Even in the best-staffed facilities, unexpected events can occur. The critical difference is that facilities that can support their staffing decisions with analysis and quantitative data are ultimately more defensible and pay less for their mistakes.
Linking risk analytics, risk management and loss control
Understanding the cost of risk isn’t limited to determining which facilities meet the captive’s desired risk profile. Rather, understanding total cost of risk is an ongoing predictive aspect of risk management and includes loss control. In a recent study based on a large self-insured long-term care captive, the impact of implementing just one dimension of data analytics, DIA, had a significant affect on the number of professional liability losses. First, the 100 facilities in the study were divided into two groups of 50: the top 50 best users of the tool and the 50 worst users of the tool. In the category of best users of the tool, 16 percent of the 50 facilities had experienced losses in the year before utilising DIA. In the year following DIA implementation, the occurrence of losses dropped to 10 percent. In the category of worst users of the tool, 32 percent of the facilities had losses in the year before DIA. In the year following DIA, that rate dropped to 26 percent. The actual number of losses across the board decreased from 121 to 101 after the implementation of DIA. For loss control, this captive can now analyse at the time of claim report if an analytic defence is available for the claim.
Data analytics: a source for answers
More and more, plaintiff attorneys, families and surveyors are relying on data and data analytics to identify who, what, where and when they should investigate. Using data analytics, surveyors scour and interpret reported information to predetermine deficiencies. Consequently, it’s helpful for captives and their members to avail themselves of these same tools to make pre- emptive strikes against risk.
With the right mix of data-based analytic tools, captives can expand
their understanding of the cost of risk to incorporate indirect costs that have a significant impact on future claims and help drive revenue to the captive members. Ultimately, these same tools can drive the development of a targeted and measurable risk management prescription for each captive member and employ a data-based defence for loss control. The result is a financially strong captive. Investigate how data analytics can rapidly supply the answers you need to chart a successful path into the future.
Mary Chmielowiec is executive vice president at PointRight, Inc. She can be contacted at:
maryc@pointright.com.
Brad Granger is business development executive at PointRight, Inc. He can be contacted at:
Brad.Granger@
pointright.com
For more information, please visit
www.pointright.com
US Captive . April 2011 29
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