Enterprise Risk Management Promoting a Discipline of Speaking Up - PDF document

Mass/Rhode Island HFMA Accounting & Regulatory Update Meeting October 17, 2014 Enterprise Risk Management Promoting a Discipline of Speaking Up ERM Objectives • To ensure ongoing assessment of significant risks confronting the Organization and implementation of a standardized means for mitigating, reporting and overseeing these risks, • To bridge organizational ‘silos’ to bring forth the most pressing current and emerging risks facing the organization, and • To provide ongoing oversight to drive accountability for addressing and mitigating these risks. 1 DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only 1

ERM Oversight Committee Members Name Title VP, Deputy General Counsel Kate Bolland Robert Cournoyer Senior Director, Internal Audit, UMass Memorial Health Care SVP Office of Clinical Integration, UMass Memorial Health Care David Fairchild, MD Robert Feldman VP Finance, Corporate Controller, UMass Memorial Health Care Robert Feldmann VP Finance, Corporate Controller, UMass Memorial Health Care Ellen Felkel-Brennan Sr. Director, Quality/Regulatory Affairs, UMass Memorial Medical Center Barbara Fisher SVP, Operations, UMass Memorial Medical Center Deb Gard Director, Risk Management, Marlborough Hospital Kathyrn Green Senior Director, Radiology, UMass Memorial Medical Center SVP Business Planning and Strategy, UMass Memorial Health Center Carlos Iitsuka Phil Kahn Interim Chief Information Officer, UMass Memorial Health Care Chief Quality Officer, HA/Clinton Hospital Mary McDonald Jose Ramirez Interim Chief Human Resources Officer, UMass Memorial Health Care John Randolph VP, Chief Compliance Officer, UMass Memorial Health Care Cathy Rossi VP Managed Care Contracting, Umass Memorial Health Care Dana Swenson SVP, Facilities, UMass Memorial Health Care Diane Thompson SVP/CNO, UMass Memorial Health Care Steve Tosi, MD President, UMass Memorial Medical Group Deborah Weymouth CEO Health Alliance Sr. Associate, Office of Program Development, Commonwealth Medicine Deb Hurwitz Jennie Johnston Project Coordinator, Office of Program Development, Commonwealth Medicine 2 DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only Risk Intelligence Maturity Model: UMass Memorial Progress Towards Enhanced Capabilities 1. How capable is the organization today to manage its risk profile? 2. How capable does it need to be? 3. How can it get to its desired state? By when? Stakeholder Value Risk 4. How can we leverage existing risk management practices? Intelligent Integrated Top Down Fragmented Initial Fall Spring 2010 2014 UMMHC Progress 2010 2011 2012 2013/2014 Stages of Risk Management Capability Maturity Representative Attributes Describing Each Maturity Level Risk Initial Fragmented Top Down Integrated Intelligent • Ad hoc/chaotic • Independent risk • Common framework, • Coordinated risk • Risk discussion is management activities program statement, management activities embedded in strategic • Depends primarily on policy across silos planning, capital • Limited focus on the individual heroics, allocation, product linkage between risks • Routine risk • Risk appetite is fully capabilities, and verbal development, etc. assessments defined • Limited alignment of wisdom • Early warning risk risk to strategies • Communication of top • Enterprise-wide risk indicators used strategic risks to the monitoring, measuring, • Disparate monitoring & Board and reporting • Linkage to reporting functions performance measures • Executive/Steering • Technology and incentives Committee implementation • Risk • Knowledge sharing • Contingency plans and modeling/scenarios across risk functions escalation procedures • Industry benchmarking • Awareness activities • Risk management used regularly training • Formal risk consulting 3 • Dedicated team DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only 2

Common ERM Oversight Committee Meeting Agenda 1. Risk Mitigation Plan status – System Level High Risks • Integration with System Priorities/Related Plans 2. Emerging Risks 3. Member Entity ERM Update 4. ERM Oversight/Reporting: • Member Entities: Management/Board • Corporate: Management/Board 5. Annual “Risk Refresher” 6. Status of annual goals 4 DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only April 2014 “Risk Refresher” Overview • An anonymous web-based survey was facilitated in April 2014 to solicit feedback on the most significant and impactful risks facing the organization. • Survey content also included participant feedback on the progress of system strategic priorities and organizational oversight and accountability • The survey was distributed to 586 stakeholders across UMass Memorial Health Care and its entities. Participants included executive management, Trustees physicians and physician leaders and management across clinical and non-clinical areas. • 320 responses were received, representing a 55% response rate. Survey participation demographics by entity and role are summarized as follows: UMass Memorial Medical Group Participation by Entity Participation by Role Management UMass Memorial Health Care (System) 0 1 24 16 0% 1 0% Physician 8% UMass Memorial Medical Center 32 5% 0% 3 6 19 10% 1% 112 28 2% 6% 35% 9% HealthAlliance Hospitals Trustee 142 44% 60 19% Marlborough Hospital 74 122 23% Executive Leadership 38% (CEO, Executive or Clinton Hospital Senior Vice President) Other Direct Caregiver Community Healthlink Support Services UMass Memorial Health Ventures (Includes UMass Memorial Labs, CMMIC) 5 NOTE: The Physician role comprises of Department Chairs, Chiefs of Service, UMMG and Non-UMMG Physicians. The Management role comprises of Vice President, Senior 5 Director / Director and Manager DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only 3

Risk Prioritization Guide 6 DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only Additional Criteria/Considerations for High Priority Risks Patient Care/Quality • Wide-spread adverse impact on patient satisfaction • Inability to attract patients • Risk of significant adverse event Legal/Regulatory • Major federal or state scrutiny • Investigations with risk of substantial fines, penalties and adverse public relations Financial • Impact on revenues/expenses/net income • Serious threat to future growth Reputation • Adverse National media attention Operations • Significant interruptions of business operations for 2 or more key service lines Employees • Unplanned loss of several key and senior employees or physicians • Risk of serious injury to employees 7 DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only 4

Proposed System Level High Risks • Strategy/Deployment • Physician Relationships • Financial resources • Health Information Technology • Labor Strategy • Workforce Culture • Patient Experience • Population Health Management • High Costs 8 DRAFT: FOR DISCUSSION PURPOSES ONLY CONFIDENTIAL – For UMMHC Internal Use Only PowerPoint Appendix templates Industry Risk Scan Supporting Materials 5