The Rising Costs of Health Care—for Cats and Dogs

Americans are spending more than ever on their pets. The tally for 2014 is an estimated $58.5 billion, according to the American Pet Products Association. After food, the biggest amount—$15.2 billion—went to veterinary care. With MRIs, sonograms, and chemotherapy all on the treatment menu, the health costs for many pets can top what well-insured humans pay for their own health care.

That prospect has helped the pet insurance industry grow an average 13 percent every year since 2009. The number of insured pets rose 14.6 percent in 2013, to more than 1 million, according to the most recent figures from the North American Pet Health Insurance Association (NAPHIA). The nation's largest and oldest pet insurer, Nationwide-owned Veterinary Pet Insurance (VPI), administers 525,000 policies, more than double what it wrote a decade ago. And on Feb. 12, the fourth-quarter earnings of pet insurer Trupanion (TRUP) showed a 29 percent year-over-year jump in pets enrolled, to 218,684, and average monthly adjusted revenue per pet that rose 4 percent, to $44.27.