The Netherlands Authority for Consumers and Markets (ACM) wants to intervene in the veterinary sector. Commercial incentives for veterinarians should be banned, practices should be required to be transparent about costs before each treatment and the industry should establish professional standards for the delivery of common treatments. This should provide pet owners with better protection against unexpectedly high bills and unnecessary treatments for their animals.
The market regulator writes this in a draft report published on Thursday. The ACM wants to be able to block takeovers of veterinary practices more quickly to prevent further monopoly formation in the sector. Because many practices have been taken over by several large chains in recent years, there are only one or two providers in one in ten Dutch municipalities.
In the report, the ACM confirms a concern that has existed among pet owners for much longer: prices can rise considerably in veterinary practices that are taken over by commercial chains. In four takeovers studied, prices for treatments increased by up to 20 percent and prices for medicines sold increased by up to 50 percent.
A veterinarian who runs the practice with his wife 24 hours a day is over
“In recent years we have seen the sector become commercialized. A veterinarian who runs the practice with his wife 24 hours a day, that is over,” says ACM chairman Martijn Snoep in an explanation to NRC. “Companies have taken their place, often owned by private equity. And veterinarians themselves have become more commercial. This puts consumers at risk: we see that there are currently insufficient guarantees against high prices and overtreatment.”
In the draft report, the ACM writes that the large chains use a “commercial business strategy aimed at increasing their profitability”, whereby they aim, among other things, to sell more healthcare and related products. According to the ACM, this has increased the risk that customers are suddenly confronted with high bills or are offered treatments “that go beyond what is appropriate for the animal and owner.”
The ACM recognizes that the quality of animal care has improved due to the introduction of the chains. Snoep: “But it depends on how much better care you think you need. And what that should cost. An honest conversation about this must take place between pet owner and veterinarian, without the burden of financial incentives.”
Bonus ban
The ACM therefore advocates a ban on ‘commercial incentives’. The remuneration for veterinarians and their assistants should no longer depend on the turnover or profit figures of the clinic or the number of treatments performed, medicines sold or referrals to an animal hospital from the same chain. At the beginning of this year, market leader Evidensia offered its veterinarians a bonus if they referred more often, a promotion that was stopped after NRC reported about it.
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According to the ACM, veterinarians who sell their practice to a chain should be prohibited from making a so-called earn outscheme, in which their remuneration is linked to turnover growth.
The regulator wants veterinary practices to be transparent about their rates. Clinics must clearly indicate the prices for common treatments, such as vaccinations, in the waiting area and on the website. Before each treatment, the veterinarian must make it clear verbally and in writing what the total costs are and what alternatives are available. According to the ACM, there are “signals from pet owners who regularly feel overwhelmed by the costs” of the vet.
Veterinarians must also clearly indicate when they refer an animal to an animal hospital or crematorium that belongs to the same chain.
Strengthen the position of veterinarian
The ACM wants the sector to draw up “professional standards” within a year and a half for carrying out the most common treatments, to prevent so-called overtreatment – a treatment that hardly helps an animal but does generate money.
According to the ACM, veterinarians who work in a chain also benefit from this, because it strengthens their “position in relation to the company”. The veterinarian’s freedom of decision “to act exclusively in the interests of the animal and owner” is under pressure, the ACM notes. From research by NRC It emerged last spring that hundreds of employees at market leader Evidensia had left due to dissatisfaction with company policy. Their employer urged them, among other things, to take x-rays of animals or perform blood tests more often.
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Veterinarians at Evidensia were also instructed to prescribe a more expensive version of certain medications. To prevent this in the future, the market for animal medicines must be liberalized, according to the ACM: “It is currently not possible for the vet to prescribe a medicine and the customer to then buy it where it is cheapest. You cannot buy even the most harmless medicines at the drugstore,” says ACM chairman Snoep. “That must be released. That also happened in human care years ago, and not without reason.”
The ACM’s findings are not yet definitive. Involved parties may respond to the draft report over the next two months, after which ACM will publish the final report with recommendations. “I am curious about the reaction of the large chains,” says Snoep. “If they start shouting very loudly that they need those profit and turnover incentives, then that proves that there is a big problem. If they say: we are fine with those recommendations because we don’t need that turnover incentive at all, then there is nothing wrong.”
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