Skilled Nursing Facility Liability Costs on the Rise
Skilled Nursing facility liability costs rise by $2,300 per bed in 2017 according to a report recently issued Aon Global Consulting/American Health Care Association predicts that a skilled facility with 100 beds will pay $235,000 for its liability insurance in 2017.
The report surveyed 31 different providers representing 224,000 skilled nursing facility beds. Those included in the survey included skilled nursing, subacute, assisted living, home health and independent living.
Loss rates have increased to 6% after remaining stable for three (3) years at 5%. The analysis looked at 17 states and found that Kentucky and Florida were at the high end of loss rates, while Minnesota had the lowest projected loss rate. At the high end loss rate increases were projected to be around $7,500, the low end was at $480.The severity of claims is projected to increase 2% in 2017, driving the per claim amount to $218,000.
It is up to the operators to be more diligent when conducting the tracking of incidents and to make sure that they do benchmarking. Individual facilities must monitor their claims and recognize that when there is an increase in frequency that they should review their risk management best practices. Best practices may have to be altered and retraining may be required if incidents are going to be reduced or a least stabilized.
Multifacility operators can use data collected to compare incident tracking between their facilities so that they can identify facilities that are doing a good job, and identify facilities that need additional risk management attention.
It is up to the provider to understand what drives high liability costs and monitor these drivers on a constant and consistent basis. See what is working for the lowest risk facilities and try to implement changes in the high risk facilities to mimic those practices. Risk loss can me managed with time and attention.