Orthopedic surgeon Raymond L. Horwood, MD, moved his long-running practice from Cleveland Clinic to St. John Medical Center, a University Hospitals facility, in order to continue using DePuy implants for joint replacements, according to a report in The Plain Dealer.
Cleveland Clinic standardized implants to just two vendors — Stryker and Zimmer — for joint replacements in a broad cost-cutting effort. However, Dr. Horwood felt Johnson & Johnson's DePuy implants were better for his patients and he chose to move his practice rather than switch implant vendors.
This high-profile move emphasizes key trends in the industry:
1. Hospitals are instituting more sweeping changes to become efficient and cost-effective as reimbursements are reduced and they take on more risk.
2. Providers, including those at the Cleveland Clinic, are establishing protocols for surgical procedures to standardize equipment and deliver reproducible outcomes.
3. There are some surgeons, particularly those who have been in practice for many years, who would rather leave a hospital than change implant companies. Dr. Horwood wrote in a letter he wasn't comfortable switching implants for cost-cutting measures.
Although surgeons were involved in the implant selection process, hospitals can't accommodate all preference items. In the letter, Dr. Horwood wrote, "Dr. Horwood does not feel in good conscience that he can jeopardize his patients by changing to an unfamiliar implant system simply to save money for the hospital."
There have been success stories with other models of limiting implant costs without giving up physician preference items. When Loma Linda (Calif.) University Medical Center adopted a "rep-less" model for implants in 2013, they received a 50 percent discount on implants, according to a General Surgery News report.
Hospitals can also join a group purchasing organization to bargain with the device manufacturer and realize savings. However, new devices often aren't covered with GPO contracts.
Other hospitals evaluate physician preference requests to keep costs down while still allowing surgeons to provide quality care. There is huge variation in orthopedic implant costs. In California, for example, the highest average cost for knee implants is $10,830 while the lowest average cost is $3,408. For hip implants, average cost ranges from $3,645 to $11,308, according to a study from Berkeley Center for Health Technology.