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When Something Goes Wrong at the Hospital, Who Pays?

Free follow-up care isn’t always the rule

Despite the Institute of Medicine’s landmark 1999 report To Err Is Human and, more recently, provisions in the Patient Protection and Affordable Care Act (PPACA) emphasizing quality of care, entering the hospital still brings risk, according to a report from Kaiser Health News (KHN). Whether because of mistakes, infections, or plain bad luck, those who go in don’t always come out better.

More than 400,000 people die annually, partly as a result of avoidable medical errors, according to 2013 data published in the Journal of Patient Safety. In 2008, the most recent year studied, medical errors cost an extra $19.5 billion in national spending, most of which was spent on extra care and medication, according to another report.

If a case of apparent hospital negligence occurs, a malpractice lawsuit may be an option, KHN says. But this can take time and money, and lawyers who collect only when there’s a settlement or victory may not want to take on a case unless it’s exceptionally clear that the doctor or hospital is at fault.

There’s no hard-and-fast rule for how hospitals handle the cost of care when patients have bad outcomes and fault is disputed, said Nancy Foster, vice president of quality and patient safety policy at the American Hospital Association. Since cases vary, she added, what’s best one time may not always be so.

Some hospitals have rules requiring that they tell patients if something went wrong and, to the best of their knowledge, why. Typically, those rules stipulate that if the hospital finds it erred, necessary follow-up care is free.

However, most hospitals don’t have that kind of disclosure policy, said Julia Hallisy, a patient safety advocate in California, but a number of professional and safety groups are urging more hospitals to adopt them. Supporters include the American Medical Association and the American College of Obstetricians and Gynecologists. The federal Agency for Healthcare Research and Quality is also on board.

But even when hospitals tell patients that something went wrong, they may say the mistake was unavoidable. Then patients often pay for the consequences, themselves or through insurance.

On average, a privately insured patient cost about $39,000 more in hospital bills –– $56,000 vs. $17,000 –– when surgery yielded complications, according to a 2013 study published in JAMA.

Patients with employer-based insurance who experienced complications or otherwise became worse while in the hospital should contact their benefits offices, especially if they can show hospital error, said Leah Binder, president of the Leapfrog Group, a nonprofit organization that grades hospitals on their ability to prevent errors, injuries, accidents, and infections. If that doesn’t pan out, insurance plans can step in.

Federal programs have taken the lead in clarifying who pays for what. Medicare won’t pay for treatments that are fixing certain errors, such as surgery on the wrong part of a patient’s body or a blood transfusion of the wrong type. And hospitals can’t charge patients –– they must cover the costs themselves.

The PPACA requires that Mediciaid implement a similar policy, which may be easier in theory than in practice, said Rachel Morgan, health and human services committee director at the National Conference of State Legislatures. It takes time and requires expertise for state Medicaid agencies to review hospital charges and then determine whether the services were in fact the result of an error. That extra work makes enforcing these rules difficult –– so while some states have had success doing so, others haven’t, Morgan said. Some commercial insurers are also experimenting with comparable policies, she added. But even then, those cover a limited set of errors.

Source: Kaiser Health News; November 11, 2015.

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