The “term risk management refers to the process of identifying, analyzing, and mitigating uncertainties in every kind of investment” (Singh & Ghatala, 2012, p. 418). Risk management focuses on different strategies that can deal with every projected loss. The process identifies the most appropriate actions towards dealing with risks.
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Youngberg (2010) believes that “inadequate risk management will eventually affect the performance of an organization” (p. 27). Risk Management (RM) is a wide field that attracts many professionals. This is the case because risk management is a powerful process embraced in different healthcare organizations. This essay describes the major issues associated with risk management.
Financial and Accounting Areas Necessary in a Risk Management Plan
According to Singh & Ghatala (2012), many professionals will eventually find themselves in the RM department. For instance, accountants and financial experts should have the required knowledge in RM. Some financial and accounting areas are relevant in every RM plan. For instance, financial accounting is used “to classify, interpret, report, and record an institution’s financial performance” (Youngberg, 2010, p. 39). This area is critical towards dealing with different financial risks.
Youngberg (2010) believes that “some areas such as budgetary accounting, cost accounting, and auditing should be implemented in every RM plan” (p. 41). Forensic accounting investigates different forms of fraud.
The approach minimizes chances of embezzlement. Health Managers (HMs) should also use various financial indicators to monitor the performance of their businesses. Some of these indicators include “liquidity, profitability, and leverage” (Singh & Ghatala, 2012, p. 419). Such areas should therefore be used in every risk management plan.
Professionals Working in Risk Management
Organizations should control risks in order to achieve their goals. Risks can affect the performance of many healthcare institutions. Such risks vary from one facility to another.
That being the case, different professionals will find themselves working in risk management. Financial managers and accountants should focus on the best strategies in order to deal with every risk. HMs should also be able “to forecast and deal with various risks” (Youngberg, 2010, p. 82). Medical practitioners should also possess the relevant skills in RM. This knowledge will encourage them to control various risks that might affect their patients.
Project managers should also use their competences to deal with every project risk. Employees working in different areas or departments should also be involved in every risk management plan. Such professionals will provide timely ideas in order to deal with every risk. Insurance Managers (IMs) should also identify various risks that can affect different healthcare institutions (Singh & Ghatala, 2012). This approach will protect the firm from different risks.
This discussion shows clearly that every organization has its unique risks. Healthcare organizations should therefore understand the nature of their potential risks. Psychologists and surgeons should also have the best knowledge in RM. This understanding will “make it easier for many professionals to deal with health risks” (Youngberg, 2010, p. 53). They should use the best strategies in order to deal with every potential risk.
Defining Scope Impact
The “term scope impact refers to the effects caused by a harmful event within an organization” (Youngberg, 2010, p. 32). This definition explains why harmful events can affect different aspects of an organization. Some of these aspects include “integrity, confidentiality, and availability” (Youngberg, 2010, p. 43). A “loss in integrity, confidentiality, or availability will affect different areas of an organization” (Youngberg, 2010, p. 32).
For instance, the affected healthcare organization can lose its reputation. It will also lose most of its customers. Every harmful event will eventually affect the financial performance of the targeted hospital. Risk Managers should therefore be able “to estimate the possible impact arising from the scope” (Youngberg, 2010, p. 63).
Scope Impact in Healthcare Management
Healthcare organizations should use the best strategies in order to deliver quality care to their patients. Healthcare facilities can encounter different forms of harmful events. HMs should therefore use Risk Models to understand the major issues affecting their institutions. Some of the “risks encountered in healthcare include misdiagnoses, poor patient support, medical errors, and strikes” (Cagliano et al., 2011, p. 701). Such harmful events can affect the quality of care.
This issue can also result in loss of integrity. The affected healthcare institution will lose most of its clients. The hospital will also have a negative publicity. This event will eventually affect the financial gains of the targeted institution. This illustration explains why HMs should have the best skills in RM.
Steps Undertaken Whenever a Sentinel Event Occurs in My Organization
Sentinel events are common in every healthcare institution. The targeted facility uses a proper strategy in order to deal with every unexpected occurrence. The first step is recording the occurrence. The institution then conducts a detailed study in order to understand the causes of the event.
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A proper communication strategy is used to inform the relevant authorities about the event (Cagliano et al., 2011). A response strategy is implemented immediately in order to deal with the event. A Risk Prevention Model (RPM) is then designed in order to prevent future occurrences. Such steps have been critical towards reducing most of the risks encountered in the facility.
Cagliano, A., Grimaldi, S., & Rafele, C. (2011). A Systemic Methodology for Risk Management in Healthcare Sector. Safety Science, 49(5), 695-708.
Singh, B., & Ghatala, H. (2012). Risk Management in Hospitals. International Journal of Innovation, Management, and Technology, 3(4), 417-421.
Youngberg, B. (2010). Principles of Risk Management and Patient Safety. New York: John Wiley and Sons.