Sunday, May 12, 2013

Health Care Costs, Payers and Complications

Relationship Between Occurrence of Surgical Complications and Hospital Finances

This article begins with some interesting data: "National health expenditures for surgical procedures
are estimated to cost $400 billion annually and are expected to outpace economic growth during the next 10 years. The rate of inpatient surgical complications is significant, with estimates ranging from 3% to 17.4%, depending on type of procedure, type of complications, length of follow-up, and data analyzed.3-8 In addition to patient harm, major complications add substantial costs, previously estimated at $11,500 per patient."

The authors performed a retrospective analysis of administrative data for all inpatient surgical discharges during 2010 from a nonprofit 12-hospital system in the southern United States. They studied nine common surgical procedures (including spine surgery, hip replacement and knee replacement) and 10 major complications (surgical site infection, wound disruption, sepsis, pulmonary emboli, stroke, cardiac events, lung/breathing problems) across 4 payer types (Private, Medicare, Medicaid, Self Pay).

In this sample, 5.3% of the patients experienced one or more complication. The inpatient mortality rate was 0.6% for patients without a complication and 12% (20 times higher) for patients with a complication.

Comment: the thrust of this article is that, depending on insurance, documentation of the complication, and allocation of overhead, the occurrence of complications affect the financial bottom line of the hospital. This is not our interest. What is interesting, however, is the different complication rates for the different payers, which we calculated from their Table IV. The complication rate for surgical procedures insured by Medicare and Medicaid is almost three times higher than for surgical procedures insured by private insurance and self pay

While these observations were not made by the authors, we believe they are most important. First of all, Medicare and Medicaid insurance appears to reflect aspects of the problem and the patient, such as a more complex arthritic deformity or co-morbidities, that are associated with increased risk of complications. This suggests that for these patients more detailed analysis of the risk/benefit ratio of surgery as as more detailed planning for the preadmission workup, the admission itself and the post discharge plan may be warranted. Secondly, in a world where complication rates are used as indicators of quality of care, this observation may tempt surgeons and medical centers to shy away from patients insured by Medicare and Medicaid - surely an undesirable outcome. Thirdly, this disparity needs to be recognized and managed at all levels of the health care system to avoid adverse consequences for the patient, the surgeon, the medical center and government economics.

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