Implementing a robust risk management strategy is crucial for NHS organisations. It is important to acknowledge the possibility of instances where NHS Trusts may come under public scrutiny and face fines, necessitating a closer review of their operational practices. Recognising the importance of preventing such occurrences underscores the necessity for a vigilant and proactive risk management approach that anticipates and addresses potential risks within the NHS.
Instances of non-compliance with policies and protocols, challenges in training and supervision, and administrative shortcomings can potentially impact patient care and organisational performance, potentially affecting the reputation and finances of the organisation. Thus, to avoid such irreparable damages, implementing a risk management strategy is imperative.
What is risk management in healthcare?
Risk management in healthcare is a structured process that involves identifying, analysing, and mitigating risks, with a purpose to ensure patient safety, protect healthcare professionals, uphold uninterrupted healthcare service delivery, and manage potential financial and operational liabilities.
Risk management involves learning from past experiences or instances and formulating plans to minimise the likelihood of similar occurrences, with an ultimate aim to make informed decisions that balance risk and reward, for sustainable growth of the organisation.
Categories of risk in secondary care
Risks within healthcare sector are multifaceted, encompassing statutory compliance, patient safety, employee well-being, environmental impact, infrastructure, and reputation. These risks can be classified and sub-classified by factors like targets, hazards, consequences, activities, departments, and safeguards. Let’s understand some of the main risk categories encountered in secondary care.
Clinical risks
Clinical risks are directly related to patient safety and the quality of care provided. It encompasses medical errors, complications in treatment or surgeries, and failures in clinical governance. Clinical risks can be subcategorised further based on specialty such as accident and emergency, anaesthetics and surgery, obstetrics and gynaecology.
Clinical risks impose monetary and reputational consequences, but above all, it directly impacts the well-being and lives of the patients. Hence, it is of paramount importance to maintain high clinical standards.
Operational risks
Challenges and implications hovering over everyday functions of the NHS Trusts, including workforce management, infrastructure and equipment, service delivery, all fall under operational risks. These risks may be related to maintaining adequate number of healthcare professionals, upgrading and maintaining medical equipment, facilities, and IT infrastructure while also addressing issues like delays in scheduling and treatment.
As operational efficiency is vital for efficient patient care and seamless healthcare delivery, keeping operational risks under control is essential.
Financial risks
As implied by its name, financial risks refer to the potential losses or negative impacts on the financial health of the organisation and the associated threats. These risks may arise due to budget constraints, mismanagement of expenses, or unexpected costs such as financial penalties. Financial risk management is necessary for financial sustainability and viability of NHS Trusts.
Reputational risks
Cases where an NHS Trust is painted in a negative light, by the press or general public, would constitute a reputational risk. These risks can arise from scandals, patient complaints, clinical incidents, and the resulting negative media coverage.
Why risk management matters in healthcare?
Patient safety
Patient safety and well-being are of the utmost importance in healthcare, and implementation of effective risk management practices plays a crucial role in achieving this objective. By proactively addressing potential challenges, such as clinical errors, infections, and other incidents that may compromise patient safety, healthcare providers can establish a robust preventive framework. Moreover, a well-structured risk management plan not only aims to minimise known risks but also equips healthcare institutions to respond swiftly and effectively to unforeseen incidents and hazards.
Legal and regulatory compliance
People’s lives are at stake in the healthcare sector, subjecting it to stringent regulations with severe legal and financial consequences in cases of non-compliance, even the possibility of criminal prosecution in serious cases. Ranging from health and safety legislation, fire safety regulations to meeting requirements for safe storage and clinical waste disposal, the statutory requirements that a Trust must adhere to are extensive. Therefore, a robust risk management strategy is essential to oversee compliance and address associated risks.
Financial
With rising operating costs and evolving medical practices, there is an inevitable expectation of upgrades and advancements from NHS Trusts. For example, inflation could place financial pressure on NHS organisations. A risk management strategy can help flag risks to finance teams in relation to capital and revenue investments, business cases and business decisions. It also offers a framework to evaluate new and innovative investment proposals, ensuring that investments align with the organisations' objectives and to deliver improved care delivery.
Furthermore, having an effective risk management strategy can help NHS Trusts avoid precarious financial situations and mitigate the risk of losses due to fines, legal cases, and clinical negligence claims, which can reach millions of pounds.
