What’s Risk Management Got to Do With It?

1. What’s Risk Management Got to Do With It? Chicago, Illinois ~ March 11 & 12, 2008

2. What's Risk Management Got to Do With It? • MODERATOR: Paul Greve, JD, RPLU, Executive Vice President/Senior Consultant, Willis Healthcare Practice • Mark DeFrancesco, MD, MBA, Medical Director, Women’s Health USA • Bruce W. Dmytrow, BA, MBA, CPHRM, Vice President, U.S. Specialty Lines, CNA Healthcare • Charles Kolodkin, MBA, JD, CPCU, DFASHRM, Executive Director, Enterprise Risk, Cleveland Clinic • Daniel Sullivan, MD, JD, President & CEO, The Sullivan Group

3. Risk Management Comes to the Forefront • IOM Report (2000) • Leapfrog • IHI 100,000 Lives Campaign • AHRQ Evidence-Based Patient Safety Practices • JCAHO Patient Safety Standards • Sentinel Events • Root Cause Analysis • Federal & State Legislation- Patient Safety

4. The Purpose of Risk Management • Protect the Assets of the Healthcare Organization

5. The Purpose of Patient Safety • Freedom from Injury or Illness Resulting from the Processes of Care Definition of Patient Safetyby National Quality Foundation

6. Risk Management Focus • Broader Focus than Patient Safety • Risk Financing and Risk Control • Pre-Claim and Post-Claim

7. Patient Safety Focus • Improving Care by Improving Systems • Creating a Culture Where Everyone can Speak Up and Suggest Improvements • Not Looking to Blame Individuals for Patient Harm – Look for the System Failure • Rewarding Individuals Who Reveal • Incidents of Harm • Near Misses • System Weaknesses • Improving Patient Hand-Offs Source: OHIC Insurance Company, 2007

8. Healthcare Risk Management - History 1970s: Arose Out of the First Malpractice Crisis 1980s: American Society for Healthcare Risk Management (ASHRM) Created 1980s: JCAHO Standards Created for Quality Assurance and Risk Management 1990s: Beginnings of the Patient Safety Movement

9. Patient Safety - History By 2003, Federal and state governments, professional organizations, national business coalitions and JCAHO had entered the patient safety arena, establishing patient safety standards and indicators, required sentinel/serious adverse event reporting and compliance with safe practices Source: OHIC Insurance Company

10. Examples of Risk Management and Patient Safety Initiatives • Technology • EMR/CPOE • Bar Coded Medication Systems • eICUs • Patient Safety • Rapid Response Teams • Simulation Lab Programs • Labor and Delivery • Fetal Heart Monitoring Training • Remote Access of FHM Strips • Pitocin Protocols

11. CMS Ceases Payment for Medical Errors Effective 10/1/08 • Urinary Tract Infections from Catheters • Bloodstream Infections Caused by Catheters • Falls • Decubitus Ulcers • Foreign Objects Left During Surgery • Blood Incompatibility • Mediastinitis After Heart Surgery • Air Embolism

12. TDC Study, 2007 Systemic Errors Cause 30% of Settled Claims • Medication Errors • Communication Errors • Healthcare – Associated Infections • Medical Record Errors • Identification/Wrong Site Surgery Source: The Doctors Company, 2007

13. Risk Management in Support of Successful Underwriting

14. What is the Ideal Medical Professional Liability Insured? • The ideal insureds are those individuals and organizations that make quality patient care in a safe environment their ultimate priority

15. Searching for the Ideal Insured • Delivers services in accordance with its mission statement and vision • Demonstrates creative leadership with recognition of staff abilities and empowers patient care workers • Seeks providers who view patients as individuals with feelings and preferences • Emphasizes development of human resources & fosters a culture of professional excellence • Provides a reward system that promotes compassion, loyalty & innovative thinking • Nurtures a holistic approach to patients, families and communities

