1. Learning to Love the Loss Run
Presented to GSHRM By
Pamela L. Popp MA JD DFASHRM CPHRM DSA AIM
Executive Vice President/Chief Risk Officer

2. Objectives Review a loss run format
Understand the characteristic of an ideal loss run
Consider the value of the financial information
Identify potential trends from non-financial information

3. What Is a Loss Run?

6. What Creates a Loss Run?

8. Reporting Best Practices

9. What Does the Policy Require*?
Notice when event occurs?
Notice when claim made?
Notice when litigation commenced (via service)?
Notice when reserved?
Notice when file opened?
Notice when file resolved?
*great bedtime reading, do read it!

10. Back Then…. In the past, we discouraged reporting: …don’t over report
…you’ll be penalized for reporting incidents
…don’t report unless it’s actually asserted
…keep your loss run ‘clean’ (aka litigated only)

11. But Now…. In the present, we really encourage reporting*:
…include everything you know
…the less litigation, the better
…the earlier, the better
*note: your actuary may subdivide for projections

12. Why Fear the Loss Run? Too much…stuff? Too hard to read?
Not sure what it says?
Lack confidence in the data?
Not comprehensive*?
*always create a FULL program picture – combine all partial loss runs!

13. What’s Important? What happened. BUT, also… When did it happen?
When did we learn about it?
What is our exposure?
How will it be resolved?
When will it be resolved?

14. Committed to Released*
Resolved
Reserve maturity
Reserves placed
Report date
Occurrence date
Committed
Released
*yes, you can parallel the criminal justice system…

15. Overlapping Committed/Resolved

16. Overlapping Committed/Resolved

17. Top 5 Things to consider in a loss run

18. Is the Data Comprehensive?
Accurate
Complete
Consistent*
= Ability to Trend, Analyze
*best to have guidelines on coding to insure consistency among personnel

19. Failure to _____ R/I ______
Best practice for narrative descriptions on the loss run

20. Is the Aggregate Consistent Over Time?
Only moderate fluctuation over a 10 year period
‘Explainable’ fluctuations
Program changes
Staff changes
Coverage/carrier changes
Philosophy changes

21. Are Matters Reported Timely?
Within 6 months of the event
Before litigation
High exposure
Batch/Multi-Exposure
Cyber, Fraud

22. Is Reserving Consistent with Philosophy?
Define your philosophy and set parameters to enforce
Are you reserving:
Ultimate at the beginning
Settlement value
Mathematical formula
Stair stepping

23. Name the Reserving Type
A = low reserves then large at end, means program likely relies on outside counsel, has cashflow issues or has a board that does not want to see reserves! (being sold?)
B=ultimate at beginning, sits there until resolved, means program is mature, strong personnel, consistent history; could also mean mathematical formula used
C= stair stepping
D= reverse stair stepping

24. Are Resolutions within the Reserves?
Take the reserves at 60 days pre-resolution, compare to resolution amount
Goal: >80%

25. Top Reason to Love The Loss Run
It’s the ‘profile page’ of the program
Can give you a reputation if misunderstood*
All information in one place
Possible to quickly identify issues
* Would you swipe left or right for your program?

26. A little bit of everything but not a lot of any one thing*
The Ideal for Loss Runs
A little bit of everything but not a lot of any one thing*
*aka swimsuit rule

27. Quick Impressions Delays in reporting = culture of fear
Delayed reserving = financial flow
Lack of proactive resolutions = comfortable with litigation

28. The ‘Expected’ Loss Run
Expect to See
If See, Concerned
Falls
Post op issues
Missed fractures/x-ray
Surgery complications
IV infiltrations litigated
Decubitus ulcers litigated
Medication error(s)
Provider issues
Security issues

29. Identifying Issues

30. Falls + Decubitus ulcers + IV Infiltrations

31. Falls + Decubitus ulcers + IV Infiltrations
Staffing ratios
Staff distractions
Lack of training on monitoring
New/inexperienced personnel
Acute patients outside of ICU

32. Readmission + Post Op Complication + Sepsis

33. Readmission + Post Op Complication + Sepsis
Infection control
Sterilization issues
Discharge process

34. Late Reserves + Big Payments

35. Late Reserves + Big Payments
Program philosophy not in place
New/inexperienced staff
Reliance on outside counsel
Cash flow issues

36. BDB + Erb’s Palsy + Missed Deliveries

37. BDB + Erb’s Palsy + Missed Deliveries
Monitoring equipment issues
Provider access
Staffing issues
OR suite access

38. Medication Errors + Adverse Reactions

39. Medication Errors + Adverse Reactions
Pharmacy supply/access
Communication process
Medical record documentation
Staffing issues (understaffed, distracted, new or inexperienced)

40. He Said + She Said

41. He Said + She Said Normalization of deviance (behavior)
Staffing issues
Credentialing issues
Culture of safety absence

42. Laparoscopic Fails + Return to Surgery

43. Laparoscopic Fails + Return to Surgery
Davinci maintenance
Provider training
Staff training
Patient selection process

44. How Will You Love Your Loss Run?

45. Thank you!