Reputation
Patients entrust their lives to healthcare organisations with hope and trust of receiving safe and effective care. Hence, reputation is of great significance to NHS to maintain this trust among the public. Risk management, in this context is essential as it is designed to protect the organisation from potential incidents which can tarnish its image.
Crisis management and security
Some circumstances lie beyond human control, like natural disasters and pandemics. Healthcare facilities must be well-prepared to face these. Risk management takes a vital role in addressing these cases, as it helps in devising contingency plan to respond to unforeseeable events.
Data security is also another pivotal aspect of risk management strategy. It ensures that the organisation’s cybersecurity is up-to-date, and their patients’ data is safeguarded against data breaches.
Operational efficiency
Risk management strategies also oversee risks related to staffing and employee well-being, ensuring the establishment of a safe and healthy work environment. Through the proactive identification and mitigation of risks before they manifest, risk management facilitates resource optimisation and enhances operational efficiency.
Stages of developing an effective risk management strategy in NHS Trusts
A risk management strategy should identify, reduce, and mitigate risk in an optimum way. Aligning to the Trust’s service and business strategy, it should clearly document strategic changes needed to manage key risk indicators and enable the board to monitor performance. The extensive process of developing a risk management strategy can be divided into the following four stages.
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Risk analysis
This initial stage deals with comprehensive assessment of current and future risks. Performance of the Trust is also analysed along with its services, human resources, and infrastructure it utilises. This stage sets the foundation for developing risk reduction options.
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Setting risk targets
The most difficult stage involves determining desired risk levels for services and assets, considering factors like national policies, legislative changes, clinical practices, performance issues, and local organisation matters. Setting these risk targets can be challenging but involves visioning future developments. The approach typically includes discussions, multidisciplinary workshops, and computer modelling.
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Developing risk control options
This stage is about developing realistic and feasible strategic options for the management of risk based on the information and output of previous stages. Strategic options are often about risk reduction and risk transfer, and they can even become Trust policies or procedures.
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Evaluating risk control strategies
Here, strategic options devised in stage 3 are evaluated in terms of financial and non-financial benefits to select the most favourable option. It often involves an interactive workshop where techniques like ranking, weighting, and scoring are used to help in decision-making. In addition, a sensitivity analysis is carried out to assess the potential impact of alterations in underlying assumptions could affect the preferred option.
Steps to enhance risk management practices in NHS Trusts
Risk management is crucial for NHS Trusts in order to maintain a sustainable growth and efficient care delivery. Efforts should be made to maximise the effectiveness of the risk management strategy. Here are some practical steps that can strengthen risk management efforts.
Comprehensive risk assessment
Risk assessment should be conducted regularly with an all-level collaborative effort to have a comprehensive understanding of all the functions and areas of the Trust.
Prioritising risks
Risks can be ranked and prioritised according to their severity and the area of their impact. This method offers a clear understanding of which risks should be given higher significance.
Data-driven approach
Historical data and data analytics can be useful to assess key risk indicators and identify trends, problem areas and predict potential risks. This information can be instrumental to guide resource allocation and other decisions.
Training and awareness
Staff training and awareness is necessary to keep employees informed on risk management procedures, reporting mechanisms, and their role in risk mitigation. Staff members can be allocated resources and responsibility to ensure implementation of these strategies. This will create accountability and drive prompt action.
Reporting and monitoring
Having a clear reporting framework and transparency in communication, ensures that staff can feel safe to report issues. Similarly, real-time tracking and monitoring is required so that prompt actions can be taken wherever needed.
Reviewing risk management strategies is just as important as formulating them. Given regulatory policies are subject to change, adapting your risk strategy to meet the evolving demands is essential.
Technology-driven solutions
Technology-driven solutions can be employed to streamline risk assessment and simplify reporting, allowing real-time tracking and monitoring of risks. Additionally, they empower organisations with data analysis insights, enabling them to spot trends and proactively address emerging threats.
Our Risk Management Solution stands out as a notable software solution within this category. It provides clarity, oversight and analysis tools to effectively control risk, exploit opportunities and minimise threats.
It supports the creation of multiple risk registers, enabling identification, mapping, and managing risks across various domains, simultaneously. It also allows assigning risk levels and scoring them, creating a hierarchy of risks based on priority.
Furthermore, it supports the delegation of risk ownership, enhancing control and accountability.
With Advanced Risk Management Solutions recording, managing, and reporting risks becomes easy.
Contact us today to find more about Advanced Risk Management Solutions and how we can be your dependable companion in your risk management journey.
