Wal-Mart’s Super-Counterintuitive Health Care Plan

[mota bhai 2,675]

Last October, Wal-Mart announced that employees who needed certain pricey surgeries would have the option of traveling to one of the six best hospitals in the country that specialize in those procedures. Cashiers in California and store greeters in Alabama could fly to the Mayo Clinic in Minnesota—all expenses paid ... this program is premised on the idea that cheaper health care is to be found at the nation’s very best providers.

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The key to the Wal-Mart approach is picking facilities that measure high on quality, have the expertise to identify when a patient’s local doctor has given the wrong diagnosis, and possess the credibility to talk patients out of surgery they don’t need.

A second element is hospital payments. Instead of the usual arrangement, where insurance companies reimburse providers à la carte for various services, the travel-surgery programs are based on a flat fee for all the care involved in a procedure. Tough transplants don’t cost the employer any more than patients who sail through the surgery easily. The flat fee reduces employers’ risks and gives the hospital an incentive to avoid problems that could prove expensive down the line.

The approach builds on research showing that for certain procedures, volume and outcomes are related. Surgeons who rarely do something struggle more than those who do it all day long ... Some academics say the assumption that all health care should be local drives down quality and reduces competition. “It is absurd to think that we would service the stealth missile in the corner garage,” says Regina Herzlinger, a health economist at Harvard Business School.

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Overall, the U.S. health care system is pulling in the opposite direction, toward approaches where large groups of providers and hospitals in an area work together to ensure low-cost, high-quality care for local patients.

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Other businesses are exploring the model ... The National Business Group on Health, which represents benefits managers at large employers, says more than 10 percent of its members are using price incentives to steer workers to high-quality hospitals. Another 19 percent say they’re considering it for next year.

http://www.nationaljournal.com/magazine/wal-mart-s-super-counterintuitive-health-care-plan-20130523

[I AM NOT THAT GUY 5,715]

Smart folks there in Bentonville.

[chaine1 116]

Unlike in retail stores, where the cheapest item is probably the shoddiest, this program is premised on the idea that cheaper health care is to be found at the nation’s very best providers. “We come at it from the perspective of how can we improve quality,” said Sally Welborn, Wal-Mart’s senior vice president of global benefits. “When we improve quality, often there will be a reduction in waste or unintended or unnecessary cost.”

Irony. This is the same reason I rarely shop at Walmart. Invest in better quality stuff, and in the long run you'll save yourself money. Laughable to me that Walmart also agrees this is a good approach!

[Mr. Big Dog 10,747]

... talk patients out of surgery they don’t need.

Sounds like death panels.

Irony. This is the same reason I rarely shop at Walmart. Invest in better quality stuff, and in the long run you'll save yourself money. Laughable to me that Walmart also agrees this is a good approach!

Excellent observation.