Better Surgical Outcomes Costly for Hospitals

Hospitals that succeed in reducing rates of surgical complications may pay an unintended financial penalty, depending on the mix of insurance carriers they're dealing with, researchers said.

Data from an unidentified 12-hospital system in 2010 indicated that the occurrence of surgical complications boosted the "contribution margin" -- the difference between gross revenues and variable costs associated with patient care -- relative to cases without complications, when they involved the 85% of patients who had Medicare or private insurance, according to Atul Gawande, MD, MPH, of Harvard Medical School in Boston, and colleagues.

The contribution margin was decreased when complications occurred in Medicaid and self-pay patients, but these patients accounted for only 10% of the system's caseload, the researchers reported in the April 17 issue of the Journal of the American Medical Association.

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