0
David McMillan, Pershing Yoakley & Associates, P.C.
dmcmillan@pyapc.com
(865) 673-0844
Larry Vernaglia, Foley & Lardner LL...
Page 1
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
• ERM began with the Committee of Sponsoring Organizati...
Page 2
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
• ERM first implemented in financial sector (banks, inv...
Page 3
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
How Have Payers Traditionally
Managed Risk?
• Historica...
Page 4
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Healthcare Risk Management
Healthcare slow to introduce...
Page 5
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Drivers of Change
Healthcare
Industry
Changing
patient
...
Page 6
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Five Indications of the Industry
The Five Fundamentals ...
Page 7
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Making the Case for
Enterprise Risk Management
Healthca...
Page 8
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Risk Management in Face of
Rapidly Changing Environment...
Page 9
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
What do YOU see?
Page 10
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Traditional Risk Management
Program Structure
Manage R...
Page 11
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Shifting Toward a Contemporary
Model of Risk Managemen...
Page 12
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
ERM means different things
to different people…
Discip...
Page 13
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
What is Enterprise Risk Management
(“ERM”)?
Enterprise...
Page 14
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
The Board’s Responsibility
to Manage Risk
A Process
ER...
Page 15
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
What is Enterprise Risk Management
(“ERM”)?
Creating a...
Page 16
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Example Risk Domains
Operational
• Transitions of care...
Page 17
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Contemporary ERM Programs
ERM Structure and Process
St...
Page 18
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Interrelated Components of ERM
Internal
Environment
Ob...
Page 19
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
COSO’s “Cube”
Entity’s Objectives
Entity’s
Units
ERM’s...
Page 20
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
– Strategy/solution development that supports the orga...
Page 21
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Designing an ERM Program
Consideration should be
given...
Page 22
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
A Practical Approach
( + ) *
Right
Processes
Right
Peo...
Page 23
May 16, 2014
Massachusetts Continuing Legal Education,
Inc.
• Risk management must be
driven
from the top down
• A...
Page 24
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
The Right Process
• Risk Identification:
– Identificat...
Page 25
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
The Right Process
• Risk Assessment and Evaluation:
– ...
Page 26
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
The Right Process
• Tools to Evaluate Risk:
– Risk Sco...
Page 27
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
The Right Process – Risk Mapping
Risk Measurement
Mini...
Page 28
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Perspective
Prospective
Senior
VP
New Initiative/ Tran...
Page 29
May 16, 2014
Massachusetts Continuing Legal Education,
Inc.
Isolated Risk vs. Systemic Risk
Risk Profile 1
Risk Pr...
Page 30
May 16, 2014
Massachusetts Continuing Legal Education,
Inc.
• The Right People make up the ERM evaluation team.
• ...
Page 31
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
The Right People
CEO
CFO
COO
CMO
CNO
CIO
Human Resourc...
Page 32
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Accumulating the Results
CE
O
SVP
Informatio
n
SVP
Fin...
Page 33
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
 Frequency
 Transparency
 Board Involvement
 Accou...
Page 34
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Dysfunctional Practices,
Dysfunctional Culture
• Arthu...
Page 35
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
• Risk management must be driven from the top down and...
Page 36
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
• Volume of data most organizations collect, process a...
Page 37
May 16, 2014
Massachusetts Continuing Legal Education,
Inc.
Implementing a
Contemporary ERM System
ERM
System
Page 38
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Challenges to Implementing a
Contemporary ERM System
•...
Page 39
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Challenges to Implementing a
Contemporary ERM System
•...
Page 40
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Success Factors of ERM Programs
• In assessment
• In s...
Page 41
May 16, 2014
Massachusetts Continuing Legal Education, Inc.
Questions?
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Presentation Makes the Case for Enterprise Risk Management

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PYA Principal David McMillan recently co-presented “Enterprise Risk Management” at the Massachusetts Continuing Legal Education 15th Annual Hospital & Health Law Conference.

