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Study Finds Hospitals Are Paid More for Worse Care

Little Rock   Atul Gawande is best known to many of us as a doctor who writes important articles about healthcare in the New Yorker magazine.  To his patients he is known as a good surgeon in Boston, and to other surgeons, he is also known as someone who advocates and develops simple checklists for other surgeons to run through to avoid stupid errors that can also mean life or death, big bills or small.   The checklists include things like double checking medicine reactions, patient identifications, and even the place on the body where the knife will slice. 

            The results are now being reported widely on an internal assessment using his checklists and looking at results, errors and costs in a chain of a dozen hospitals in Texas run by Texas Health Resources.   The complication rate was a bit over 5% of the cases (1820 out of 34256), which might not be that bad, unless it was happening to you or someone you know, I guess.  The bloopers though led to patient charges paid by insurance companies being an average of almost $50,000 rather than $20,000 without the complications. 

            So hospitals that messed up made more money.   The incentive system that so many believe is the iron law in all matters is that financial incentives should reward good care, rather than bad care, not the other way around.   That’s not the way insurance currently works.  And, here’s more bad news, a lot of what we are doing under the Affordable Care Act is dependent on these same insurers.   In fact in Arkansas with a number of Republican holdout states watching closely, the legislature is about to pass a form of this managed care that relies even more heavily on private insurance companies to run the show.  The incentive for politicians is that this kind of plan keeps the campaign contributions coming, but as we can see, the incentive for the rest of us seems to be longer stays in hospitals, assuming we live through it.

            It’s good to know they are studying all of this pretty hard, but I think we would feel a bit better if they were doing something more about it!

Audio Blog on Hospital Care