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Gawande: Hospitals Profit When Surgeries Go Wrong

Cheryl Clark, for HealthLeaders Media, April 17, 2013

"If you think that hospitals are somehow differentiating by payer, that would be odd," she says. "And it's clear to me that when hospitals prevent these complications, they do have a financial incentive to do so," not the other way around.

Besides, she says, every hospital in the country is dedicated to patient safety at some level. "We haven't gotten to perfection yet, much as we would like to get there. But we are dedicated to making patient care safe regardless of the consequences to the bottom line."

To suggest that hospitals are not trying to improve safety because their financial incentives direct the opposite, she says, "is disingenuous" by Gawande and his co-authors.

But Leah Binder, president of The Leapfrog Group, which represents employers that purchase health coverage, says Gawande's report illustrates profits from complications "that are outrageous− an example of cost-shifting to purchasers that is senseless."

She says it should be a "wake-up call" to employers that "you are being taken by the hospital community, that you are paying almost $40,000 more every time a hospital makes an error during surgery" with a covered worker.

"These numbers tell us there's profit to be made in suffering. Whether hospitals are deliberately taking advantage of this opportunity or whether they just happen to benefit from it is irrelevant."

Binder adds, "In what other industry do you pay more because they're worse? Do you pay a restaurant more because they have a rat infestation? No. I don't care whose fault it is. The numbers in this paper are astonishing."

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4 comments on "Gawande: Hospitals Profit When Surgeries Go Wrong"


16788044 (4/18/2013 at 12:37 PM)
No kidding, the doctor has to do more work because of a complication and additional revenue is generated, who would have thought. Why is this article is printed, it doesn't take a genius to see this risk. So what's the solution, all procedures have to be taped and review to ensure doctors are not be unethical. Come on, this risk has always been there and always will be. Are there doctors that take advantage of this, yes, and again, there always will be. Do the vast majority of doctors have the ethical sense not to do this, yes, and they always will.

Naomi Price (4/17/2013 at 7:52 PM)
What a cascade of horrors. It's good that your surgeon has been kind and compassionate and that your hospital at least apologized. However, it's impossible to know from your comment, at least, the source of the infection. It could trace to the surgeon. Or not. I do hope you continue to improve and that your knee replacement goes well. As for "paperwork" interfering with safety, what kind of paperwork interferes with hand hygiene? With use of surgical checklists, each and every time? With CLABSI prevention protocols? With attention to environmental cleaning? With pre-surgery MRSA screening & education of patients? With VTE & DVT protocols? This study dealt solely with surgical/post-surgical care, nothing else.

Tara Bukowsky (4/17/2013 at 12:12 PM)
Approximately a year and a half ago, I underwent a simple knee arthroscopy for a torn medial meniscus at Cox Walnut Lawn in Springfield, Mo. Following surgery, I developed a severe enterococcus hospital acquired infection deep in the joint resulting in septic arthritis. Five additional surgeries, 2 inpatient hospitalizations, drains, a picc line, seven weeks of IV antibiotics, a DVT, Lovenex injections, home health nursing and months of lab draws were required to treat the infection. I lost my job and my health care coverage as a result of this ordeal. The hospital billed my insurance company (that I had at the time), then balance billed me. My surgeon, who I feel was not responsible for this infection in any way not only saved my life, but remained compassionate and supportive throughout this entire ordeal. I do feel though that the hospital was responsible, but they feel differently and have offered an apology for the immense physical, emotional and financial strain this has placed on me and on my husband. I have remained under care, still unable to work and now require a total knee replacement. The hospital could have responded to my repeated requests to assist with some of the financial burden, but said I was a "statistic" and they felt that I had not received improper care. My care was appropriate for the circumstance, but was required due to an event that should never have occured in the first place.