Bargaining Power in Health Plan Negotiations

tennesseanThousands of children have passed through the doors of Vanderbilt’s Monroe Carell Jr. Children’s Hospital. The lobby is bright, full of natural light and decorated in bold colors and kid-friendly shapes such as stars. It hums with the quiet chaos of sick and recovering children.
The building opened as Nashville’s first and only freestanding children’s hospital in 2004 and a $30 million expansion was added this year. And while the hospital does many things for patients every day, its capacity to care for children holds great weight for Vanderbilt’s business side. Namely, the hospital brings the university tremendous bargaining power when discussing reimbursement rates with insurance companies.
“It’s huge, it’s just huge, right?” says Peter Ubel, a professor of marketing and public policy at Duke’s Fuqua School of Business. “If you’re a big employer and you don’t offer an insurance plan that includes that children’s hospital, all of your employees with kids are going to be up in arms” …(Read more and view comments at The Tennessean)

Similar Posts

  • |

    The Key to Surviving Your Hospital Stay? Get Admitted During Inspection Season

    A fascinating study from JAMA Internal Medicine shows that hospital mortality rates decline when hospitals are being inspected by The Joint Commission, a national accrediting agency. Here’s a picture showing the research findings: Which raises the question – is there a way for hospitals to be vigilant even when they aren’t being inspected?

  • 150,000 Walt Disney Employees Denied Mental Health Coverage – A Headline from the Future

    Newswire Services, April 11, 2015: Breaking News


    Since purchasing the Walt Disney Company six months ago, the Church of Scientologyhas been slowly remaking that venerable institution, in an effort to promote their ambitious religious mission. In the pipeline are an unprecedented number of science fiction films and John Travolta/Tom Cruise buddy movies, changes that have been surprisingly popular among movie fans.
    But now the church is making a change that is not so popular. It has decided that Disney employees will no longer receive insurance coverage for psychiatric care or any medications used to treat mental illness: “Psychiatrists are the enemy of the people,” stated Church spokesperson Walter McGee. “The church opposes their brutal, inhumane treatments and refuses to pay for such services because they collide with our religious beliefs.”
    Many Disney employees are up in arms over this decision. But the church is unrelenting in its position: “If people want to receive devil-care, they can either pay their own money or find a job somewhere else,” said McGee.
    Critics blame the situation on a decision made by President Obama in February of 2012. Early that month, he had announced regulations that would require health insurance companies to cover contraception, with exceptions for churches that oppose birth control but not for larger church run organizations such as hospitals or universities. The Roman Catholic Church cried foul, claiming that their religious freedom was being violated. In response to pressure, the Obama administration quickly backed off on its policy, broadening the religious exception to any church owned business that was run as part of the church’s broader religious mission.
    That shift in policy opened an opportunity for religious organizations to carve a broader set of services out of their health insurance plans. The Jehovah’s Witnesses had gained ownership of Wal-Mart in late 2013, and soon employees of that company (at least the ones who get health insurance) no longer received coverage for blood transfusions. An Orthodox Jewish organization became majority owners of Ace Hardware in early 2014, and now employees of that company no longer receive insurance coverage for insulin products that are derived from pork.
    The Church of Scientology is undeterred by critics who claim that treatments like antipsychotic medications and antidepressants ought to be part of any basic health insurance plan. “America is the land of religious freedom,” he explains “a place where the government has no right to stand between a church and its employees.”
    Who could argue with that logic?

  • | |

    The Best-Selling Biologic Drugs

    Biologic drugs are a big deal for the pharmaceutical industry right now. Blockbuster chemicals for common conditions like diabetes and hypertension are largely things of the past. We’re getting pretty good at controlling those conditions, and few people expect a slew of major scientific breakthroughs that will lead to many more multibillion dollar treatments for…

  • The Most Expensive Medical Condition Is Not What You Think

    In a minute, I’m going to ask you what the most expensive medical condition is in the American healthcare system. Before you guess, however, I’m going to explain what I mean by “most expensive.” I’m not talking about cost per patient. Some people with cancer receive hundreds of thousands of dollars of chemotherapy per year,…

  • Why Many Physicians Are Reluctant to See Medicaid Patients

    In an earlier post, I presented some data on which kind of physicians in the United States are most and least likely to see new patients who receive Medicaid, the state/federal program to pay healthcare costs for low income people. Now a recent study lays out some reasons why many physicians are so reluctant to see such patients….

Leave a Reply