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Financial Risk Mgt.

The Pitfalls of Fixed Rates for Cases

Business expertise for hospitals: Medical practitioner Tarun Mehra and ETHZ economist Tobias Wekhof are getting into the consulting business.


Healing processes are rarely completely predictable. Nevertheless, health insurance companies in Switzerland have been settling all hospitalization cases based on fixed rates since the beginning of 2012; this goes for routine meniscus operations that allow patients to go home almost immediately as well as the lengthy treatment of major burns, which are often associated with complications. According to Tarun Mehra of the University Hospital Zurich, “this means considerable financial uncertainty for hospitals.” While this uncertainty cannot be completely eliminated, it can be limited statistically. Mehra and his partner Tobias Wekhof are able to calculate, based on a hospital’s historical data, the financial risks of different groups of cases. They are targeting hospital administrations, which they want to help to manage their investments. In addition, they see themselves as a partner of banks and consulting companies involved in health care. For Tarun Mehra, there is no doubt: “If medical progress is to remain affordable, we need to bring more business efficiency into the system.”


Tarun Mehra participated in the Business Concept course in spring 2017.