Insurers Take On Botched Medical Work -- With Their Checkbooks

(MoneyWatch)  Medical errors are one of the leading preventable causes of death in the U.S., accounting for up to 98,000 fatalities a year -- more than car crashes, breast cancer or AIDS. But the healthcare system has been remarkably resistant to working to bring those numbers down -- at least until recently.

To put it bluntly, hospitals have had very little incentive to invest in procedures and systems that better coordinate medical care and prevent simple screwups such as giving patients the wrong drug. An automaker whose vehicles reliably killed drivers would get hammered by federal regulators and lose customers in droves. But few hospitals have ever wanted for patients just because their surgeons and nurses make easily avoidable mistakes.

Which is why it's heartening to see some insurers following the lead of Medicare, which last August announced it would no longer reimburse hospitals for care that resulted in preventable conditions such as hospital-acquired infections and injuries or major medical errors, like leaving sponges or surgical instruments inside patients. The first private insurer to follow suit, so far as I know, is WellPoint, which announced recently that it also won't reimburse for botched medical care in 11 "scenarios" that include surgery on the wrong body part (or wrong patient, for that matter). Other insurers are reportedly considering similar tactics.

Given that the Institute of Medicine raised the alarm about unacceptable hospital errors almost a decade ago, it's tempting to dismiss these efforts as too little and too late. For the patients who've continued to die as a result of preventable mistake over that time, of course, it is. But since the only way to really get a handle on medical errors in today's profit-centered healthcare system is to make them bad for business, hitting hospitals where it hurts -- in their revenue stream, that is -- is an idea that's long overdue.

UPDATE: Apparently this move has been in the works for a while, and according to a WSJ article from January, Aetna is also close to cutting off payments for what the insurers call "never events" (as in, events that should never happen). Good for them.

Meanwhile, some doctor-bloggers have aired some trenchant criticism about a few of these guidelines, particularly those involving death or serious injury resulting from falls in hospitals. (In this case, their argument boils down to the unfortunate fact that elderly patients, particularly the very ill, will always be at risk of falling unless they're restrained.) The Happy Hospitalist is particularly caustic, envisioning expanded prohibitions on paying for kidney failure or dementia that develops while in the hospital.

While it's entirely possible that some of the guidelines might need to be tweaked, I think the docs are overreacting. The point of the exercise is to push hospitals to rethink care in ways that prevent such problems, not to reach for quick fixes such as restraining all elderly patients. Making it less likely that you'll die from a preventable fall in a well-funded hospital surely isn't too much to ask.

(Hospital patient image courtesy of Flickr user gregor_y, used under Creative Commons.)