Risk Management in Health Care

Historically, risk management in health care emerged out of the programs from other industries and organizations, like Insurance organization, to stem malpractices in healthcare organizations, and to structure and orient the healthcare, to accrue to people's needs.Often risk management is confused with 'patient safety management', but unlike patient safety management, the major role of risk management is more with protecting the assets of the organization and the stakeholders of the organization, while keeping the patients' needs at bay. This function is apparent from the fact that, despite human being conscious of their health since time immemorial, risk management has existed for only fifty years. A crisis in 1970s involving malpractices and loss of assets, made health care organizations to develop the first risk management system, based entirely on protecting health organizations against possible accidents. The American Society for Health care Risk Management (ASHRM), established in 1980 was one of the first to respond to these needs.

Nowadays, the major functions of healthcare organization dealing with risk management, involves maintenance of such long-term and short-term; and broad and narrow risk managements like:

• Medical professional liability
• Accidental losses of any health care organizations
• Enterprise risk management, which involves a more formalized structure, including legal, regulatory, political, business and financial aspects of the any health care organizations. In simple words, the function involves all the risks that health organizations faced.

There are some structural factors that helps ensure that these functions are taken care of: a) Authority: The risk management group ensures that they have strong authority to administer clinical practice, policies and procedures, and medical staff and employee behavior, that keeps the system running. b) Visibility: as terms of collaboration and dependence among co-workers in health organization c) Communication: Networking with other organization for merger, acquisition, and joint ventures, etc. d) Coordination: is required to make the system successful, and this includes all departments and functions in health care organizations. With these structural factors, risk management in every healthcare organizations aims to avoid anything that expressly involves risk, or unforeseen disaster, in order not to experience organizational loss, and to remain answerable in case, any accidental loss happens. In a nutshell, risk management acts as the proactive system to protect and mitigate risk.