Jon Wilkerson, Director of Human Resources/Benefits of the largest county in Oklahoma (Oklahoma County) bravely proposed to the elected officials of Oklahoma County that they enter into a direct contract with Surgery Center of Oklahoma.  Aware of the experiences other self-funded companies have had with whom we have these arrangements, Jon hoped that the County’s self-funded health plan could be spared the outrageous charges for outpatient surgical procedures to which the health plan had been previously exposed.  

Three weeks following County’s decision to accept Jon’s recommendation he delivered the results of this decision:  a net savings of $140,000.  County had paid us about $58,000 for surgeries that would previously have cost County $200,000.  The significance of these results, beyond the actual amount saved, requires comment.  

As far as I know this arrangement is the first of its kind, where a public entity has abandoned the corporate healthcare syndicate to secure guaranteed and transparent pricing directly.  It was not The Unaffordable Care Act, it was not price control dictates, it was not central planning that brought these savings to Oklahoma County’s health plan.  The savings resulted from the application of the principles of the free market to our medical practice, with the pricing and quality that predictably result when market forces are trusted and allowed to work their magic.

On another level I feel personally vindicated because for many years I have told state legislators that unlike corporate healthcare, I wanted no part of their favors, asking only to be left alone.  I have for many years assured lawmakers (many of which were determined to legislate our surgery center out of business in favor of their hospital pals) that if they left us alone, allowed to bring market principles to healthcare delivery, everyone would realize an improvement in quality and a lowering of prices.  To their credit, over the years enough of the state lawmakers in Oklahoma have resisted pressure from corporate healthcare to hamstring our efforts, allowing us to deliver the results promised.  

To a legislator, it is one thing to hear the praise heaped on us by a large self-funded company spared corporate healthcare’s pricing.  It is another matter altogether for a public entity to realize the savings many private self-funded companies now enjoy due to our guaranteed pricing, as obviously this public savings interests the lawmaker much more than any private savings.  Indeed, any future legislative push to hamstring the operation of our facility (like we have seen in the past) would now be seen as an attack on the interests and finances of Oklahoma County.

The elected officials (and the taxpayers) of Oklahoma County aren’t the only ones toasting Jon Wilkerson.  The employees of Oklahoma County, joking about Jon wearing a cape and an “S” on his chest, are also celebrating, as they now have a direct line to the fine physicians and surgeons on our staff and have been relieved of the outrageous copays previously demanded from them when they required surgery. 

While we have been contracting with self-funded companies for years now, the arrangement with Oklahoma County has definitely “hit a nerve.”  I will relay the reactions in my next blogs.

G. Keith Smith, M.D.

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