What you need to know about the forces reshaping our industry.


November 25, 2014

GE contracts with four 'centers of excellence' for employee joint replacements

Daily Briefing

General Electric (GE)—one of the nation's largest employers—has contracted with four hospitals in different parts of the country to provide hip and knee replacement surgeries to employees through a bundled-payment agreement.

Specifically, GE has entered agreements with:

  • Carolinas Medical Center in Charlotte, North Carolina;
  • Christ Hospital in Cincinnati;
  • Hospitals for Special Surgery in New York City; and
  • Northwestern Memorial Hospital in Chicago.

According to Modern Healthcare, center-of-excellence deals like this one generally involve a company that has reached out to providers with high quality ratings and experience in a given specialty. The employer and provider then reach a deal for a bundled payment for those procedures, and the companies tell workers that they can undergo the procedure with no or minimal out-of-pocket costs at the designated centers. In many cases, including this deal, the company pays for patients' travel costs.

The deal is not the first bundled-payment deal for GE. The company also has contracted with provider-based centers of excellence for organ transplants, bariatric surgeries, and some kinds of cancer care.

More broadly, the agreement is part of a nationwide trend for large employers, which are increasingly looking for ways to bring down employee health costs.

In August, a National Business Group on Health survey found that more than one in three big employers consider centers of excellence or "premier networks" to be among the three most effective ways of containing benefits costs. Moreover, about 25% of large companies said they were considering or planning to use direct contracting with providers for certain procedures.

Commenting on the trend, Hannah Alphs Jackson, Northwestern's program director for value-based care, said, "It's definitely a way for academic medical centers to grow… We see this as an opportunity to partner with employers who are looking for high-quality and high-value services" (Herman, Modern Healthcare, 11/24 [subscription required]).

More from today's Daily Briefing
  1. Current ArticleGE contracts with four 'centers of excellence' for employee joint replacements

Have a Question?


Ask our experts a question on any topic in health care by visiting our member portal, AskAdvisory.