Patients beware: Study shows hospital profiting from medical errors

May 03, 2013

Like any other business, healthcare entities are continuously looking for ways to increase their bottom lines. For some hospitals, this is happening despite the danger it poses to patients. According to a recent study, hospitals are actually profiting quite a bit from patients who need additional care or treatment as a result of surgical complications or medical errors.

The study

The study, recently published in the Journal of the American Medical Association, examined the 2010 medical records of approximately 34,256 patients who needed surgery at various hospitals run by Texas Health Resources--a nonprofit hospital system. Researchers determined that 1820 of the total surveyed suffered complications from their care and needed more treatment and hospitalization.

They researchers also determined that the cost to care for the patients who needed the extra treatment increased on average more than $30,000 per patient--and in turn increased the profits made by the hospitals. Specifically, the average cost for patients who underwent surgery without complications was $18,900; for those with complications it was $49,400.

More profit, less incentive

It doesn't take a genius to realize the lack of incentive for hospitals to reduce their occurrence of medical errors. When they make, on average, triple the profits for patients with private insurance plans who experienced complications and double the profits for Medicare patients who need addition treatment from medical errors, many hospitals aren't likely to instill protocols to enhance patients' safety anytime soon.

Researchers say that hospitals aren't deliberately causing errors just to make money, but there's no real evidence they are doing anything to really reduce the occurrences.

A spokeswoman for America's Health Insurance Plans says that it's vital we move away from the "perverse incentive of the old fee-for-services system that emphasized quantity over quality, and toward methods of payment that reward better care."

Pushback

Within the last few years, the federal government has taken action to prevent hospitals from profiting from their mistakes. New Medicare regulations, adopted by the Centers for Medicare and Medicaid Services, were passed a few years ago that now prohibit hospitals from seeking reimbursement for additional patient care needed in connection with certain medical errors or never events like bed sores, catheter-associated urinary tract infections, and other hospital acquired infections.

Some private insurers have also created a list of preventable never events they refused to reimburse such as care needed as a result of an object accidentally left inside the body of a patient, or as a result of surgical operations on the wrong body part. Medicare regulations and actions by private insurers are a step in the right direction to help encourage all hospitals to focus on patient care instead of profits. However, continued efforts are still needed.

Article provided by Teal Montgomery & Henderson
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