Pharm Ad 2: Risk Management in Pharmacy PDF
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Sonia S. Morales
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This document is a presentation on risk management in pharmacy practice. It covers different risk management strategies, and the steps involved in the process. It also examines the role and importance of the risk manager.
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Pharm Ad 2 The Basics of Managing Risk Sonia S. Morales, RPh, MSPharm Key Concepts 1. Risk management is the application of knowledge and experience to manage the occurrence of a potentially bad incident (i.e., a risk). This is something we do everyday. For...
Pharm Ad 2 The Basics of Managing Risk Sonia S. Morales, RPh, MSPharm Key Concepts 1. Risk management is the application of knowledge and experience to manage the occurrence of a potentially bad incident (i.e., a risk). This is something we do everyday. For example, we do not step into the street when a bus is coming because there is a chance that we may be hit by the bus and be injured. In other words, we identify a risk that our experience and knowledge has told us should be avoided or controlled. Enterprise risk management involves using knowledge and experience to manage risks within a business or organizational environment. Managing risks is important both to improve quality and increase profits. Risks external to the organization, such as medication errors that may harm patients, as well as internal risks, such as potential workplace accidents that result in workers’ compensation claims, must be identified and addressed. An example to avoid medication errors entails the design and use of workflows, planned to avoid as many mistakes as possible before they reach a patient. Applying Risk Management Process to the Enterprise Risk management is most effective when applied in a systematic manner, and most systems used in pharmacy today are directly or indirectly modeled on the work of W. Edwards Deming and the concept he called Total Quality Management (TQM). He taught that quality begins with management’s adoption of the 14 basic principles. Deming’s 14 Principles of TQM 1. “Create constancy of purpose” regarding quality improvement, i.e., quality improvement should e an ongoing process. 2. Management must actually adopt a continuous improvement philosophy 3. Organizations should reduce dependence on inspections and promote systems and processes that produce quality products 4. Build relationships with reliable, quality suppliers rather than those suppliers that are the least expensive 5. Constantly improve all aspects of operations 6. “Institute training on the job.” Integrate employee training into organizational operations 7. “Institute leadership.” Leaders are driven to achieve results, they do not settle for a supervisory role. 8. “Drive out fear.” If employees fear reporting errors, then quality suffers. Leaders and managers should establish a culture in which communication is encouraged and valued. 9. Remove barriers between departments/divisions to facilitate formation of interdepartmental teams that will work toward improving quality 10. Remove slogans, as they are unlikely to affect quality improvement and may alienate employees. 11. Focus on achieving quality rather than on meeting numerical goals, 12. Remove barriers to pride in workmanship, as pride will likely contribute to quality 13. Facilitate employee education, self-improvement, growth, and development 14. “The transformation is everybody’s job.” In other words, all employees must contribute to the process of quality improvement. Key concepts... (cont.) 2. Many believe that management’s job is to provide a philosophy of quality along with planning, training, and tools that employees can use to implement the risk management process. Steps in the Risk Management Process Identifying Risks The first step in managing risks is to identify them. Once a risk has been identified, it can be reduced, transferred, eliminated, or avoided. The first task is to develop a list of realistic risks that may affect the business. High on the list involving medications is medication errors which pharmacists must consider as their professional liability. Other risks to consider are the following: Other risks... A person visiting the pharmacy may slip and fall A member of the pharmacy staff may violate a law or Board of Pharmacy regulation A member of the pharmacy staff may cause harm to another employee or a patient A Health Insurance Portability and Accountability Act (HIPAA) violation may occur Confidential information may be disclosed inappropriately The building in which the pharmacy is located may be destroyed by fire or flood A pharmacist may fail to renew his or her license In addition to these, a pharmacy may face other problems: Employee injuries Changing regulations Professional staff turnover Power outages Prioritizing Risks and Organizing the Plan Each identified risk can be classified according to its frequency, severity (potential impact), and time to probable impact and warning (likelihood of it occurring in the foreseeable future). From this list, the manager can decide which problem to address first. Working on ALL risks simultaneously might not get the anything done. In classifying a risk, a number value can be assigned with each risk. Table 1: Risk Priority Chart (Frequency, Severity and Time) Frequency Severity Time to (Value: low (Potential Probable 1 to high 5) Impact) Impact and (Value: low Warning 1 to high 5) (Value: low 1 to high 9) 1 = rare 1 = minor 1 = long 2 = unusual 2 = moderate (months) 3 = sporadic 3 = major 3 = short 4 = periodic 4 = severe (days) Table 2: Example of a Risk Priority Chart Risk Frequency Severity Time Scoreᴱ (Range:1 – (Range: 1 (Range: 1 – 5) ᴬ – 5)ᴮ 9)ᴰ Customer falls in 3 2 3 8 parking lot due to slippery pavement /street / frontage Medication error 4 5 9 18 Flood 1 5 1 7 ᴬ1 = rare; 2 = unusual; 3 = sporadic; 4= periodic; 5= frequent ᴮ1 = minor; 2 = moderate; 3 = major; 4 = severe; 5 = catastrophic ᴰ1 = long (months); 3 = short (days); 9 = no warning ᴱThe score are weighted. They should not be used merely mathematically but are designed to be a consideration tool. Points may be added depending on other factors. Key concepts... (cont.) 3. The goal of monitoring is to be certain that a risk management plan, once implemented, does not ultimately fail because it was later neglected. Selecting Techniques to Manage Risks Several techniques may be used to manage risks. The manager can: a) eliminate the risk entirely, b) avoid the risk, c) transfer the risk of loss to another party, or d) develop a series of practices to reduce the occurrence of the risk or reduce its impact if it does occur. Following are examples of pharmacy practice risks and utilization