New Report Demonstrates That Following Guidelines Improves Clinical Practices, Reduces Liability Costs

June 24, 1998

MMI Companies Programs Make A Significant Impact On Risk Within Healthcare Organizations

DEERFIELD, Ill., June 24, 1998 -- Following all risk modification guidelines in three of the most costly and visible areas of healthcare liability led to substantially lower average dollar losses per medical malpractice claim than following no guidelines at all -- $2,834 versus $72,767, a 96 percent difference -- according to a report released today by MMI Companies, Inc. The report indicates that aggressive implementation of risk modification guidelines not only reduces the cost of claims but also enhances patient safety.

The new report is based on MMI's comprehensive data set, compiled since 1985 primarily from the Company's hospital clients. The report is the fourth in a series released by MMI as part of the Company's efforts to monitor and enhance the degree of patient safety within healthcare organizations. MMI, an international healthcare services company, maintains one of the largest national comparative databases of clinical practice, patient outcomes and medical malpractice claims data. Medical malpractice claims generally are the result of perceived poor patient outcomes and/or patient injury. MMI works with its healthcare clients to reduce patient injury through the consistent application of MMI's clinical risk modification programs.

"The findings from this report reinforce and support our philosophy that following a comprehensive set of guidelines, or a rules-based approach to managing risk, can improve clinical practice, leading to better patient outcomes and a substantial reduction in costs associated with liability claims," said Pam Lockowitz, president, MMI Risk Management Resources, Inc., the MMI subsidiary responsible for implementing and monitoring MMI's clinical risk modification programs.

MMI's clinical risk modification guidelines encompass a variety of clinical and administrative processes that are at work before, during and after a patient receives care. MMI convenes national task forces of practicing clinicians to frame best practices and develop the guidelines. Risk issues addressed in these guidelines are based on data MMI collects from healthcare organizations nationwide and aggregates to identify significant trends in clinical practice that may adversely affect quality of care. MMI's systematic approach helps healthcare organizations focus their limited resources on key areas of risk, such as serious patient injuries and diagnostic error, in an effort to reduce medical mistakes and improve patient safety.

"For more than two decades, MMI has been at the forefront of helping healthcare providers understand relationships among practice patterns, patient outcomes and liability claims experience," said Laura Morlock, Ph.D., Professor and Associate Chair of Health Management Programs in the Johns Hopkins University School of Hygiene and Public Health. She is an international expert in risk management and professional liability claims research. "This most recent analysis provides further evidence that a systems approach to process improvement can enhance patient outcomes and reduce claims expenses."

MMI's report looks at liability losses associated with closed claims in perinatal care (care delivered just before and after birth), perioperative services (surgery and anesthesia combined) and emergency services. Full compliance with MMI's core risk modification programs for these three areas resulted in an average cost per claim that was almost $70,000 less than with no guideline compliance. For each of these individual programs, the financial impact of following all of MMI's guidelines versus none of the guidelines is as follows (average cost per claim):
  • Perinatal guidelines: $3,002 versus $218,910;
  • Perioperative guidelines: $5,207 versus $78,477;
  • Emergency services guidelines: $1,304 versus $24,659.
MMI's programs have helped healthcare organizations not only control costs but improve quality of care. Previous data collected from participating hospitals showed that the use of pulse oximetry appeared to correlate with fewer anesthesia-related complications during surgery. Pulse oximetry is a non-invasive monitoring technology that assesses oxygen levels in the blood. With the increasing prevalence of the newer intravenous (IV) conscious sedation technique used across clinical settings, MMI began aggressively encouraging the use of pulse oximetry with this type of anesthesia across all settings. Over a three-year period, from 1994 through 1996, the percentage of cases in which this monitoring technology was used with IV conscious sedation increased among participating organizations by as much as 84 percent. Given the benefits noted with this practice, increased awareness and compliance help enhance patient safety in those settings.

"With more and more patients receiving care in ambulatory settings, it is essential that monitoring practices that reduce risk to inpatients move with patients to alternative sites of care," said G. Eric Knox, M.D., MMI medical director. Dr. Knox is also director of the Perinatal Center at Abbott-Northwestern Hospital, Minneapolis, and professor of obstetrics and gynecology at the University of Minnesota. "At a time when there is a national focus on patient safety, these findings help our healthcare providers identify patterns of care that put patients at risk for injury, and also pinpoint areas for improvement."

Identifying missed opportunities for providing better care is an important focus of MMI's data analysis. One compelling example involves tracking unplanned patient returns to the hospital's Emergency Department. An analysis of data was performed on patients over age 30 who presented in the Emergency Department (ED) with chest pain and were sent home without a definitive diagnosis. These patients are twice as likely to have an unplanned return to the emergency department within 48 hours compared with all patients discharged from the ED.

Furthermore, there is a statistically significant correlation between these patients and unplanned hospital admission or death within the same two-day time frame. These findings reinforce how critical timely and accurate diagnosis is to clinical outcomes, particularly with regard to cardiac symptoms.

Another area that confirms the distinct connection between clinical practice and patient outcomes emerges from the surgical guidelines. The data suggest that effective use of patient evaluation and selection criteria correlates to a low rate of unplanned returns to surgery within 48 hours, as well as a low rate of injuries to organs resulting from the use of an endoscope during surgery (in each case, rates are less than one percent). An endoscope is a tool that allows surgeons to view necessary organs without having to make a large incision.

"MMI's goal is to help clients take a more systematic approach to clinical practice in order to improve patient outcomes," Lockowitz said. "We help our clients focus on the total system of care in their organizations. By identifying their potential exposures, we can work with them to modify those risks, with a particular emphasis on applying our programs to improve patient safety and healthcare quality. Our data provide us with the insight necessary to achieve these goals."

MMI Companies, Inc. (NYSE: MMI) is an international healthcare services company with more than 20 years of experience providing a wide range of products and services that help the healthcare industry enhance its performance and manage risks associated with the delivery of care. Through its operating subsidiaries, MMI provides strategic consulting services, clinical risk management and operational consulting services, and insurance and reinsurance products for the healthcare industry. In addition to its Deerfield headquarters, MMI has a network of offices throughout the United States and overseas. For more information about MMI, visit the Company's Web site at

For a copy of the report, please call Paula Wheeler, 847-374-2498.
NOTE: Pam Lockowitz and Dr. Eric Knox will be available to discuss these findings and answer questions via a conference call scheduled for Wednesday, June 24, at 10 a.m. CDT. To participate, call 1-800-482-5543 and give confirmation number 322114 or simply ask to be connected to the MMI Companies conference call.

Fleishman-Hillard, Inc.

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