analyzed by economists at Purdue University's Krannert School of Management.
What is it? The price index is based on prices paid at time of service from nine years of data and provides a look at relative change over time.
What it is not? The price index does not represent retail pricing or fee schedules, but instead the real amount charged by the veterinarian and claimed by a Nationwide pet insurance customer.
"These are the actual prices people are paying over time," said Kerry O'Hara, PhD, Nationwide director of research, data and strategy, to an audience at the 90th annual Western Veterinary Conference (WVC) in Las Vegas last week.
O'Hara presented top-line statistics from the most recent research, which takes a deeper dive into:
> General practitioner vs. specialist charges
> Corporate/group practice vs. "Main Street" practice charges
> Urban vs. suburban vs. rural practice charges.
Here are the highlights:
Uncle Sam's consumer price index is ... questionable
All charts courtesy of Nationwide.
When the government puts together the consumer price index, it hires employees to gather prices for a virtual shopping basket of products and services Americans buy each year-from houses to cars to groceries to, yes, veterinary care. But veterinary care represents only 0.3 percent of that basket. How does the government find out those prices? They call veterinary hospitals and get quotes over the phone for a few basic products or services.
Here's the scoop on that: According to the consumer price index, the total amount Americans spent on all products and services rose 14.3 percent from 2009 to 2017. What they spent on veterinary care, however, rose a whopping 30.9 percent.
The veterinary price index tells a different story ...
That 30.9 percent increase in prices doesn't jibe with data from millions of Nationwide claims in its veterinary price index. Nationwide and Purdue saw a rise of 10.2 percent in prices paid at time of service over the same period.
But that's still an increase, and a considerable adjustment from the big recession: Prices were down 2.2 percent from 2009 to 2014, but then climbed 9.1 percent between 2015 and 2017.
Prices go wild ...
Nationwide also took a swing at a deeper comparison: between medical services (like surgical procedures) and wellness care (like parasite prevention and routine exams). What they found? Wellness care prices were up 7.8 percent between 2009 and 2014, and they were up 5.1 percent between 2015 and 2017. In those same time periods, medical service prices were down 5.2 percent, then up 10.3 percent. Nationwide's O'Hara speculates that the initial drop may have been a result of earlier overpricing.
Looking at specialties, regions and corporate practice
There were other stories in the data associated with important comparisons. Do you see your own experience in these numbers?
> General practitioner charges: Down 2.8 percent 2009-2014, up 9.5 percent 2015-2017
> Specialist charges: Down 10.5 percent 2009-2014, up 10.6 percent 2015-2017
>Takeaway: Specialists started at a much higher price point, fell further than general practitioners during the recession, and are now much closer in price. Check it out: In 2009, specialists charged 40 percent more than general practitioners for services, with a $124 difference. In 2017, they charged just 16 percent more for the same services, with a $54 difference.
Nationwide Chief Veterinary Medical Officer Carol McConnell, DVM, did admit that this comparison isn't quite apples to apples: "These may be the same conditions, but specialists may be using different techniques than general practitioners," she said.
> "Main Street" practice: Down 3.4 percent 2009-2014, up 9.9 percent 2015-2017
> Corporate/group practice: Down 2 percent 2009-2014, up 8.3 percent 2015-2017
> Takeaway: Turns out maybe corporate practices don't charge a ton more than Main Street practices-10 percent more, with a $27 difference-and they're experiencing the same pressures.
"I was surprised at how similar corporate practices were in pricing," O'Hara said. "The differences were very minor."
> Urban: Down 2.6 percent 2009-14, up 9 percent 2015-2017
> Suburban: Down 2 percent 2009-14, up 8.8 percent 2015-2017
> Rural: Down 1.6 percent 2009-2014, up 10.9 percent 2015-2017
> Takeaway: Rural practices are coming up. In 2009, they charged $63 less than urban hospitals for similar services; in 2017, just $36 less.
The big takeaway? Yes, prices are going up, but O'Hara urged thoughtfulness in increases.
"Increasing prices is a living experiment," O'Hara said. "It may help the business now, but it may hurt consumer spending over time."