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Responding to CMA reform: what veterinary practices need to know
The Competition and Markets Authority's (CMA) final remedies for the veterinary sector are now confirmed, with implementation beginning this year. Lee Reeves, Head of Healthcare Banking Services at Lloyds, explains why understanding the financial and operational implications is essential for veterinary practice owners and partners.
Read time: 5 mins Added: 26/08/26
Quick links: In this insight
The reforms at a glance
Following an extensive market investigation into veterinary services for household pets, the CMA published its final remedies at the end of Marchi. The legally binding measures are designed to improve transparency and boost competition, with implementation starting in the autumn.
To explore what these changes could mean in practice, I spoke with Simon Biles, Director in the veterinary team at Moore Scarrott, which advises more than 300 independent veterinary practices across the UK. Together, we've identified the key outcomes that practices need to know.
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Practices will be required to publish prices for specified items, both in-practice and online. This information will also feed into the RCVS Find a Vet website, creating an industry-wide comparison tool.
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Practices must actively inform clients of their right to request a written prescription during all consultations where medicines are dispensed. Prescription fees will be capped at £21 including VAT for a single item and £12.50 for each additional item, which is potentially lower than many practices’ current charges.
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For procedures with an anticipated cost of £500 or more, practices must provide written estimates. If costs are likely to exceed the estimate by more than 20%, clients must be updated in writing before proceeding.
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The CMA’s compliance deadlines vary by practice size. Larger providers with 15 or more locations face shorter timeframes, while smaller practices have additional time to prepare.
For pricing list requirements, larger groups will need to comply by around December 2026, with practices operating fewer than 15 locations following by March 2027. Estimate and itemised billing requirements are expected to come into force between June and September 2027.
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Simon has also been working closely with his clients to understand the financial impact of the CMA’s rulings. That includes concerns around medicine pricing and prescription charges, which represent significant revenue streams for many practices. As the reforms take effect, some practices may need to review their business models and manage cash flow carefully during the transition.
"When we're looking at it from a pure financial perspective, the biggest impact is likely to be the profit margins on long-term medications," Simon explains. "Historically, some of the margins on those longer-term chronic medications that clients need monthly can make a useful contribution to the practice finances." The requirement to actively promote prescription availability, combined with fee caps, could potentially shift client behaviour.
Simon Morrish Director, Moore ScarrottAs a rough guide, that might affect a third of overall drugs income, though it varies considerably by practice type and current pricing position.
And Simon emphasises that independent practices cannot simply absorb these margin pressures. "We don't feel that profit margins overall can reduce significantly if there's going to be a thriving independent sector moving forward. What we need to look at is rebalancing – what changes need to be made to ensure medication prices are competitive, while adjusting professional fees to maintain viable margins."
For practices concerned about managing this transition, working capital facilities and careful cash flow planning can provide the flexibility needed while business models adapt to the new landscape.
Operational challenges
Beyond the financial impact, practices face a significant administrative burden. New systems and processes will be needed to ensure compliance, from publishing and maintaining pricing lists to providing timely written estimates and updates.
"What we're discussing with practices is how to make those systems and processes as efficient as possible," says Simon. "The extra administration burden needs to be managed so it doesn't detract from clinical capabilities."
This is where investment in practice management systems, digitising customer journeys, and pricing and billing software can pay dividends. Efficient systems not only ensure compliance but can improve the client experience and free up clinical time. Modern payment solutions, including card services and digital billing, can also streamline transactions and support the transparent pricing approach the reforms require.
Planning for the future
The CMA’s reforms undoubtedly present challenges, but they are also an opportunity for practices to review their operations, strengthen their business models and position themselves for long-term success. Lloyds has specialist teams of Relationship Managers who understand the veterinary sector and can help practices navigate the financial and operational implications of the CMA reforms, identifying opportunities to build stronger, more sustainable businesses.
As traditional revenue streams come under pressure, careful cash flow planning becomes essential. Working capital facilities can provide the flexibility practices need while adapting pricing structures and rebalancing their business models. Compliance with the new requirements will demand efficient practice management, pricing and billing systems. Lloyds can support investment in technology and digital infrastructure, including cards and merchant services that streamline client payments and support transparent pricing.
Whether you're considering acquiring a competitor, bringing in new partners through a management buyout, planning for succession or exploring exit options, Lloyds can provide finance and guidance tailored to your circumstances. The veterinary sector is entering a new chapter. With the right preparation and support, practices can navigate the CMA reforms while building businesses that thrive in the years ahead.
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