BANGOR UNIVERSITY

Bangor Business School

College of Business, Social Sciences and Law

Corporate Risk Management

ASB-4414

Risk Management: Hospital disaster

Done by:

Adnan Shibani

ID# 500217722034

Submitted to:

Dr. David Ayling

Word Count:

2,386

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 Table of Content

Abstract ................................................................................................................................ 3

disaster overview ............................................................................................................... 4

Definition of risk management .......................................................................................... 5

Understanding and assessing the scale of risk .................................................................... 6

Risk analysis ..................................................................................................................... 7

Risk management .............................................................................................................. 9

Risk treatment ................................................................................................................... 9

Risk in perspective .......................................................................................................... 10

Conclusion ...................................................................................................................... 10

References .......................................................................................................................... 11

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 Abstract

This paper discusses risks in hospitals, and how they may be managed. It starts with a case
study of a poor risk-management that led to the death of an elderly patient in a Libyan
hospital. It discusses the inadequacies of the hospital in the light of risk-management theory,
and describes how such unnecessary death in hospitals may be reduced. However, it also
describes how risk-management can never be perfect and, in this, how risk-management itself
carries risks.

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Disaster overview

There follows an example from the Tripoli Medical Centre.

The Centre is large, and is based in Tripoli, Libya. It has 1200–1500 beds, and is based round
three hospital towers, each of eight stories. The first seven of each contain wards and rooms
for patient care, and key facilities (e.g., kitchens). The eighth of each provides for
administration and rest rooms for staff, including doctors. In general, the centre provides
good care for patients. However, because it has large it has several managers, and the
managers do not always communicate effectively with each other. Also, at least some
managers are unaware of developments in hospitals elsewhere, including those in Europe and
North America.

Recently, a 70-year-old female patient disappeared at 3:00 a.m. after she had entered the
Tripoli Medical Centre. The patient suffered from Alzheimer’s disease. Upon noticing the
patient’s disappearance, security staff organised a search for her, but did not notify the police.
After much effort, the staff found her dead in a room controlling air conditioning.

It transpired that the woman had gone to the bathroom, but, upon her return, had got lost.
The entered the air conditioning room by mistake. When found, she was identified only by
her head scarf(Lymedicine 2009).

Three things stand out from this. First, the woman suffered from Alzheimer’s disease, and
was old, so she should have been identified as being at high risk, but she wasn’t—nobody
escorted her to the bathroom and back. Second, the security staff did not inform the police.
Third, the woman was identified only by her scarf, which suggests there was no labelling
(e.g., by name-tags) of patients. In all, these three things suggest a lack of protocol for
dealing with accidents within the Tripoli Medical Centre.

Accidents may be inevitable, but it is important that staff follow protocols to minimize their
incidence and, when they do happen, staff follow established and effective procedures in
dealing with them. The Tripoli Medical Centre incident illustrates that staff do not always
follow either such protocol(Lymedicine 2009).

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 risk
identification

understanding
and assessing
Monitor the scale of
risk

Risk Risk
treatment analysis
Risk
manage
ment
Strategy

Figure 1. Risk management cycle (Scribd 2009)

Definition of risk management

Risk management is the formal process that facilitates the identification, assessment,
planning, and management of risks. Effective risk management demands that all levels of an
organisation need to be included. Effective risk management demands that, not only are all
levels of an organisation are involved, but also that they communicate and learn from each
other. The aim of risk management is therefore threefold: (a) it must identify potential risk;
(b) it must objectively analyse the specific risks specific the organisation; and (c) it must
respond to the risks in an effective manner. Each of these demands an assessment of the
prevailing organisational environment, both internal and external (Cox and Tait, 1998).

Considered in this light, the Tripoli Medical Centre incident involving the missing
Alzheimer’s patient can be viewed as follows:

First, because such an incident had not happened before, management had not considered it
as a possibility—management had not considered potential risks, much less those that are
especially likely to apply to hospitals. Second, the management had not evaluated the risk,
not only in terms of its likelihood of happening, but also in terms of its costs. The costs of
such accidents can be considerable. Such costs are of two sorts quantifiable and
unquantifiable.( Merna,T. Al Thani.F 2005).The quantifiable costs are those in terms of

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money—fees paid to lawyers and other parties in fighting litigation, compensation to victims
and to family members, and so on. The unquantifiable costs are, if anything, more serious—
loss of prestige, decline in staff morale, and so on. A hospital with a bad reputation and low
staff morale is unlikely to serve its patients well, and, even if it did, a bad reputation and low
staff morale are bad things in their own right(Lymedicine 2009).

