Recently CalPERS has been in the news for their new bidding process to split up the insurers offering coverage for their health insurance. They have opening admitted they don’t know if any money will be saved but in working with Blue Cross on some of this they are making some headway with what they will pay for certain surgical procedures. Hospitals don’t want to lose patients so if they are too far out of the ball park, and consumers have to pick up the rest of the bill they look else where.
CalPERS Announces Results of Health Insurance Bids and Blue Shield Loses It’s Monopoly & No Clue If Any Money Will Be Saved
On the other side of the coin too we had situations like this at Stanford to where they eventually made up but Blue Cross patients had to go elsewhere.
Stanford Hospitals and Clinics No Longer Accepting Blue Cross Health Insurance–Contract Expire-Patients Have to Go Elsewhere While the Cost Algorithms Churn With Contract Negotiations
Now even hospitals like Cedars have lowered costs and are included on the list where patients can go and have the procedure covered for knee and hip replacements and CalPERS may entertain capping even more procedures. When compared with other insurance data, there were no better or worse outcomes. There have been employers who have also negotiated with hospitals like Lowes and the Cleveland Clinic for one example with domestic medical tourism to save money. BD
When the California Public Employees’ Retirement System told its Anthem Blue Cross members it would pay only up to $30,000 for a knee or hip replacement surgery, some patients shopped around for a cheaper hospital.
What may be more surprising is that about 40 higher-priced hospitals in the state cut their surgery prices significantly to avoid losing patients. That response accounted for about 85% of the $5.5 million CalPERS saved over two years, researchers at UC Berkeley found, with the rest of the savings coming from patients opting for lower-cost hospitals.
The average charge among the more-expensive hospitals fell 37% from $43,308 in 2010 to $27,149 last year for these common joint replacements. The average price for CalPERS members at the less-expensive hospitals was $24,528, down just 3% since 2010.
CalPERS, the nation’s third-largest purchaser of health benefits, said it pursued this idea because its hospital bills for hip and knee surgeries ranged from $15,000 to $110,000. Now the giant pension fund said it will look at expanding this approach to other procedures.
To assist workers, CalPERS and Anthem gave members a list of 46 hospitals that were judged to be both higher quality and lower cost. This group, which has grown to 54 facilities, includes hospitals such as Cedars-Sinai Medical Center.