Surgery mistakes
Janie Airey  /  Getty Images stock
Spurred by government and industry actions, hospitals in more states are vowing not to charge patients for so-called "never events," such as operating on the wrong body part.
Image: JoNel Aleccia
By JoNel Aleccia Health writer
updated 8/12/2008 8:44:19 AM ET 2008-08-12T12:44:19

Hospitals in nearly half the states in the nation now say they won’t bill patients for the worst kind of medical mistakes, including operating on the wrong body part or the wrong person, or giving someone the wrong blood.

The list has more than doubled since February, when an analysis showed that hospital associations in 11 states urged their members to waive payment for specific errors dubbed “never events” because they should never happen at all.

“It really does go to the heart of our patients’ confidence,” said Craig Becker, president of the Tennessee Hospital Association, which adopted a plan in June. “When you look at these adverse events, these are pretty gross errors.”

Tennessee is among 23 states that have approved non-payment policies for specific mistakes, with at least three more expected to do so by fall, a new review shows. Hospitals in another eight states have agreed to general guidelines that advise eliminating bills on a case-by-case basis for errors proven to be both serious and preventable.

The remaining states have not adopted even those voluntary standards, a concept that still stuns Patty Canakaris, 63, of St. Augustine, Fla. Her 67-year-old brother, Blake Oliver, died in December after a Florida hospital mistakenly gave him type A positive blood instead of type O positive blood during a transfusion for a simple operation.

“With something this horrific, whether they’ve operated on the wrong person or removed the wrong finger, they shouldn’t expect reimbursement,” she said.

Medicare shift driving changes
It's not clear how many private patients or their insurers are still billed for medical mistakes, but a July study by the federal Agency for Healthcare Research and Quality estimated that preventable errors that occur during or after surgery may cost employers nearly $1.5 billion a year.

The idea of cutting payments for avoidable errors has gained considerable momentum in the year since federal officials sparked the shift by announcing that, starting Oct. 1, Medicare will no longer reimburse hospitals for the extra costs of treating certain injuries, infections and complications that occur after admission.

Does your state charge for medical errors? Medicare officials this month expanded the hotly contested list of eight errors for which it won’t pay to augment one condition and add two more: surgical site infections after elective orthopedic and bariatric operations; severe complications from poorly controlled blood sugar; and deep vein thrombosis or pulmonary embolism following total knee and hip replacement surgeries.

In addition, the agency urged state Medicaid directors nationwide to implement the non-payment policies, already in effect in Massachusetts, New York and Pennsylvania. It's not clear how many others plan to follow.

At the same time, many of the nation's largest insurance providers — Cigna, Aetna, Blue Cross Blue Shield — have announced they no longer will pay for serious, preventable mistakes.

The growing financial pressure has forced many individual states and hospitals to decide how to address the rare but shocking errors when they occur.

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Last September, Minnesota became the first state to announce that its hospitals would no longer charge patients or insurers for avoidable errors. Within weeks, others statesbegan following suit.

At least five states now have agreed to waive fees for 28 so-called “never events” identified by the National Quality Forum, a patient safety and advocacy agency. Other states have chosen not to charge for eight, nine or 10 mistakes or they’ve created their own lists that include errors ranging from the sudden amputation of a limb to directing radiotherapy to the wrong body region.

Utah lists 31 potential errors, including the unanticipated death of a full-term newborn and death or serious disability caused by a health care-acquired infection.

"We wanted to make sure we covered the whole gamut," said Debra Wynkoop, director of health policy for the Utah Hospital Association, which considered national and state standards in coming up with its list. "We just said, 'Listen, we're going to cover all of them.'"

Not every error is preventable, hospitals say
But even as the list grows, some health officials say cutting payments for medical errors isn’t as simple as it seems.

“Just because something defacto occurred on that list, that doesn’t mean that it’s defacto the fault of the provider,” said Karen Nelson, senior vice president for clinical affairs at the Massachusetts Hospital Association.

Nelson’s state was the second to approve non-payment policies for hospitals and the first in which government agencies, including Medicaid, have said they will no longer cover certain errors.

Some of the conditions on the lists kept by NQF and Medicare may not be preventable or under the hospital's control, added Dr. Dan Stultz, president of the Texas Hospital Association, which announced a new policy last month that recommends not billing for nine preventable errors.

“ABO blood compatibility? I don’t have a problem with that,” Stultz said. But if a titanium medical device fails because of a manufacturing defect, the hospital shouldn’t be held responsible, he added.

In addition, Stultz and other hospital officials said it’s still not clear how billing practices will be implemented. If a patient is hospitalized for three weeks for a certain condition and an error occurs during the second week, should the hospital be dunned for the first week’s care?

And Stultz said he worries that cutting payment for treatment will lead some providers to avoid certain patients, such as those susceptible to pressure sores.

"[Care providers] are going to be so spooked about taking people with a red spot on their skin," he said. "Does the rule make the care better? We can make rules that make care worse. You can make a rule that will make people die."

Those dilemmas, however, hold little sway for patients and other health care consumers confronted with egregious medical mistakes, said John R. Clarke, medical director of the ECRI Institute, a patient safety and research agency in Pennsylvania.

To them, what's obvious is that no one should have to endure “never events” that can include patients given the wrong gas in an oxygen line or ignited by sparks from faulty devices.

To many, the idea those patients would be asked to pay for the mistakes is unthinkable, Clarke said.

“You shouldn’t expect to be set on fire, for instance,” he said. “This should never happen.”

Clarke applauds the non-payment movement as a step toward transparency and accountability.

“In theory, this is a good idea,” he said. “In practice, one real result is hospitals admitting these things occur and trying to keep them from happening.”

Victims say costs already too high
The movement also makes sense to those affected by medical errors, like Canakaris, who said Medicare shouldn’t be billed for what she said were $72,000 in costs for her late brother's care.

Her feeling was intensified by a July disciplinary hearing that fined Bert Fish Medical Center in New Smyrna Beach $1,000 in connection with Blake Oliver’s death —  even though the Florida Agency for Health Care Administration found that the hospital violated its own protocols for tracking blood types. An agency spokeswoman said that was the maximum penalty allowed.

“It makes my blood boil,” Canakaris said. “They were at fault and they won’t convince me otherwise.”

Resolving questions over even acknowledged mistakes can be a long, frustrating process for many patients. Three years after an Iowa surgeon performed hernia surgery on the wrong side, Kevin Baccam, 34, of Urbandale, is still trying to resolve the ordeal.

Baccam said he decided to sue Dr. Frederick S. Nuss of the Iowa Clinic after being billed for two operations, a charge Nuss denied through his lawyer, Craig Kelinson.  A copy of a bill, however, appears to show that that Baccam's insurance provider was charged twice, but that one charge was later rescinded. Trial is set for September.

Some hospitals always waived fees
Hospital officials in several states, including those that have no guidelines, said they waived fees for errors long before “never events” became a public focus. Others said they started paying more attention after their states adopted the non-payment plans.

That’s the case at Virginia Mason Medical Center in Seattle, which agreed last year to abide by recommendations of state hospital, doctor and ambulatory surgery associations not to charge for the 28 NQF events.

Newly released records show that Virginia Mason is one of nine Washington hospitals where doctors have operated on the wrong body part just this year.

But the unidentified patient affected by the June 4 medical mistake will not suffer economic insult on top of injury, said Steve Schaefer, the hospital’s vice president of finance.

“As the social awareness of the country grew, we adopted a new practice,” Schaefer said. “Now, we stop it before the bill ever goes out.”

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