Hospitals Profit From Post Surgical Complications

Fierce Healthcare has;
Hospitals Profit From Post Surgical Complications

Profit margins for insured patients more than triple when complications occur

April 17, 2013 | By Julie Bird

Hospitals that reduce post-surgical complications could be cutting into their profits, concludes a study published yesterday in The Journal of the American Medical Association.

The study by The Boston Consulting Group, Texas Health Resources and Ariadne Labs found a 330 percent higher profit margin when insured surgical patients experienced a complication, according to an announcement of the findings. The margin increase for Medicare patients experiencing post-surgical complications totaled 190 percent.

"This clearly indicates that health care payment reform is necessary," study author Atul Gawande, M.D., a surgeon and a professor at Harvard School of Public Health, said in a statement. 

"It's been known that hospitals are not rewarded for quality, but it hadn't been recognized exactly how much more money they make when harm is done."

Study co-author Barry Rosenberg, M.D., a Chicago-based partner in the consulting group, was even more blunt: "The U.S. healthcare system is paying for harm," he noted, by "rewarding hospitals for complications."

Moreover, hospitals should not suffer financially for improving outcomes, added David Sadoff, another co-author from the consulting group.

The researchers examined costs related to more than 34,000 surgical inpatient procedures at a 12-hospital system in 2010, including 1,820 that involved complications.

"The magnitude of the numbers was eye-popping," Gawande said in an interview with NPR. "It was much larger than we expected."
It's not that hospitals are trying to cause complications, Gawande told NPR. "But we've seen a lot of hospitals where you say, 'Why aren't you investing in reducing risk, the way other industries do?' "

A similar study last year also found that eliminating surgical complications hurts hospitals' cash flow. Hospitals lose about $1.2 million in annual reimbursement revenue for each 1 percent drop in the complication rate, according to the article in Health Affairs. In that case, researchers recommended hospitals with "limited growth prospects" form a gain-sharing arrangement with payers to share in any savings from surgical complication reduction programs, FierceHealthcare previously reported.

To learn more:
- read the announcement
- here's the abstract in JAMA
- see the NPR article
- check out the study in Health Affairs

Related Articles:
Study: Hospitals save millions with surgical complication prevention
Healthcare cost–quality association varies
Do hospitals profit from drug discounts meant for poor, uninsured patients?
Flat admissions, reimbursements drive down hospital margins
Repeal of health reform would 'constrain' hospital profits


Thank You Fierce Healthcare and Ms Bird.

"We wouldn't let a drunk physician into the operating room"

No, We wouldn't Want Drunken Surgeons in an Operating Room, ....... BUT:

Study: 15% Of Surgeons Abuse Alcohol

 "Teamwork is vital for efficient care; each professional caregiver possesses unique and equally important expertise that should be shared." 

Hospital Workers Don't Report 86% Of Patient Harm Events

Hospitals Report Only 1% Of Patient Harm Events 

And it continues because the Control mechanism in situ to put the brakes on it is an openly Protectionist farce.

Medical Boards Lack Resources To Punish Dangerous Docs 

State Med Boards Not Punishing Dangerous Docs 

National Database Riddled With Holes: Records Missing On Disciplined Healthcare Workers

Medicine has systemically gotten So lax that not only has the Operating Room become a post 19th Hole good old boys club, but the surgical instruments themselves are becoming an ever more septic hazard. 

Dirty Surgical Tools, A Dangerous, Growing Problem

"But we've seen a lot of hospitals where you say, 'Why aren't you investing in reducing risk, the way other industries do?' "

Oh for Chrissakes, If they Did, they'd also have to toss their Psychiatric Profit Packers clean off the premises.

But in San Francisco, being the Progressive People's Collective it is, they've already embraced that very paradigm and gone it one better. They kicked the Premises off the Premises.

SFMHB 06/13/07 

Gee Whiz, Why would they have done That?
Science For Sale: The Psychrights.org Collection 

"It's been known that hospitals are not rewarded for quality, but it hadn't been recognized exactly how much more money they make when harm is done."

Pic Credits and Thanks to thepeoplescube, for;

Government Issues Study of A Study About Studies