I read an interesting article in the Economist about Kaiser hospital’s integrated, efficient approach to health care. I have been a Kaiser member since high school. Only once did I lapse. When I got my first full-time job, I thought I’d try a PPO. Everyone at work said I had to try their well-regarded physician or dermatologist. I agreed. I was an adult and I figured it was finally time to pick and choose the best providers. But the best providers came at a hefty price. After routine appointments, I received exorbitant bills in the mail. One year later, I was back at Kaiser. I had seen what it was like on the other side and I preferred my HMO. Kaiser was cheap and good enough.
I’ve grown to like Kaiser more and more since then. The wait times have drastically improved. I get emails reminding me to make appointments for routine exams. My copayments are $20. My prescriptions are $10. No hidden fees. No extra bills in the mail. I also think the doctors are the very best in their field. Even if I were a millionaire, I’d stick with my Kaiser plan.
The Economist article described what makes Kaiser’s approach successful: fixed pricing, technology, integrated computer systems, and an incentive structure that promotes prevention and well-being. An illustrative example of prevention is Kaiser dentists apply a coating on teeth that prevents cavities, saving the organization money in the long-run. Most dentists don’t do this because more cavities means more revenue.
Apparently, Kaiser’s approach is hard to replicate, but still a fascinating example of success in an industry considered untreatable.