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Transcript of "Presentation Makes the Case for Enterprise Risk Management"

  1. 1. David McMillan, Pershing Yoakley & Associates, P.C. dmcmillan@pyapc.com (865) 673-0844 Larry Vernaglia, Foley & Lardner LLP lvernaglia@foley.com (617) 342-4000 Enterprise Risk Management A Presentation For: Massachusetts Continuing Legal Education, Inc. May 16, 2014
  2. 2. Page 1 May 16, 2014 Massachusetts Continuing Legal Education, Inc. • ERM began with the Committee of Sponsoring Organizations of the Treadway Commission (COSO), which issued “Internal Control – Integrated Framework” to assist businesses and other entities assess and enhance their internal controls systems. • Over the past two decades, this framework has been incorporated into policy, rule, and regulation, and is used by thousands of enterprises to better control their activities in moving toward achievement of their established objectives. • COSO’s framework for ERM helps organizations achieve their objectives: o Strategic o Operations o Reporting o Compliance Enterprise Risk Management: The Beginning
  3. 3. Page 2 May 16, 2014 Massachusetts Continuing Legal Education, Inc. • ERM first implemented in financial sector (banks, investment companies, insurers, etc.) • Now widely utilized and well-developed across the business sector and slowly being adopted by the healthcare industry. • Well-known accounting compliance and corporate governance scandals (e.g., Enron and WorldCom) largely the impetus for the passage of the Sarbanes-Oxley Act of 2002 (SOX), resulting in many organizations implementing ERM programs. • Primarily publicly traded, for-profit organizations (including healthcare). • Increased awareness of boards of directors’ responsibility for identifying and managing organizational risk. Enterprise Risk Management Across Industries
  4. 4. Page 3 May 16, 2014 Massachusetts Continuing Legal Education, Inc. How Have Payers Traditionally Managed Risk? • Historically insurance companies have been designed in a silo structure (i.e., each operational activity is undertaken independently, as are the associated risks) – Ex: there can be virtually no interaction between underwriting and claims department of insurance companies. As a result of this structure, information generated from these activities are rarely every shared or synthesized. • In previous, less volatile years, the silo structure was workable. Given the dramatic regulatory and technological changes in recent years, the silo structure is giving way to newer, more strategy-focused structures, such as ERM. • In many circumstances, the management of these risks can be more efficient if conducted at the enterprise level.
  5. 5. Page 4 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Healthcare Risk Management Healthcare slow to introduce ERM programs but, as it has become increasingly evident that no organization or business sector is immune from catastrophic loss, the industry’s interest in ERM is greatly increasing. Shift away from regional operations to state, multi- state, and/or national level has played a significant role in igniting interest in ERM across the healthcare industry. Traditional Setting Acute Care Hospital Contemporary Setting Expanding Beyond Hospital Walls and State Lines
  6. 6. Page 5 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Drivers of Change Healthcare Industry Changing patient demographics Advances in medicine Competition Patient- centered focus of care Changing reimburse- ment The ACA Increasing regulation Shift to EMR and Meaningful Use Necessity of outcomes data Rapidly changing technology
  7. 7. Page 6 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Five Indications of the Industry The Five Fundamentals Driving Healthcare Transformation: Read more at http://www.pyapc.com/resources/collateral/white-papers/2014-Healthcare-Whitepaper-PYA.pdf
  8. 8. Page 7 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Making the Case for Enterprise Risk Management Healthcare reform is causing many health systems to quickly react/respond/implement (i.e., bundled payments, ACO regulations, value-based purchasing, etc.) Too often, health systems are failing to proactively plan for the response of the reaction to health reform, often leaving the system at risk Hastened decisions are often made in silos and without considering the impact/risk to all entities EnterpriseRiskManagement
  9. 9. Page 8 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Risk Management in Face of Rapidly Changing Environment Today’s Challenge: Defining the parameters “along the way” Yesterday: • Financial derivatives in capital and debt structures Today: • Rapidly changing reimbursement structures • Physician-Hospital integration (horizontal & vertical) Tomorrow: • Bearing insurance risk
  10. 10. Page 9 May 16, 2014 Massachusetts Continuing Legal Education, Inc. What do YOU see?
