DOES OUR INDUSTRY WANT PET INSURANCE, OR NOT? by J. A. Keith, DVM, MBA, MEcon,CVJ
As everyone now knows, the pet insurance market is full of potential millions of dollars and we see almost new carriers every few months or two. Historically an untapped market, we are now front and center with the decisions our clients are making. We are encouraged to become salespeople for virtually every insurer but what is our remuneration? What do we gain as a ‘free’ purveyors of these policies. It is important to understand the good and the bad with pet insurance.
As technology, diagnostics and medical/ surgical care advance almost at light-speed, costs to deliver these services also increases - often beyond what the average client can afford, and insurance can play a vital role in the difference of life or death. I reviewed 4 companies and their ‘payouts’ for the exact same medical/ surgical conditions. What I found is that most cover at, and often beyond, the general costs of these most common conditions I compared. Tis certainly is a win for the patient, owner and veterinarian. Every- body should be happy. Insurance companies are betting you will not need them; consumers are betting that they will. Tis is the basic tenant for every type of insurance. So, what could possibly be the down- side to pet insurance?
After a quick spin through my own client base, I found that 1.3% of our clients had used insurance in the previous calendar year. Tis was a difference of 0.1% compared to 2020. We do not have a particular company that we favor over any other and do not actively promote pet insurance. Rather, when a client brings up the topic, we supply them with the pamphlets and answer any questions they may have. We help navigate the myriad of offerings, but the final decision rests with them.
My first concern is at what point will there be enough policy holders for insurers to begin to tell provid- ers (us) what we can charge for our services. In the human medical insurance industry, carriers negotiate service fees with physicians. Simply look at any bill you receive from your doctor and the negotiated fee will be evident. Tey agree to accept patients with various insurance company policies in exchange for a continual patient base at a discounted rate. Will we arrive at that point?
My second concern is the manner of getting paid. Currently, there is a very acceptable method for veter- inarians to be paid. Te client pays the bill and submits the paperwork and the insurer repays the client. So far, so good. Will we reach a point where- by WE will be responsible for submitting pa- perwork and collecting payment? I certainly hope not. Tis could potentially create an- other staff position thereby increasing labor costs in many practices.
I do believe we are not anywhere close to critical mass whereby the insurance carriers will have the power to change the status quo as it currently stands. I do think a reason- able policy is good for all concerned. When health insurance was first introduced, it was meant for catastrophic injuries or illnesses. It has since morphed into covering almost any and all health concerns humans face includ- ing dentistry. Review the various companies that provide this service and help your clients make the wise decisions based on their specif- ic companion.
J. A. Keith, D.V.M., M.B.A., M. Econ Versailles, KY
859.753.5000
vetau94@aol.com 24 KVMA News
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