July 10, 2009
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Most veterinarians didn’t go to school to become financial planners. Yet, many spend lots of time discussing finances with their clients.
After all, veterinary care costs money, and when that money isn’t available, the pets ultimately suffer.
| Making a Case for Insurance
On the surface, pet insurance may seem like a monthly expense that pet owners could trim in lean times. But Chris Edgar of The Hartville Group Inc., says clients should be reminded that they’ll be even less likely to afford sudden, significant expenses during an economic recession.
“The most compelling aspect of pet insurance value remains its service as a means to prevent unexpected veterinary costs, which can total hundreds or thousands of additional dollars,” Edgar says.
Jules Benson of Petplan says veterinarians can encourage customers to plan for the health of their pets—and their pocketbooks—in many ways. For example, he says, reminding owners of healthy pets about common conditions that could arise years into the future can help set expectations and encourage proper planning.
Also, he says, veterinarians can provide educational materials on pet insurance through various means, including puppy packs and invoices.
William Craig of PurinaCare Pet Health Insurance says consumers and veterinarians need to realize that pet health insurance is not an investment with a guaranteed return. Rather, he says, “It is an expense that allows consumers to replace ‘How much is this going to cost?’ with ‘Do what is best for my pet.’ ” —L.L.
Suggesting financial options to pet owners is key not only to a clinic’s bottom line, but to maintaining patient health.
Christine Merle, DVM, MBA, CVPM, notes that the recession is driving more pet owners to ask about veterinary costs and carefully evaluate whether the services they seek are of value.
“There is more interest in pet insurance and planning ahead for elective procedures,” says Dr. Merle, a consultant with Brakke Veterinary Practice Management Group.
As more people look for ways to save money on pet care, they are more apt to respond to incentives and other value-added propositions, she notes. It’s more important than ever, she says, for veterinarians to be upfront about costs, make clients aware of the possibility of accidents and illnesses, and educate clients on the benefits of insurance and other planning tools.
She recommends that veterinarians discuss pet care costs during a puppy or kitten’s initial visit and offer bundled wellness plans.
It’s one thing for veterinarians to encourage clients to plan for expenses. It’s quite another to ensure they actually do so.
“For years, pet experts, veterinarians and financial advisers have advocated that pet owners use a separate savings account to help cover pet care expenses,” says William Craig, DVM, chief medical and underwriting director for PurinaCare Pet Health Insurance of San Antonio. “In theory, such accounts would cover anticipated costs such as routine vaccinations and checkups. They would also cover the unexpected, like accidents, disease or hereditary problems.”
Such savings accounts sound wonderful in theory. But Craig notes that many pet owners find the model difficult in practice. “Pet owners might be tempted to tap into their savings plan for routine veterinary expenses and never reach the amount needed to cover the bigger bills,” he says.
Pet insurance is one of the key tools that veterinarians can promote in trying to help their clients manage veterinary costs. And that message is increasingly resonating with pet owners, says Carol McConnell, DVM, MBA, vice president and chief veterinary medical officer at Veterinary Pet Insurance of Brea, Calif.
“A year or two ago, when people were more comfortable with their finances, the unexpected bill of $1,000 or $1,200 may have been something that some pet owners were willing to risk on their own. They may have felt like they could self-insure,” Dr. McConnell says.
“But now, clients are paying more attention to cash-flow management. If they don’t have pet insurance, they’re more likely to be looking into it, and if they have it, they’re more likely to keep it.”
After all, McConnell notes, owners who properly manage their pets’ health through regular wellness exams are going to catch problems earlier and see long-term cost savings. “It’s what’s best for the pet and for the pet owner’s pocketbook,” she says.
Linda Bell, chief marketing officer at PetPartners Inc. of Raleigh, N.C.,, says her company is witnessing similar trends. “Pet owners appear to want more control in these continuing uncertain times,” she says.
PetPartners is selling more policies than anticipated this year and has a strong renewal rate, Bell says.
Chris Edgar, chief marketing officer at The Hartville Group Inc. of Canton, Ohio, says his company hasn’t seen a significant increase in policy cancellations. “Of those who do discontinue coverage, a modestly higher number cite financial distress as a reason for doing so,” he says.
Jules Benson, BVSc, MRCVS, vice president of veterinary services at Petplan of Philadelphia, notes that he, like most veterinarians, has seen studies and surveys that show slowing growth in the veterinary industry overall. “I have certainly seen this reflected in my exam room in practice,” he says.
Dr. Benson says Petplan’s data indicate that insured clients are still opting for core treatments and preventive care because they’re not as concerned about unexpected veterinary costs.
“(With some clients) who choose not to bring Fluffy in every year, having insured clients can be an additional bonus to the practitioner in that insured pets are generally required by the policy to have their annual exam, vaccines and veterinary-recommended tests and treatments,” he says.
Insurance is a valuable tool for managing veterinary costs, but not all pet owners do that kind of planning. Thus, veterinarians may find it useful to point owners to other financing options for emergency situations.
Some national organizations help pet owners secure funding for specific treatments.
For example, the Magic Bullet Fund specializes in funding canine cancer treatments. Others operate locally, like the Niagara Frontier Veterinary Society of New York, whose Pet Emergency Fund pays for one-time intervention in life-threatening situations for otherwise healthy pets.
“Funds are tight for many nonprofit organizations, but some grants and assistance may be available through organizations,” says Doug Hammond, senior vice president of sales for CareCredit Inc. of Costa Mesa, Calif., which offers flexible repayment options.
“Emergency cases can be difficult to advise clients on if they don’t have a third-party payment option,” Hammond adds. “Veterinarians have to do what makes sense both as a practice financially and in providing patient care.”
Jack Stephens, DVM, founder and president of Pets Best Insurance of Boise, Idaho, says his company receives many calls from pet owners wanting help after a medical problem develops.
“But of course, then it’s too late for pet insurance for that problem,” he says. “This has always bothered me, and we want to help all pet owners financially with veterinary care.”
Thus, in May, Pets Best began referring uninsured pet owners to ChaseHealthAdvance of New York. Depending on the owner’s finances and needs, the lender offers 12-, 18- and 24-month, no-interest payment plans and instant credit decisions.
Like Stephens, PetPlan’s Dr. Benson says his company gets numerous calls from pet owners asking whether it’s too late to obtain insurance for an animal that has suffered an injury such as a cruciate tear. “It’s not too late,” Benson says, “but this particular injury will not be covered.”
Benson says his company advocates plans like CareCredit. But, he adds, “Inevitably, even these programs can involve taking on too much debt for some pet owners.”
Encouraging owners to plan for veterinary expenses while their pets are healthy remains vital in managing unforeseen expenses, he says.
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