  11. 11. Page 10 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Traditional Risk Management Program Structure Manage Risks of “Separate and Distinct” Departments/Silos Operations Finance HumanCapital Strategic Legal/Regulatory Technology Hazard
  12. 12. Page 11 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Shifting Toward a Contemporary Model of Risk Management Traditional ModelTraditional Model • Reactive • Incident-based • Clinically focused • Risk analyzed according to silo or department (e.g., market risks handled by marketing department, patient safety risks handled by the quality/patient safety department). • Fails to account for the fact that risks do not exist in isolation (i.e., cross organizational structures, departments, etc.) • Reactive • Incident-based • Clinically focused • Risk analyzed according to silo or department (e.g., market risks handled by marketing department, patient safety risks handled by the quality/patient safety department). • Fails to account for the fact that risks do not exist in isolation (i.e., cross organizational structures, departments, etc.) Traditional Model • Reactive • Incident-based • Clinically focused • Risk analyzed according to silo or department (e.g., market risks handled by marketing department, patient safety risks handled by the quality/patient safety department). • Fails to account for the fact that risks do not exist in isolation (i.e., cross organizational structures, departments, etc.) Contemporary Model (ERM)Contemporary Model (ERM) • Proactive, which better equips healthcare organizations to focus on all risks throughout the organization while maintaining patient safety, ensuring compliance and improving the organization’s bottom line. • Holistic • Multidisciplinary • Risk analyzed across the entire enterprise, not solely at silo/department level. • Accounts for synergistic relationship among and between risks. • Proactive, which better equips healthcare organizations to focus on all risks throughout the organization while maintaining patient safety, ensuring compliance and improving the organization’s bottom line. • Holistic • Multidisciplinary • Risk analyzed across the entire enterprise, not solely at silo/department level. • Accounts for synergistic relationship among and between risks. Contemporary Model (ERM) • Proactive, which better equips healthcare organizations to focus on all risks throughout the organization while maintaining patient safety, ensuring compliance and improving the organization’s bottom line. • Holistic • Multidisciplinary • Risk analyzed across the entire enterprise, not solely at silo/department level. • Accounts for synergistic relationship among and between risks.
  13. 13. Page 12 May 16, 2014 Massachusetts Continuing Legal Education, Inc. ERM means different things to different people… Discipline ProcessPractice
  14. 14. Page 13 May 16, 2014 Massachusetts Continuing Legal Education, Inc. What is Enterprise Risk Management (“ERM”)? Enterprise risk management is a discipline that engages professionals in the practice of identifying, managing, controlling, and monitoring all risks to the organization. A Discipline A Practice ERM can best be described as an ongoing business decision-making process instituted and supported by the healthcare organization’s board of directors, executive administration and medical staff leadership. ERM recognizes the synergistic effect of risks across the continuum of care, and has as its goals to assist the organization reduce uncertainty and process variability, promote patient safety and maximize the return on investment (ROI) through asset preservation, value creation, and the recognition of actionable risk opportunities. A Process ERM is a process, effected by an entity’s board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risks to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives.
  15. 15. Page 14 May 16, 2014 Massachusetts Continuing Legal Education, Inc. The Board’s Responsibility to Manage Risk A Process ERM is a process, effected by an entity’s board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risks to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives. The Board of Directors is not necessarily responsible for the effects of decisions they make – they are, however, responsible for having a sound process in place for making these decisions, despite the outcome, good or bad, of the ultimate decision.
  16. 16. Page 15 May 16, 2014 Massachusetts Continuing Legal Education, Inc. What is Enterprise Risk Management (“ERM”)? Creating an effective structure through combining the correct players with an appropriate strategy, equipping these players with a common understanding and appreciation for the direction of the health system and engaging these players in a process to evaluate enterprise risk.
  17. 17. Page 16 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Example Risk Domains Operational • Transitions of care • Quality/coordination of care • Adverse event management • National Patient Safety Goals • Facility/equipment management • Workplace safety • Infection control • Business continuity • Billing/collections • Corporate compliance (fraud and abuse) • Liquidity • Growth in programs/facilities • Capital structure • Capital equipment • Capitation contracts • Staffing/turnover • Union and labor relations • Hiring, retention, education • Succession planning • Organizational direction and culture • Morale and engagement • Employment Practices liability Strategic • Regulatory change • Patient needs/expectations • Population health competencies • Advertising, marketing, branding • Alliances/integration/affiliations • Competition • Antitrust • Corporate compliance • Confidentiality/security of PHI • Multiple statutes, standards, and regulations • Accreditation • State licensure • Private inurement • CPOE • EMR/EHR • Robotics • Telehealth/telemedicine • Radio Frequency Identification (patient tracking, infant security, etc.) • Information exchange • Social media • Facility management • Plant age • Natural disasters • Parking • Construction/renovation Hazard Financial Legal/Regulatory Technology Human Capital
  18. 18. Page 17 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Contemporary ERM Programs ERM Structure and Process Strategy Real Legal/Regulatory Compliance FinancialPerformance Access PhysicianAlignment Patient Estate Technology Health systems operate multiple businesses with divergent priorities within one entity. An enterprise risk management framework, consisting of an effective structure and disciplined process, intersects each distinctive business initiative to provide a holistic view of the health system.
