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Domestic Medical Travel Increasing as Hospitals Across The US Begin To Compete for Procedures and Pricing

Posted Jul 07 2010 6:32pm

This is a lot better than having to leave the US; however you will still need to see if your health insurance will cover as all policies differ and they are so confusing image today.  Earlier this year I wrote about Lowes negotiating surgical procedures for the heart for all their employees who elect to travel to the Cleveland Clinic and Lowes picks up all the bills entirely.  According to this article Lowes had asked their insurers to work on this project with them and got tired of waiting so they went out and negotiated their own contract. 

Four other large employers including an airline and a bank are looking a the Lowe’s plan that may soon announce similar agreements with medical providers.  If same city competition is not enough, there may be more for hospitals on the horizon.  One thing to also be aware of too, depending on what type of a procedure you need, don’t low ball for price and make sure the hospital can provide the services an doctors you may need – again this varies based on what type of care and surgery you need and it can be simple or very complicated.  BD 

One company mentioned here in the OC is Newport Orthopedic Institute in Newport Beach and the center started offering flat rates with domestic travel companies 2 years ago.  What is also interesting is to see their notice on the website relative to United Health Care asking patients to ask them to support a new contract as at present it’s not reimbursed at the same levels as other carriers and contains articles about how much the United CEO earns too.  So you can see right here, check with your insurance carrier as United seems to have more issues than most, as that is what I see and hear more of anyway in southern California.  BD

When employee John McNally needed a knee-replacement operation, Alpha Coal West offered to pay his travel expenses if he would have the surgery in Fort Collins , Colo., a five-hour drive from his home near Gillette, Wyoming.  image

The Colorado surgery center had data showing good results with such operations, and it charged far less than the hospital in Gillette. Despite feeling "every bump on the way back," McNally was so pleased with the outcome of the operation that he returned to Colorado a few months later to have his other knee done.

A lot is at stake. Hospital care accounts for more than one-third of the nation's $2.5 trillion annual health spending tab. And spending on hospital care — which rose nearly 6% last year — is expected to accelerate, government data show, driven both by increased use and rising prices. Employers with domestic travel programs say they save money in part by negotiating a single rate, which includes fees for surgeons, anesthesiologists and all medical care up until the patient is discharged.

It could shake up the hospital industry by fostering "a truly national competition," says consultant Jim Unland of the Health Capital Group in Chicago.  Still, the domestic travel movement faces challenges. It could backfire, Unland says, if employers and insurers focus solely on cost, rather than quality. While most programs are voluntary, large financial incentives can blur the line between choice and necessity. Medical providers have balked at making their discounts public. And it isn't clear how many workers are willing to travel long distances, particularly those with young children.

James Caillouette, co-owner and surgeon at the Newport Orthopedic Institute in Newport Beach, Calif., says doctors and hospitals had better get over their anger and embrace the new model. Two years ago, the center began signing flat-rate prices with domestic travel companies.

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