The government is pushing to disclose veterinary clinic fees by hospital. The insurance industry sees disclosure of individual fees as the first step toward standardizing the medical system and lowering pet insurance premiums, but strong backlash from the veterinary community is expected to cause friction before the system is implemented.
The Ministry of Agriculture, Food and Rural Affairs on Feb. 6 preannounced legislation for a revision to the Enforcement Rule of the Veterinary License Act to expand the scope of disclosing veterinary clinic fees. Until now, the costs of major treatment items had been disclosed in statistical form such as medians, averages, minimums, and maximums by city and province and by city, county, and district, but the revision would allow people to check fees individually for more than 4,000 veterinary clinics nationwide.
The Ministry of Agriculture, Food and Rural Affairs moved to expand disclosure because the burden of pet medical fees is high. Currently, pet care lacks standardized treatment names, methods, and expense systems. Even for the same condition, treatment items and prices vary by hospital, making expenses hard to predict and disparities large.
This fee structure is also a stumbling block to expanding the pet insurance market, which would reduce consumer burdens. That is because insurers lack consistent medical data needed to calculate loss ratios by product. When it is hard to accurately predict insurance expenditure, insurers have no choice but to price premiums conservatively or narrow coverage.
According to the Korea Insurance Research Institute, the domestic pet insurance subscription rate is only 2% to 3%. Japan is at 21.4%; the United Kingdom is 25% for dogs and 12.1% for cats; and Sweden is 90% for dogs and 50% for cats, making Korea much lower compared with major countries overseas.
However, due to fierce opposition from the veterinary community, whether the system will be implemented remains uncertain. Veterinarians argue that because expenses vary greatly depending on an animal's weight and health status, whether anesthesia is used, and the scope of tests, hospitals cannot be compared by a single price. They also express concern that price competition could lower the quality of care and worsen the management difficulties of local veterinary clinics.
The Korean Veterinary Medical Association (KVMA) held a rally in front of the National Assembly in Yeouido, Seoul, on Mar. 2 with veterinarians and veterinary students and demanded the withdrawal of the revision. The organizers estimated that about 3,000 people attended. Woo Yeon-cheol, president of the KVMA, said, "We will firmly oppose any decision that harms veterinarians' expertise and future."
An insurance industry official said, "While supplementary measures are needed to reflect the unique nature of animal care, disclosing and standardizing fees are necessary steps to prevent overtreatment and leakage of insurance benefits and to lower premiums," adding, "Once fees are disclosed, pet insurance premiums and coverage are likely to be adjusted to reasonable levels."