Episode #72 – Dr. Scott Campbell

Do you work in the animal health industry or veterinary profession? Have you ever wondered how people began their careers and how they got to where they are today? Hi everyone. I’m Stacy Pursell, the founder and CEO of the VET Recruiter, the leading executive search and recruiting firm for the animal health industry and veterinary profession. I was the first recruiter to specialize in the animal health industry and veterinary profession in the United States and built the first search firm to serve this unique niche. For the past 25 plus years, I have built relationships with the industry’s top leaders in trailblazers. The People of Animal Health Podcast highlights, incredible individuals I have connected with.

Throughout my career, you’ll be able to learn more about their lives, careers, and contributions with our wide range of expert guests. You’ll be sure to learn something new in every episode. Thanks for tuning in and enjoy the episode. Welcome to the People of Animal Health Podcast. Our guest today is Dr. Scott Campbell, a visionary in veterinary medicine and business. He built Banfield into one of the largest and most influential veterinary networks and now leads innovation through Hannah the Pet Society, a membership based approach designed to reduce barriers to pet care, a veterinarian, entrepreneur, and rancher dedicated to sustainability.

Dr. Campbell approaches problems with systems thinking as seen in everything from a dog park he designed to his efforts to reshape how pets are cared for in the modern era. Scott, welcome to the People of Animal Health Podcast. I’m honored to have you here today, and how are you today?

I’m good. It’s great to be here. Thanks for inviting me.

Well, so glad to have you here. Scott, let’s start off at the beginning. What was your life like growing up and where did you grow up?

I grew up on a ranch outside of Burns, Oregon.

Was there a defining moment in your life when you decided to become a veterinarian?

Yeah, there was. I was about six years old and we had a bunch of kittens in the barn, of course, every spring and of course, they all got sick. And so, I remember treating those when I was six years old and hoping that I could help them live.

Well, Scott, you’ve often been described as a changemaker in veterinary medicine. What was the pivotal moment or insight that convinced you the traditional veterinary practice model needed reinventing?

Probably after I had already started in PetSmart and I realized that as we did research on the industry, that there were still… I had been out of school about five years, I think, and there were still lots and lots of people graduating and going into practice that were making then an average of about $22,000 or $24,000 a year, which didn’t seem like enough. And also, the other thing was we found that dogs weren’t living very long. They were living to be about seven and a half or eight years old, and clearly biologically the breed had lived to be at least 12 to 14. And so, it looked to me like veterinarians weren’t getting much out of it and neither were the pets.

Yeah, and I remember those days, Scott, I remember talking to a veterinarian in Dallas, Texas, and she was making a salary of $25,000 and then went to work for Banfield back in the ’90s and doubled her pay, and she called me crying. She was in tears and said, “This was so impactful to her. It changed her life.” When you acquired Banfield, it was one hospital. What were the major early challenges you faced in scaling it into a national and even international veterinary network?

Well, there were obviously a lot of changes that we had to make. We made them slowly. The first thing was with that hospital, it had been built in 1955. And so, the hospital itself was a year older than I was, and so there were lots of changes that had to be made. And Dr. Weigert, the guy I bought it from, stayed there and really helped me make those changes. He stayed for over 10 years after I bought the practice.

Well, Banfield invests heavily in data and systems. For example, the population database and data savant. I don’t know if I said that correctly. How do you personally balance data-driven decision making with the empathy and unpredictability of medicine?

I don’t know how I do it. Certainly, you have to make those decisions together and they’re really important that you do that. I certainly do, but I don’t know. I don’t really think about it as a process. I just try to find out everything I can about something before I make a decision. And then once I think I know about everything I need to know, which is probably more like 80% or 90%, not a hundred percent, I’m going to make the decision because I know that you can always change the decision and make a different one if it’s the wrong one.

Well, your approach to designing the dog park beneath your office, digging a well instead of using chlorine is emblematic of your philosophy, find systemic and elegant solutions. How do you carry that design infrastructure mindset into running veterinary businesses?

Well, that one, when you get all the data, it leads to the right decision because the well was cheaper than the chlorine was going to be over a long period of time. And so, it’s certainly the best decision for the pets, and it was clearly the best decision for the business too.

Well, that makes sense. Well, Scott, in an article in DVM360, you mentioned that veterinarians coming out of school today often don’t want to own a practice, but instead they want leadership roles, good quality of life and less debt. How have your business models like Banfield and Hannah tried to respond to that shift?

