What to Do Before Fido's Vet Bill Hits $16,000

NEW YORK ( MainStreet) -- Roxanne Hawn, "mother" of two kids of the four-legged variety, knew her dog Lilly's 2012 vet bills were going to be extraordinary when she added them up last month, but she wasn't prepared for the $16,626 total.

"I've never had to make a treatment decision for one of our dogs based on finances," says Hawn. "It appears to us now that there are limits and it's tough."

Lilly, the subject of the award-winning Champion of my Heart blog, contracted meningoencephalomyelitis -- a severe swelling of the brain and a very rare reaction to a rabies vaccine -- in January. Lilly has been fighting the disease all year, which has included hospitalizations, appointments with neuro-veterinary specialists and costly tests and treatments. Hawn and her husband have been paying the bills.

"Our financial planner is not happy," says Hawn, who lives in a Golden, Colo.

According to the Bureau of Labor Statistics, veterinary costs have increased an average of 79% from 2000 to 2010. Rising operating costs are to blame, but so is the quality of care that is now available, says Keith Niesenbaum, a veterinarian and owner of Crawford Dog and Cat Hospital in Garden City Park, N.Y.

"There are so many specialty practices and so many things we can do today," says Niesenbaum. "People realize we have the advances, but they don't realize the cost."

Niesenbaum says that with CAT scans, MRIs, pacemakers, radiation and chemotherapy all available today, veterinary bills, especially at specialist's offices, can add up pretty quickly.

"We try to watch going down that slippery slope with the initial diagnosis and we try to map out all of the options," says Niesenbaum. "It just isn't feasible for someone to go into debt for half of their annual take home pay. People want to do everything they can, but most times, it just isn't realistic and I really feel for people. I would say that's the toughest part of my job."

What would you do if faced with a $16,000 veterinary bill for a pet you love as much as a child?

Justin Krane, a certified financial planning professional with Krane Financial Solutions in Los Angeles, Calif. says while most financial planners would advise against borrowing funds from savings, retirement or equity accounts to pay a vet bill, every case is different.

"For some people, their pets are their lives, they are their children, a part of the family," says Krane. "I would ask them if it would give them a better return on their life if they extended that of their pets. If a pet brings extreme happiness to an elderly person and they can extend that pet's life by five years and maybe that five years could be a big portion of that person's remaining life, then I would definitely advise them to do it," he adds.

Once that question is answered, Krane asks his clients to list their financial goals in rank of importance and that's where they would determine from which account to withdraw the funds.

Where to find Fido's medical fund

Hawn has used a variety of sources to pay the vet bills thus far. She did have what she described as a basic pet insurance policy, which maxed out at $3,000 in benefits. Lilly's blog readers also sent her approximately $2,200 in donations. The remainder was drained from her emergency fund, as well as placed on a low rate credit card. So far, she says, she has been able to pay the bills as they come due.

Beverly Harzog, an Atlanta-based finance blogger, says rewards credit cards and low interest credit cards can be good to pay veterinary bills, as she recently discovered when her 16-year-old dog, Nick, had to have his eye removed due to a rupture and advanced glaucoma. Harzog used a rewards card to pay the $1,086 veterinary bill and paid it off with her emergency fund as soon as the bill arrived. Harzog says you have to be careful with rewards cards as they can carry a higher interest rate and she cautions to only use them if you can pay them right away. If she couldn't have paid it off, she would have used a lower interest rate card, she says.

There are financing options most veterinarians offer through their office, such as CareCredit or Citi Health Card. Hawn says she had previously used CareCredit for a $6,000 bill when her other dog, Ginko, needed knee surgery. "They offered one year, no interest and I just figured out how much I needed to pay each month to pay it off," says Hawn. Niesenbaum says that is key to these programs, or you could be slammed with high residual interest at the end of the loan.

Knowing when to stop

If a beloved pet needs long-term care that requires ongoing expenses, this is when it becomes a really tough decision.

"Even $2,000 in treatments can be too much for some people's entire budget for a year," says Niesenbaum. "That's when we slip into quality of life mode, really a hospice model that will not attempt to cure, but will keep the pet comfortable, happy and eating for as long as possible. It circumvents the $15,000 bill and the emotional decision."

Krane says if his clients are dealing with an ongoing situation, he would ask them two questions:
  • What happens with my pet if I continue to do this?
  • What are the consequences for me if I continue spending the money?
  • Faced with the possibility of bills upwards of $400 every three weeks for chemotherapy injections for Lilly, Hawn says her family is starting to come to the painful conclusion that they just may not be able to afford to continue Lilly's treatment.

    "I don't think maxing out our credit and getting more is the answer," says Hawn. "If you don't use credit in a strategic way, it can ruin you."

    While Hawn remains optimistic about Lilly's recovery, she says she is also trying to be realistic. "I do worry about making that decision and my ability to recover from that decision," says Hawn. "It would be different if she were old and sick with no treatment options. That is a different thing than making the decision based on finances."

    Tips for dealing with your vet
  • Consider a Plan B:
  • When bringing in a sick pet, vets will typically offer the Plan A treatment plan. If the client indicates they cannot afford all of the tests and treatment options, Niesenbaum tailors the plan to fit the client's budget. He says he can still typically offer therapy without compromising quality of care.
  • Negotiate: Ask your vet to price match other vets in the area.
  • More on personal finance:

    401(k) industry gets fat while savers' accounts remain lean

    Expect to pay more for your health care

    8 types of protection not worth paying for

    --By Kerri Fivecoat-Campbell

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