  19. 19. Page 18 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Interrelated Components of ERM Internal Environment Objective Setting Event Identification Risk AssessmentRisk Response Control Activities Information & Communication Monitoring
  20. 20. Page 19 May 16, 2014 Massachusetts Continuing Legal Education, Inc. COSO’s “Cube” Entity’s Objectives Entity’s Units ERM’s Components “A distinct relationship exists between an entity’s objectives and ERM’s components, which represent what is necessary to achieve objectives.” – COSO’s “Enterprise Risk Management – Integrated Framework”
  21. 21. Page 20 May 16, 2014 Massachusetts Continuing Legal Education, Inc. – Strategy/solution development that supports the organization’s mission, vision, and values – Better equipped to anticipate and deal with the unexpected – Increased understanding of organization-wide costs of risks – Establishment of consistent methodology for assessing future risks – Development of strategic, organizational framework for managing risk – Conservation and effective allocation of limited resources – Improved decision making and creation of formal links between units/divisions/organization – Improved success of regulatory and compliance initiatives – And the list goes on and on… Benefits of ERM
  22. 22. Page 21 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Designing an ERM Program Consideration should be given to the following: Organizational structure (for profit, not-for-profit, governmental) Business approach (acquisition/growth, struggling to survive, maintain status quo) Strategy (academic, integrated network, community- based, etc.) Variances in setting/locale (acute care hospital, physician practice, etc.)
  23. 23. Page 22 May 16, 2014 Massachusetts Continuing Legal Education, Inc. A Practical Approach ( + ) * Right Processes Right People Disciplined Approach Ability to Evaluate Risks Contributes to Right Culture
  24. 24. Page 23 May 16, 2014 Massachusetts Continuing Legal Education, Inc. • Risk management must be driven from the top down • At its core, an ERM framework is proactive, not reactive • A framework acknowledges that confronting risks before they are emergent yields significant benefit • A comprehensive risk management framework does not automatically ensure that a system will be void of future and present risks The Right Process
  25. 25. Page 24 May 16, 2014 Massachusetts Continuing Legal Education, Inc. The Right Process • Risk Identification: – Identification and analysis of risk is management’s responsibility with respect to determining which risks may impact strategy and achievement of organizational goals. – It is essential to create a comprehensive list of internal and external risks facing the organization – Risk identification tools can be developed and used to survey leadership and interviews can be utilized to develop a deeper understanding of risks already identified
  26. 26. Page 25 May 16, 2014 Massachusetts Continuing Legal Education, Inc. The Right Process • Risk Assessment and Evaluation: – Once all organizational risks have been identified and analyzed, the next steps are: o Understand and attempt quantification of potential magnitude of each risk o Identify risk drivers o Consider positive and negative consequences across the organization o Assess likelihood and severity of each risk
  27. 27. Page 26 May 16, 2014 Massachusetts Continuing Legal Education, Inc. The Right Process • Tools to Evaluate Risk: – Risk Scoring: evaluates the importance of one risk over another, accounting for likelihood/probability and impact/severity. • Sample formula: Probability x Severity = Risk Score – Risk Mapping: a data generating process that utilizes local perceptions to identify and address risks in an effort to reveal transactions, departments, or processes that result in different types and levels of risks. • Graphically depicts the organizations’ risks, displaying the relationship between frequency and severity. • Requires a team approach to identify and rank each identified risk.
  28. 28. Page 27 May 16, 2014 Massachusetts Continuing Legal Education, Inc. The Right Process – Risk Mapping Risk Measurement Minimal Moderate/ Acceptable Untenable Clinical Quality Financial/Economic Legal/Compliance Marketing/Brand Patient Experience Relational
  29. 29. Page 28 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Perspective Prospective Senior VP New Initiative/ Transaction New Initiative/ Transaction New Initiative/ Transaction Departments/ServicesDepartments/Services Departments/Services Developing a Comprehensive Risk Profile Departments/Services Comprehensive Risk Profile Comprehensive Risk Profile
  30. 30. Page 29 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Isolated Risk vs. Systemic Risk Risk Profile 1 Risk Profile 2 Risk Profile 8 Risk Profile 53 Systemic Risk How many “Moderate”s = “Untenable”? Isolated Risk Risk Measurement Minimal Moderate/ Acceptable Untenable Clinical Quality Financial/Economic Legal/Compliance  Marketing/Brand Patient Experience Relational Risk Measurement Minimal Moderate/ Acceptable Untenable Clinical Quality Financial/Economic Legal/Compliance  Marketing/Brand Patient Experience Relational Risk Measurement Minimal Moderate/ Acceptable Untenable Clinical Quality Financial/Economic Legal/Compliance  Marketing/Brand Patient Experience Relational Risk Measurement Minimal Moderate/ Acceptable Untenable Clinical Quality Financial/Economic Legal/Compliance  Marketing/Brand Patient Experience Relational
