When complications occur during surgery, hospitals and payers see a similar increase in their costs, meaning both groups are incentivized to reduce those complications, according to an article in JAMA Surgery.
Researchers compared hospital cost, third-party reimbursement and hospital profit margin for 5,120 total surgeries, 744 of which had complications. Data were pulled from the Michigan Surgical Quality Collaborative and internal cost accounting from Ann Arbor-based University of Michigan Health System from Jan, 2, 2008, through April 16, 2015.
For all of the studied procedures, mean hospital costs were 119 percent higher for patients with complications compared to patients without complications. Similarly, mean third-party costs were 106 percent higher for patients with complications compared to those without.
Therefore, profit margin decreased from 5.8 percent for patients without complications to 0.1 percent for patients that suffered complications.
"Both hospitals and payers appear to currently have financial incentives to promote surgical quality improvement," the authors concluded.