The American Hospital Association, which along with many of its members has been critical of the methodology Leapfrog uses to generate its letter grades, is similarly dubious of 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 local hospital safety rankings, purchasers are able to calculate both the total surcharge for hospital errors and the average amount spent on errors per patient admission each year. Leapfrog estimates that a purchaser pays, on average, $7,780 in hidden surcharges 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 hospital admissions that would pay a $7.7 million surcharge for the year.
But Binder said that figure could actually be higher because of the conservative estimate the calculation uses, which assumes that purchasers pay twice what Medicare pays.
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 multiplier in the calculator is also adjustable to reflect the situation in a specific insurance market.
“At the very least, you're paying millions of dollars for the privilege of harming your employees, when you could be spending this money on plant and equipment,” Binder told Modern Healthcare. “Our board really wants to reach out to colleague purchasers and motivate them to use their leverage to make a difference in safety."
The AHA, however, takes issue with what Watteau described as the use of California infection data projected nationally without a clear explanation of how the data is 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.
Follow Rachel Landen on Twitter: @MHrlanden
