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Economic Impact of Preventable Medical Errors Nearly $1 Trillion, Researchers Say

October 17, 2012
by Gabriel Perna
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According to a study from researchers at Wolters Kluwer’s Journal of Health Care Finance, preventable medical errors may cost the U.S. economy up to $1 trillion in “lost human potential and contributions.” The study’s authors used Quality-Adjusted Life Years (QALYs) to develop, what they say, is a “more complete accounting of the economic impact when someone dies from a preventable error.”

Most previous studies say the economic impact of preventable medical errors ranges from $17 billion up to $50 billion annually. “Previous studies do not come close to illustrating the economic loss of human potential and contribution, which families, colleagues, businesses, and communities experience when someone dies from a preventable medical error,” co-author and health policy analyst Stephen Davidow said in a statement.  “The magnitude of the problem for our society is many orders of magnitude greater than just the medical costs.”

According to Wolters Kluwer, the authors based their calculation on various “well-accepted” reports, studies, and economic measures. This included the well-known Institute of Medicine (IOM) report, “To Err Is Human,” which suggests that up to 98,000 deaths in the U.S. result from preventable medical error. Using this, they then estimated an average of ten years of life lost for each of the 98,000, and applied a range of $75,000 to $100,000 per year, which Wolters says is standard values for a year of life that account for lost earnings and other contributions.

The researchers would have gotten somewhere between $73.5 billion to $98 billion in QALYs with these calculations. Instead, using an article Health Affairs which stated preventable deaths due to medical errors are 10 times higher than the IOM estimate, the extrapolated impact was $735 billion to $980 billion. 

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