Don't leave insurance to finance department

Risk managers should have an active role in purchasing and managing insurance, says R. Stephen Trosty, JD, MHA, CPHRM, president of Risk Management Consulting in Haslett, MI, and a former insurance company executive.

"It should not be just the financial individuals in the healthcare organization who are involved with insurance," Trosty says. "Risk managers have a greater knowledge of the claims, the risks, the medical errors that are occurring. There should be an active involvement in insurance issues."

Much of the interaction with the insurer should involve the risk manager, possibly with financial professionals also, he says. "If the hospital's interactions with the insurer are left entirely to the financial people, then the risk management program is not as comprehensive as it should be," Trosty says. "As you look to moving more toward enterprise risk management, that becomes even more true. One cannot have enterprise risk management without having involvement with the insurance component."

Inaccurate claims loading often is the result of the risk manager not being involved enough in the procurement and management of insurance contracts, Trosty says. Risk managers can focus so intently on preventing and responding to medical errors, for example, that they are content to leave the intricacies of insurance to their financial colleagues.

"There is far too little understanding among risk managers of these insurance questions and the role they can play," Trosty says. "A risk manager who wants to build his or her worth in the organization has a lot of opportunity if they get involved in these issues."