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The Purpose of Risk Management in Healthcare

 |  6 Min Read

Risks to patients, staff, and organizations are prevalent in healthcare. Thus, the role of a healthcare manager is to assess, develop, implement, and monitor risk management plans to minimize exposure. Healthcare organizations have many priorities, such as finance, safety, and patient care.

The Role of Healthcare Risk Managers

Risk managers are trained to handle various issues in multiple settings. The specific organization determines the essential duties a risk manager undertakes. 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

The role of a Healthcare manager is to 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 incidents or minimize the damages following an event.

The Importance of Risk Assessment & Management Planning in Healthcare

Examples of risk management in healthcare are outlined by the Centers for Disease Control (CDC). Their recently published research 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 evaluate the catheter regularly. The result was a decrease in patient risk.

Given that each organization within the healthcare industry faces unique challenges, there is no one-model-fits-all risk management solution. However, there are key risk management concepts in healthcare and the main factors of concern when creating a risk management plan. 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 role of a healthcare manager involves addressing current challenges and preparing for future situations. The hazards of not qualifying 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 must be evaluated and measured regarding their possible adverse effects. Based on the risk assessment, an organization-specific management plan should be developed, implemented, and monitored.

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Effective Patient Care Practices

The development and implementation of healthcare risk management programs are based on extensive ongoing research. Risk managers in healthcare 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 compromised patient safety. The risk-management outcome was to ensure that strategies were in place to improve residents’ sleep schedules and reduce potential patient risks.

Developing Risk Management Plans

Reviewing other studies for examples of risk management in healthcare is one-way healthcare managers may develop risk management programs. In addition, following the directives of governing organizations such as the Department of Health and Human Services, Food and Drug Administration (FDA), and the American Society for Healthcare Risk Management (ASHRM) ensures risk management compliance.

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

  • What could happen?
  • How likely is something to happen (measuring risk)?
  • How severe would the outcome be if something did happen?
  • How can the likelihood of something being 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 and 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 implementation to ensure minimal risk to human subjects. Therefore, 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 robust 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:

Sending patients adequate notification of prescription expiration will support communication between patients and physicians, thus reducing potential prescription medication abuse.

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.

Implementing a system to follow up with patients who miss appointments but fail to reschedule is another proactive step in managing patient risks.

Patients may have a limited understanding of information received from physicians. Therefore, a strategy that checks the patient’s comprehension of information reduces the likelihood that the patient will misinterpret a physician’s orders or improperly take medication.

Making minor modifications to things like bed rails, bathtubs, and toilets lacking grab bars, institutional lighting, and the ground conditions can significantly reduce the risks of such hazards.

Keeping patient records on file for an extended period or indefinitely helps monitor patient health, even when patients are not actively seeking care. Risk management protocol should also have plans in place for disposing of records by federal mandates.

Comprehensive risk management plans in healthcare can facilitate patient safety initiatives and reduce readmissions. Robust risk management requires extensive preparation and qualified healthcare administrators to develop, implement, and monitor an organization’s plan. This ultimately benefits 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 healthcare career. Those interested in understanding more about risk management in health will find the knowledge and resources available at The University of Scranton to advance their career with the Online MBA specializing in Healthcare Management.

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