Hospitals earn $30 000 extra from surgical patients who have complications, study finds

BMJ 2013; 346 doi: (Published 18 April 2013) Cite this as: BMJ 2013;346:f2522
  1. Michael McCarthy
  1. 1Seattle

Surgical complications can substantially boost US hospitals’ revenues, a new study shows.

The findings indicate that under the current US healthcare payment system a hospital’s income may suffer if it implements quality improvement measures to reduce infections and other common complications of surgery and numbers of avoidable admissions to intensive care.

In the study, published in JAMA,1 the researchers looked at the financial effects of surgical complications on the revenues of Texas Health, a 12 hospital network that includes a mix of higher and lower volume urban, suburban, and rural hospitals with academic and non-academic surgical departments.

The network’s payer mix was similar to that of the average US hospital, with 45% of its income coming from Medicare, 40% from private insurers, 4% from Medicaid, and 6% from patients who paid out of their own pockets.

The researchers looked at costs and incomes for nine common procedures carried out in the system in 2010: craniotomy, colorectal resection, total or partial hip replacement, knee arthroplasty, coronary artery bypass graft, spinal surgery (laminectomy, excision of intervertebral disk, or spinal fusion), hysterectomy (abdominal or vaginal), appendectomy, and cholecystectomy and common bile duct exploration.

The analysis identified 10 potentially preventable groups of severe complications: surgical site infection; wound disruption; sepsis, severe inflammatory response syndrome, or septic shock; pulmonary embolism or deep vein thrombosis; stroke; myocardial infarction; cardiac arrest; pneumonia; ventilator use of 96 hours or longer; and infections other than surgical site infections.

All told, the researchers found that of 34 256 surgical discharges included in the study, in 1820 cases (5.3% (95% confidence interval 4.4% to 6.4%)) there was at least one surgical complication, a proportion in line with national averages. The median length of stay among these patients was more than four times that among patients whose care did not involve serious complications (14 versus three days (95% confidence interval for the difference 8.5 to 12 days)).

Because of the additional cost of care of patients with the complications, the hospital’s average revenue per patient with one or more complications was $30 500 (£20 000; €23 400) higher than it was for patients with no complications ($49 400 ($40 700 to $54 000) versus $18 900 ($15 800 to $20 500)).

“It’s been known that hospitals are not rewarded for quality, but it hadn’t been recognized exactly how much more money they make when harm is done,” said the study’s senior author, Atul Gawande, a professor at Harvard School of Public Health and surgeon at Brigham and Women’s Hospital in Boston.

“This clearly indicates that healthcare payment reform is necessary,” he said. “Hospitals should financially gain—not lose—by reducing harm.”


Cite this as: BMJ 2013;346:f2522