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Winter 2012

PepsiCo Agreement Makes a Splash

Thousands of employees now eligible for surgery at Hopkins through model agreement.

Date: February 1, 2012

PepsiCo Agreement Makes a Splash

Employees of PepsiCo, the world’s second-largest food and beverage business, now have the option to travel to Johns Hopkins Medicine in Baltimore for cardiac and complex joint replacement surgeries.The travel surgery benefit has been extended to PepsiCo’s domestic employees and their dependents—almost 250,000 people.

PepsiCo, which sponsors its own self-funded medical plans, will waive deductibles and co-insurance for those who elect to have their surgery at Johns Hopkins. The company will also cover the travel and lodging expenses to Baltimore for the patient and a companion.

Hopkins is offering the procedures in a “bundled” rate, an all-inclusive rate for hospital and physician charges and certain preoperative testing. This reimbursement model—which provides payment for all the patient care over the course of a clinical episode—departs from the standard practice of paying for each service on a fee-for-service basis.

“We’re offering [PepsiCo] employees some of the best health care available, which should mean fewer complications and should result in employees being able to return to work sooner. At the same time, we’re offering PepsiCo predictability regarding cost,” says Patricia M.C. Brown, president of Johns Hopkins HealthCare LLC, the managed care arm of Johns Hopkins Medicine. Brown adds that Hopkins is open to similar arrangements with other large companies.

To be eligible for the new program, the patient must be approved for surgery in advance and be healthy enough to travel. Other types of surgery may be made part of the program in the future. 

Stephanie Desmon