Leapfrog Group introduces error calculator
Slightly more than a year after the Leapfrog Group unveiled controversial letter grades for hospital safety, the organization introduced an online tool to help employers calculate the “hidden surcharge” they pay hospitals for errors, accidents and infections.
“It’s counterintuitive and outrageous, but you will pay a lot more for hospitals that have more errors, accidents and infections,” Leah Binder, Leapfrog president and CEO, said in a news release. “Errors aren’t typically marked as a line item on a bill, but purchasers and consumers are paying millions of dollars for them, and we’ve substantiated it with our research.”
The American Hospital Association, which along with many of its members has been critical of the methodology Leapfrog uses to generate letter grades, is dubious about the accuracy of the error calculator.
“Without additional reference points or validation, the methodology of this new tool is seriously flawed,” AHA spokeswoman Marie Watteau wrote in an e-mail.
By inputting claims data and hospital safety rankings, employers can calculate the costs they bear for hospital errors and the average amount spent on errors per patient admission each year. Leapfrog estimates that the average toll is $7,780 when a patient is admitted to a hospital with a safety score of C, D or F. The calculator includes an example of an employer with 1,000 annual hospi- tal admissions that would pay a $7.7 million surcharge for the year.
Binder said that figure could actually be higher because the calculator assumes that private healthcare purchasers pay twice what Medicare pays for avoidable services, and at least one recent study suggests a wider gap.
At one hospital system in the South, according to an April 2013 study published in the Journal of the American Medical Association, the marginal cost for privately insured patients who experienced at least one surgical complication, compared with those with no complications, was 22 times higher than for Medicare patients ($39,017 versus $1,749).
The AHA, however, takes issue with Leapfrog’s use of California infection data projected nationally without a clear explanation of how the data are adjusted. The AHA also criticizes the tool for incorporating comparisons across reported data and claims data. And, Watteau added, the calculator fails to reflect that sicker patients need more procedures and present more openings for complications and errors.