Abstract for: Healthcare Industry Incentive Structures Pressure System Operators to Operate in a High-risk State

The operation of hospitals in a low-risk state has become more a more challenging goal to meet as cost-of-care increases have forced hospitals to find alternative revenue sources. In particular, hospitals have compensated for increasing costs by expanding their ad hoc patient referral base and overloading their operation schedules without a corresponding increase in resources to treat the increased patient load. Without adequate resources to treat patients, proceduralists respond to throughput pressure by speeding up the pace of cases, thereby exposing the patient to greatly increased risk of an adverse event. The subsequent treatment of adverse events caused increases the cost-of-care as hospitals bill related treatment to insurance companies. Recent changes by third-party payers to the hospital reimbursement policy have attempted to address this issue by denying coverage of adverse event treatment. The policy is examined along with alternative solutions that seek to align the incentives of insurance companies, hospitals and surgeons in an effort to decrease the cost of care and encouraging the low-risk operation of hospitals.