  31. 31. Page 30 May 16, 2014 Massachusetts Continuing Legal Education, Inc. • The Right People make up the ERM evaluation team. • Right People, typically members of senior management, are responsible for evaluating risks respective to his or her position within the organization and hold responsibility for strategic initiatives. ( + ) * Right Processes Right People Disciplined Approach Ability to Evaluate Risks Contributes to Right Culture The Right People
  32. 32. Page 31 May 16, 2014 Massachusetts Continuing Legal Education, Inc. The Right People CEO CFO COO CMO CNO CIO Human Resources Legal Counsel Risk Manager Real Estate/Facility Management Key Leader
  33. 33. Page 32 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Accumulating the Results CE O SVP Informatio n SVP Finance SVP Operations SVP Quality
  34. 34. Page 33 May 16, 2014 Massachusetts Continuing Legal Education, Inc.  Frequency  Transparency  Board Involvement  Accountability ( + )*Right Processes Right People Disciplined Approach Ability to Evaluate Risks Contributes to Right Culture Disciplined Approach
  35. 35. Page 34 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Dysfunctional Practices, Dysfunctional Culture • Arthur Andersen – Inability to question superior's practices and incapability to suggest new ways of doing things. When these practices no longer worked, the culture shifted to keeping clients at any cost. – Resistance to change from seemingly unethical to ethical practices. The root of the problem was top management figures who exemplified poor ethical practices. – Culture shifted to increasing revenue from clients as much as possible. – Began to underestimate vulnerabilities in their practices, jeopardizing the organization's future.
  36. 36. Page 35 May 16, 2014 Massachusetts Continuing Legal Education, Inc. • Risk management must be driven from the top down and embedded in an organization’s culture • At the core of the ERM framework, an entity must be proactive, not reactive • Health systems should plan for risks, and create an efficient structure and a disciplined process to evaluate potentially risky strategic decisions. ( + )*Right Processes Right People Disciplined Approach Ability to Evaluate Risks=> Ability to Evaluate Risks
  37. 37. Page 36 May 16, 2014 Massachusetts Continuing Legal Education, Inc. • Volume of data most organizations collect, process and analyze growing exponentially. • Numerous organizations, such as IBM and Microsoft, are now offering products to utilize big data to analyze/predict risk. • Example: Google Flu Trends – “…we can accurately estimate the current level of weekly influenza activity in each region of the United States, with a reporting lag of about one day.” – Google, 2009 – Found that certain search terms are good indicators of flu activity. Google Flu Trends, in collaboration with the CDC, uses aggregated Google search data to estimate flu activity. – Early detection of a disease outbreak can reduce number of people affected. Google’s up-to- date influenza estimates may enable public health officials and health professionals to better respond to seasonal epidemics and pandemics. Ability to Evaluate Risks
  38. 38. Page 37 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Implementing a Contemporary ERM System ERM System
  39. 39. Page 38 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Challenges to Implementing a Contemporary ERM System • Competition among units (quality, risk management, patient safety, corporate compliance, etc.)Territorial Turf • Cultural incompatibility and diversity may act as barriersCulture • Moving away from tradition punitive environment centered around individual employee/staff error to an organizational emphasis on systems Changing Environment • Employees often have a hard time working in teams and/or promoting communication on their own Teams and Communication • Technology should be used to support the core operations of healthcare and to support patient safety, decrease medical error, and improve management. Limited use of Technology • C-suite should understand the concepts of ERM and also lend organizational support for program development and implementation Inadequate Senior- Level Support • Willingness to devote time to implementation may hold many organizations back from ERM. Length of Time to Implement
  40. 40. Page 39 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Challenges to Implementing a Contemporary ERM System • Expertise in risk and finance may be limited.Expertise • May be difficult to demonstrate immediate, quantifiable ROI.ROI • Without change and follow-through, ERM programs become static and eventually dwindle in support and effectiveness. Follow-through • Successful ERM programs recognize the importance of employee involvement and contributions and value their input. Employee Involvement in Design
  41. 41. Page 40 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Success Factors of ERM Programs • In assessment • In scoring measurement • Quantifying and benchmarking results • Decreased variability through evidence-based practice Consistency • Internal • External Monitoring and evaluation Leadership support and a positive culture Broad-based employee involvement
  42. 42. Page 41 May 16, 2014 Massachusetts Continuing Legal Education, Inc. Questions?
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