Well, that’s what we tried to do. We certainly need leaders and the best leaders in the practice, any practice are in my estimation, usually there’s a veterinarian if you can get them to do it. And if you can’t, you got to just find another one because you really need to have a veterinarian lead the practice because other people just get it wrong because they don’t understand it well enough in my estimation. But there’ve been a lot of trials here lately. It’d be interesting to go and look at all the practices that are out there and see the ones that are run by veterinarians, not too many of those and the others and see how you like what they’re doing.

Yeah. Well, let’s talk about Hannah the Pet Society, one of your current, which is a bold re-imagining of pet ownership, essentially leasing pets with bundle care. You invited me out to see and tour Hannah and meet the Hannah team. And when I asked you why you started it, I will never forget your response. You said, “If I had the opportunity to help people, would I?” And I said, “Of course.” And you share with me how Hannah gives people the opportunity to own pets who may have never been able to afford a pet before. I would love if you could share this story with our audience. How did you arrive at the Hannah model?

Well, at Banfield, what we did back then when Banfield was clearly the biggest practice around anywhere was we were trying to say what did we need to do next to stay the biggest and to continue to grow and to continue to serve our clients and patients? And we eventually came up with the idea of what our people wanted with. We had a million wellness plans, but those weren’t really solving everybody’s problem because the people had pets and they would get other illnesses that weren’t covered by the wellness plan too well. And so, we said, “Well, how are we going to do this with pets and cover everything?” And so, we started researching that and we found that there had been pet healthcare then already that was in probably 2005.

There had already been pet healthcare insurance since the ’50s, and so 50 years and it wasn’t working. And so, we dug into that to try to find out why it wasn’t working. And the reason that it wasn’t working was because it was just too expensive and it still is and it’s still not working. And so, why is that? And it turns out that pet care is insurance like every other insurance, but it’s not health insurance really. We think of it as health insurance and it is insuring their health, but actually it’s property and casualty insurance and property and casualty insurance is a lot different than health insurance.

And the big companies that have been around for hundreds of years are insurance companies and property and casualty insurance like Safeco or any of them, they’re big insurance companies. And what they’re trying to do is maintain their status and their profitability and stuff in that business. And so, they do that and they erect laws and stuff to keep it that way. And one of the laws is you have to get a license in every state. Just to get a license in every state costs thousands and thousands of dollars, and it’s not really necessary for what we’re doing with pet care. So, you have to be in compliance with all those laws that there are for property and casualty insurance, but you are of a pet health insurance company.

And so, a pet health insurance company may not need the license, but they really need actuarial tables and it costs a lot of money to have enough data to get actuarial tables. And nobody really has them except Banfield certainly did, and we do, but nobody else really has pure actuarial tables and all the other things that you have to do besides actuarial tables to be a healthcare company. And so, by the time you add those two bunches of costs, it’s just too much and it makes the cost of the insurance too high. And so, we tried to say, how could we do it without doing that? Or how could we do it as a healthcare company? And there’s no real good way you have to change the laws in 50 states.

And so, we didn’t think that was too likely, but we found that all the laws that really regulate veterinary medicine, you have to comply with those, which is fine because therefore for the healthcare business, so to speak. And so, that’s what we did, and we found that every state had similar laws and we could go anywhere that we wanted to, but we have to and be in compliance with the laws obviously and we are.

What were the biggest conceptual or regulatory hurdles in launching Hannah?

What we eventually did was what our clients asked us to do was figure out how to get their own pet that they’d already had for five years. How do we get that to be a Hannah pet? And so, how do we buy it from them, and then how can they be assured that they can get it back if they want to move or something where we aren’t? And so, that’s what we do now. Probably 80% of the pets that are new Hannah pets every week, which is 60 or 80 pets a week, those pets, most of them, 80% are already their pet. And they bring it in and we examine it and we determine what we think it’s worth, and then we pay them that for it and usually just trade them services for it.

And then if they ever want to have it back, they just pay us what we paid them for it. And that goes down over time too, because the pet’s worth less as it’s older. And so, that’s worked great, and I don’t think we’ve ever, we might’ve had one or two that we’ve done that with, but that doesn’t happen very often and is great that you can just give it back to them and they owe you 60 bucks or something, but they can’t start a second time. And so, it worked, but that’s what we do now and it works really well.

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Well, Scott, the barriers you cite to pet ownership such as cost, behavior, and mismatch are real. In your view, which barrier is the hardest to overcome, and has your view of those barriers changed over time?

