CMA Review

SPVS Support for Member Practices in response to CMA Review Announcement

The CMA have identified 5 key concerns:

– Consumers may not be given enough information to enable them to choose th e best veterinary practice or the right treatment for their needs.
– Concentrated local markets, in part driven by sector consolidation, may be leading to weak competition in some areas.
– Large corporate groups may have incentives to act in ways which reduce choice and weaken competition.
– Pet owners might be overpaying for medicines or prescriptions.
– The regulatory framework is outdated and may no longer be fit for purpose.

Next steps for CMA

The CMA has launched a 4-week consultation to seek views from the sector on the proposal to launch a market investigation. The consultation closes on 11th April 2024 at which point it will consider the responses received and a decision will be made on how to proceed.

SPVS Board will be working with our partners to create material to help our members at this time

SPVS Working Party

We are inviting members to join a working party alongside board members to help us develop useful resources for members. IF you are interested we would welcome you. Please email the office and let us know: office@spvs.org.uk

Initial Resources are:

• Questions from Clients: – Eight common questions that we suspect your team will be asked by owners. EQUIP your team to answer these questions with some model responses.
• 5 Key concerns raised by the CMA, how to talk your staff about it, and possible actions.

SPVS Presentation to the CMA

Pete Orpin, SPVS Chair, and Vicki Farbon, SPVS Board member responsible for the Fees and Salary Surveys, recently met with the CMA to explain the various drivers that have impacted on the vet profession in the last decade. They explained that supply constraints ( labour, medicines, energy) combined with wider post COVID impacts (working patterns/ consultation lengths) has hugely impacted on the practices ability to respond to increases in demand without increasing fees. A summary of their presentation to the CMA can be seen in the video below.

SPVS Board Response to the CMA Review

Pete Orpin, Chair of SPVS Board took part in a Big 6 Debate at the London vet Show focusing on the Competition and Markets Authority Review of veterinary services. The four key areas the CMA review are focusing on are pricing of services, prescriptions and medicine supply, out of hours provision and the transparency of practice ownership.

The wide ranging review has been brought about amid concerns that pet owners may not be getting a good deal or receiving the information they need to make good choices. The CMA identified that the number of independent practices has reduced from 89% to 45% in the last 10 years, and they perceive that market consolidation may be distorting the market and reducing competition. The review is focused entirely on the small animal sector.

The Big 6 debate focused on positive steps the profession could make now as “sunlight remedies” to minimise any imposition of further regulations on the profession.
Fee increases are a feature of the last 5 years. Consult lengths, complexity of investigation and overall costs have increased significantly during this period. These changes were driven by the COVID pandemic, inflation and rising client expectations. The panel discussed the importance of transparency on pricing and the need for improved explanation of fees.

The joint BVA/ BSAVA/ SPVS/BVNA/VMG paper submitted to the CMA provides great insights into the 4 key areas. In this initial enquiry the CMA need to understand the industry and the data they have been given. With this in mind, Vicki Farbon, Board member of SPVS provided contextualised content on salaries and fee increases to BVA to help strengthen the joint report highlighting why the trends have occurred.

We cannot predict the likelihood as to whether this review progresses to a full-blown investigation, but the odds are that we may enter some challenges in the months and years ahead. Ryan Davis SPVS president recently said “I wholly believe in the veterinary profession and the value we bring to the animals under our care. I am confident whatever the outcomes of the CMA investigation we will innovate and continue in the same professional manner”

Clearly there will be a continued role for SPVS helping practices through this period of change. SPVS will continue to encourage collaboration and dialogue between members to ensure the best possible outcomes can be attained. The CMA are looking for a fair and open market, and don’t forget how important our profession is to the pet owning public, the majority of whom value the work we do. Practices that focus on client needs, maintaining their trust, and continuing to provide a valued service for their clients have nothing to fear.

Some top tips from the discussion were:
• Greater Transparency. Ensure the whole practice team understands the true costs of the business and the importance of a fair fee structure that balances the needs of the practice and the client. If the practice team does not understand this relationship, they can’t explain it confidently to the clients.
• Building Teams. Continuing to develop a sustainable, well managed, efficient, happy and productive veterinary practice.
• Managing Expectations. Consult lengths have doubled in 10 years (Moore Scarrott) which will have reduced the number of clients seen by 50%.
• Delegation and Triaging. Utilising technology and empowering the team to simplify and deliver a valued service rather than leaving all the responsibility with the veterinary team.
• Improving Vison, Leadership, and insights. Read the BVA joint paper and act now to prepare for the future.
BVA president and past SPVS president Anna Judson summed this up nicely- “We want to see healthy competition, consumer choice and thriving veterinary businesses.”.

The SPVS Congress 2024, in Birmingham, January 25-27th, is focusing on working smarter through utilising improved leadership and tech to deliver efficient working. The themes, practical workshops and networking has never been more important so make sure you join us for cutting edge thinking and debate.

CMA update for SPVS Members March 25th 2024

The Competition and Market Authority have conducted a Review of the small animal veterinary sector and has now decided to progress to a more formal Market Investigation. This allows the CMA to have enhanced legal powers to investigate and make firmer recommendations on actions required to enhance competition and deliver best value to the consumer.

