Todd A. Ward, PhD, BCBA-D
Daniel Law, ARM, CRIS
The Liberty Company Insurance Brokers
Dawn Mackey & Jamie Pagliaro
Rethink Behavioral Health
Your ABA agency faces various risks on a daily basis. Insurance companies and attorneys like to use the word “exposure.” As an ABA business owner, don’t waste your time asking yourself “if” your company is at risk – the answer is always “yes.” Rather, you should look for ways to assess and manage your company’s risk and the amount of risk you are willing to tolerate. To help you through the process, Daniel Law, President of The Liberty Company Insurance Brokers, San Jose, recently gave a webinar hosted by Rethink Behavioral Health. In the webinar, Daniel gave an overview of risk management, along with best practices to assess and mitigate risk to the best of your abilities.
Risk Management: A Multi-Step Process
Risk management is a multi-step process. You will want to begin by planning for risk management, followed by identifying, analyzing, and responding to the risks your business faces.
Before you can take that first step, you have to do a little planning. During this stage, you should decide who will be involved in the risk management process, and define their roles and responsibilities. For smaller companies, the owner will likely be part of the process. For larger organizations, the CFO or COO, might be involved. Daniel also recommends inviting your insurance broker to the process, as well as legal counsel, HR compliance specialists, and most importantly, those front-line staff who carry out the main work of your agency.
“All too often, companies find themselves in a disconnect between management and the BT-level staff” Dan says. “The management team generally perceives operations functioning in a way that may be vastly different from reality. Your front-line staff will provide valuable insight into the daily operations of your business.”
Planning also means budgeting for the risk management process itself. This includes accounting for the time of everyone involved in the planning process, legal and insurance costs, and outside consultants among other things.
Once the planning process is in place, you have a structure to identify risk. The key in the identification stage is to make sure that you have an intimate, and accurate, understanding of your business operations. Again, your “boots on the ground” play a critical role to ensure that management’s perception of operations matches how your business processes actually work.
Daniel distinguishes between two broad categories in the identification process – internal factors and external factors. Internal factors are those factors faced by your business individually and include the types of clients served (e.g., children vs adults), staff hired (e.g., employees vs contractors), and where services are provided (e.g. clinic, school, in-home) all of which have the potential to place your company in different situations with varying amounts of risk.
External factors include things like government regulations, licensing requirements, legal requirements, and business competition. Of the two, Daniel recommends to focus the majority of your time mitigating internal factors, as the external factors are largely out of your control.
By the time you’ve reached this stage, you likely have a laundry list of risks you have identified that could impact your business in some form. “Having identified the risks is very important, but knowing how they can impact your business is also vital to ultimately mitigating those serious exposures your business faces. I recommend putting your identified risks into “buckets” so you can help determine the best course of action for mitigation” says Daniel.
The general “buckets of risk” Daniel details in the webinar include Extreme Consequences, High Consequences, and Moderate to Low Consequences.
Extreme Consequence risks are those that could ultimately put your agency out of business – this includes fatalities or multiple fatality events (e.g. auto accidents), allegations of abuse, or other events that could put you at risk of losing a major funding source.
High Consequence risks typically could lead to serious injury to a staff member or client.
Moderate or Low Consequence risks are events that might lead to lost time for workers, first aid, scheduling issues, etc.
Daniel recommends starting at the extreme end and working back based on your own tolerance for risk.
Daniel points out a number of areas of specific concern for exposing ABA agencies to risk, and driving is at the top of the list. Given that many types of ABA agencies involve large amounts of driving, on the part of the BCBA supervising a caseload, or a front-line staff driving to work, or staff transporting clients, the probability that some sort of accident will occur is greatly increased relative to other professions. Second on his list is coverage for abuse allegations against your staff by clients, parents, or other people involved in the client’s life. For example, if a child comes home from school with bruised arms caused by a BCBA that grabbed the child in order to save his/her life, the behavior analyst in the school district might be blamed. One simple preventative measure to guard against abuse allegations is to always have the caregiver present during sessions, along with de-escalation training for your staff.
Responding to Risk
There are several ways to respond to the risks your ABA agency faces. Generally, you can avoid, transfer, mitigate, and/or accept risks of various types.
Avoidance is simply not undertaking the task that you have deemed too risky to your business. An example of this is having your BT staff drive clients in their own vehicles. This is never a recommended course of action and should be avoided.
Transferring risk to another party through contract, indemnity, insurance, or another means is often the most effective means of controlling the risks your business wishes to undertake. There are pitfalls and you need to ensure that your contracts and indemnity provisions protect against them. You also need to make sure your insurance professional understands your business and designs coverage appropriate to your specific operations.
Mitigating risk is done through the use of loss control, employee training, shifting of responsibilities, or other means. It’s a very important portion of your overall risk-management strategy and should be employed as a part of your transfer or avoidance strategies.
Some risks cannot be avoided or transferred to another party and need to be accepted as the basis for doing business. These risks are generally moderate or low consequence exposures.
Daniel notes that using multiple responses to a particular risk is often the best strategy. Loss control (mitigation) and insurance (transfer) can combine to create and effective outcome.
How have you mitigated risk in your ABA business? Are you monitoring your risk management process to ensure it works? Let us know in the comments below, and be sure to check out the full webinar for more information!
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Todd A. Ward, PhD, BCBA-D is President of bSci21 Media, LLC, which owns bSci21.org and BAQuarterly.com. His company aims to disseminate behavior analysis to the masses through non-academic publication outlets. Todd is an editorial board member for Behavior and Social Issues and previously a Guest Associate Editor for the Journal of Organizational Behavior Management. He has worked as a behavior analyst in day centers, residential providers, homes, and schools, and served as the director of Behavior Analysis Online at the University of North Texas. Todd’s areas of expertise include writing, entrepreneurship, Acceptance & Commitment Therapy, Instructional Design, Organizational Behavior Management, and ABA therapy. Todd can be reached at [email protected]
The Liberty Company Insurance Brokers is a leading regional broker serving businesses and individuals for 30 years. We provide insurance and risk management solutions for over 10,000 unique clients with total premiums in excess of $100 Million. Our dedicated practice groups focus on industries such as construction, real estate, non-profit, and ABA services. For more information, visit libertycompany.com or email [email protected]
Rethink Behavioral Health provides the tools every behavioral health provider needs to manage their practice and deliver quality ABA treatment effectively & efficiently. Rethink’s easy to use web-based software streamlines client care with sophisticated yet intuitive tools for both clinicians & administrators. For more information, visit http://www.rethinkbh.com.
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