No, that is not what the hospital does, and thus based on this heuristic, it is not its purpose. What a system does is not the same as the context-free outcome. It is the outcome compared to the outcome that could be expected without the system. You have to define your priors.

However, if the expected 5 year mortality for the cancer was 50%, and with this treatment 2/3 died, then the rule would apply. A choice to continue using that treatment could be criticized as equivalent to a choice to kill 1/6 more patients. Because despite the intention, the known outcome was more patients dying.