Risk and the Quality BusinessRisk and the Quality Business

Dr Peter Kirker

Manager Health Risks

Victorian Managed Insurance Authority

Victorian Managed Insurance AuthorityVictorian Managed Insurance Authority

•Established under Act in 1996

•Covers the public hospital system for medical malpractice

•Costs community approximately $50m per year to manage

•Covers all of government risk

•Charged with identifying and insuring the State of Victoria’s assets (asset register)

The Rule of 72The Rule of 72

5% rise in numbers per annum7% rise in costs p.a.

Claims processClaims process

90 000 APEs reported annually10 000 require further action (more

information)4 500 filed (no further action)5 000 – 6 000 claims notification files1 500 claims files established and

managed

APEs in AustraliaAPEs in Australia

Quality in Australian Healthcare Study (QAHCS), MJA, 6 Nov 95. Wilson et al

Reviewed >14 000 admissions (NSW & SA) 16.6% associated with adverse event

resulting in disability / longer hospital stay (Harvard study only 4%)

51% of these considered preventable 13.7% had permanent disability 4.9% patient death

APE rate

Permanent Disability rate

Death rate

High pre-ventability rate

Emergency Medicine

1.5% 9% 6% 82%

Internal Medicine

6.5% 41% 20% 73%

Cardiology 5.1% 25% 8% 58%

General surgery

13.8% 15% 3% 53%

Anaesthesia 2% 4% 2% 38%

QAHCS Study - APEs in AustraliaQAHCS Study - APEs in Australia

QAHCS revisitedQAHCS revisited

Causes of adverse events:-– Technical performance failure /

complication (34.6%)– Information mismanagement (15.8%)– Follow up / follow on failure (11.8%)– Sub optimal care and attention (10.9%)

• Medical Journal of Australia• 1999, 170

Tackling medical errorsTackling medical errors

Active failure – active mistakes with people directly involved in patient care (wrong syringe; memory lapse)

Latent failure – caused by people not directly involved with patient care (heavy workloads, inadequate experience or supervision, inadequate maintenance etc)

Adverse Outcomes Leading to LitigationAdverse Outcomes Leading to Litigation

The Victorian Experience

Statewide Data 1993-2001Statewide Data 1993-2001Specialty Number

(n=3474)% by no % by cost

Anaesthetics 189 3.0% 1.1%

Cardio-thoracic 69 1.4% 1.3%

ENT 90 1.5% 0.3%

Emergency 557 9.0% 11.4%

Gen Surg. 598 9.6% 7.7%

Neurosurgery 99 1.6% 1.5%

O&G

Orthopaedic

Ophthalmology

Plastic surgery

Psychiatry

Urology

Vascular Surg

1163

445

86

61

206

112

5

18.8%

7.2%

1.39%

1%

3.3%

1.81%

0.08%

42.2%

5.2%

0.73%

0.4%

2.6%

0.98%

0.05%

St Elsewhere’s – Anaesthesia $265kSt Elsewhere’s – Anaesthesia $265k

Elsewhere Somewhere Aware

Phys. injury 4 1 2

Breech of policy 1

Damaged teeth 5 1 1

Other 1 1

Incorrect Δ

Cardiac arrest 1

Awareness 5

Airway related 2

IV related 1

Lack of care 1

Orthopaedics -$800kOrthopaedics -$800k

EW SW AW

Complication 32 4 1

Incorrect Δ 4

Breach of policy 1 1

Delayed Δ 1

FB left in situ 2

Consent 4

Procedural issues 5 1

Lack of care 1

Emergency Medicine - $1.8mEmergency Medicine - $1.8mEW SW AW

Delayed Δ 9 5

Incorrect Δ 18 12

Lack of care 1

Complications 3 1

Suicide 1

Complications of Rx 1

Medication error 1

Incorrect test interpretation

1

General Surgery – 1.22mGeneral Surgery – 1.22mEW SW AW

Complications 34 4 1

Procedural issue 4 1

Lap. complications 6 3 1

Consent 2 1

FB left in situ 3

Incorrect Δ 4

Equipment issue 1

Waiting list issue 1

Delayed Δ 1

Obs and Gynae - $940kObs and Gynae - $940kEW SW AW

Postpartum comps 3

Comps of delivery 6

Failed sterilisation 2

General comps 1

Delayed Δ 7 3 1

Un Δ stillbirth 1

Un Δ congenital anomalies 2

Equip. issue 1 1

Procedural issue 1

Consent 3

Psychiatry - $180kPsychiatry - $180k

EW SW AW

Suicide 6

Incorrect Δ 2

Absconding 4

Lack of care 2

Breach of Admin rule/policy 7

Medication error 3

Delayed Δ 1

Neurosurgery - $750kNeurosurgery - $750kEW SW AW

Complications 10

Delayed Δ 2

Incorrect Δ 4

Medication error 1

Waiting list issues 4

Consent 1

Suicide 1

Procedure 1

Equip. issue 2

Present directions

•DHS initiatives ( LAOS and Sentinel Event reporting)

•Incident & complaint monitoring and tracking

•Infection control

•Credentialing of medical staff

•Documentation and medical records

•Medical staff education

VMIA STRATEGYVMIA STRATEGYRisk Management FocusAS4360 Risk Management Standard

Risk IdentificationRisk EvaluationRisk TreatmentMonitor & Review

HOW TO MAKE IT HOW TO MAKE IT HAPPENHAPPEN

Create a Risk Management culture endorsed by CEO, Board and driven from top down.

Identify a Risk Management “Champion”Establish Risk Management CommitteeMonitor and review Risk Management

ProgramRisk is everyone’s responsibility

ASSISTANCE FROM VMIAASSISTANCE FROM VMIA Assist clients with the following:

Establish RM Committees Develop a Risk Profile Risk Management Performance Assessment Tool

(RIMPAT) Incident monitoring tool – uniformity - RiskMan Implement Incident Reporting Systems Site Risk Surveys Sponsoring of pilot CRM projects

BENEFICIAL OUTCOMESBENEFICIAL OUTCOMESAssists Corporate GovernanceReduction of exposures to lossCompliance with relevant legislationUndesirable risks identified and

ManagedUltimate reduction in Premium costs

Reduced adverse patient incidents

BASE PREMIUM – BASE PREMIUM – FUNDED BY DHSFUNDED BY DHS

Base includes loadings for high risk practices: ObstetricsEmergency

BONUS & PENALTYBONUS & PENALTY

• Base Premium adjusted for good/poor claims performance; 3 years actuarially developed claims X 100

3 years premium cost 1

• Claims capped – Protects “Lightning Strikes”• Loss Ratio determines extent of Bonus or

Penalty

CLAIMS PERFORMANCE POOL – CLAIMS RATIOS

  Annual Premium Band for the Current Year of the Insured Agency

Loss Ratio Bands

0 – $25,000 

$25,001 - $100,000

$100,001 - $200,000

$200,001 +

0 – 65% (25.0%) to (1.7%)

(17.5%) to (1.2%)

(12.5%) to (0.8%)

(10.0%) to – (0.7%)

65 – 85% 0.0% 0.0% 0.0% 0.0%

85% + +3.3% to + 50.0%

+ 1.7% to + 25.0%

1.0% to + 15.0% +0.7% to + 10.0%

Dr Peter Kirker

Dr Jack Bergman

Managers of Health Risks

Victorian Managed Insurance Authority

Ph. 03 8601-5900

Email: p.kirker@vmia.vic. gov.au