Is fixed-price care a win for hospitals, employers, patients?

Negotiating fixed surgical rates with employers has been gaining popularity among major health systems, but the new payment model could pose threats to some patients who travel longer distances for a deal, the Los Angeles Times reported.

Under the bundled payment arrangement, patients enjoy all-expenses-paid trips to high-quality facilities, while employers get low, fixed rates for procedures, and hospitals see a steady flow of new patients.

Although it seem likes a win-win-win situation for everyone, patient advocates question the safety of patients traveling across the country for treatment, the article noted. Moreover, patients often struggle to find local doctors to provide needed follow-up care when far from home.

With complications costing about $7,600 a patient, hospitals and employers should consider excluding patients who have a higher risk for post-surgery complications from bundled-payment arrangements, James Caillouette, Hoag Orthopedic Institute's surgeon in chief, told the LA Times.

Nevertheless, health systems and employers continue to make such pacts to control healthcare costs. Wal-Mart now offers employees free heart and spine surgeries under arrangements with Cleveland Clinic; Geisinger Medical Center in Danville, Pa.; Mayo Clinic sites in Minnesota, Arizona and Florida; Mercy Hospital Springfield in Springfield, Mo.; Scott & White Memorial Hospital in Temple, Texas; and Virginia Mason Medical Center in Seattle.

Meanwhile, Cleveland Clinic and defense contractor Boeing last month reached a deal to offer heart care at fixed rates. The bundled-payment arrangement includes the cost of a procedure, travel and lodging for a patient and companion.

For more:
- read the LA Times article