Understanding and assessing the scale of risk

One can consider nurses. Nurses are the key care providers in any hospital, and any
deficiency in their behavior, including negligence, is likely to increase risk of accident. It
was deficiency of nursing behavior—specifically, negligence—that was to blame for the
missing Alzheimer’s patient in Tripoli Medical Centre. Thus to understand risk one has to
understand the behavior of staff (not only nurses, but doctors, physiotherapists,
radiographers, and so on, too). And to assess the scale of risk one has to assess what could
go wrong, given the staff’s behavior. There are two types of risk measurement, qualitative
and quantitative (Cox and Tait, 1998).

A qualitative approach uses subjective impressions. If, for example, a hospital manager
notices that the hospital has many patients suffering from dementia but that the hospital has
no protocols for dealing with them when they go to the bathroom, it should occur to the
manager that something could go wrong. There are, obviously, many such qualitative risks
within a hospital—lack of protocols for storage of dangerous (including illegal)
pharmaceuticals; lack of hygiene protocols throughout the hospital, including especially the
operating theatre; and so on. Here, the important thing may be that managers be encouraged
to think such dangers through, and to encourage staff to advise them of risks they haven’t
considered. (Scribd 2009 )

A quantitative approach uses numbers. These are of two sorts: probabilistic and financial.
The former provides a measure of the likelihood of accident. It is given as a value between
zero (no likelihood) and one (a certainty). Determining the exact probability of a given type
of accident is impossible. However, in many cases an approximation to it can be obtained by
looking at incidence of similar accidents within similar organisations. Thus, for example, if it
is known that, in hospitals in general, one in one hundred Alzheimer’s patients go missing
each year, there is a high probability that in any hospital catering for more than a few
Alzheimer’s patients, it is a near certainty that eventually one will go missing. Severity of

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risk is measured in terms of financial cost. Some of these may be judged fairly objectively—
potential compensation to victims, for example, can be estimated by consideration of
precedents. Other costs, as indicated, are less easy to establish—damage to reputation and
lower staff morale are example (Merna,T. Al Thani.F 2005).

Risk analysis

There are two key features of the model. First, it involves identifying risks and suitable ways
of tackling them. Second, and more important, it involves continuous feedback, at all levels.
Thus, for example, identifying risks gives rise to understanding them and assessing their
scale, than this gives rise to risk analysis. But these activities give rise to implementation and
monitoring, and these, in turn, may identify further risks. Similarly, risk treatment—the
object of the exercise—gives rise to decision-making, but this too may help identify further
risks. Hence, as indicated, risk management involves all levels of an organisation, and it
involves affecting its culture

.Figure 1 leaves ambiguous what exactly risk analysis is. Cox and Tait (1998) show the key
components. Figure 2 summarises their model.

Evaluation Monitor and

Communicate Refine and try and review
and consult again prioritisation

Figure 1. Components of risk analysis.

Again, the key feature of the figure is the feedback. Risks are evaluated and prioritised, but
are done so, not in a “once and for always” fashion, but under continuous monitoring and
under continuous feedback to and from staff.

Risk management Strategy

There are different ways of managing risk. One can transfer it, avoid it, eliminate it, or retain
it. Transfer of risk involves ensuring that some other party bears the risk. I the case of
hospitals, this will, most likely be the patient. A hospital may eliminate certain types of risk

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by requiring the patient to sign a document to the effect of, “If this happens to me, then I, not
the hospital, am responsible.”( Cox, S. and Tait, R. 1998)

Transfer of risk is possible for small matters, as in signs in restaurants to the effect of
“Patrons leave their belongings here at their own risk”. However, for non-trivial matters it is
not always possible. A restaurant, for example, would be unlikely to be able to put up signs
to the effect of “Patrons eat here at their own risk [of food poisoning]”. Restaurants that
poison patrons tend to be sued.

One can avoid the risk by following the procedures outlined above (Figures 1 and 2).
Thus, for example, in the case of Alzheimer’s patients, not only may protocols be established
that ensure they are escorted to and from the bathroom, there may also be video cameras in
their wards to ensure that, even if staff are not physically present within the wards, staff may
see whether anything risky occurs.

One may eliminate risk by insurance. Here, the risk to the hospital of something
unfortunate happening is transferred to the insurance company. Thus, for example, in the
USA almost all doctors are insured against possible law suits by former patients.

Risk elimination through insurance, however, carries two problems. First, it is expensive.
In effect, the hospital takes the risk that accidents will not happen, in which case it will have
lost the money it spent on insurance premiums. Second, it may—as does risk avoidance—
make the hospital too risk-averse. It is possible to be “too” risk-sensitive. Hospitals that are
afraid to take risks may give patients too many treatments. Alternatively, they may refuse to
undertake potentially life-saving treatments because the treatments are too “dangerous”
(Gabe, 1995).

