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PREMIUM REBATE PROGRAM

In addition to the tools developed to assess risk and report on KPIs, the Office of the President's Office of Risk Services has developed programs to reduce the frequency and severity of loss. For the Medical and Hospital Liability Program, Risk Services developed a Premium Rebate Program in 2006-2012 that was known as the Professional Liability Prescription Program (PLPP), designed to encourage risk reduction initiatives aimed at reducing the cost of risk for the hospitals and schools of medicine. The program encouraged clinical loss prevention and patient safety and rewarded hospitals and medical groups for developing and implementing specific initiatives. PLPP is a good example of propagating the concept that everyone is a risk manager. It put loss control in the hands of individuals responsible for the outcomes. It gave them the financial resources and incentives to make a difference. There were several parts to the PLPP (see Exhibit 5.5).

The University of California (UC) Professional Medical and Hospital Liability Program (PL) is the second largest component of UC's cost of risk. In 2012, the Chief Risk Officer believed there was a need for more ERM focus on the university's five medical centers and began exploring ways to make this happen.

University of California Center for Health Quality and Innovation (CHQI) had established a system to encourage initiatives designed to create a culture of improvement with the support of the CHQI board, comprised of the five academic medical center CEOs, the six deans of the Schools of Medicine, and chaired by

Exhibit 5.5 Professional Liability Prescription Program (PLPP)

Grant Funds for Locally Developed Loss Prevention Initiative – Maximum Rebate 2 Percent of Premium

Requests for the 2 percent grant funds may be made at any time during the fiscal year; however, locations are encouraged to submit early.

Medical Center Risk Management offices are expected to coordinate the applications. Each project submitted for the grant funds must have both School of Medicine and a Medical Center approval if applicable. Multiple requests per site are permitted until the 2 percent is exhausted. Once the funding application is approved by Risk Services, the funds will be transferred to the campus account. The campus must transfer to the appropriate local code. The funds must be used for the approved project; failure to apply the funds to the project will result in recoupment of the funds by Risk Services. Projects will be monitored by Risk Services.

Medical Center and School Departments Allocation of Premium – Maximum Rebate 4 Percent of Premium

Allocation of premium based on loss experience and exposure is a critical underpinning of a successful loss prevention program. To qualify for this rebate, each School of Medicine and Medical Center must implement allocation to departments using the Bickmore approved methodology. Half of the premium will go to School of Medicine for its allocation to departments and half will go to Medical Centers for allocation of premium among its departments. Criteria:

Ensuring the location organization structure for premium allocation is current and appropriate.

Reviewing and categorizing all historical and current malpractice cases to location identified Schools and Medical Centers and then to departments and divisions within each, entering the data into the Sedgwick CMS claims system on a continuous basis.

Selecting and applying an allocation model from Bickmore recommendations to the fiscal year 2011-2012 budget.

A written report, signed by the Dean and CEO of the Medical Center attesting to the methodology employed and the amounts paid by the various departments, is required.

Adoption and Implementation of EMMI – Maximum Rebate 2 Percent of Premium

Qualification for this rebate will require adoption and substantial implementation of EMMI by the individual locations during fiscal year 2011-2012. The amount of the rebate will be dependent on the degree of adoption of use as measured by EMMI data.

Use of Technology to Prevent Retained Surgical Sponges – Maximum Rebate 2 Percent of Premium

Human error in the counting process is a significant cause of retained sponges. Technical solutions such as Surgicount provide a reliable method to assure a valid sponge count. Reducing retained sponges through reliable technology contributes to improved patient safety, enhances hospital reputation, and avoids regulatory and legal expenses.

the University's Senior Vice President of Health Sciences & Services, with a small coordinating staff based at the UC Office of the President, Oakland.

 
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