Basics Functions of Management

							                             RISK MANAGEMENT PROGRAM

The fundamental purpose of the risk management process is to establish a way to make decisions
that will eliminate or minimize the consequences of accidental losses. . . . . The risk management
process consists of five steps:

       1.      Identify and analyze loss exposures.
       2.      Examine the feasibility of alternative risk management techniques.
       3.      Select what appears to be the best risk management technique or combination of
               techniques.
       4.      Implement the selected technique(s).
       5.      Monitor and improve the risk management program.1

The Risk Management Plan delineates activities that will reduce practices and situations that
pose a threat to the safety and well being of patients, staff, and visitors in accordance with state
and regulatory agencies. It is designed and implemented with the annual approval of the
governing board of the organization.

Risk Management, Patient Safety, and Quality/Performance Improvement are very much
intertwined. It is imperative that these functions interact with each other to derive positive
outcomes. Risk Management requires sufficient scope to be positioned to identify risk sources.
To that end, the risk manager should have direct and regular communication with the facility's
chief executive officer, employee director, medical director, and departments and/or committees,
including, but not limited to:

Nursing                                       Medical Records
Medical Staff                                 Information Systems
Administration                                Board of Directors
Legal                                         Ethics
Clinical departments                          Finance
Education                                     Safety
Quality Improvement                           Infection Control
Patient representative or Ombudsman

To conduct a sound Risk Management Program including a comprehensive incident reporting
system, the risk manager must create and maintain adequate authority and visibility within the
organization through an open and non-punitive environment. The risk manager needs an active
communication network throughout the organization to coordinate risk management strategies.

Risk Management Goals

1.     To provide patient, staff, and visitor safety and to prevent injury or harm to all concerned.
2.     To avoid liability exposure by evaluating new and existing services, practices and
       procedures including consultation with the professional liability carrier.
3.     To maintain an incident reporting system to identify trends and patterns of practice and
       occurrences having a potential of causing an adverse occurrence.
4.     To identify risks specific to clinical applications, utilizing quality improvement, to reduce
       any untoward impact on patient care.
5.     To suggest appropriate education programs, facility-wide or department specific, based
       upon the identified trends and patterns of practice and occurrences.
6.     To support the quality improvement committee.

MEDICAL STAFF INVOLVEMENT:

       1. Assure continued evaluation through a peer review process.
       2. Provide a well-defined informed consent policy.
       3. Assure compliance with the medical staff Bylaws/Rules and Regulations.
       4. Assure granting of appropriate clinical privileges in accordance with the medical staff
          Bylaws.
       5. Assure medical staff members maintain appropriate continuing education hours.
       6. Assure participation on the Risk Management and Quality Improvement Committees.

RISK MANAGEMENT INDICATORS:

To assure quality patient care, priority should be given to those risk management indicators that
have historically been linked to potential problems:

       1.   Patient falls
       2.   Medication errors
       3.   Infections
       4.   Nosocomial pressure ulcers
       5.   Equipment failures
       6.   Proper maintenance of utilities and patient protective systems
       7.   Patient grievances
       8.   Non-compliance with regulations/law/policies.
       9.   Unusual or unexplained deaths or injuries, including self-inflicted injury, attempted
            suicide, and allergic reactions to medication/diet.

COLLECT AND ORGANIZE DATA:

Data for risk management and quality improvement activities are derived from various sources
including, but not limited to incident reports, patient grievances, committee minutes, litigation,
regulatory agencies, audits, request for medical records and training (federal and state regulatory
issues). The risk manager provides oversight and functions as the clearinghouse for quality data
and information collected throughout the facility. The risk manager tracks, trends, and
aggregates data from all sources to bring potential problems to the attention of the
administration, quality improvement, chief of medical staff, etc. for resolution and to prepare
reports to the governing board.
CORRECTIVE ACTION:

When evaluation of the data identifies a problem or opportunity to improve care, the risk
manager, patient safety officer, administration, chief of medical staff, or governing board,
whichever appropriate, will determine the proper corrective action. Actions may include:
education/training, new policies/procedures, changes in policies/procedures, new equipment
purchase, counseling or disciplinary action. The risk manager should monitor the results and
determine the efficacy of the recommended corrective action. If the performance level improves,
the actions should be institutionalized to hold the gains through the development of written
procedures for the new process. However, if the level of performance remains, the recommended
corrective action should be reviewed and monitored until appropriate safeguards have been
established. A summary of risk management actions should be included in the quarterly risk
management report and presented to the governing board.

NOTE: The above-described is intended strictly as suggestions that may be adjusted
(added to or subtracted from) to fit a hospital, a surgery center or other facility that
requires a licensed health care risk manager.
1
 Risk Management Handbook, Vol. 1, Carrol, Roberta (ed.), Nakamura, Peggy & Carroll, Roberta (eds.), American Hospital
Publishing, Inc./Jossey-Bass, Chicago, 2006, p. 97.