Introduction to ERM

Healthcare organizations are exceptionally complex and rapidly changing entities facing a high degree of uncertainty and the myriad of emerging clinical, legal, financial, operational, safety, and other organizational risks that can lead to significant losses. Pursuing high reliability in healthcare delivery requires constant state of mindfulness and sustained focus on anticipating and preventing failures rather than reacting to them. Considering the magnitude, variety and complexity of potential risks, healthcare organizations are increasingly moving from managing risks in fragmented silos toward the model of Enterprise Risk Management (ERM). ERM, also known as Integrated Risk Management (IRM), provides a proactive, structured and systematic approach to managing diverse risks across an entire organization using consistent processes within a comprehensive framework. ERM creates a shared platform to manage risks strategically by integrating risk management into the overall governance, strategic and operational planning processes, organizational policies and procedures, training programs, and performance management. ERM helps organizations achieve their strategic goals by handling risks proactively from a much broader perspective than traditional risk management focused mainly on medical professional liability issues and adverse events. Understanding the totality of organizational risks from a common frame of reference allows leaders at all levels of the organization to develop effective loss prevention strategies, preserve organizational assets, enhance patient safety, and ensure high quality of care.