Risk management is no longer just about getting sued for malpractice. It has evolved into protecting the practice’s financial and physical assets through insurance and proper policies to minimize risk exposure. A comprehensive compliance program is mandatory in order to avoid financial losses and possible catastrophes. The most important areas in risk management are discussed below, followed by a specific discussion on malpractice prevention.

Corporate Structure Compliance

Any practice will have a legal business structure that has specific requirements for governance and tax reporting. It is important to get good assistance from attorneys and accountants to make sure that all items are current. Failure to file estimated quarterly taxes, file annual corporate reports, and keep adequate records are common areas where many practices do not perform timely.

Conflict Resolution and Grievances

A good set of personnel policies and procedures should outline the steps required to resolve any issues. It is imperative that physicians get involved early in any employee disputes relating to work conditions, harassment, or OSHA regulations before they escalate into a lawsuit or complaint to external agencies. Delegating this important task to a clinic manager is usually not the most optimal way to handle these situations.

Personnel and Property Security

Safe working conditions for staff are imperative with adequate attention to lighting and safe parking for staff, especially for clinics operating extended hours. Security monitoring of premises is a must for most large practices. Security also relates to safeguards of your computer database, including limiting access to financial data and records by staff depending on their position.

Quality Assurance and Patient Satisfaction

An ongoing quality assurance program not only helps care but can also identify potential problems with processes or staff. Patient feedback is critical and needs to be monitored with ongoing surveys. Make sure you review this information as staff may ignore complaints from patients, especially if it relates to their job performance.

Collection of outcomes data will become more commonplace and may even be mandated by CMS and other carriers. Objective data will also ensure that the quality of your care is optimal.

Confidentiality

Patient confidentiality has become standardized with HIPPA, and all staff and contracted personnel who may have access to patients are required to abide by it. Specific agreements with vendors, such as cleaning personnel, IT personnel, and others who may access patient data, must be obtained to protect confidentiality.

Confidentiality of employee’s records including personal information must also be locked with restricted access. Medical data relating to health claims by employees also cannot be shared.

Compliance

Many other governmental rules and regulations need to be followed, including Stark regulations, self-referral laws, OSHA, fraud and abuse, the American Disabilities Act, and Medicare regulations to name a few. It is impossible to keep up with these regulations without a formal compliance program in place and using consultants as needed.

A compliance committee that meets regularly is mandatory for any medical practice, and a compliance officer who has knowledge needs to be designated. The compliance committee should consist of the lead physician, office manager, billing manager, legal department representative or consultant, and lead clinical staff person. Any patient complaints or quality issues should be referred to the compliance committee for disposition, so a procedure for staff to refer issues to the compliance committee should also be in place. An active committee that resolves issues will be your best defense for any litigation.

Liability Insurance

Comprehensive liability coverage including property, general liability, director’s, and officer’s liability is mandatory for all practices. Many practices forget about auto liability (should you ask staff to go to a bank or post office on your behalf), specific computer insurance, business interruption insurance if there is a fire, flood, or natural disaster, or employee dishonesty insurance. However, the biggest risk is with malpractice insurance.

Malpractice coverage is a requirement in most states although a posting of a bond may allow a physician to satisfy this requirement. Going “bare” is a complicated decision requiring sophisticated asset protection and legal advice. Most physicians will seek coverage from an insurance carrier. There are two types of coverage. First, there is “Occurrence,” which covers you if a claim is made for an act committed during your coverage even if the actual lawsuit is filed after you are no longer covered. This coverage is rarely offered. Most policies are “Claims Made,” which covers acts only if you are covered during the period of the act committed as well as when the lawsuit is filed. If you do change jobs and insurance coverage, then you must obtain “tail” insurance from the carrier that will cover you for any claims discovered later. You can also try to obtain “nose” insurance from your new carrier for acts committed before starting coverage with them. Adequate planning and insurance coverage is requisite to prevent a financial catastrophe, especially if the practice has significant assets, such as medical equipment. The best plan is to concentrate on areas of risk so that you don’t get sued in the first place.

Risk Areas

• Front Office: The patient’s first and often lasting impression is the physical appearance of your entrance and greeting by your front office personnel. A cheery greet- ing, a pleasant reception area, and minimized waiting times will promote satisfaction even before the patient ever meets with the doctor. Tracking all appointments is important to document missed, canceled, or rescheduled visits in the medical chart.

• Office and Equipment: A clean, orderly, modern, and organized office conveys a good impression to the patient. It is important to have a safe area with comfortable furnishing and ease of access. All equipment should be functional and maintained properly.

• Patient Complaints: Make sure all significant complaints are reported to the physician and compliance committee. Establish a formal process to investigate all complaints. Be sure and report a resolution back to the patient even if it involves an apology for uncontrollable circumstances. Resolving these will avoid more serious questions and potential lawsuits.

• Informed Consent: Informed consent is mandatory, as failure to obtain it could result in allegations of assault and battery or negligence. Written documentation in the chart with a detailed explanation of the planned treatment with a witness who participated in the discussion is mandatory.

• Medical Records: A well-organized medical record will not prevent you from being sued but will be your best defense if you get sued. The old saying in court is “If it’s not in the medical record, it didn’t happen.” Every procedure or major conversation about treatment options needs to be accurately and legibly recorded. Dictate all of your notes to avoid the issue of illegible records. Sign, time, and date every entry in the medical record. Never erase, alter, or correct records without dating with your initials. Document all interactions with patients, including telephone calls or on-call interactions. Do not record allegations, accusations, and differences in agreement with other physicians or claims of faulty equipment unless verified.

• Release of Records: Only the patient or legal representative can authorize the release of records. Even legal subpoenas from potential litigation will require disclosure to the patient first by the legal parties. Exercise care when releasing records to parties claiming to be officers of the court unless there is known litigation involving the patient. Do NOT release extremely confidential information, such as HIV testing results or psychiatric history, unless the subpoena specifically requests such information.

• Termination of Physician-Patient Relationship: The contract between a patient and physician starts when a physician physically sees a patient, not when an appointment is made. After you have seen the patient, you may not refuse to see the patient for any reason unless you terminate the contract. Failure to pay the bill, abusive behavior, and failure to show up for appointments are all legitimate reasons to terminate the relationship but NOT to refuse to see the patient until notice is sent. You must also allow the opportunity for a patient to find another physician, especially if they are in the middle of a course of treatment. To release a patient from your practice, send a written notice via certified mail with a return receipt. You may state the reason for termination if it involves failure to follow your care but avoid mentioning personal issues including billing matters.