Financial responsibility for hospital medical errors: No easy answers

The question of who pays when something goes wrong in a healthcare setting seems simple enough, but the answer isn't straightforward due to so many variables, according to a report from Kaiser Health News.

It's been 16 years since the Institute of Medicine's landmark report "To Err is Human: Building a Safer Health System" and two years since a study identified hospital medical errors as the nation's third-leading cause of death. When these errors are the fault of the hospital, in theory malpractice lawsuits can compel the hospitals to pay for them, but in practice such lawsuits are so expensive and time-consuming that many lawyers whose pay depends on a victory won't take on anything less than a slam dunk.

"We'll never know if something has happened because of malpractice," John Goldberg of Harvard Law School told KHN, "because it's not financially viable to bring a lawsuit."

There are no standardized policies for disputes over responsibilities for bad care outcomes, according to Nancy Foster, the American Hospital Association's vice president of quality and patient safety policy. Some hospitals mandate transparency, with any necessary follow-up care at the hospital's expense, but that is not the case for most organizations.

A number of hospital advocacy groups and agencies, from the American Medical Association to the federal Agency for Healthcare Research and Quality, have endorsed more providers adopting such a policy. Massachusetts hospitals have also implemented a program aimed at making the post-error apology process more sincere and transparent and giving patients full information about compensation options.

However, transparency is only one piece of the puzzle, according to the article, as many hospitals simply say an error was unavoidable, leaving patients or their insurance to cover the costs. Potential insurance liabilities mean hospitals also face pressure from employers to pay for unexpected care to defray the cost of insurance paying for the errors.

Meanwhile, the federal government has worked to clear the air on who's responsible for certain errors; for example, Medicare will not cover fixing errors such as blood transfusions of the wrong type. The Affordable Care Act made similar classifications for Medicaid.

To learn more:
- here's the KHN report