of techniques to manage these risks. Risk Risk Specific Strategy Management Technique Computer Avoidance Upgrade or replace computer system system malfunction Customer Reduction Install security cameras and theft electronic surveillance (i.e., the use of security tags that alert employees when products are removed from the store premises without being paid for) Hire security Customer Transference Purchase a commercial insurance violence policy that will provide coverage if customers or employees are harmed on the pharmacy premises Employee Reduction Install security cameras and theft electronic article surveillance (i.e., the use of security tags that alert other employees when products are removed from the store premises Risk Risk Specific Strategy Management Technique Violence Reduction Install security cameras and metal against detectors employees Hire security Conduct rigorous pre-employment background checks Develop a strict human resources policy and sanctions concerning Transference employee violence Purchase a commercial insurance policy that will provide coverage if customers or employees are harmed on the pharmacy premises Forged Elimination Do not keep controlled substances controlled in stock scripts Inability to Reduction Develop a relationship with a properly staff reliable temp agency that is able to provide temporary workers on short notice Reduce pharmacy hours Risk Risk Management Specific Strategy Technique Inadequate supply Avoidance Identify comparable alternative products that of key ph’ceuticals are in stock Reduction Increase the supply of safety stock Loss of power Elimination Purchase and install an emergency backup generator Medication error Reduction Use bar-coding systems Misreading scripts Avoidance Use a computerized order-entry system instead of handwritten prescriptions Others overhearing Reduction Designate a private patient counseling area confidential patient info Product Reduction Use the principles of continuous QI to contamination continuously monitor and improve workflow to decrease opportunities for product contamination Reputational Avoidance Develop relationships with the media and damage key business leaders Honor commitments to customers and vendors Sponsor events for local nonprofit organizations to forge alliances Robbery (after Reduction Install security cameras hours) Install a security / alarm system Hire security for when the pharmacy is Transference closed Key concepts... (cont.) 4. Elimination of risk is the most complete – and, in some ways, the most appropriate – outcome to seek. Risk elimination refers to the complete removal of an identified risk from an organization or business. A company may not be able to eliminate a risk but may be able to avoid it. For example, a pharmacy’s delivery vehicle was involved in an accident which paralyzed operations. Delivery service cannot be eliminated completely, thus, the delivery car was sold ultimately and the pharmacy contracted a local taxi company to make the deliveries during the day. Transferring Risk There are two primary ways to transfer a risk: – Indemnification and insurance. Both are contractual. Indemnification involves acceptance of responsibility by Party A for certain or all adverse events occurring to Party B. This usually involves a claim or a lawsuit alleged to caused by Party A’s negligence. Insurance is another method of risk transfer. Reducing risk involves simple establishing courteous and respectful relationships with patients and professionals. Implementing the Plan Once a risk has been identified and prioritized, the techniques for addressing the risk selected, a team chosen, and a plan approved, the plan must be implemented. For the pharmacy manager or risk manager, this may mean turning the plan over to the team and waiting for a report. In some cases, the risk manager may or may not be the team leader. Monitoring and Adjusting the Plan Monitoring asks the questions, “Is it working?”, “Did it work?”, and “Will it continue to work?” A tool commonly used in CQI is the PDSA cycle (under Quality Improvement, 1st Sem, Pharm Ad1) The PDSA Cycle Element of Activity Associated with Cycle Element Plan Identify an opportunity for improvement and plan a change Do Implement the change on a small scale Study Collect data on the change and compare to the baseline, study the effect of the change, and show the effects of multiple changes on a process over time Act If the change was successful, implement it on a wider scale and continuously assess results; if the Key concepts... (cont.) 5. The risk manager’s role is to serve as a liaison between upper management and pharmacy staff to promote quality and reduce risks in all aspects of the pharmacy. One-way information collected can be used directly to encourage and emphasize risk management to the staff is to make visual displays emphasizing quality. A QRE (quality-related event) accuracy graph might compare the number of mistakes made in the pharmacy in one month with the number of prescriptions filled for the month. These visual representations (graphs or charts) can be protected from discovery (privileged information) and considered confidential if they meet the following criteria: 1. They are prepared from information sent to or from the pharmacy’s patient safety organization (PSO); 2. They are used to reduce errors; and 3. They are part of the pharmacy’s business operations and protected from disclosure to anyone other than pharmacy staff. It is therefore important they are not placed where patients or non pharmacy staff have access to them Protecting Near-Miss and Error Data Collection of near-miss and error data may expose the pharmacy organization to legal risks. Protecting these collected information is a must. Incident / error reports may serve several purposes, such as to alert management or the pharmacy’s insurance company of potential claims or lawsuits. The Risk of Not Taking Risks Managing risks strategies usually involve reducing the effects of a planned action. Sometimes, risk management may mean NOT doing something or always saying “no” or of being too cautious. Some risks involved in NOT taking risks could mean a failure to innovate which could create a negative impact on the business. Case Scenario Six months ago, another pharmacy in your medical center instituted a bar-coding system at the same time that your pharmacy did. Both pharmacies experienced initial increases in QREs and medication errors. However, in the 3 months since starting the program, the number of actual reports of medication errors reaching patients has increased at the other pharmacy, whereas errors have decreased at your pharmacy. The medical center pharmacy manager has asked for your help. She has asked that you outline at least three ideas of what may have gone wrong at the other pharmacy.