The Review stage was launched in September 2023 and the consultation process delivered an unprecedented level of response from consumers (45,000) and the vet profession (11,000). The CMA consulted widely and SPVS delivered a response via the BVA Joint working party (BVA, SPVS, BVNA and VMG) . SPVS has also had a direct meeting with them to discuss the SPVS survey data. This allowed us to present a wider picture as to how veterinary fees have increased, based on our data on salaries, fees and profits.

The CMA’s concerns

Based on the evidence gathered so far, the CMA has 5 key concerns that it proposes to investigate further:

  • Consumers may not be given enough information to enable them to choose the best veterinary practice or the right treatment for their needs.
  • Concentrated local markets, in part driven by sector consolidation, may be leading to weak competition in some areas.
  • Large corporate groups may have incentives to act in ways which reduce choice and weaken competition.
  • Pet owners might be overpaying for medicines or prescriptions.
  • The regulatory framework is outdated and may no longer be fit for purpose.

The purpose of the Investigation is to make changes that will achieve increased competition in the market place to improve the value proposition for the client. The CMA are clearly looking to make changes that improve the functioning of the veterinary market within the small animal sector ( equine, farm are not included within this Investigation)
Clearly the CMA have great potential to make changes. SPVS role is to ensure that they have the most up to date information and views from our members so that the right decisions are made.

The CMA have produced two reports during their Review stage. They CMA have identified multiple concerns in the vets market together with a market research report based on interviewing 64 small animal clients Qualitative Research on Pet Owners’ experienes of buying veterinary services in the UK

The Review produced a document Veterinary services for household pets in the UK: Consultation on proposed market investigation reference

This report highlighted the evidence gathered and the case for progressing to the full Investigation.
The consultation is open until April 11th. If you wish to make a direct response to the CMA you can email Vetservicesreview@cma.gov.uk

SPVS have created a working group to support and represent members which includes vets from clinical practice in the independent and corporate sectors. If you wish to provide any views through to SPVS please do so via office@spvs.org.uk or add your comments on our members discussion forum.

SPVS Response to the CMA market review – Next Steps

The major areas that are likely to impact on practices relate to how consumers can be given more information so that they can make the right choices of practice and procedure and the concern that pet owners may be overpaying for medicines or prescriptions. They have also identified a rapid movement towards more specialist investigation and treatment and are concerned that lower cost treatment options may not be offered to clients.
The areas relating to the consolidation of veterinary practices within the 6 large groups is a further concern for the CMA and its impact on the veterinary market place. They are concerned about the perceived lack of transparency regarding ownership of both practices and the wider supply chain (referral practices, crematoria etc).

The limitations of the 1966 Veterinary Act to regulate veterinary practices is also a concern as the current system regulates the individual rather the practice.

Initial thoughts and considerations from our group have centred on the vet client pet relationship being key to how veterinary practice works. Our relationship with a client hugely important. We are not selling widgets. We are working with clients to get the best possible outcome for their pet. If you have a good working relationship with a client you understand their needs better, communication is much easier and good health outcomes are likely to more easily achieved.

Pete Orpin .Chair of SPVS and the CMA working group said

“ The negative media coverage has the potential to erode trust in that relationship between client and the vet practice team. We would urge the CMA to visit veterinary practices and to appreciate the pressures that exist with delivering veterinary care within a “time bound “environment. ”

“Opportunities exist to further improve the whole area of discussing costs with clients. CMA data reveals that 90% of clients were informed of costs ahead of surgery, 50% before proceeding to out of hours treatment and 80% before proceeding to further tests. This data confirms we are doing a pretty good job! However, the report highlights the challenge with cases that pass through to out of hours or referral centres. There is a genuine opportunity to help information flow between all parties to help reduce the potential for unexpected costs and shocks to the client. We are unique in providing urgent care to our patients within a commercial environment. The human sector does not work like this. You don’t seek private medical care when you have road traffic accident or go into intensive care.”

“Time is in short supply within a veterinary practice setting and if we are to provide more information to guide clients then perhaps, we need to consider the wisdom of developing an authoritative website akin to that provided by the NHS to provide guidance for all clients. We can’t just keep extending consult lengths as this increases costs and reduces capacity to treat pets further. Shared decision making is so much easier within an informed client”.

“There is also a real potential to develop a Client Charter or perhaps something less formal that permissions the client to ask about costs and further information at any time. The practices that are open and transparent with clients will retain their trust. Broaching costs is a difficult especially during urgent care consultations. Enhancing the client’s ability to ask about costs at any stage as well as simpler systems for explaining fees at the practice level would greatly help eliminate some of these concerns”.

Practices that continue to work closely with their clients, deliver a highly valued service to their clients will always prosper.

We fully support the need to revise the Veterinary Surgeons Act and for the profession if this is done wisely. The regulation has to keep pace with the rapidly changing veterinary profession.

 

Our next joint meeting with the key divisions reporting into BVA is on April 9th. The purpose of this meeting is to agree a joint response to the CMA consultation on the proposed Market Investigation.

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