Call Us 866-373-9547

Home > The University of Scranton’s Online Resource Center > Resources > The Purpose of Risk Management in Healthcare

The Purpose of Risk Management in Healthcare

Risks to patients, staff, and organizations are prevalent in healthcare. Thus, it is necessary for an organization to have qualified healthcare risk managers to assess, develop, implement, and monitor risk management plans with the goal of minimizing exposure. There are many priorities to a healthcare organization, such as finance, safety and most importantly, patient care.

The Role of Healthcare Risk Managers

Risk managers are trained to handle various issues in multiple settings. The duties a risk manager undertakes are ultimately determined by the specific organization. These professionals typically work in the following areas of medical administration:

  • Financing, insurance, and claims management
  • Event and incident management
  • Clinical research
  • Psychological and human healthcare
  • Emergency preparedness

Healthcare managers identify and evaluate risks as a means to reduce injury to patients, staff members, and visitors within an organization. Risk managers work proactively and reactively to either prevent incident or to minimize the damages following an event.

The Importance of Risk Assessment & Management Planning

For example, the Centers for Disease Control (CDC) recently published research that found that prolonged urinary catheter use is the leading risk factor for catheter-associated urinary tract infections. Based on this information, a risk management plan was implemented requiring physicians to regularly evaluate the catheter. The end result was a decrease in patient risk.

Given that each organization faces unique challenges, there is not a one-model-fits-all risk management solution. Challenges faced by administrators that should be addressed in a risk assessment plan include but are not limited to:

  • Patient safety
  • Mandatory federal regulations
  • Potential medical error
  • Existing and future policy
  • Legislation impacting the field of healthcare

The hazards of not preparing for potential issues can have significant, long-term effects. Neglecting to have comprehensive risk management plans in place can compromise patient care, increase liability risks, and result in financial losses.

Thus, potential risks have to be evaluated and measured in terms of their potential negative effects. Based on the risk assessment, an organization-specific management plan should be developed, implemented, and monitored.

Effective Patient Care Practices

The development and implementation of healthcare risk management programs are based on extensive ongoing research. Risk managers must stay up-to-date on relevant information in their organization because research results could prove contradictory to presumptions that would otherwise shape risk management practices. For example, one study published by JAMA Internal Medicine revealed that increasing the hours of sleep residents in teaching hospitals received actually compromised patient safety. The risk-management outcome was to ensure that strategies were in place to improve resident’s sleep schedules and reduce potential risks to patients.

Developing Risk Management Plans

Reviewing other studies is one way to develop risk management programs. Following the directives of governing organizations such as the Department of Health and Human Services, Food and Drug Administration (FDA), and American Society for Healthcare Risk Management (ASHRM) ensures risk management compliance.

Based on information provided from other resources, managers should conduct organization-specific risk analyses to determine potential risks. The analysis should identify:

  • What could possibly happen?
  • How likely is something to happen (measuring risk)?
  • How severe will the outcome be if something did happen?
  • How can the likelihood something will happen be mitigated on the forefront and to what degree?
  • What can be done to reduce the impact (and to what degree)?
  • What is the potential for exposure or what cannot be proactively avoided?

Using analysis results, risk managers can compare the likelihood of different adverse events along with their impacts and rank potential risks in terms of severity. Plans for mitigating risks and handling them appropriately can then be developed. Risk management plans also undergo quality assessments so the interventions and actions proposed are addressed as real potential issues. Once a strategy is in place, it is monitored and modified as needed.

Implementing Strategies for Patient Care

As noted, risk management plans are specific to different healthcare facilities. While avoiding potential financial consequences is one concern, patient needs are generally the priority. In clinical studies, for example, Institutional Review Boards (IRBs) monitor proposed research plans before they are implemented to ensure minimal risk to human subjects. Plans for risk management must cover patient-specific risks and be well documented; they must also be accessible to those working with patients.

Many patient risks can be reduced by adequately training physicians and staff, encouraging strong communication among staff-members, providing counseling services for those working with patients, and conducting competency assessments.

Other risks posed to patient safety can be mitigated using patient-specific risk management strategies such as:

  • Not filling expired prescriptions - Sending patients adequate notification of prescription expiration will support communication between patients and physicians thus reducing potential prescription medication abuse.
  • Following up on missing test results - Patients who need to take additional medical tests following appointments may fail to do so, or the test results might get lost. Developing a plan to monitor receipt of test results guarantees the results are reviewed, so patients can then be consulted.
  • Tracking missed appointments - Implementing a system to follow-up with patients who miss appointments but fail to reschedule is another proactive step in managing patient risks.
  • Communicating with patients - Patients may have limited understanding of information received from physicians. Having a strategy that checks the patient’s comprehension of information reduces the likelihood that the patient will misinterpret a physician’s orders or will improperly take medication.
  • Prevent falls and immobility - Making minor modifications to things like bed rails, bathtubs and toilets lacking grab bars, institutional lighting, and the conditions of the ground can significantly reduce the risks of such hazards.
  • Sufficient record retention - Keeping patient records on file for an extended period of time or indefinitely is useful for monitoring patient health, even when patients are not actively seeking care. Risk management protocol should also have plans in place for disposing of records in accordance with federal mandates.

Comprehensive risk management plans in patient care can not only facilitate patient safety initiatives but also reduce readmissions. Robust risk management requires extensive preparation and qualified healthcare administrators to develop, implement, and monitor an organization’s plan. This is ultimately beneficial to overall patient satisfaction and other bottom-line priorities within healthcare organizations.

The University of Scranton is an accredited leadership-oriented school that prepares students for a career in healthcare. Those interested in understanding more about risk management will find the knowledge and resources available at The University of Scranton to advance their career with the Online MBA with a specialization in Healthcare Management.