What is Risk Management in Healthcare

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Risk Management in Healthcare is as crucial as it is unique. No matter what the industry, every business has a protocol in place to minimize risks. In addition, they help increase things like employee safety and morale. In healthcare, the field deals primarily with the lives, safety, and wellbeing of patients. This gives healthcare risk managers one of the most important responsibilities imaginable.

The Purpose and Role of Healthcare Risk Managers

In the field of healthcare, there are many potential risks to patients, medical professionals, and organizations. It’s therefore imperative that a qualified healthcare risk manager keeps a detailed account of any possible risk then develops plans and solutions to address and reduce those exposures and risks. The quality of care that a patient receives should be the top priority for a healthcare risk manager. The safety of the medical staff is also very important; a good healthcare manager will also understand any financial risks that could arise for an institution or organization in the medical field. Other duties for a healthcare risk manager include monitoring medical errors, implementing policy and keeping a close eye on any changes in federal regulations.

The Importance of Risk Management in Healthcare

It’s impossible for anyone to calculate exactly which risks are more pressing than others, but an experienced risk manager in healthcare will know what signs to look for in order to mitigate those risks. If an organization is caught unprepared for challenges that a risk manager would normally handle, the consequences can be costly. Without proper risk assessment and management, the organization faces more liability, the patient care could suffer, healthcare staff workplace quality could decrease, and so on. Ultimately, these risks would end in a financial loss for the organization, if ignored.

For these reasons, the success of an organization is dependent on the risk manager or management team. Healthcare risk managers will study potential risks, perform a cost/ benefit analysis on them, then create a plan for the organization to follow and ensure the successful implementation of that plan.

What is a Risk Management Analysis?

Each organization has different risk management needs, depending on the following factors: the size of the organization, location, industry, specific health of each employee, etc. During a risk management analysis, there are some general questions that should be asked, regardless of the specifics of the organization.

  •  Ask what specific occurrences could happen to/ within the organization that present risks, such as concerns about certain medication for patients, hazards to employees, etc.
  • What is the likelihood that these risks will present themselves?
  • If risks should escalate, what kind of damage would they do, and how severe?
  • What steps can we do to prevent these risks, and how much will those steps be effective?
  • What other proactive risk prevention measures can we take?

Of course, this is just a small sample size of the potential questions a healthcare risk management analysis should be asking. As you can see, risk managers place high importance on the ability of an organization to prevent potential risks. Additionally, the way an organization responds to mitigating and resolving these risks is also crucial.

The Process of Developing Risk Management Plans

Depending on the size of the organization, a risk assessment team could develop the management plan and help implement it. Other situations will call for the business to develop its own healthcare risk management plan, and would, therefore, need to be conducted in-house. Below is an example of a step-by-step plan for risk management. Keep in mind that all organizations are different, and each requires risk management plans specifically tailored to their needs.

  1. Review the analysis from risk manager.
  2. Develop a plan that is specific to the organization.
  3. Ensure that all employees and staff understand the risk management protocol, and how to react to these risks.
  4. Document as much as possible when involving potential issues.
  5. Develop employee safety and fast response incentive program to proactively address potential risks caused by staff.
  6. Confirm that everyone at the organization knows how to respond to complaints and report incidents to reduce potential risk related costs to the company.

Risk Management Healthcare Best Practices

Provided a risk management healthcare strategy is developed and implemented, an organization can usually keep risks at a minimum.

Sometimes, the medical staff isn’t properly trained due to a lack of communication or experience. These potential risks to the quality of care a patient will be receiving can be addressed by encouraging staff to follow up with patients about:

  •  Rescheduling missed appointments
  •  Addressing patient mobility concerns
  •  Proper storage and management of all patient records
  •  Refilling prescriptions
  •  And so on

Can Stop Loss Insurance Reduce Your Organizational Risks?

Healthcare is a challenging yet rewarding field. Everyone’s job gets a little bit easier with proper teamwork. If you’re interested in learning more about how medical stop-loss insurance can positively impact your risk management healthcare plan, give us a call today.

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