MBA FPX 5014 Assessment 2 Risk Financing

• MBA FPX 5014 Assessment 2

Risk Financing Memo

To: XYZ

From: Risk Manager

This memo outlines a discussion for the XYZ team regarding risk financing strategies to address the problem of high hospital-acquired conditions (HACs). Despite a strong safety culture enhancing nursing care quality at XYZ Hospital of Pittsburgh, the institution faces a significant challenge with high rates of HACs, particularly adverse drug events (ADEs).

UPMC XYZ Hospital of Pittsburgh (2021) states that these ADEs contribute to poor care quality and high readmission rates, leading to Medicare penalties and lower per-patient MBA FPX 5014 Assessment 2 reimbursements from CMS (2024). The combination of revenue-capitation payment models, high weighted average costs (WACs), and readmissions often results in reimbursement shortfalls, making this a foundational issue for risk management and financing in the hospital, which operates as an accountable care organization (ACO).

Regulatory and Ethical Obligations

ACO regulations in the United States include shared reimbursements, membership-based patient care, and compliance with regulatory standards on HACs and readmissions as per ACA and CMS guidelines (CMS, 2024). ACHE’s nine codes of ethics also emphasize public responsibility, patient safety, and harm prevention—key ethical obligations for ACOs (ACHE, 2022).

XYZ Hospital of Pittsburgh must make effective decisions to reduce HACs and enhance patient safety. Legal and ethical obligations demand these improvements, as a lack of compliance with CMS guidelines can result in financial penalties and legal actions (CMS, 2024). The MBA FPX 5014 Assessment 2 framework offers structured strategies to address these challenges.

Strategies for Addressing Risk Financing Challenges

Dashboard Metrics and DMAIC Model

Two primary strategies have been used to examine the issue of high ADEs at XYZ Hospital of Pittsburgh:

1. Dashboard Metrics: ADE and patient safety widgets were analyzed to track the growth of HACs.
2. DMAIC Model: The Define, Measure, Analyze, Improve, and Control framework was applied to identify, address, and monitor HAC trends.

The initial analysis revealed that ADE rates were a significant concern, as highlighted by the dashboard metrics. The improvement stage of the DMAIC model emphasized training nurses in MBA FPX 5014 Assessment 2 healthcare technology and implementing a Clinical Decision Support System (CDSS) (Maddox et al., 2022).

Improvement Options and Challenges

Key recommendations include:

• Training Programs: Equip nurses with the necessary skills to effectively use healthcare technology.
• CDSS Implementation: Integrate CDSS tools to enhance clinical decision-making and reduce ADEs.

However, reluctance among nurses to embrace new protocols remains a significant obstacle. Overcoming this requires targeted change management strategies.

Recommendations to Reduce HACs

Proposed Actions

1. CDSS Application: Research by Maddox et al. (2022) demonstrates that CDSS reduces ADEs associated with HACs.
2. Enhanced Training: Effective training enables nurses to leverage healthcare technology efficiently, as supported by Ali et al. (2021).

These interventions aim to optimize patient safety while addressing financial challenges stemming from HACs. Implementing these strategies aligns with the MBA FPX 5014 Assessment 2 framework for improving healthcare delivery.

Implementation and Monitoring

Using the SMART approach (Karpenko et al., 2020), two key performance indicators (KPIs) were developed to measure the success of these recommendations:

1. Reduce ADEs by 50%: CDSS implementation and nurse training should halve the ADE rates within two months of intervention.
2. Lower HAC Rates by 20%: HACs should decrease by 20% within the assessment period.

These KPIs are specific, measurable, achievable, relevant, and time-bound, ensuring a precise evaluation of the intervention’s effectiveness.

Conclusion

XYZ Hospital of Pittsburgh faces substantial challenges with HACs, particularly ADEs, impacting patient safety and financial performance. The MBA FPX 5014 Assessment 2 highlights actionable strategies, including implementing CDSS and comprehensive nurse training programs. Compliance with CMS and ACA regulations is critical for reducing ADEs by 50% and improving overall HAC management. The hospital can improve patient care and risk financing by aligning efforts with defined KPIs and addressing staff resistance.

Read more MBA FPX 5014 Assessment 1 Regulatory Environment – Executive Summary about for complete information about this class.

References

ACHE. (2022, December 5). Code of ethics. ache.org.

https://www.ache.org/about-ache/our-story/our-commitments/ethics/ache-code-of-ethics

Agley, J., Xiao, Y., Nolan, R., & Golzarri-Arroyo, L. (2021). Quality control questions on Amazon’s Mechanical Turk (MTurk): A randomized trial of impact on the USAUDIT, PHQ-9, and GAD-7. Behavior Research Methods, 54(2), 885–897.

https://doi.org/10.3758/s13428-021-01665-8

Ali, S., Salahudeen, M. S., Bereznicki, L. R. E., & Curtain, C. M. (2021). Pharmacist‐led interventions to reduce adverse drug events in older people living in residential aged care facilities: A systematic review. British Journal of Clinical Pharmacology, 87(10), 3672–3689.

https://doi.org/10.1111/bcp.14824

CMS. (2024). Regulations and guidance. www.cms.gov.

https://www.cms.gov/marketplace/resources/regulations-guidance

Karpenko, A., Karpenko, N., & Shudrik, O. (2020). Develop and implement a strategic personnel management system according to goals based on key performance indicators. Management and Entrepreneurship: Trends of Development, 2(12), 22–35.

https://doi.org/10.26661/2522-1566/2020-2/12-02

Maddox, K. E. J., Shashikumar, S. A., & Ryan, A. M. (2022). Medicare’s bundled payment models—progress and pitfalls. Journal of American Medical Association (JAMA), 327(18), 1761–1762.

https://doi.org/10.1001/jama.2022.6402