Here’s a business model that would certainly seem to reward laxity and discourage innovation geared toward a higher level of accuracy and efficiency: Reward mistakes.
And reward them with more money than is the case for delivering a better product.
That sounds illogical in any business field, but it seems especially incongruous in the field of medicine, where mistakes often have very serious consequences. Patients in New Jersey and across the country die from medical malpractice acts such as surgical error and medication mistakes, and medical administrators and doctors strongly tout their ongoing efforts to curb preventable medical errors and thereby promote patient safety.
Given that, a recent study published last week in The Journal of the American Medical Association seems more than just a bit jarring for its central finding, which is precisely that hospitals earn more money the higher their rate of preventable medical mistakes.
If that sounds flatly contradictory, it might make a bit more sense when it is considered that health insurers usually and quite readily pay hospitals for the extra costs of taking care of patients suffering from surgical and other complications. Where preventable medical error occurs, it often necessitates a longer hospital stay for a patient, which naturally drives up the cost. The researchers in the study — which included participants from the Boston Consulting Group and Harvard Medical School — say that the added days of in-house care typically tack on about $30,500 more for patients on the receiving end of preventable mistakes as opposed to those who are adequately treated and released as originally scheduled.
One study commentator notes that Medicare and some other payers are trying to bring about enhanced care by refusing to pay for preventable errors. He admits, though, that the study “shows that we still have miles to go.”
Source: New York Times, “Hospitals profit from surgical errors, study finds,” Denise Grady, April 16, 2013