Preventable medical error may cost US $1.32 trillion per year

The Journal of Patient Safety reports in its September 2013 issue that premature deaths associated with preventable harm to patients is now estimated at around 440,000 per year.1  Serious harm, the journal reports, “seems to be 10 to 20 fold more common than lethal harm.”

So, let’s talk in terms Americans understand: Dollars.

Using a formula published in the Journal of Health Care Finance, death due to preventable medical errors has an economic impact averaging $75,000 to $100,000 per year for an average of ten years ($750,000-$1million).2

Using that measure, preventable medical error deaths now cost the US economy between $330-440 billion per year.

To give some perspective, Stephen Friedman, a senior White House official, left government in 2002 after irking his colleagues by publicly estimating that the Iraq war could end up costing up to $200 billion, total.3

The term “serious harm” is not defined in the Journal of Patient Safety article. But in a bulletin published by one state’s medicaid administrator, serious preventable events include such things as (1) surgery performed on the wrong body part; (2) surgery performed on the wrong patient; (3) wrong surgical procedure performed on a patient; (4) unintended retention of a foreign object in a patient after surgery or other procedure; (5) patient death or serious disability directly attributable to an intravascular air embolism that occurs while being cared for in a health care facility; (6) patient death or serious disability directly attributable to a hemolytic reaction due to the administration of ABO/HLA-incompatible blood or blood products; (7) hospital-acquired pressure ulcers (decubitus ulcers) – stage 3 and 4; (8) hospital-acquired catheter associated urinary tract infections; (9) hospital-acquired vascular catheter – associated infection; (10) hospital-acquired mediastinitis after coronary artery bypass surgery; (11) falls and trauma (hospital acquired) – fractures, dislocations, intracranial injuries, crushing injuries.4

If serious harm events occur 10 to 20 times more frequently than deaths and are valued at one-tenth as much for economic impact, then the annual economic cost from preventable medical error causing serious harm is $330-860 billion.

Using that measure, we are looking at an annual cost to the US economy from deaths and serious harm caused by preventable medical error of $660 billion to $1.32 trillion per year, or 3-8% of the estimated US 2013 GDP.

Again, for perspective, the total annual cost of US healthcare in 2011 was $2.7 trillion or 17.9% of GDP.5

1  A New, Evidence-based Estimate of Patient Harms Associated with Hospital Care, J. Patient Saf., vol. 9, no. 3, September 2013.

2 The Economics of Health Care Quality and Medical Errors, J. Health Care Finance, 2012 Fall; 39(1):39-50, Andel, Davidow, Hollander, Moreno.

3  Washington Post, Iraq, Afghan wars will cost $4 trillion to $6 trillion, Harvard study says (Mar. 28, 2013).

4  Guidance Regarding Serious Preventable Events – approved May 2008, https://www.bcbsal.org/providers/adverseEvents/AlaHAGuidelines.pdf

5 National Health Expenditures 2011 Highlights, http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf

Bill Daniels is a trial lawyer and shareholder with the law firm of DANIELS LAW in Sherman Oaks, CA.  A graduate of Loyola Law School of Los Angeles, he is a former member of the Consumer Attorneys Association of Los Angeles Board of Governors, a founding member of Loyola’s Civil Justice Program and a past president of the Encino Lawyers Association.  Since 2007, he has been named a Southern California “Super Lawyer” by Los Angeles Magazine.  Mr. Daniels focuses his practice on serious personal injury, insurance and employment. For information, visit our website at www.daniels.legal or contact us through e-mail: Info@danielslaw.com.