Well, certainly the barriers having pets are changing over time, and I think they’ll continue to change. A lot of them are linked to regular barriers that have been around for a long time like money, and how people react to those are changing a little bit. But right now, a lot of people aren’t being able to afford pet care because it’s getting too expensive. And pharmaceutical companies are raising the prices and combining and doing all these things that cause them to raise the prices far higher than it’s worth to people. And we see it every day. And the great thing about Hannah is that once they’re on the plan, it goes up by inflation every year in a dollar in a month and not more than that.

So, once they’re on the plan, they’re locked in there and that worked for them. And so, that’s how we address it at least.

Yeah. Well, Scott, you and your wife, Sandy are involved with The Campbell Family 4-H Small & Companion Animal Program Endowment via Oregon State. How did your roots at Oregon State influence your vision for veterinary education or outreach?

Well, that’s what I did at Oregon State was I did education, obviously. And so, I guess that’s how it happened. And Sandy was a 4-H teacher and I was in 4-H. She was in 4-H, our kids were in 4-H. It’s a great program. And so, we had the opportunity to donate a little bit of money to it and help it, and we have, and I think it’s a good thing to do.

Well, you own Silvies Valley Ranch in eastern Oregon where you’ve embarked on ecological restoration and sustainable tourism. What lessons from ranching, land stewardship or ecology inform your work in veterinary medicine or business?

Well, that’s quite a question. Well, that’s quite a question. I guess, I think they’re very much the same to me at least. And you have to understand, you have to understand everything before you can make a decision. And here at Silvies Valley Ranch, it was an Indian reservation actually back in 1882. And before that I, back in 1822 was when the first explorers got here. And what they did here and throughout the west was really destroy the beaver population. And they did that to make it so that the Americans wouldn’t want to settle here because the English who still owned it at that time felt like if they could stop the Americans from wanting to come here, then they could maintain their hold on it easier.

But it wasn’t very easy to get here. You had to go clear around the tip of South America and a little sailing ship to get here. So, it was pretty hard, but they did. They got here and they eventually sent out all these explorers. And the explorers were doing two things, looking for a northwest passage to sail here without going around the tip of South America and without having to go up through the ice in the Arctic. And so, they were looking for that. They of course never found it, but they were also trying to wipe out the beaver, and they just about did that. And in about 10 years, from about 1822 to about 1832, they mostly destroyed most of the beaver that were out here.

And as they did that without the beaver here making dams, the creeks all started to erode and they eroded, really many of them are still doing it. And here on the ranch, a lot of the streams had eroded down at least 10 feet, some 14 feet, some 16 feet down into the meadow. And then what happened was the meadow is like a big sponge. It’s all organic material, and so it’s there, but it’s all full of water. And the water travels through it downhill, but it goes really slow. You can measure it in feet per year. And when there’s not water there or the water isn’t in the soil and all the stuff around the stream, then it can go 20 miles an hour. So, it all runs out really fast if the streams are eaten down into the meadow.

And that’s what they did was they ate down into the meadow and then all the streams on this ranch had done that so severely that almost, well, all of the streams could run downhill at 20 miles an hour in the spring when there was snow melted. And so, most of the trees and the grass and stuff were all gone. It was just these deep, deep Creeks that had a little bit growing in the bottom that was eight or 10 feet wide, but nothing that was growing up where the meadow had been. There wasn’t a meadow there anymore. What was growing there now was sagebrush and juniper trees and desert species. And so, we tried it in one creek first and then a lot of creeks. And we eventually have recovered most of the streams on the ranch. It takes a long time.

They look a lot better though in a year. And now some of them are, they have taken over the entire thing. That was a meadow once. It’s now a meadow again, and now it’s a mile wide instead of 20 feet wide, and it’s really miraculous to see it. And so, some of those are getting the native fish back in them that were in them once a hundred, 200 years ago, but they’ve been gone for a long, really long time. It’s hard to get them back in all of them. I think it will eventually, but the bigger streams are regulated by the government. And so, the biggest stream here is the Silvies River, which isn’t much of a river anymore, but it is eroded down about eight feet in the valley here.

And it needs to be fixed, but we can’t do it because it’s regulated by the government and they won’t give you a permit to do it. We’re arguing with them occasionally about that and trying to figure out ways to do it without a permit, because you just can’t get the permit that they cost way, way too much, hundreds of thousands of dollars for a permit to do a restoration that costs $20,000. It’s just silly. But it’s the same thing with a pat that comes in and is sick, or is just getting old real fast. You need to find out what’s wrong with them by doing tests or at least a good exam, find out what’s wrong with them so you can change whatever that is.

