Insurers Take On Botched Medical Work -- With Their Checkbooks

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  timautrey04/07/08 Reported as spam
  1

  Why not take a proactive approach?

  There is no doubt that the medical industry in the US is staffed with many dedicated professionals. After all, most of the folks who work in this field got into such professions because they want to help people.
  
  While we are beginning to see pockets of positive results (relative to the reduction of human error in medicine), the system overall remains rife with latent organizational weaknesses and human error traps- classic (and pervasive) setups for mistakes to occur.
  
  Our firm specializes in helping organizations minimize human error, and we have been tremendously successful in many different industries. Our efforts to assist medical; however, have to this point been completely stifled.
  
  For example, I offered my services (for free) for a full week to one of the country's leading medical institutions. The intention was for me to conduct observations and interviews so that I could provide my feedback on actions the institution could take to minimize human error. I had a 'champion' from within the organization (a technical staff supervisor) who was familiar with our processes. When it got to the doctors who approve such visits, we were told, "the Clinic has its own internal people who do such things." The visit (which again was offered at zero cost to the organization) was therefore denied.
  
  The question is obvious- if medical institutions do have the answers, why do error rates remain so high?
  
  So, the insurance companies have begun to take a path toward progress by refusing to cover claims for some types of preventable errors/injuries.
  
  I would, however, like to propose a more proactive path: Why not offer a discount in rates (based upon tangible performance improvement) for implementation of proven error prevention strategies within client institutions?
  
  In such a scenario, everbody wins.
  
  The staff members at medical institutions win because a very simple set of proven strategies and tools, which when properly implemented within teams of dedicated professionals (such as emergency room teams, operating room teams, technical lab staffs, nursing teams, etc.) virtually eliminates the potential for events to occur.
  
  The institutions themselves win because of reputation and obvious bottom line benefits.
  
  The insurance companies win because, rather than turning down a claim months or years after tragedy has occurred, they are promoting prevention.
  
  And, of course, patients win because they do not get unnecessarily infected, injured, or in worst cases...killed.
  
  To give an example of the results these processes have been able to achieve in other industries, we were able to achieve an 87.5% reduction in human error at an operating nuclear power generation facility in a 30-month period (breakthrough by any six sigma standards). In another case, errors by contractors implementing electrical transmission capital construction projects in the northest were cut by more than 50% in just a few months.
  
  If other industries can achieve such results, there is no doubt that the dedicated professionals within the medical industry can do the same or better. The process simply needs to begin.
  
  Hurrah to the insurance companies for providing additional impetus. But let's now think proactively, shall we?

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  ingoodcompany04/07/08 Report as spam
  2

  What a Novel Idea....

  Novel idea, not paying for defective products/services. I'm wondering if they'll also bar doctors and hospitals from billing the patients for botched work when the insurance doesn't pay. My guess is that its going to be double jeopardy for the poor patient who gets the incompetent practitioner and the dunning letters and collection notices when the insurers back out. And how many of these facilities are simply going to change the categories in their reporting from "staff infection" to "auto immune deficiency" and blame it on the patient for not having enough resistance to fend off their failure to sterilize equipment.

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  David P Hamilton04/18/08 Report as spam
  3

  Thanks for your comments

  Apologies for the late reply -- I'm not currently getting automatic notification when people comment, something that I hope will change before long.
  
  timautrey, you raise some excellent points. The main reason the sort of thing you describe hasn't already happened, I think, is the fragmentation of payers in the industry. Outside of Medicare, which got this particular ball rolling, no individual health plan has the clout to really affect medical practice by offering discounts of this sort. Doing so on an individual basis also sets up a classic "free-rider" scenario, where some insurers could benefit from the error-prevention strategies without actually offering the discount.
  
  One other thing to consider is whether it makes sense to tie incentives to procedural goals (i.e., strict sterilization procedures for central lines) or to actual results (reduction in hospital-acquired infections). Procedural compliance is easier to measure, but could inhibit innovation that might yield better results. Paying based on results, meanwhile, opens the door to "stat juking" and other attempts to game the system -- plus results are intrinically harder to measure and need to be risk-weighted by the illness of patient populations and the like.
  
  ingoodcompany, my understanding is that the insurers will somehow also indemnify the patient against collection, although I haven't yet had time to figure out how that would work.
  
  In any case, I hope you'll both come back to visit at our new home for healthcare coverage, industry.bnet.com/healthcare.

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  Alex Hayes01/11/09 Report as spam
  4

  RE: Insurers Take On Botched Medical Work -- With Their Checkbooks

  This is another "smart" way not to pay for medical services and seemingly a good PR move, based on "consumer" response here. It may come as a surprise, but like all other fads ( "pay for performance" and other "innovations" shoved into the throat of demoralized health care providers )it will not improve quality in provision of health care services. Most likely, it will cause worsening of the financial condition of the most vulnarable hospitals and physician groups. Some will have to close. Patients will have to find other institutions to take care of them, which is not going to be easy due to persistent shortages of providers. Mistake here is to view health care services as a commodity, which it is not. It is unique and different and requires special ways of regulation. I know it sounds like another moan from a doctor, but maybe there is a reason why we moan. And not all of us are arrogant and self serving. Most of self serving and arrogant people do not survive long as a health care providers.