By Samuel H. Steinberg, Ph.D.
Medical malpractice claims cost the health care industry more than $4.4 billion in 2006 – not counting the accompanying increase in malpractice insurance premiums. Can hospitals and physicians proactively prevent these damaging blows to their financial health and reputations?
The answer in many cases is yes. And in most other situations, hospitals and physicians can dramatically reduce their malpractice exposure through precautions and procedures undertaken as part of a facility or system-wide malpractice audit. The audit process, as described below, takes a serious and objective look at the risk management program of an organization and can be very effective in reducing exposures that often occur in today’s environment.
As an expert witness, I see many cases that could be avoided with some thoughtful review and analysis. Typically, the cases I review are either related to the hospital not following their required policies and procedures; or physician credentialing and privileging matters. Hospitals and physicians that do not take these matters seriously will often find themselves in situations that could be avoided. Examples of preventable problems include such things as not updating rules and regulations annually or allowing a physician to perform a new procedure without demonstrating the training required for it. It only takes one circumstance for the oversight to result in a case that is difficult to defend.
It is important to note that physicians typically depend on their hospital to effectively manage their risk management program. All too often, this is an unwarranted assumption and physicians should verify for themselves that the hospital has an effective program. The organized medical staff of a hospital has the responsibility to provide oversight of the delivery of care at their hospital and cannot delegate this responsibility. Given this responsibility, making certain that the hospital has a risk management program that involves physicians appropriately is essential in protecting physicians from unnecessary incidents and claims. This is an area that truly requires teamwork.
Reducing medical malpractice claim exposure requires leadership, a commitment to formulating an administrative system that will be adhered to and taking a long term view to the issue, not the typical “flavor of the month” approach that happens when the institution has a serious loss. Most importantly, this is not the typical actuarial-driven process that looks at monetary losses and insurance costs. This is a methodology that looks at how the hospital actually manages the business of credentialing physicians, approving new procedures, empowering the nursing staff and others to report incidents and stop practices that should not be happening.
Reducing exposure starts at the top, engages all members of the hospital staff, and makes the difficult decisions needed to eliminate poor practices. It also requires a serious review of policy manuals and bylaws, as they will be used against the organization if they are not actually followed.
Conducting the Audit
For a hospital, the process starts with getting the support from the top leadership that is needed for this to be successful. This means the CEO and/or the Board of Trustees. Often, these individuals are not actively engaged in the malpractice case review process or the risk management program. This is often indicative of a program that does not have the visible support needed to have a successful program. Risk management is too important to be left to the risk manager.
Physicians must not be reluctant to be involved due to the difficulties in reviewing their colleagues and friends clinical performance. There is no question that this can be uncomfortable, but administrators alone cannot perform these tasks; nor should physicians allow themselves to be co-opted from the process. A balance can be achieved so that no one is reviewing a close friend or rubber-stamping a credentialing decision that is not justified by the facts.
The audit process looks at:
· Program oversight and the composition of all committees that impact the medical malpractice arena, including risk management, hospital bylaws, medical staff bylaws, physician credentialing, nursing care, and board and medical staff committee meeting minutes.
· Descriptions of cases for several years of activity, the most recent accreditation and licensure surveys, a compilation of incident reports related to medical care issues, and board and medical staff committee minutes.
· Policy and procedure manuals for the hospital, the medical staff and the nursing service.
· Rules and regulations for hospital practices.
· Review of physician credentialing files, including delineation of clinical privileges and surgical procedures.
· Criteria for selection and history of use of locum tenens physicians and traveling or agency nurses, and review of the credentialing process for each category.
Much of this information, particularly types and number of cases, should be summarized and reviewed by the leadership to determine if trends are evident. Correcting blatant problem areas is something that can be accomplished well in advance of additional incidents arising.
No organization can completely eliminate their risk of malpractice exposure, but they can seriously reduce their potential for loss. The typical program focuses too much attention on the cost of insurance and too little on the actual business of how patient care is delivered and who delivers it. Properly done, a medical malpractice audit performed in the manner described here augments the activities of the actuary and risk manager, and provides a plan for managing the delivery of care for the hospital.
Risk Management in the Office
For physicians, a properly run program gives them comfort that the hospital they utilize is managing its business appropriately and is not exposing them to unwarranted risks. Conversely, this is an area that physicians should assure themselves of the adequacy of the risk management program at their offices as well. The same principles apply at both sites and will benefit from the objective review described herein. Given how busy physicians are, and the daily demands of their practices, it is not uncommon for them to mostly ignore good risk management procedures in their offices. Add to that the requirements of HIPAA and other federal and state regulations, it is not surprising that they do not spend the time to assure themselves that their office staff is following the proper guidelines in their daily activities, nor are they making certain that the physician completes all paperwork and files on a timely and complete basis.
Good risk management principles apply to the office as well. Leadership is critical as the physicians must show that they are fully committed to doing things correctly. Compliance with regulations and licensure standards is essential. Completion of forms, timely filing, and follow-up with patients and referring physicians all play a role in this.
Taking responsibility for your files at the hospital being accurate is a needed task. Reviewing your own credentialing file at the hospital and ascertaining that there is no adverse information is something to be done on a regular basis. Making certain that you follow hospital rules regarding new procedures, use of outside equipment, and supplies is necessary. Verifying that your privileges are up-to-date is a task to be accomplished on a regular basis.
The end result of these activities is the ability to reduce malpractice exposure, both in your office and at the hospital. It is worth your time and effort to monitor your own activities and that of your hospital. Remember: risk management is too important to be left to someone else!
Samuel H. Steinberg, Ph.D., FACHE, is Senior Associate Consultant of Health Strategies & Solutions, Inc.