So, we’ll quit doing it and the pet will be healthier and live a lot longer life. We found that Banfield, our pets were living about two or three years longer than pets that weren’t on a wellness plan. And I don’t know what been found at Banfield since, but at Hannah’s, it’s certainly the same thing. If we have a pet and we get it to be on a Hannah plan, it’s definitely going to live longer. It definitely depends on how old it is when it comes on the plan, how much longer it’s going to live. And they’re all different. So, you can’t say, “Well, this pet’s going to live 3.4 years and this one’s going to live 2.2.” It’s going to be different, but they are going to live longer.

And there’s also people that understand that themselves, and they can do that themselves. It’s about giving them the right food and taking care of their teeth and all those things. Doesn’t really take a veterinarian obviously, to do it, but veterinarians can educate people about it, and it makes a big difference on those pets. I mean, Banfield’s got a lot of wellness plans now, and I’ve never really understood, well, I know everybody else hasn’t done it, but it’s hard to do. But I think at Banfield, it’s just automatic now.

Well, you used to run Banfield, which you eventually sold to Mars, Inc. What was that decision like? What did you gain or relinquish and how did it shape your next chapter?

Well, I said I was going to retire when I got to be 50 and I got to be 50, and so I retired. And so, the decision was already made and I went ahead and did it, and it was the right thing for me to do for my family. I have two sons, and they were both in the beginning of high school and it was a great time to have with them. And we bought a lot of toys and I said it was for them and I got away with it. So, that was really good. And then we had a bunch of our friends from Banfield that came and helped us with Hannahs, and they’re still helping us with Hannahs, and we were having a good time with Hannahs.

Well, Scott, in the veterinary profession there is a shortage of veterinarians and high educational costs. What structural reforms do you think could most effectively address those challenges?

I don’t really know. I know that the people who are veterinarians now are different than the veterinarians, the people who are becoming veterinarians. When I was getting into school, that was a long time ago now, and you have to figure out what they want and try to address that. And I think the clients largely want the same thing, they always did. They want a healthy pet that’s going to live a long time and not going to cost them too much. And that’s easy to say and hard to do. But at Hannah, we don’t cover a lot of things that we used to cover at Banfield even. And we did in the beginning at Hannah’s, like some kinds of cancer that no matter what you do is not going to live very long. We won’t do much for that.

I mean, we do all we can with pain medication and some steroids and stuff, but we are not going to do surgery on something that we know is not going to make it live longer. And some people will. And the problem is, every once in a while, one does live longer and we lose those probably. But we also know that the people want a lower cost to healthcare, and the doctors can do anything that they would honestly do on their own pet. And that’s a really hard thing for them to learn when they first join the practice. It takes about a month, sometimes longer, and sometimes they don’t learn, but we can’t just do anything since we pay for everything. The client will do anything. And sometimes, it’s not the best thing for the pet.

The pet’s in a lot of pain. It’s peeing all over the house or something else all over the house, and it’s not really a good pet any more like it was. And so, you have to address that and most all lives come to an end. And for the dog and cat, most of the time, that’s going to be in the veterinary hospital or right around there. And so, we have to get so that we can help advise people who have pets that rovers are just about to the end of the line here. And you always had to do that anyway. I mean, there’s some pets who are doing it a few weeks early and earlier than we might have, but we’re saving thousands of dollars.

And by doing that, and we tell the client, “You can take your pet to another vet obviously and get a different opinion. They’re going to recommend you do this surgery and blah, blah, blah, and we’ll let you do that if you want to.” The doctor can give the pet to the owner if they want to, and then they can go take it to another vet and they can spend all that money, but we’re not going to do it. And that’s a hard thing to learn, but it’s very important for this kind of medicine because you just can’t do it all because we could take care of fewer pets than everybody else does. And right now, one of our hospitals, or both of them, we only have two, and they see about 60 to 80 patients a day with one doctor.

And they have a lot of paraprofessionals that are helping them, but it’s one doctor that’s licensed that’s in there doing it all, and they feel really good about it because they’re giving a really, really high level of care to all 60 of those, or sometimes 80 or 90 pets that they’ll see in a day. And of course, their time’s being spent on the sick ones, the four or five out of those six or 70 a day that are really sick because they still get sick and they still got to be treated and they still get all the same diseases. But when it comes to one that is limiting their life, that’s when we got to have discussions because we can’t do that.

Well, Scott, for younger veterinarians or entrepreneurs listening, what’s one principle or practice you would advise them to embed from day one?

