A group of large employers including retail giants Wal-Mart Stores and Lowe's Cos. announced they will offer their employees coverage for hip and knee implant procedures with no cost-sharing if they receive the procedures at one of four previously selected hospital systems.
The participating hospitals are Johns Hopkins Bayview Medical Center in Baltimore; Kaiser Permanente's Orange County-Irvine (Calif.) Medical Center; Mercy Hospital Springfield (Mo.); and Virginia Mason Medical Center in Seattle.
The preferred network is similar in many ways to initiatives developed by Wal-Mart and Lowe's that encourage employees to visit preferred academic centers like the Cleveland Clinic and Mayo Clinic
for heart and spine surgeries.
As part of this network, employees will have the option to receive care at a local healthcare provider although they will incur regular cost-sharing under their employer benefit plan. For the employees who choose to undergo procedures at one of the four systems, the cost of consultations and care, as well as travel, lodging, and living expenses for themselves and a caregiver, will be fully covered.
“This is especially important for our employees who live in areas underserved by high quality healthcare providers,” Randy Moon, Lowe's vice president of international human resources, benefits and human resources information systems (PDF)
, said in a news release.
The Pacific Business Group on Health's Negotiating Alliance, an organization that will oversee the so-called Employers Centers of Excellence Network, developed quality
criteria to determine which providers would participate in the network, said David Lansky, the business group's president and CEO. “There's a sense of great variation” in the costs and quality associated with hip and knee implants, Lansky said. “The cost of care has been very unpredictable.”
The criteria did not include information about the costs of orthopedic procedures at the various facilities, but did take into account location. The Pacific Business Group on Health screened potential providers and later conducted on-site visits. Between 20 and 30 hospitals received requests for proposal.
“Each of these providers has a proven record of practicing evidence-based medicine with above-average positive patient outcomes in knee and hip replacement procedures,” Sally Welborn, Wal-Mart's senior vice president of global benefits, said in the same release.
The participating companies—there are others that are expected to announce their participation in the network over the next few months—hope to lower complication rates and re-operation rates in the long-term, according to Lansky. Follow Jaimy Lee on Twitter: @MHjlee