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Medical errors will cost major hospital operator

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A major private hospital operator has agreed to forgo payment from insurer Bupa if any of its members are harmed by serious medical errors at any of its institutions.

In an agreement lauded as setting a new quality benchmark for care in the private hospital system, hospital operator Healthscope and Bupa have agreed on a list of 14 medical errors, dubbed ‘never events’, that should not occur.

Under the terms of the agreement, when a never event involving a Bupa member does occur, and is found to be the hospital’s fault, the health fund will withhold payment.

The types of error covered by the agreement include patients being transfused with the wrong blood, surgery being conducted on the wrong body part, a medication error resulting in serious disability, or surgical instruments or medical supplies being left in the body, requiring follow-up surgery to remove it.

Healthscope Managing Director Robert Crooke said his company was confident in the quality of care it provided, and the agreement set a framework which could eventually lead to reward payments for above-standard care.

“Never events are essentially the reverse of being paid for quality,” Mr Cooke said. “If a never event occurs in a Healthscope hospital, and it is due to hospital error, then we do not expect to receive payment from Bupa. We are prepared to stand by our commitment to quality and safety.”

Bupa Chief Medical Officer Dr Paul Bates said the agreement with Healthscope was an important innovation in lifting the standard of care.

“This shared commitment leads the industry in terms of improving hospital outcomes for patients, which is something the industry has grappled with for many years,” Dr Bates said.

 Mr Cooke said the agreement with Bupa provided a blueprint that could be adopted across the private health sector.

“There is currently no industry-wide agreement on what should happen in the rare instance when a never event occurs,” he said.

“We hope that this agreement will drive change and set a precedent for the consistent provision of health care.

So-called never events are rare, but their effects can be devastating for patients and their families. A similar scheme in the United States found that 0.6 per cent of all hospital patients suffered such an error in their care, and a 2006 study estimated that such mistakes cost the country more than $2.2 billion a year.

A Productivity Commission report found that in 2010-11, there were 26 incidents in public hospitals where surgical instruments or materials were left in the body of a patient and had to be retrieved, as well as 13 instances where the wrong medication was given to a patient, resulting in their death. Other serious errors included operations on the wrong part of the body, intravascular gas embolisms, and suicides of hospital inpatients.

Health Minister Peter Dutton told The Australian he welcomed the initiative, which should serve as an example to others in the private health industry.

“I think it brings pressure on to the other providers to be more transparent in the data that they release,” Mr Dutton said. “If we can bring that pressure to bear on both the public and private systems, we will end up with better health outcomes.”

The Healthscope-Bupa agreement came as more than 50 leading international health care providers, suppliers and operators urged the universal adoption of the GS1 System of Standards as the global benchmark for the health care supply chain.

GS1 is a not-for-profit global standards organisation supported by an international network of health and medical manufacturers, suppliers, providers, industry associations and regulatory bodies, and is intended to develop and implement uniform global standards governing the manufacturing and distribution of health and medical supplies.

Adrian Rollins