Sponsored Content by Berkshire Hathaway Specialty Insurance
Healthcare: The Hardest Job in Risk
Management
Do you have the support needed to successfully navigate healthcare
challenges?
By: Berkshire Hathaway Specialty Insurance | April 1, 2015
The Affordable Care Act.
Large-scale consolidation.
Radically changing cost and reimbursement models.
Rapidly evolving service delivery approaches.
It is difficult to imagine an industry more complex and
uncertain than healthcare. Providers are being forced
to lower costs and improve efficiencies on a scale
that is almost beyond imagination. At the same time,
quality of care must remain high.
After all, this is more than just a business.
The pressure on risk managers, brokers and CFOs is
intense. If navigating these challenges wasn’t stress
inducing enough, these professionals also need to
ensure continued profitability.
“Healthcare companies don’t hide the fact that they’re looking to reduce costs and improve
efficiencies in practically every facet of their business. Insurance purchasing and financing are high
on that list,” said Leo Carroll, who heads the healthcare professional liability underwriting unit for
Berkshire Hathaway Specialty Insurance.
But it’s about a lot more than just price. The complexity of the healthcare system and unique
footprint of each provider requires customized solutions that can reduce risk, minimize losses and
improve efficiencies.
“Each provider is faced with a different set of challenges. Therefore, our
approach is to carefully listen to the needs of each client and respond with
a creative proposal that often requires great flexibility on the part of our
team,” explained Carroll.
Creativity? Flexibility? Those are not terms often used to describe an
insurance carrier. But BHSI Healthcare is a new type of insurer.
The Foundation: Financial Strength
Berkshire Hathaway is synonymous with financial strength. Leveraging the
company’s well-capitalized balance sheet provides BHSI with unmatched
capabilities to take on substantial risks in a sustainable way.
For one, BHSI is the highest rated paper available to healthcare providers. Given the severity of risks
faced by the industry, this is a very important attribute.
But BHSI operationalizes its balance sheet in many ways beyond just strong financial ratings.
For example, BHSI has never relied on reinsurance.
Without the need to manage those relationships,
BHSI is able to eliminate a significant amount of
overhead. The result is an industry leading expense
ratio and the ability to pass on savings to clients.
“The impact of operationalizing our balance sheet is
remarkable. We don’t impose our business needs on
our clients. Our financial strength provides us the
freedom to genuinely listen to our clients and propose
unique, creative solutions,” Carroll said.
Keeping Things Simple
Healthcare professional liability policy language is often bloated and difficult to decipher. Insurers
are attempting to tackle complex, evolving issues and account for a broad range of scenarios and
contingencies. The result often confuses and contradicts.
Carroll said BHSI strives to be as simple and straightforward as possible with policy language across
all lines of business. It comes down to making it easy and transparent to do business with BHSI.
“Our goal is to be as straightforward as we can and at the same time provide coverage that’s
meaningful and addresses the exposures our customers need addressed,” Carroll said.
Claims: More Than an After Thought
Complex litigation is an unfortunate fact of life for large
healthcare customers. Carroll, who began his insurance career
in medical claims management, understands how important
complex claims management is to the BHSI value proposition.
In fact, “claims management is so critical to customers, that
BHSI Claims contributes to all aspects of its operations – from
product development through risk analysis, servicing and claims
resolution,” said Robert Romeo, head of Healthcare and Casualty
Claims.
And as part of the focus on building long-term relationships, BHSI has made it a priority to introduce
customers to the claims team as early as possible and before a claim is made on a policy.
“Being so closely aligned automatically delivers efficiency and simplicity in the way we work,”
explained Carroll. “We have a common understanding of our forms, endorsements and coverage,
so there is less opportunity for disagreement or misunderstanding between what our underwriters
wrote and how our claims professionals interpret it.”
Responding To Ebola: Creativity + Flexibility
The recent Ebola outbreak provided a prime example
of BHSI Healthcare’s customer-centric approach in
action.
Almost immediately, many healthcare systems
recognized the need to improve their infectious
disease management protocols. The urgency
intensified after several nurses who treated Ebola
patients were themselves infected.
BHSI Healthcare was uniquely positioned to rapidly
respond. Carroll and his team approached several of their clients who were widely recognized as the
leading infectious disease management institutions. With the help of these institutions, BHSI was
able to compile tools, checklists, libraries and other materials.
These best practices were immediately made available to all BHSI Healthcare clients who leveraged the
information to improve their operations.
At the same time, healthcare providers were at risk of multiple exposures
associated with the evolving Ebola situation. Carroll and his Healthcare
team worked with clients from a professional liability and general liability
perspective. Concurrently, other BHSI groups worked with the same clients
on offerings for business interruption, disinfection and cleaning costs.
Ever vigilant, the BHSI chief underwriting officer, David Fields, created a
point of central command to monitor the situation, field client requests
and execute the company’s response. The results were highly customized
packages designed specifically for several clients. On some programs, net
limits exceeded $100 million and covered many exposures underwritten by
multiple BHSI groups.
“At the height of the outbreak, there was a lot of fear and panic in the
healthcare industry. Our team responded not by pulling back but by leaning
in. We demonstrated that we are risk seekers and as an organization we can deploy our substantial
resources in times of crisis. The results were creative solutions and very substantial coverage options
for our clients,” said Carroll.
It turns out that creativity and flexibly requires both significant financial resources and passionate
professionals. That is why no other insurer can match Berkshire Hathaway Specialty Insurance.
To learn more about BHSI Healthcare, please visit www.bhspecialty.com.
Berkshire Hathaway Specialty Insurance (www.bhspecialty.com) provides commercial property, casualty, healthcare professional liability,
executive and professional lines, surety, travel, programs, and homeowners insurance. It underwrites on the paper of Berkshire Hathaway’s
National Indemnity group of insurance companies, which hold financial strength ratings of A++ from AM Best and AA+ from Standard &
Poor’s. Based in Boston, Berkshire Hathaway Specialty Insurance has regional underwriting offices in Atlanta, Boston, Chicago, Los Angeles,
New York, San Francisco, Toronto, Hong Kong, Singapore and New Zealand. For more information, contact info@bhspecialty.com.
The information contained herein is for general informational purposes only and does not constitute an offer to sell or a solicitation of an offer
to buy any product or service. Any description set forth herein does not include all policy terms, conditions and exclusions. Please refer to the
actual policy for complete details of coverage and exclusions.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk &
Insurance, in collaboration with Berkshire Hathaway Specialty Insurance. The editorial staff of Risk &
Insurance had no role in its preparation.