Whether you are a late night talk show junkie, an early riser who loves the daily news, a social media fanatic, or a talk radio enthusiast (if you know me I am a mix of all four depending on the day); one thing is for sure, you will hear a significant amount of discussion surrounding healthcare. Much of this discussion will be used in the context of the upcoming presidential election and specifically the review and fact checking of the last two presidential debates. One event in the news has probably received less overall media attention due to the increased political coverage this fall. I am referring to the recent meningitis outbreaks. Clearly this is a very challenging situation and our sympathies go out to those who have become ill. In writing this blog it is not my intent to discuss the information specific to this situation, but to discuss what potential risk management and business insurance lessons/strategies can be learned from an event like this.
In this example, there are many organizations and individuals involved; from the original production of the pharmaceuticals, to the patient presenting to a provider with healthcare problems. Some of these could include: pharmaceutical manufacturer, compounding facility, distribution businesses, hospitals, physician practices, receiving, nurses, patients, families, emergency rooms, urgent care centers, etc… Due to the complexity of these situations, many policies/procedures, strategies, or insurance policies will need to work together to proactively manage these risks. Some of the risks include:
- Potentially put you out of business
- Lawsuits – enough said.
- Lost time and productivity by staff and executives
- Need to field increased calls/inquiries
- Need to proactively reach out to customers/patients
- Executive staff time spent
- Staff time spent due to depositions
- Loss of reputation
- Loss of customers
- Uncovered costs (risk not covered by an insurance policy)
- Future availability of insurance
- PR firm
- Loss of employees
- New legislation/restrictions
First, let’s start with the potential insurance products that may respond (or be asked to respond) somewhere in the process:
- Product Liability
- Product Recall
- Professional Liability (malpractice)
- Business Income
- Crisis Management
- Directors + Officers
- General Liability
As discussed in prior blogs, insurance is only one way to manage risk. What can we learn from the above background to Prevent, Mitigate, or Transfer risk away from some of the individuals and organizations?
Lesson #1 Crisis Management – Can you think of one person who you may love as an employee, but would cringe at the thought of them speaking to the world on your company’s behalf? Now, have you developed and tested your crisis management plan (may be a part of a Disaster Recovery Plan)? Who do you allow to speak to the media on your company’s behalf? What does your social media policy state about employees discussing these situations online? Prevent a bad situation from spiraling out of control by having and testing your crisis management or disaster recovery plan.
Lesson #2 Product Recall – As a new mother, my wife subscribes to blogs/websites that text/email alerts about products that have been recalled. If you needed to recall a product do you have a product recall plan and product recall insurance policy in place? What if you are a provider such as a hospital, physician, or other healthcare provider and a product you have used in the past has been recalled. How do you plan to communicate to your patients and the general public? How accessible is a replacement product and how much down time will this cost you? How do you destroy/return the damaged product? What happens if you cannot meet the needs of your customers/patients and they go somewhere else for service…. Will you ever get them back? A policy stashed in a binder in the back of a drawer is not enough. True risk management plans are strategically developed and tested.
For more information on communication plans (media, social media, crisis management) or insurance policies (Professional Liability, Product Liability, Crisis Management) contact Kelly Reed | 906.315.7227 | firstname.lastname@example.org.