Evaluation of three different pricing policies in total knee arthroplasty surgery: A clinical pathway-based tariff and reimbursement simulation

Aim: This research examines the effects of the multi-layered tariff structure (Health Practices Communique-HPC, Public Health Services Price Tariff-PHSPT, and Health Tourism Price Tariff-Annex 2A) in the Turkish health financing system on the financial sustainability of public hospitals, using a holistic approach through Primary Total Knee Arthroplasty (TKA), a high-volume, material-intensive elective surgery. 

Materials and Methods: Instead of traditional static methods, a patient-centered “Clinical Pathway-Based Cost Simulation” model was used in the study, analyzing the entire medical service production process, from the patient’s outpatient visit to post-discharge follow-up, using secondary data integration techniques.

Results: The findings quantitatively demonstrate that HPC base prices, which represent Social Security Institution reimbursements, lag increases in foreign currency-indexed biomedical implant costs, creating a devastating price squeeze for hospitals. According to case-based simulation results, HPC payments cover only 59.33% of the calculated operational consumables cost for TKA surgery, indicating below-cost pricing. In contrast, the PHSPT fee applied to paying domestic patients covers 202.68% of the cost, while the Annex-2A tariff under health tourism covers 283.88%. This margin difference creates a necessary “cross-subsidization” mechanism for public hospitals to cover their HPC deficits through health tourism revenues. The revenue from a single international patient can finance approximately 4.79 domestic patients.

Conclusion: Consequently, to prevent domestic patients from facing capacity allocation dilemmas in the public system and to ensure equitable access to services, it is necessary to switch to dynamic reimbursement models that explicitly separate implant costs from the procedure package in surgeries that rely heavily on imported materials.