16. Redesigning the Environment of Care • Evidence of organizational commitment transforming healthcare to meet the diverse needs of all patient populations • An adaptive corporate culture that values proactive and innovative approaches to changes in populations and healthcare delivery systems • Reputation in the healthcare industry rests on the successful delivery of care in a safe and secure environment. • Leadership goals that result in an emotional atmosphere that is warm and welcoming, and where employees and providers are proficient at • Listening and hearing • Looking and observing • Treating and caring

17. Transformational Drivers for Acute Medical Services

18. Transformational Drivers for Aging Services

19. Acute Care Enterprise Risk Measures – Risk and Defensibility Enterprise Domains • Clinical • Medication management • Behavioral health services • Emergency medical services • Perinatal services • Surgical/anesthesia services • Other clinical services • Documentation • Human Capital • Executive leadership • Medical staff • Nursing and allied healthcare professional staff

20. Acute Care Enterprise Risk Measures – Risk and Defensibility Enterprise Domains • Legal/Regulatory • Accreditation survey results • Contract management • State/federal survey results • Operational • Patient safety program • Quality management program • Risk management program • Environment of care • Awards/recognition • Strategic • Marketing and public relations

21. Aging Services Enterprise Risk Measures – Risk and Defensibility Enterprise Domains • Clinical • Skin integrity • Fall prevention • Elopement • Medication management • Abuse prevention • Infection control • Other clinical risks • Documentation • Human Capital • Leadership/executive functions • Nursing services – Skilled Nursing Facilities, Assisted Living Facilities • Customer service

22. Aging Services Enterprise Risk Measures – Risk and Defensibility Enterprise Domains • Legal/regulatory • Survey history • Contract management • Operational • Resident rights/dignity/grievance process • Admission, transfer and discharge processes • Quality assurance/quality improvement/performance improvement • Resident safety • Risk management/adverse event management/claims management • Credentialing • Organizational manuals and files/policies, procedures and practices • Strategic • Marketing and public relations

23. Achieving Customer Loyalty • Relationships! Relationships! Relationships! • Flexible products/services with long-term viability • Accessibility and ease of doing business • Customer-centric • Share market intelligence • Supportive services to enhance risk posture • Experience- understand the healthcare industry • Expertise in risk assessment and education in healthcare specialties • Insurance products that respond to customer needs

24. Presentation to Underwriters

25. Agenda • Financial & Operational Overview • Risk Management & Quality Update • Claims Discussion • Reinsurance Program • 2007 Structure • 2008 Objectives

26. Financial and Operational Overview • Financially: Stable Earnings; Strong Balance Sheet • Estimated 2007 Net Revenue: $4.7 Billion • Assets: $6.7 Billion • Continued High Occupancy levels and Market Share • Capital Investment in Facilities and Technology • Main Campus • Regionally • International Initiatives • Improving the Patient Experience • Formation of Institutes

27. Quality and Risk Management • Enhanced Review & Decision Making Process • Full Implementation of SERS (Event Reporting) • Root Cause Analysis • Patient Concerns Review (Vanderbilt Project) • Emmi Solutions • Remote Central Monitoring Unit

28. Challenges Faced by Healthcare Industry • Declining Reimbursements • Caring for the Uninsured • Personnel Shortages • Maintaining Necessary Capital Investments • Regulatory Compliance • High Cost of Insurance • Patient Satisfaction

29. Improving the Patient Experience • Emergence of the Patient Safety Movement • Standardization of Quality Data • Patient Centered • Improved Communication • Transitioning away from Silos • Formation of Institutes

30. Cleveland Clinic: Specialty Institutes* • Neurological Institute • Medicine Institute • Pediatrics Institute & Children’s Hospital • Orthopedic & Rheumatologic Institute • Eye Institute • Urological and Kidney Institute • Heart and Vascular Institute • Cancer Institute * (not all inclusive)

31. What’s Changed? Risk Management in a Large Ob Gyn Group • The Culture • Patient Expectations

32. The Culture • “Lawsuit-happy” environment • Anecdotally… very few lawsuits years ago • Today: • Neighbors sue neighbors • Employees sue employers • Would-be employees sue would-be employers • Fact of Life: 90% of ObGyns get sued at least once • Overall average of 2.6 cases per Ob/Gyn

33. The Culture • You’ve seen the ads: • “If you have an accident, we’ll help you get the money you deserve” says the Trial Attorney’s TV commercial. • There is an underlying theme: • “Someone has to pay…” • “That’s why they have insurance…” • Etc., etc., etc.

