AMERICAN SOCIETY FOR HEALTHCARE RISK MANAGEMENT • VOLUME 31, NUMBER 2 1

© 2011 American Society for Healthcare Risk Management of the American Hospital Association

Published online in Wiley Online Library (wileyonlinelibrary.com) • DOI: 10.1002/jhrm.20081

Healthcare is an ever-changing environment, and it seems the pace of change is at a very rapid level. It also seems that this change has a component of urgency, an urgency that is greater now than in the past. Much of this urgency is likely based on the economic situation of our country, specifically, the rising costs and the rising demand for healthcare. For example:

The U.S. healthcare costs exceed 17% of the gross domestic product and continue to increase. •

The demand for services is rising; a record 2.8 million Baby Boomers will qualify for Medicare • in 2011 (one every 8 seconds), rising to 4.2 million a year by 2030, for an estimated total of 80 million Medicare enrollees (New England Journal of Medicine Perspective titled “The Economics of Financing Medicare,” –July 2011).

These changes have spurred a shift from what we have known in the past as a volume-based reimbursement model in healthcare to a value-based outcome model. Many healthcare organizations are transforming from acute care to population health management. This is a significant change in the healthcare service delivery model. A primary focus of the changes is on improving the value delivered to patients and measuring this value in terms of the patient outcomes that are achieved per dollar expended. This is also a significant change from the fee-based model structure whereby reimbursement is based on the procedures delivered versus the outcomes achieved.

As the service model and cost structure in healthcare change, so do the risk exposures. One of our greatest challenges is to not only anticipate the future risks but to provide solutions around managing uncertainty. Many organizations will be looking at not only protecting value/mitigating risk during this rapid period of change, but also in creating value. Risk exists in both aspects (value protection and creation), yet with a very different focus. This new healthcare model also has a strong focus on prevention of healthcare–acquired conditions (HACs). HACs have been defined by the Centers of Medicare and Medicaid Services and include many conditions such as patient falls and infections. Another financial component that is impacting healthcare is that HACs are considered nonreimbursable events. HACs have also been classified by some as preventable serious safety events.

Leaders who embrace the changes and find solutions are likely to help their organizations not only to thrive but to gain. For the risk manager to not only thrive in this evolving envi-ronment, but to also lead, they will need an increased understanding of enterprise risks and the impact of change on the entire organization. In preparing for the ever-changing face of healthcare and the implication for risk management, the following suggestions are offered:

Stay abreast of the changes in the service model and cost structure and the impact that this • will have on the risks facing our organizations.

Be involved in the teams that are creating the new service delivery models and assume the role • as the leader in anticipating new risks.

Lead efforts to decrease variation in care and process.•

Be aware of the changes toward greater efficiency and reduction in process time in healthcare • service and the potential impact on patient safety.

President’s Message

Embracing change … anticipating risk

Michelle Hoppes, RN, MS, AHRMQR, DFASHRM

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JOURNAL OF HEALTHCARE RISK MANAGEMENT • VOLUME 31, NUMBER 2 DOI: 10.1002/jhrm2

Enhance analytical skills to incorporate data profiling and demonstrating risk management outcomes. •

Transition to managing uncertainty, moving from silos to integration, reactive to proactive, and from single-focused • approaches to comprehensive—incorporating the enterprise risk management domains in most efforts.

Change will require healthcare leaders and risk managers to take the initiative to innovate, to embrace change and see it as an opportunity, and to stimulate people in organizations to take action to master it! Become a change master for your organization—risk management is in a unique role to lead change and to anticipate new risk.

2011 President, ASHRM

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