Saturn automobiles, songs on iTunes, and coronary bypass surgery wouldn't seem to have much in common, but they do-at least they do if you get that last item at Galichia Heart Hospital in Wichita, Kansas. On February 26, the hospital announced that it would charge a flat fee of $10,000 for the procedure, a pricing approach found more commonly among less esoteric consumer goods. In a press release announcing the move, Steve Harris, the chief executive officer of the hospital, said "After carefully studying our costs and reviewing our social responsibilities, the board of directors has taken careful aim at rising US health care costs by offering an 80% reduction in the cost of open heart surgery."
According to Harris, conducting this single operation for this price is not a loss leader for other procedures offered. "We make a fine profit at this level," he said. That level is about a 1/3 of what Blue Cross is paying ($30,000) for the same operation (without comorbitities or complications) at nearby hospitals. The biggest source of extra expenses in heart surgery is related to surgical complications, Harris pointed out, and so the Galichia approach takes care to minimize them.
To be eligible for this largely elective procedure at this price, a patient cannot be having a redo of an earlier operation; the surgeon must believe the patient is eligible for off pump surgery; and the fee is to be paid at the time of admission, so no paperwork is involved.
In terms of acceptance by the public, so far the discounted surgery has appealed less to the locals than those further afield. We "have had a lot of people on the schedule," for the surgery, said Harris, "but they are all Canadians." In addition, several larger US employers are looking into making Galichia the preferred provider for such surgeries. A Boston-based firm of approximately 30,000 employees may soon be sending their cardiac cases to Galichia.