How to Be a Highly Effective Healthcare Risk Manager

How to Be a Highly Effective Healthcare Risk Manager
Marketing Director

Change is the name of the game in healthcare, and risk managers are often on the cutting edge of it. As the way healthcare is provided and paid for evolves, risk managers must juggle a wide variety of issues — financial, operational and strategic — to serve their organizations in the best way possible.

Risk management leaders face multiple challenges, says Gwen Stokes, Vice President, Healthcare Risk Management Group, AWAC Services, a member company of Allied World. As a result, she says, “risk managers should be open to change, because change is inevitable and those willing to be change agents will be needed to help healthcare organizations survive the challenges healthcare continues to face.”

Here are some best practices to help you become a highly effective healthcare risk manager.

Get Data-Savvy

For healthcare organizations, big data represents both an opportunity and a target, and risk managers are on the front lines of managing that data. The threats include data theft and ransomware such as the recent “WannaCry” attack that crippled England’s National Health Service, says Ted Chan, Founder and CEO of CareDash. At the same time, everyone in the healthcare organization is thinking about how to use data to create value without creating regulatory or privacy risk, he says.

Risk managers need to understand both how to protect data and how to use it, experts say. Some of that value includes the ability to aggregate, normalize, analyze and derive actionable insights from massive amounts of data, according to Alan Cudney, a Principal Healthcare Consultant in SAS’ Health and Life Science global practice. “As never before, modern analytics provide the ability to detect risks earlier, even predicting those risks before they occur.”

Hit the Books

Changing reimbursement models have posted numerous challenges for risk managers, and the stakes are high: Reimbursements are scrutinized heavily, Stokes says, and healthcare organizations may face penalties for not meeting new standards or recommendations.

It’s vital that healthcare risk managers stay up-to-date on the latest legislation and regulations, experts say. If they fail to do so, they may be denied reimbursement by third-party insurers and government programs where payments are rejected due to inadequate documentation or deemed medically unnecessary, Stokes says.

Keep Up with Trends

Healthcare organizations’ shift from an inpatient delivery model to an outpatient delivery model has meant a number of changes. “Patient days have shortened dramatically, challenging inpatient healthcare facilities to make up lost revenues by initiating more ambulatory services, such as outpatient surgery, outpatient diagnostic testing, physician practices and outpatient therapies,” Stokes says.

Through it all, risk managers will need to be involved in determining new models of care delivery for the organization to best leverage its strengths. Insurers may deem patient hospital stays unnecessary or may not approve surgical procedures, so risk managers must help identify new opportunities to deliver care.

Mind the Business

Mergers and acquisitions have been running hot in recent years, with PricewaterhouseCoopers reporting that the first quarter of 2017 was the 10th quarter in a row that saw more than 200 deals. “Rarely are standalone hospitals capable of remaining financially solvent as an independent organization,” Stokes says. “Large health systems are being tapped to infuse capital as well as management and clinician resources to help hospitals remain open for business.”

As a result, blending cultures can be a challenge. Risk managers can play a role in addressing some of the biggest challenges, which include helping the new organization adopt a common mission, vision, values and goals, Stokes says, as well as standardizing common policies and procedures and managing physician and patient expectations.

Take the Lead

Risk managers should be ready to speak up for themselves, their profession and their mission. The work risk managers do is vital to the organization and its survival, experts say, and risk managers must advocate strongly for it.

“Risk managers need to remain visible and vocal,” Stokes says. “Networking with other risk management professionals provides an avenue for sharing of lessons learned as well as best practices. Risk managers should seek opportunities to engage with organizational leaders, offer to facilitate efforts to manage and mitigate the challenges facing the healthcare organization.”

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