Medical Errors: Price Tag is Lower Than Expected

Today’s Managing Health Care Costs Indicator is $17.1 billion

To most of us, $17.1 billion is real dollars. Heck, it’s almost half of the amount of federal budget cuts negotiated to prevent the federal government shutdown this weekend.

But in the healthcare world, $17.1 billion is, well, almost nothing. In fact, it is 0.7% of each year’s health care budget. 

Consultants from Milliman reported in this month’s Health Affairs  [Harvard Link] that the total cost of preventable medical errors in hospitals is $17.1 billion.   This number is orders of magnitude lower than previous estimates – which have generally included all costs those patients who suffered from medical errors - not just the excess cost associated with the errors.   

The researchers used a huge claims database, and calculated the difference between the costs of those with similar procedures and diagnoses who did and didn’t have a medical complication.  Then, they used expert opinion to specify the likelihood that any given medical error was preventable.   The $17.1 billion is the excess cost of medical errors discounted by the likelihood of preventing them. 

We should do everything we can to prevent medical errors, and the real cost of medical errors in terms of patients and their loved ones is enormous – far more than excess medical claims!

Most medical errors result from inadequate systems (not bad people).   Further, it’s not usually especially expensive to improve the system to prevent medical errors.  Sure, sometimes we want to put in a complex IT system – but in many instances medical errors can be fixed with something as basic as a checklist.

BUT – don’t believe it when experts suggest that eliminating medical errors is all we need to do to address medical inflation.  There is no pro-error constituency, so we can all get behind eradicating medical errors.   We’ll have to do more than prevent medical errors, though, to cure rampant medical inflation.