Bad Medicine: Illinois Insurer Refuses to Pay for ‘Never Events’

What’s a ‘never event’? That was my first question, too, when I heard about this new development. ‘Never event’ is the term used to describe medical errors that should never happen. Despite the name, however, ‘never events’ sometimes happen. Examples: a sponge left in your chest after surgery, or an amputation of the wrong limb. Obviously, these are not your typical medical mistake, and the exception rather than the rule, but the notion is troubling nevertheless.

We have no clear way of tracking ‘never events’ presently, but with legislation passed in 2005, Illinois is set to begin collecting such data by the middle of next year. But, to put the problem in perspective, a 2003 study in the New England Journal of Medicine found that foreign objects are left behind in 1 out of every 1,000-5,000 abdominal surgeries. That translates to approximately $50,000 per corrective surgery, usually paid for by insurers.

We’re used to the phrase “The customer is always right,” and we expect to be treated that way; if we receive the wrong meal, our server will bring the right one; if we purchase a lemon on the lot, the dealer will replace it; if we were overbooked on the flight, we should get vouchers for the future. There’s a certain give-and-take in our society, and an understanding that we should get our money’s worth.

But not when it comes to healthcare. Most often, you go to the doctor’s office and fork over your co-pay, not bothering to question whether your money was worth it if you don’t come away with any type of diagnosis. Similarly, your hospital sends its bills to your insurance carrier, regardless of the outcome of your surgery…until now. Now, Illinois patients are getting a voice…surprisingly, from their insurance company.

As reported by the Chicago Tribune, Blue Cross and Blue Shield of Illinois has come forward, saying that if a hospital commits a serious error, it will no longer pay the claim. The new payment plan is expected to be in place by the end of the year. And while this might seem like a way to cut costs for the insurance company (and let’s face it, that’s probably part of it), it’s a measure aimed to provide an incentive for quality healthcare. And considering that Illinois Blue Cross shelled out less than a million dollars for ‘never events’ in 2007; that chunk of change just might be enough to inspire change in Illinois hospitals.

We can’t be blind to potential problems, though. For instance, we’re relying largely on the hospitals to report the very errors that will result in non-payment; talk about a conflict of interest. In Minnesota, where hospitals are required to report ‘never events,’ 125 ‘never events’ occurred last year. We have been witnessing respect for the “I’m sorry” movement, so let’s hope that this new change doesn’t signal a decline in openness about hospital errors. We all make mistakes; this change in insurance policy is just forcing hospitals to take ownership of theirs.