Your Role in Healthcare Governance
By: Gene Clarke, MBA, CIA, CISA
Healthcare governance is a general term for the overall framework through which organizations are accountable for continuously improving clinical, corporate, staff, and financial performance. Governance is seen as the purview of Board’s of Directors and executive management; however, governance is operationalized in the day-to-day activities of providing patient care, practice management, and administration.
Governance Comes in Two Flavors
The two pillars supporting healthcare governance can be categorized into clinical governance and corporate governance.
Clinical governance is the systematic approach to maintaining and improving the quality and safety of patient care.
Corporate governance is focused on business performance and compliance with laws, regulations, and ethical responsibilities, so that the organization contributes positively to its stakeholders and within the community it serves. Revenue cycle/reimbursement activities fall under corporate governance, but can extend into and directly influence clinical governance through ongoing reimbursement monitoring and risk assessment activities.
There is no well-defined model that healthcare organizations can follow to achieve broad clinical and corporate governance objectives. The crucial aspects of governance and how to implement an integrated governance system that operates effectively between corporate and clinical objectives is rapidly evolving, and is not well understood in many healthcare systems.
In general, problems with healthcare governance emerge when:
- One of the elements (clinical or corporate governance) is weak or underperforming;
- The linkages between clinical and corporate governance are not understood, not well communicated, or not respected inside an organization;
- The boundaries between clinical and corporate governance are not effectively managed; or
- Physician leadership delegates its governance responsibilities to practice management and administration.
The boundaries between corporate and clinical governance should also be clear. First, it is important to recognize that corporate governance covers many matters that clinical governance does not touch upon (accounting and finance, investments, HR, IT, facilities, security, etc.). Second, it is the clinical governance arm that deals with implementing the detailed patient care and practice processes, procedures, and structures needed to service patients and meet regulatory compliance objectives.
The Boundaries of Clinical and Corporate Governance
Clinical and corporate governance each have intrinsic, independent objectives; however, they are linked. Clinical governance is responsible to implement the clinical governance systems and processes around patient safety and quality that:
- Delivers high quality clinical services that are measurable and effective;
- Ensures patients are consistently, and safely, cared for;
- Verifies mechanisms to constantly improve upon prior outcomes; and
- Continuously assesses, monitors, reports, and remediates clinical risks, as appropriate.
Corporate governance is a multifaceted set of processes, policies, regulations, laws, and organizational structures. These should work in concert to assure the quality, accountability, and effective management of an organization as a whole, to ensure that:
- Business goals, objectives, and results are delivered;
- Resources are prudently managed;
- The organization operates as an ethical corporate citizen; and
- Business and compliance risks are continuously assessed, monitored, reported, and remediated, as appropriate.
Risk Management: A Common Objective
The linkage and integration between clinical and corporate governance are found within risk management activities. One example of this is related to the potential misuse of electronic health records (EMR) copy-paste or copy-forward functions in patient records. Although the function can increase provider efficiency and effectiveness, when used appropriately, this shortcut has the potential to violate patient confidentiality and HIPPA rules, and to lead to malpractice lawsuits and payer recovery audits. More importantly, the misuse of this function can negatively affect patient care.
Reimbursement specialists, through billing compliance monitoring activities, are in the best position to assess potential reimbursement and clinical risks, and to report these to appropriate parties for investigation. The corporate governance function can assess regulatory compliance risk, while the clinical governance function can assess patient safety and EMR risks and coordinate with the medical information technology function. The key is the reimbursement department’s active involvement in the risk management process, which allows potential issues to be reported and investigated at the appropriate management level.
A sample governance structure is outlined below, but it’s critical that compliance and reimbursement staff clearly understand their organizations governance structure, and how to communicate issues and risks through the organization’s channels. In this example, reimbursement compliance committees are responsible to report potential risks to both the clinical compliance/patient safety and corporate compliance committees.
Governance—to be effective and promote improvements to patient safety, quality of care, and regulatory compliance—requires that:
- The Board of Directors, senior management, and physician leaders all understand corporate and clinical governance, how they are linked, and their respective boundaries;• Delegations and expectations are clearly understood;
- Training programs are in place across the organization, so that each staff member understands his or her unique role in governance and risk management—especially in times of transition and change;
- Boards and senior management evaluate and assess governance effectiveness; and
- Continuous risk assessments and feedback loops among stakeholders are in place to create an environment that promotes constant improvement of the interface between corporate and clinical governance, to promote the goal of high quality outcomes.
Collaboration Is Key
As healthcare moves rapidly into incorporating value into payment models—and with more than two-thirds of payments expected to be based on value measurement, in five years—exceptional collaboration will be needed to tackle the unprecedented complexity of running dynamic reimbursement models at scale. This means compliance and reimbursement specialists must become knowledgeable and active in their organizations’ governance programs, and must be comfortable with risk assessment and reporting in both the corporate and clinical governance arenas.
Today may be a good time to ask your senior management to provide an overview outlining your organization’s governance program, and how your specific role helps the organization meet its corporate and clinical governance objectives.
Gene Clarke, MBA, CIA, CISA is an internal auditor focused on risk assessments and risk management.
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