Advise them to… I’m sorry, could you repeat that?

For younger veterinarians or entrepreneurs listening, what’s one principle or practice you would advise them to embed from day one?

Well, I think probably the most important thing to do is really with pets that, like I was just talking about in the last question, have a disease that is limiting their life. I think that they should talk about that with their client instead of just recommending one more thing to do, because most good pet owners will do what you tell them to do, no matter if that’s the best thing for the pet or not. And the best thing for them are not. I mean, the best thing that we’re trying to do is give them a good quality of life as long as we can. But we think that we, because of our experience, know best when that is, and we need to give that knowledge to the consumer because that’s what they’re really paying us for.

And you have to do that, and it’s painful to do sometimes.

What do you see as the next frontier of innovation in veterinary medicine over the next decade? Example, technology, preventative care models, telehealth, AI, population health. What do you see as the next frontier in veterinary medicine and innovation?

Well, I think the next frontier is going to be doing a lot more of what we’re doing, learning how to give people the care that they want, not what they think they want because somebody told them to do it. And if we don’t, there’s going to be more than one state that has licensed non-veterinarians to do stuff like Colorado. Now, Colorado, when you really look at what they did, it wasn’t very much, but it was a start and it was a good start. And it will destroy practices for sure. If the veterinary industry doesn’t respond to it appropriately, it will destroy practices because it’ll have all non-veterinarians doing everything pretty soon because there’s not very much of that stuff to do with people that have the money to do it.

And they probably won’t do it twice. Some will clearly, but the number that want to do it the second time is a lot less than the number that you can talk into it the first time. And so, I think that’s the big thing that we have to learn as a profession is how to limit what we get people to do.

Well, Scott, if you were to imagine a world 20 years from now where you have had maximum positive influence, what does veterinary practice and pet ownership look like in that world?

I don’t think it’s very much different from what we have today. I think it’s largely the same only we’re not doing a lot of the things that don’t really need to be done. And so, it’s a better relationship that people will have with their pet because that last little bit that they can buy with a lot of money is not very fun for them either. And right now, we feel like we have to do it, I guess because we have a high debt and blah, blah, blah. You can do the same thing, just see more pets, frankly. And it’s easier and more fun to do it that way. We got to go through what we’re going through now to get there.

What has been the most surprising thing to you during your career in the veterinary profession?

The most surprising thing to me is how it’s changed. When I first got into it, it was all men and now, it’s largely women and going to be all women. Maybe 10% guys, and they’re not working so hard and they’re making them more money. And I like that they’re doing that. The thing is, you have pets getting sick at night too. And so, somebody’s going to night call because pets get sick at night and they’re not going to be able to afford it any more than they are today and maybe less. And so, there’s going to be the way things are going, more limited resources to take care of the pet, and there’s going to be a lot more veterinarians, unless we do something to stop that. And I think there’s going to be more pets.

There’s a lot more pets today than there was when I got out of school. And that’s good because people that have a pet live longer and have a better quality of life themselves. And so, having them have more pets is really good, and we have to make it so that they can take care of them adequately. That’s the thing. And we’re not doing a real good job of that right now.

Scott, what advice would you give the younger version of yourself?

What advice? I’m not sure I know what I would tell them. I have a lot of opportunities to tell them because lots of people come and ask. And as I said, do the right kind of practice that you can, look in the mirror and say you did the right thing and you charged the right amount for it.

Well, some of our guests say they’ve had a key book that they read that helped them along the way. Do you have a key book in your life that’s impacted you the most?

Not a book, I don’t think. There’s been a lot of books that have impacted me. I read a lot, and the normal ones like the Bible. And there’s a lot of good books for veterinarians out there, I think and just for people to read. And yeah, I don’t really have a book.

Well, Scott, you’ve got the mic. What is one thing that you want to share with our listeners of the People of Animal Health Podcast before you drop the mic today?

Let’s see. I think making it easier for people to have a pet is the most important thing that we can do as veterinarians, and that’s a great thing and it’s a good thing to do. And there are people that have pets that need it taken care of free sometimes, and it’s certainly okay to do that. I know some of the people out there say, you should never do that, but I’ve always done it. And that’s important to do, but you got to remember that everybody will be there if you’re just doing that. And that probably won’t go too well if you do too much of it, but it’s okay to do things for what you think it’s worth, and I think it’s important to remember that.

Well, Scott, thank you so much for being here with me as my guest today on the People of Animal Health Podcast. It was a pleasure to have you here today.

Thanks.