Finding an underwriter and broker who can create the right insurance program for your particular industry has undeniable value. This is especially true for nursing homes and continuing care facilities, which have their own specific insurance issues.
“The predominant issues right now are fall prevention, pressure ulcers and dehydration,” says Jim Misselwitz, a vice president with ECBM Insurance Brokers and Consultants. “In general, those are the areas that are the most significant for nursing homes in order to improve the quality of care they give their clients. That also happens to be the area where the largest litigations are going on.”
Smart Business spoke with Misselwitz about how to build a strong insurance plan for nursing homes.
What steps can be taken to address the issues facing nursing homes?
One way to prevent falls is by implementing restraints. To do that, you have to have a lot of education and communication with the family to ensure they know the particulars, the background and status of this particular relative. Then, they will understand it is not done as a punishment but to maintain the safety of the individual.
There are also technical improvements that can help, such as nonskid surfaces in showers, automatic brakes on wheelchairs and edge protection devices that sound an alarm if someone gets near the edge of a bed.
Many nursing homes are developing the wound consultant position to combat pressure ulcers. Their job is to come in immediately when a pressure ulcer is recognized and begin a very aggressive treatment on that area that effectively limits further damage and growth of other ulcers.
Many pressure ulcers in nursing home settings are preventable through education and technology. The ulcers often appear on the backs of legs and heels. When a person is dormant in their nursing home situation, you have to provide movement to the body so the blood doesn’t stay in one area, which is probably the biggest contributor to pressure ulcers. Certain special boots and beds that vibrate can help.
Hydration, for the most part, can be improved by auditing and control. Keep good records. Make sure you know how much liquid each person has taken daily. Some marvelous systems allow the nursing home to know each patient’s fluid intake on a daily basis, and per shift, near automatically.
What are the keys to building the right insurance program for a nursing home?
There are three elements: a broker, an underwriter and the management of the nursing home itself. You’re looking for an underwriter who is very familiar with the industry, who has an established book of business in that field, who shows a willingness to become a partner with the facility, not only in terms of improvement but in giving them additional guidance, auditing and controlling the risks they find, and also giving them feedback on the losses that occur.
The program will be most effective when the nursing home’s management recognizes issues that need to be addressed from the top down, not the least of which is spending capital in order to bring some technical solutions to the facilities.
That has always been a tricky balancing act because funds are usually limited; income is steady but sometimes slow. So they have to be very cognizant of how to use money wisely to get the biggest return on investment.
Also, management needs to understand the importance of strong auditing and control mechanisms that allow them to troubleshoot problems before they become significant issues. When you get those two things from top management and you couple that with the underwriter, the third leg of the stool is the broker.
The broker’s job is to marry management’s expectations with what the underwriter can do in terms of pricing and coverage, then filter the importance and priority of the issues management needs to concentrate on — the issues with the largest potential risk.
Why is it important to hire a team with industry-specific expertise?
If you show up on the doorstep with just a general liability, professional liability or workers’ comp quote, that’s fine; it gives you the ability to transfer risk to the underwriter. But has it helped the facility control ultimate expenses down the road? If you’re not marrying those two issues together, when a soft market comes and prices are low, you’ll see premiums go down. When the market gets hard, you’ll see premiums go up.
Most nursing homes would like to get off that roller coaster. They want to be able to control costs in good markets and bad.
How can you determine which features to implement in an insurance program?
The key is examining where the facility is in terms of its development, in terms of addressing issues and implementing technical solutions. Then you need to look at the client mix inside the nursing home, the staff training needs and the kind of access you have to the staff in terms of supplementing their training needs.
Not all training comes from underwriters or loss control professionals. A lot comes from the vendors who sell the equipment. The equipment is often technically complex, so the staff has to learn how to use it and what to do in the event that something goes wrong.
Lastly, you need to develop and tailor a plan that fits the facility in terms of its continuum of development. Take its experience, capital budgeting process, staff, insurance costs and future plans, and marry that with an insurance program that will be supportive and flexible.
It should assist the nursing home to create a growth pattern and improve the quality of care to the clients.
Jim Misselwitz is a vice president with ECBM Insurance Brokers and Consultants. Reach him at (888) 313-3226 ext. 1278 or [email protected].