Colleges in crisis

Colleges in crisis

Economy, changing profession hurt teaching
Jul 01, 2008

National Report — The downturn in the economy is blamed for deficits, spending cuts and administrative reorganization at some of the nation's leading veterinary colleges.

Fewer veterinary visits and more guarded spending at veterinary teaching hospitals, coupled with scaled-back state funding, is hurting schools, with two of the largest veterinary colleges drawing attention for their recent belt-tightening.

Colorado State University's veterinary teaching hospital was bailed out of a $1.5 million shortfall last month by the state. A week later, The Ohio State University announced that its hospital faced an $850,000 deficit and would reorganize its administration. Those two schools graduated the two largest classes of new DVMs this year, with 136 and 134, respectively. They are joined by the University of California-Davis, which awarded 114 new DVM degrees this year and predicts a $750,000 deficit when its fiscal year closes June 30.

In 2007, the University of Georgia's College of Veterinary Medicine lost 2 percent of its $55.1 million budget from federal and state cuts of 1 percent each. Other revenue sources stayed about the same, but operating costs were cut from 2006 to 2007, according to the school's annual report. State funding made up 48 percent of Georgia's veterinary-college revenue in 2007 and federal funding contributed 11 percent. Only 4 percent of the school's budget comes from tuition.

These cases may seem like extremes for veterinary education, but those close to the problem say it's just a sign of the times.

"For several years, the Association of American Veterinary Medical Colleges' (AAVMC) members have been addressing just this issue — what is the future for veterinary teaching hospitals? I don't think anyone sees a cookie-cutter right way/wrong way for handling this," says Grant Frazer, director of OSU's veterinary teaching hospital. "It's amazing, when people start talking at annual AAVMC meetings, you can see them nodding around the room. Everyone is wrestling with similar problems."

Private schools seem to do a little better, with the University of Pennsylvania reporting a $3,387 surplus at the close of its 2007 fiscal year. But none of its more than $137 million in revenue is from state or federal funding, according to its annual report.

"A good many of the veterinary schools are facing declining budgets," UC-Davis School of Veterinary Medicine Dean Bennie Osburn says. "Support from the state is not what it has been in the past."

Other factors involved

But not all of the problem lies with federal funding. The natural evolution of the veterinary profession is a factor, AAVMC Executive Director Marguerite Pappaioanou says. Big changes are nothing new in the profession, she says, explaining that there was a large shift to livestock care when people started using cars to get around instead of horses. Then, as farms went from family-owned to corporate, livestock managers started hiring full-time veterinarians for their operations instead of using the local DVM. Now, there is a big change again as people build closer relationships with companion animals.

To respond to this change, more specialty practices are opening throughout the country, allowing companion-animal owners to get complicated procedures done close to home instead of traveling to the nearest veterinary college.

"Forty or 50 years ago, you would have gone to a teaching hospital for complicated procedures. Now, there are a number of veterinary specialty practices that have the facilities, that have the experts, that can do that," Pappaioanou says. "Hospitals are in a bind because they don't want to compete. They want to support the specialists. It's just not a winning scenario for practitioners in the state to think they are losing their clients to the teaching hospitals."

More speciality practices taking difficult cases means smaller caseloads for the hospitals, she says. Fewer caseloads mean fewer experiences for students and less revenue for the teaching hospitals. Combined with declining financial support coming into land-grant colleges from their states and more accountability desired from boards at private hospitals, these factors are putting the crunch on teaching hospitals.

To add another blow, customer service chases some business away from teaching hospitals, Osburn says, because students will take up more of the clients' time than a private practioner would. Plus, the clients coming in don't want to spend as much on services or don't come in as frequently — a problem private practices face, too.

"When you have a lot of people hitting hard times, they are probably going to think three and four times before taking their animals in," Pappaioanou says. "A teaching hospital, all of a sudden then, needs to make enough money to run the hospital. They can't lose money and exist."

In years past, states would help make up any shortfalls, as lawmakers did in Colorado State University's case, but that is more the exception than the rule now.