Posted August 19, 2002
Applicable to all long term care facilities
By Jerri Lynn Ward, J.D., Garlo Ward, P.C. and Beth Alford, Vice President of Risk Management for Tutera Health Care Services, L.L.C.
As we all know, long term care facilities often have difficulty obtaining reasonably priced liability insurance. One of the reasons for this is facility survey history. Here we discuss a possible solution.
To give some useful tips on how to be more successful in obtaining insurance, we have interviewed Beth Alford, Vice President of Risk Management for Tutera Health Care Services, L.L.C., a company that manages nursing facilities throughout the country. According to Ms. Alford, one of the obstacles encountered during the underwriting process is the underwriter’s lack of understanding of the survey process. When presented with a facility visit history, the underwriters do not know how to make distinctions between kinds of tags (substandard quality of care vs. other tags) or scope and severity.
The underwriters also do not understand the significance of the informal dispute resolution process or the appeal process. And as you know, many times even when a tag has been deleted or scope and severity has been decreased through the IDR process, the written facility visit history is not changed. Thus, if the underwriter sees deficiency tags on a facility visit history when processing an insurance application, the underwriter does not have the knowledge to make distinctions between the deficiencies.
Beth Alford has successfully obtained insurance at more reasonable premiums by proactively educating the underwriters about the survey process and the details of loss history and aggressive risk management and risk mitigation. Below, Beth gives some tips to help you do the same.
Interview With Beth Alford
Jerri: Beth, would you please describe how you educate insurance underwriters about the survey process and the facility visit history?
Beth: The first step is to make sure that your insurance agent and broker know that you want to be involved in the underwriting process. In today’s hard market, the underwriters are taking a much closer look at all risks. The underwriter should provide the broker and agent with a list of issues that are of concern. Once received, supporting documentation and facts should be gathered and forwarded to the underwriter. If survey issues are involved, be prepared to discuss not only the number and scope/severity of tags, but also the actual examples cited. Remember; the underwriter is only seeing the language attached to the tag. The actual examples do not always match with the language of the requirement. If F314 was cited because 2 residents were not turned in a timely manner but they have no pressure sores, the underwriter is only going to see that the facility has “a problem” with pressure sores.
Include a copy of the scope and severity grid that explains each level of deficiency. Then ask for a meeting between all parties or a conference call. In addition to discussing the reasons (examples) behind each tag, inform the underwriter of any informal dispute resolutions or appeals and what the outcomes were. Part of your “homework” should be to identify the top deficiencies written in your state and the nation and what the percentages of scope and severity are in your area. This information is available from your nursing home association. This will give the underwriter some perspective on your survey results.
The other areas under close scrutiny by underwriting are staffing levels, Risk Management policies and loss history. Underwriters traditionally look at the staffing levels provided to the State on the most recent survey. Be prepared to provide average staffing information for a year’s time. Don’t forget to include all related personnel, such as the MDS coordinator, bath aides, wound care nurses, etc.
Keep fall prevention policies, abuse prohibition polices and pressure sore prevention polices current and in place. Provide frequent staff education on these and share with the underwriter how often training is done and what statistics are maintained on outcome.
In summary, help the underwriter see why your nursing home(s) are a safe risk for them to write insurance on.
Jerri: How has this benefited the facility in shopping for insurance?
Beth: At Tutera Health Care Services, L.L.C., we are blessed with a great nursing team. Their proactive resident safety programs and survey readiness activities help keep claims to low levels. In Risk Management, I provide them with data on what new risks are present, what areas are of concern, and claims management. With programs like this and open communication with your agent, broker and underwriters, it is still possible to find quality insurance coverage for your facility.
To guide you in your quest to obtain the best insurance and premium prices possible, we have converted Beth’s suggestions into a handy checklist for your convenience.
Checklist
- Keep records of each survey that are broken down by actual examples per tag. Compare the actual examples when a tag is written multiple times in a 3 year period to determine if the same issues are present.
- Provide your agent with information on survey procedure, scope and severity and claim details. She will need this to provide to the underwriter.
- Volunteer to meet with the underwriter personally to discuss what each survey issue means and what proactive steps have been taken to prevent survey tags from becoming claims.
- Review all Risk Management related policies on an annual basis. Make sure that regulatory changes and best practice information are included in the updates.
- Keep records of incidents and wounds. Use the information to identify trends and target areas for improvement.
- Educate the staff on policies at the time of hire and throughout the year. Keep records of when inservices are held and any follow-up to ensure understanding of the training.
- Be involved in any claims that arise. Know all of the facts and be prepared to discuss them with the underwriter. Know how defensible each one is; the amount of each settlement and any reserves set by the insurance company that make up your loss runs that underwriting looks at.
All information in this article is informational only and is not legal advice. Should you have any questions or a situation requiring advice, please contact an attorney.
Copyright 2004 by Garlo Ward, P.C., all rights reserved
Austin, Texas 78752-3714 USA
Telephone: 512-302-1103
Facsimilie: 512-302-3256
Email: Info@Garloward.com