On many measures, U.S. healthcare providers and healthcare facilities are the envy of the entire world and yet, research shows that medical errors still occur at an alarming rate of 1 in 10 patients. Estimates of the cost of medical errors exceed $37 billion a year, which does not include lost income and lost productivity of the medical institutions.
A serious medical error can increase the time length of stay for a patient by almost 5 days, increasing the cost of admission to over $4,700 per patient in the U.S. alone. Some estimates put the average cost of a medical error at $10,000. Risk Managers across the country are fearful that the rise in medical errors will result in higher insurance premiums and increased litigation.
Starting in October 2008, Medicare and other large healthcare payers will no longer reimburse healthcare facilities for services provided as a result of 27 “never events”. The 27 “never events” are so serious, and preventable, that they should never occur in a healthcare facility. The non-reimbursement is a result of the low tolerance for these types of events and to incent healthcare providers to improve the quality of the healthcare being provided to their patients. This will result in millions of dollars of lost revenue for healthcare providers.
The U.S. government has taken the first step to mandate the public reporting of the 27 “never events”. Many states have similar mandatory reporting requirements and it is expected that the rest of the states will soon follow. Insurers are following suit.
The cost that is difficult to measure is the damage to the image and brand of healthcare facilities when medical errors are made public.
Healthcare is turning to IT to solve these problems at an unprecedented pace.