34. Patient Expectations • Have never been higher • We all want perfect babies • We all want perfectly accurate tests • No one should ever get cervical cancer if they get Pap smears • Mammos should never miss a lesion • MRIs should REALLY never miss a lesion

35. What’s New? • Doctors have more “skin in the game” • Premiums are thru the roof • More at stake than ever before • Real Tort Reform is unlikely • More reasons to reduce the number of cases going to court • More reasons to focus on patient safety

36. What’s New? • Electronic Tools: • E-prescribing • EMRs • Secure Messaging • Can increase safety • Can increase efficiencies – saving practices money

37. What’s New? • Alternative Dispute Resolution • COPIC’s 3 R’s • Early intervention • Arbitration • Health Courts • Reduce the caseload in traditional courts • Let’s get it away from Juries

38. What Can We Do? • Support e-tool adoption • Subsidize cost of hardware/software • Premium credits for use of tools • Encourage alternative strategies • Early intervention • Structure settlements

39. Women’s Health • 155 ObGyns (1/3 of CT’s ObGyns) • 35 collaborative providers (CNMs, APRNs) • Merged in 1997 • THEARK Indemnity Company, Limited • Internal Peer Review and Risk Management program

40. Women’s Health • PR/RM Program • Review all incidents and sentinel events • Intervene if indicated (retire some, limit practice of others, supervise or rehab where possible, etc.) • Practice Guidelines Compliance • Created Quality Agenda with ongoing QA studies and monitoring of key indicators

41. Women’s Health • Premium “Debits and Credits” • 5 years no cases: 3% credit • Use of EMR: 3% credit • Several cases: 5% surcharge • More cases: 7.5% surcharge • Most cases: 10% surcharge

42. Women’s Health • “Provider Report Card” in development • Guideline compliance • Participation in Risk Management activities • CMEs • Use of E-tools • Claims experience • Patient satisfaction

43. A Risk and Safety Program?Getting Physician Buy In • Improved practice, based on the evidence. • Data. Up close & personal. • Proven record of improvement in morbidity and mortality. • Success rate in reducing adverse events, medical errors, and litigation. • You’ve got their attention!

44. Developing a System Solution • Research: • Over 2000 medical malpractice lawsuits against emergency physicians / hospitals • Over 1000 morbidity & mortality cases from academic EM programs • Two years of focused medical/legal research in all EM high-risk areas. • Ongoing analysis of adverse outcomes & allegations of malpractice • The most complete profile of EM errors and adverse outcomes available. • Next step…

45. MD Results Cases Reviewed Abdominal Pain Patients > 50 (n = 16,000 Patients) Abdominal Pain Patient 50 yrs. & Older Indicators Across the Department Discharge History Physical Exam Annals of Emergency Medicine, Vol. 36:4; October 2000

46. Vital Signs – Gather DataIdentify National Profile • We looked at vital signs in 90,000 patients. • 16% of patients with very abnormal vital signs are discharged without a single repeat. • Extrapolate to the nation. The related morbidity & mortality is staggering.

47. Risk & Safety Web-Based Curriculum – Step 1

48. Intelligent Medical Records – Step 2

49. Radial DeviationForce Tendon Insertion Palpate tendon just past distal edge of ulna. Tendon inserts at the base of the fifth metatarsal, dorsum (back) of the hand. To test tendon function, ask the patient to ulnar deviate the wrist and palpate the tendon just past the distal edge of the ulna. Apply a radial deviation force with your finger on the tendon to test tendon strength. Tendon Testing Illustrations Extensor Carpi Ulnaris Testing

50. Risk & Safety Audit –Step 3 Facility Emergency DepartmentEMRI Overall Risk Score by % 100% 90% = % compliance with all indicators 80% 70% 60% 50% 40% 26% Non Compliance 30% 74% Compliance 20% 10% 0% EMRI Overall Risk Score by %