Reducing Complications may Cost Hospitals Money

Hospitals have a financial incentive to not reduce complications because they are paid per each treatment and each lab or other test according to an article published in the April issue of the Journal of the American Medical Association. While this may not be what hospitals are overtly thinking, the problem is how motivated are they to reduce complications?

Between 3 and 17% of surgeries have complications and average a profit of about $11,500 per patient. On the average, for privately insured patients hospitals make about $17,000 per surgical patient when there are no complications, but about $56,000 when there are complications. Overall, including Medicare patients, hospitals ended up with about $8,000 per complication.

It is easy to see why hospitals would be "punished" for introducintg quality-improvement programs.