Rachel V. Rose, JD, MBA, advises clients on compliance and transactions in healthcare, cybersecurity, corporate and securities law, while representing plaintiffs in False Claims Act and Dodd-Frank whistleblower cases. She also teaches bioethics at Baylor College of Medicine in Houston. Rachel can be reached through her website, www.rvrose.com.
A look at how enterprise risk management can help prepare medical practices for the looming ICD-10 coding transition.
Last week, we looked at enterprise risk management (ERM), the changing dynamic of risk, and the impact on human capital. This week, we focus on the strategic emphasis of ERM in relation to corporate culture and the ICD-10 medical coding transition.
Roberta Carroll, ARM, MBA, CPCU, CPHRM, LHRM, senior vice president for Aon Healthcare and Peggy Nakamura, RN, MBA, JD, vice president, chief risk officer, and associate counsel with Adventist Health continue to lend their expertise on ERM.
Rachel Rose: How much of a role does corporate culture play in the effectiveness of ERM?
Roberta Carroll: Corporate culture is definitely one of the top things that have to be in place. These programs have to be open and transparent - not punitive, like some organizations have been in the past. Communication is critical.
Peggy Nakamura: The focus of ERM should be instilled in your culture and that is what takes some time. If risk valuation (both pros and cons) has not been evaluated in relation to the strategic planning session, it is even more important to take baby steps to change that culture. These steps begin with the leaders of the organization.
How can different size providers or organizations utilize ERM effectively?
RC: ERM is ERM and the skills, the tools, and the process does not change. The culture and strategic plan are factors, but the implementation is the same regardless of the size of the practice or the organization. The enterprise risk needs to be identified and analyzed, then the options need to be presented, chosen, implemented, and monitored. The process is the same, but the risks that percolate up vary from organization from organization.
PN: Seeing the big picture is crucial to an ERM program's success.
How can ERM benefit providers when preparing for the October 1, 2014, transition to ICD-10?
PN: Get a multi-disciplinary group together and look at the execution in light of the risk domains. It really is helpful to get the perspective of, "What is the impact on each of the risk domains on ICD-10?" Continue with your process of coming up with specific action items because it will have an impact on the workforce - there is a financial, technological, operational, and strategic domain unit issue. By taking these domains and dissecting each area with a multi-disciplinary group, an effective action plan can be produced and implemented.
RC: As part of that action plan, it can be determined whether it can be addressed internally or externally. Basically, how you are going to manage the items that were identified: Can it be done in-house or is external expertise required? A smaller physician practice might not have the expertise in-house, whether technological or human capital.
Overall, it is imperative to "stay with the course." ERM is a culture change in terms of identifying and managing risk. In light of the multitude of laws, regulations, and standards organizations are implementing, ERM is a proactive way to address risk in a more positive way.
Author disclosure: Roberta Carroll, Peggy Nakamura, and Rachel V. Rose are co-authors of the American Health Lawyers' Enterprise Risk Management Handbook for Healthcare Entities (2nd edition).