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Some Employers Encourage Workers to Travel to Hospitals With Bundled Prices

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More employers are incentivizing workers with bonuses, waived deductibles and paid travel expenses if they receive surgery at a select hospital that charges a fixed price for the procedure, according to a Los Angeles Times report.

Food retailer Kroger is one company that has specified 19 hospitals as top performers for employees' surgery. If employees choose one of these 19 hospitals, they may pay 10 percent out of pocket. If they choose another nearby medical center, they may pay 25 percent to half of the out-of-pocket costs, according to the report.

So far, 21 Kroger employees have traveled for their surgery this year, many to Hoag Orthopedic Institute in Irvine, Calif. The employees' travel and lodging expenses are paid for, and Kroger also provides a certain amount of spending money for the patient. A Kroger spokesperson said the company pays $30,000 on average for hip and knee replacement surgeries — about 15 percent less than what it pays at other hospitals.

Walmart is also beginning to "surgery shop." Beginning in January 2013, the retail giant will offer employees and their families heart, spine and transplant surgeries at no cost at six major hospital systems across the country. Travel and lodging will also be covered.

In 2011, the California Public Employees' Retirement System restricted its spending on knee and hip replacement surgeries to $30,000. Hospital bills ranged from $15,000 to $110,000 with no noticeable difference in quality. Forty-five hospital systems were willing to stay within CalPERS' designated amount. Since then, the average price per surgery has dropped 30 percent to $23,113, according to the report.

More Articles on Hospitals, Employers and Bundled Pricing:

Cleveland Clinic Strikes Bundled Payment Deal With Boeing
Bundled Pricing: Getting Physician Buy-In
Walmart Employees to Receive Free Heart, Spine Services From 6 High-Profile Systems


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