Reimagining risk assessment: Are you ready for a new approach?

To stay ahead of a changing healthcare industry and gain the insights you need to protect your organization, you need a fresh lens on risk assessment.

The risks facing your healthcare organization evolve constantly. From new regulations to advances in care modalities and technology, the industry is moving faster than ever. Your risk assessment processes need to keep pace.

To stay ahead of a changing industry and gain the deep insights you need to protect your organization from risks, you need a new approach to risk assessment. This article explains this fresh approach and how it can better help your organization reduce risk.

Traditional risk assessments have their limitations

The traditional risk assessment methods internal auditors have used for years surely can help identify risks. But they have their limitations.

Consider a typical risk assessment process, which includes the following steps:

• Document retrieval/review
• In-person meetings with individuals to identify potential risks
• Surveying of individuals regarding current and potential risks
• Development of an internal audit work plan
  
  

Taking a closer look at these steps, a traditional risk assessment process’ limitations become more evident.

For example, the input gathered during in-person meetings might be limited due to the small number of people with whom auditors are able to meet. It’s not uncommon for such interviews to be limited to 15-20 staff members.

Likewise, surveying individuals about risk also has its limitations. In our experience, such surveys tend to have an average response rate of 10%.

Due to their limited size and scope, in-person meetings and traditional surveys have another drawback: They are subject to the biases of the small number of people completing them.

Traditional risk assessment approaches aren’t giving healthcare organizations a clear enough picture of their risk landscape: So, what will?

A fresh risk assessment approach

A reimagined risk assessment approach includes the document retrieval and review steps used in a traditional risk assessment process. But at the heart of this new approach is data—and a lot of it. After analyzing clinical and financial data to identify—and quantify—current and potential risks, internal auditors then use that data to guide their next steps.

For example, this data is leveraged to inform anonymous, interactive, focus group-style feedback sessions with up to 1,000 individuals at one time. These sessions focus on current and potential risks. They use an AI-powered technology tool to generate additional, related questions as the survey progresses, allowing for more in-depth insights.

Internal auditors initially use data analytics to help them home in on the questions that should be included during the feedback sessions and any in-person interviews the internal audit team conducts. Then, during the feedback sessions, internal auditors can “push” other questions to participants in real time based on participants’ answers about certain risks, resulting in more of a conversation than a conventional survey.

This reimagined survey approach is customizable, in-depth, and agile compared with a traditional survey. We have found it to allow internal auditors to achieve much better response rates than traditional surveys—an 85% response rate versus the typical 10% response rate seen with traditional surveys.

Newer process yields positive results

Healthcare organizations that have adopted this fresh approach to assessing and reducing their risk exposure have found it beneficial in many ways.

One major benefit is that it can identify risks more globally than a traditional approach. This includes not only risks that can be audited but other internal and external risk drivers. Internal risk drivers include staff qualifications and training, employee fatigue, and task interruptions. External risk drivers include regulatory compliance, reimbursement issues, and market competition.

The reimagined risk assessment process culminates in a risk profile that auditors can share with stakeholders in areas such as compliance, revenue cycle, coding, and clinical leadership, and an internal audit work plan that is based on objective and complete data sets.

This full risk universe view is helpful for today’s healthcare leaders who are facing risks on multiple fronts. Information gleaned from this reimagined risk assessment process can identify risks that need to be addressed and that can be investigated further, such as through focused risk committees. More in-depth risk information also can be helpful for organizations in shaping their compliance plans. 

Overall, staff members whose organizations have begun using the reimagined risk assessment process have reported feeling more “heard” and more comfortable talking about risks due to the anonymous feedback sessions.  

At one organization, use of data analytics and anonymous focus groups included in the reimagined risk assessment process reduced the time internal auditors typically would have spent in one-on-one meetings by half, reduced the overall hours the internal audit team spent on risk assessment overall by 15%, and increased risk coverage for the organization by 40%.

Ready to try a reimagined risk assessment?

A dynamic risk landscape requires a dynamic approach to risk assessment. Find out how Kodiak can help your organization become more agile when it comes to assessing and addressing the risks that affect your organization. Reach out to our risk specialists today to get started.