For example, in Florida, the mandatory staffing ratio in a nursing home is 2.9, which equates to 2.9 hours of patient care per day for each individual patient. To determine if a facility has enough staff to meet or exceed that ratio, simply take the total amount of patients currently in the facility and multiply by the ratio that is mandated by the state and then divide that by the number of hours each employee works in a day. In the case of a 100-resident Florida facility, 37 staff members would be required each day.
Many CEOs will opt to lay off maintenance staff over caregiver staff in an attempt to cut operating expenses without sacrificing the level of care. But this is a common mistake because trash still needs to be emptied and bed sheets still need changing—only now the caregivers must perform these custodial duties, distracting them from their normal duties and leading to negligence and carelessness that any plaintiff’s attorney will be able to blame directly on the ratio of caregiver hours to patients.
DOCUMENT AND IMPLEMENT
Finally, while most facilities correctly document policies and procedures that dictate the guidance for care, many facilities ultimately fail to implement them. Without implementation and policy enforcement, a facility is at even greater risk if a suit is filed against it because there is the written acknowledgement of proper procedures but the failure to hold staff members to those written standards. It is imperative that all staff be held accountable for the implementation of policies and procedures, especially all C-level and senior management staff, because a top-down culture is the most effective implementation method.
TRANSFER RISK BEFORE A CLAIM
Another effective way to reduce a facility’s exposure to claims and the corresponding costs is to leverage another party’s insurance policy—for LTC facilities this means a review of all contracts with outsourced professionals (physical therapy, rehab or other therapy providers, even dining services and beautician services) to access the proper indemnification provisions. Most facilities consistently obtain certificates of insurance from outsourced rehabilitation professionals and other contracted workers, but that is not enough. A good contractual risk transfer process consistently contains three key elements:
- Consistent insurance requirements
- Specific indemnification wording in contracts
- A requirement for Additional Insured coverage from vendors
LTC facilities should also have a process that dictates minimum limits of insurance that it is willing to accept, minimum insurance company financial ratings and maximum deductibles. A professional insurance broker should be able to advise on the minimum acceptable insurance levels based on a facility’s specific operations and risk appetite. Once determined, these requirements should be used and confirmed religiously.
TAKE CONTROL OF CLAIMS
Despite the best prevention efforts, a claim may still occur, and how it is then managed is critical to the financial stability of any LTC facility, particularly cash-strapped nonprofit and independent facilities, but also large chain operators that have been attacked by plaintiff firms and media alike for their corporate structures that maximize efficiency and profitability and minimize financial exposure. No facility is immune to claims, but a few best practices can be the difference between keeping the doors open and needing to close them.
Effective claims management starts with the proper investigation of every situation and claim, no matter how small. Without a cap on punitive damages, it does not take a large claim to yield a large settlement. Proper investigation procedures must always include root cause analysis, witness statements and chart reviews. Also, a representative from the facility who has been trained in proper family communication procedures should speak with the family. These honest, upfront conversations can often result in greater understanding, provide a calming effect once facts are known and prevent the claim before it starts.
Facility operators should meet with a trusted insurance advisor to review current liability policies to ensure proper coverage is provided. In particular, evaluate if policies cover sexual abuse (related to provider/resident and even resident/resident situations), punitive damages (where allowable by law and with “most favorable venue” wording), knowledge of “occurrence” and selection of counsel requirements, to name a few key policy areas.
It is also important to understand who exactly has “Named Insured” status on the policy. Many policies can vary as to employees, volunteers, medical directors, independent contractors and others and their status as insureds.
Elder neglect and abuse is this decade’s mesothelioma—and if we don’t act now to prevent and manage claims, the rise in LTC litigation and the plaintiff-friendly environment have the potential to forever change the composition of one of the most in-demand sectors of today’s healthcare industry. If tort reform is not applied to the LTC industry, it is plausible that the largest for-profit operators will face high-profile trials and suffer both punitive and reputational damage, while smaller, nonprofit and independent operators will acquiesce to settlements out of court—both out of convenience and to avoid public scrutiny. This, combined with the rising cost of long-term care, will eventually force further consolidation in the LTC industry, which will have a broader-reaching impact than any plaintiff’s bar could have ever foreseen.