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Learning Objectives

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LEARNING OBJECTIVES

  • Discuss insurance as a risk management tool.

  • Compare the categories of potential risks and strategies for reducing them.

  • Discuss Occupational Safety and Health Administration (OSHA) requirements.

  • Discuss security of documentation, environment, and stakeholders.

  • Develop a strategy to improve a practice's bad reputation.

  • Determine the role of job descriptions in reducing personnel-related risks.

  • Discuss the risks associated with the direction of supportive personnel.

  • Determine the role of establishing patient rapport in reducing risks.

  • Analyze an incident report.

  • Apply root cause analysis to given scenarios.

  • Identify the basic structure of the U.S. legal system.

  • Discuss legal rights, duties, and remedies.

  • Discuss a manager's role in contracts and professional malpractice.

  • Discuss the role of managers in addressing the legal duties of organizations.

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The intent of this chapter is to alert current and future managers to possible risks, related legal duties, and ethical concerns. Jurisdictions and circumstances differ. CONTENT SHOULD NOT BE TAKEN AS LEGAL ADVICE.

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Overview

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Risk management is the process of identifying potential threats that could severely damage or completely ruin an organization and taking action to reduce those risks. The increased complexity of healthcare organizations has broadened the scope and importance of risk management as a tool in achieving patient outcomes and financial goals. This specialized demand has led to the creation of risk management professionals for healthcare organizations who often report directly to the chief executive officer.1

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Using a range of measures and data collection, often supported by computer software, risk managers are central to controlling risks so that losses are minimized. Risk management is about processes to avoid accidents, to decrease liability when incidents occur, and to improve the quality of care. Failure of risk management has serious financial implications for healthcare organizations. Risk management requires a broad scope of effort that depends on the attentiveness and carefulness of all employees at all times.

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Mid-level managers provide data and implement risk management plans within their units of responsibility as part of the larger organization's plans. In other types of health organizations, risk management may not be as clearly centralized, or it may be among the responsibilities of the upper management team as a whole. Private practitioners in physical therapy also must consider the importance of risk management to the financial success of their businesses because they typically assume responsibilities for these duties themselves.

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Managers, particularly in developing program proposals, feasibility studies, or business plans, may use risk management as a "big picture" opportunity to address all components of the business from the somewhat negative perspective of potential losses as shown in Activity 11.1. This process may identify insurmountable barriers or risks that could destroy an exciting or promising business venture. More likely, it may result in a more impressive, well-thought-out plan.

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ACTIVITY 11.1: TIME-OUT FOR WRITING

Consider each category of risk as you ...

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