One can retain risk by acknowledging that there is a risk of something happening, but by
also acknowledging that (a) the cost of avoiding the risk would be disproportionately high, or
(b) there is nothing that can be done about the risk. For example, there is a theoretical risk
that an aircraft will crash on a hospital, but it is unlikely that any hospital has a specific
protocol for “airplane cashes” (though some may have protocols for “explosions”).

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Risk treatment

Risk management involves managing an organisation’s culture. Milton Keynes Hospital

(2009) identifies nine key principles in doing this. See Table 1.

Table 1. Key issues in changing hospital culture.

Key issues
1 Promote corporate, divisional and individual responsibility for risk, including staff
understanding of the process and responsibilities for incident reporting and risk
assessment, identification and management;
2 Cultivate and foster an ‘open and just culture’ in which risk management is identified
as part of continuous improvement of patient care and staff well being;
3 Integrate Risk Management into all our business decision making, planning,
performance reporting and delivery processes to achieve a confident and rigorous basis
for decision-making;
4 Establish a systematic approach to the identification, assessment and analysis of risk
and the allocation of resources to eliminate, reduce and/or control them in order that
the Board of Directors can meet its objectives;
5 Manage risks to patients, staff, visitors and any other persons likely to be affected by
the activities of the Trust by targeting underlying system weaknesses rather than
blaming staff for error (providing that they are not wilful, criminal or there is evident
professional misconduct).
6 Encourage learning (individual and organisational) from all incidents, mistakes,
accidents and ‘near misses’ be they related to clinical, financial, environmental or
organisational events;
7 Minimise damage and financial losses that arise from avoidable, unplanned events;
8 Ensure the Trust complies with relevant statutory, mandatory and professional
requirements including:
9 NHSLA Risk Management Assessment scheme and can demonstrate embedded and
sound risk management practices
Source: Milton Keynes Hospital (2009)

Of course, changing an organization’s culture can be difficult. Nonetheless, it would appear

to be necessary. This is all the more so in that risk-taking behavior appears in part cultural.
Some hospitals appear more risky than others (Gait, 1995).

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Risk in perspective

Gait (1995) argues that risk management has become an “industry”. He, like other
authorities, acknowledges that one can never, in principle, eliminate all risk. Adams (1995)
argues that the only way to ensure, for example, that old people living at home would never
break bones would be to force them to wear suits of armour 24 hours a day. Thus accidents
must happen occasionally.

Adams (1995) makes a further point. Risk management may reduce some risks but, in
doing so, increase others. For example, the introduction of compulsory seat belts in motor
vehicles may have made them safer for drivers, but they made them more dangerous for
pedestrians and cyclists. When the UK introduced compulsory seat belts in moor vehicles,
deaths to pedestrians and cyclists increased. This is because drivers who feel safe drive more
dangerously. A similar phenomenon appears to have happened with the introduction of
compulsory helmets for motor cyclists. Cyclists who wear helmets appear to pay less
attention than otherwise to road hazards. From such findings (they are empirically verified),
Adams conjectures that the main reason passenger aircraft are the safest means of transport is
that the person most likely to die in the event of a plane crash is the pilot.

In the context of hospitals, Adams’s (1995) point is instructive. First, it suggests that a
“risk-free culture” (i.e., one that minimizes risk) may give rise to complacency among staff.
Second, it suggests that managers must monitor, and be aware of, hazards originating from
risk management itself.

Conclusion

Risk management is important within hospitals, and it involves cooperation between all
levels of staff. In this, the most important aspects of it would appear to be the development
of a risk-minimalisation culture, the introduction of protocols to reduce risk, and constant
monitoring of the protocols to see if they work or can be improved. However, there is no
such thing as a risk-free environment, and minimalising risks carries its own hazards.

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 References

Adams, J. (1995). Risk. London, UK: University College London Press.

Cox, S. and Tait, R. (1998). Safety, reliability and risk management: An integrated approach.
(2nd ed.). Oxford, UK: Butterworth-Heinemann.

Gabe, J. (1995). Medicine, health, and risk: Sociological approaches. Oxford, UK:
Blackwell.

Lymedicine (2009). Tripoli Medical Centre. Retrieved from

http://www.lymedicine.com/forum/viewtopic.php?f=82&t=2512

Merna,T. Al Thani.F(2005)Corporate risk management. City publisher

Milton Keynes Hospital (2009). Risk management strategy 2009–2011. Milton Keynes
Hospital Management Trust.

Scribd.Com(2009) Fraud risk management . Retrieved from Scribd.com

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