Prosthesis cost containment in total joint replacement: a physician-driven free-market approach.

As an alternative to a limited vendor/volume discount approach, our hospital employed a physician-driven free market strategy aimed at reducing joint implant costs. Surgeons were provided with vendor pricing and peer profile comparisons of implant cost data and asked to select implants providing the best value based on patient need. Vendors were challenged to reduce prices where appropriate. Total savings based on the 1995-1997 volume-adjusted cost difference were $1,059,159, a 17.5% decrease. These results demonstrate the possibility of reducing joint implant costs using a strategy that does not limit vendors or cap prices.