Why are veterinarian bills getting so ruff on the wallet?

Yeah, that is a steep increase. And according to a recent Gallup survey, most pet owners say they have skipped necessary vet care because of the cost. So what is going on here? This is the indicator for Planet Money. I'm Adrian Ma.

Compared to veterinarians, you could argue that human doctors have it kind of easy. I mean, after all, they only have to take care of one species, while vets, they, they might have to treat a dog and a cat, a snake and a flying squirrel all in one afternoon.

Can I ask what kind of pet and what kind of toy? Or is this like a HIPAA violation?

And here's the headline. Adam says the costs of operating a practice have just gone up a lot. Medication is more expensive, thanks in part to tariffs, for the same reason. Medical supplies like bandages, gowns and syringes are more expensive. Adam says a box of exam gloves costs more than twice what it did just a year or so ago.

In a way, what Adam is describing here is a perfect example of a classic economic idea called Balmol's cost disease.

Yes, this is like a econ nerd deep cut. Balmol's cost disease is a theory Devised in the 1960s by two economists, William Balmall and William Bowen.

That's right. We got BB and BB, the two BB kings. Sounds like a vaudeville act.

Yeah, and this explains why over time we've seen big screen TVs and computer software become cheaper, but certain services that require human labor have gotten more expensive. There isn't yet a robot or an AI in the world that can watch your kid or administer an IV or unclog your toilet or remove a plastic

Yeah, I don't think I would trust that to a robot. Not yet. And if we as a society want people to become caretakers and nurses, plumbers and animal surgeons, wages for those jobs have to rise over time. Otherwise a lot of people that might have chosen to do those jobs will choose to do something else. And that is Balmer's cost disease in a nutshell.

Finally, one more reason people are spending more on pet care is that many pet owners are just willing to spend more on pet care. Adam Henchko says he's noticed a shift in the culture of pet ownership compared to a few years ago. And he chalks it up to pandemic lockdowns when people were isolated.

So let's recap. Vets are facing higher costs for supplies, medicines, and employees. Some are under pressure from their bosses to be more profitable. And some pet owners are just willing to pay a premium for a premium level of care. But for those who can't, there are still a lot of people who are being priced out of veterinary services.

Annie says you could consider buying pet health insurance, but we should say those policies are not cheap. Often they can run several hundred dollars a year. And like pet care in general, the trend is that they're only getting more expensive. Special thanks to the dogs and cats of Indicator Land for their support. In no particular order, they are Jolene Widget, Bocephus, Texas, Juarez, Juno Juarez, Tigger Roo, and Richard Katz McKim, which is a cat, if you hadn't guessed. This episode was produced by Angel Carreras and engineered by Maggie Luthar. It was fact checked by Sierra Juarez. Cagan Cannon edits the show and the Indicator is a production of npr.