Leveraging Dynamic Risk Management to Improve Patient Safety and Reduce Malpractice
October 19, 2021
By Dr. Abraham Morse
Dynamic risk management (“DRM”) means active surveillance of an organization’s entire spectrum of risk management challenges. It is a proactive approach to managing high-severity patient safety incidents and high-value medical malpractice claims. A recent study, based on medical record and revenue cycle reviews of 20,000-plus patients, estimated that every incident of temporary or permanent patient harm increases the average cost to an organization up to approximately $4,600 and reduces contribution margins by up to $1,100. Other negative consequences include an average two- to three-day increase in length of stay, a 74% increase in the likelihood of a readmission, and a 59% increase in the 30-day readmission rate. All of these outcomes negatively impact quality scores, such as Leapfrog and HCAHPS, and erode brand perception and loyalty.
An experienced health care business advisor can assist organizations transition to DRM by developing a risk profile to demonstrate how DRM manages risk volatility and decreases the overall cost of professional liability and patient harm. The process mines and harmonizes data from medical malpractice claims, safety events and patient complaints. The aggregated data is then analyzed to identify trends and repetitive events to uncover actionable risk and safety hot spots. These pain points can be mitigated through the implementation of recommended countermeasures identified from our library of more than 500 automated, operations-based and more than 600 policy-based controls. These implemented countermeasures (controls) assist with the reduction of patient harm, number and severity of medical malpractice claims, and cost of managing claims. These countermeasures improve both the defensibility of claims and indemnity costs. When considering patient safety and professional liability challenges, effective DRM—through the implementation of countermeasures to mitigate risk—can help ensure the prevention of repeat event occurrence.