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Study: medical errors are profitable and discourage remedial measures

Each year, many patients suffer from medical or surgical mistakes while in a hospital. You might think that, in a professional environment such as a hospital, the fact that a medical error occurred would provide sufficient motivation to take steps to ensure that it is not repeated. However, according to a recent study published by the Journal of the American Medical Association, hospitals have little incentive to correct their errors. The reason: making medical errors increases their profits in many cases.

For the study, researchers analyzed 34,256 medical records for patients receiving surgery in hospitals owned by Texas Health Resources during 2010. Of these patients, researchers identified about 1,820 who suffered complications such as infections, blood clots or pneumonia, that staff could have been prevented.

Researchers found that the patients with complications brought more money to the hospital. The average stay of the patients with complications was 14 days-about four times the average of other patients. As a result of the longer stays, the average revenue of patients with complications was $35,500 more than other patients-almost triple the revenue.

Tweaking policies and medical procedures or purchasing additional equipment to minimize the risk of medical errors costs money. If such actions were to result in a reduction of medical errors, hospitals would lose out on additional revenue. As a result, researchers found that hospitals have little financial incentive to prevent medical errors.

The current billing model for hospitals backs up the researchers’ theory. The current system is a fee-for-services model, which financially rewards quantity of medical care over quality. If the model were to change to a results-based system where good medical results are financially rewarded, it would give hospitals an incentive to protect patients from medical errors.

Government and insurers step in

Realizing the problem, the federal government has already passed Medicare regulations that address the issue. The regulations prevent Medicare from reimbursing hospitals for treatment necessitated by certain medical errors. Additionally, Medicare regulations limit the amount of reimbursement if the hospital has a high percentage of patients who are readmitted.

Many private insurers have followed the government’s lead and have instituted a “never list” of errors that they will not pay for such as a sponge left in a patient or surgery performed on the wrong body part or patient. By withholding payment, insurers and the government give hospitals an incentive to avoid medical errors.

A medical malpractice attorney can help

Besides the threat of not being reimbursed, hospitals that disregard patient safety also face medical malpractice lawsuits. Texas law gives victims of malpractice the right to recover expenses associated with the error such as past and future medical expenses and loss of wages. If you or a loved one has been the victim of a medical error, contact an experienced medical malpractice attorney to evaluate your claim and learn about your right to compensation.