It seems crazy , but according to a new study published in the Journal of the American Medical Association, hospitals profit more from surgical complications than treatments without complications. Therefore, hospitals do not have a financial incentive to improve patient safety.
The report entitled: Relationship Between Occurrence of Surgical Complications and Hospital Finances
In this hospital system, the occurrence of post surgical complications was associated with higher per-encounter hospital contribution margin for patients covered by Medicare and private insurance, but lower contribution margin for patients covered by Medicaid and self payment. Depending on payer mix, some hospitals have the potential for adverse near-term financial consequences for decreasing post surgical complications.
I have written about the financial advantages of defensive medicine before:
Defensive Medicine: There Is Someone On The Defense All Right, Mike Bryant | November 21, 2009 5:07 PM
However, to look at the practical evidence, bad results lead to longer stays, usually more procedures, and increased care. So financially, it would benefit the hospital to have more ways to bill patients.
This is a very troubling study and should be reviewed from every angle. The health insurance companies should look at what they are paying for, the hospitals should open the books and show the benefits of bad care, and everything should be done to protect the consumer.
A founding partner with Bradshaw & Bryant, Mike Bryant has always fought to find justice for his clients—knowing that legal troubles, both personal injury and criminal, can be devastating for a family. Voted a Top 40 Personal Injury "Super Lawyer" multiple years, Mr. Bryant has also been voted one of the Top 100 Minnesota "Super Lawyers" four times.