No. of Recommendations: 20
A group of medical researchers published an article in the Journal of the American Medical Association aka JAMA on surgical outcomes. [1] One of the authors is Harvard Medical School professor/surgeon Atul Gawande. He wrote a significant analysis of medical costs a few years ago.

The significant finding is that hospitals make a lot more profit when a surgery patient has complications, compared to NO complications. The overall sample size was 34,256 so it was a fairly massive analysis.

Brief summary of the facts:

Patients with complications with private insurance contributed an additional $39,017 profit to the hospital.

Patients with complications covered by Medicare contributed an additional $1,749 profit to the hospital.

Quote from the abstract:

Conclusions and Relevance In this hospital system, the occurrence of postsurgical complications was associated with a higher per-encounter hospital contribution margin for patients covered by Medicare and private insurance but a lower one for patients covered by Medicaid and who self-paid. Depending on payer mix, many hospitals have the potential for adverse near-term financial consequences for decreasing postsurgical complications.

The data speaks for itself and Yoda cannot additional insight.

[1] JAMA Relationship Between Occurrence of Surgical Complications and Hospital Finances

[2] Fortune magazine take on this story
Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.