CPHRM Exam Dumps : Certified Professional in Health Care Risk Management (CPHRM)

According to Health Care Risk Management principles established by ASHRM and the American Hospital Association Certification Center, indemnity reserves represent the estimated amount the organization expects to pay in settlement or judgment to a claimant. Indemnity refers specifically to damages paid to compensate the injured party, not defense or administrative expenses.

Incurred medical expenses are a core component of economic damages and must be included in indemnity reserve calculations. Emotional pain and suffering fall under non-economic damages and are also considered when estimating potential settlement or verdict value. Future cost of medical care is another essential factor, particularly in cases involving long-term injury or disability, as it represents projected economic damages that may substantially increase exposure.

Medical expert witness costs, however, are categorized as defense expenses and are typically included in allocated loss adjustment expenses rather than indemnity reserves. These costs relate to the defense of the claim rather than compensation to the plaintiff.

Risk management objectives emphasize accurate differentiation between indemnity and expense reserves to ensure proper financial reporting and regulatory compliance. Therefore, incurred medical expenses, pain and suffering, and future medical costs should be considered when setting indemnity reserves, while expert witness costs should not.

According to Health Care Risk Management standards supported by ASHRM and the American Hospital Association Certification Center, determining coverage requires careful review of the applicable insurance policies and policy structure. Because the alleged negligence occurred 10 years earlier, the risk manager must first review both the current policy and the policy in effect at the time of the delivery. Coverage depends on the specific policy terms, limits, endorsements, and retroactive dates applicable during the relevant policy period.

It is also critical to determine whether the policy is written on an occurrence or claims-made basis. Under an occurrence policy, coverage is triggered by the date of the incident, regardless of when the claim is filed. Under a claims-made policy, coverage depends on when the claim was reported and whether appropriate tail or extended reporting coverage exists.

Identifying co-defendants’ coverage may be relevant to contribution or indemnification but does not determine the hospital’s own coverage. Discussion with defense counsel may assist in strategy but should follow preliminary internal coverage analysis.

Risk financing objectives emphasize accurate policy review and understanding of trigger mechanisms before executive discussions. Therefore, reviewing the relevant policies and determining policy type are essential first steps.

According to Health Care Risk Management standards supported by ASHRM and the American Hospital Association Certification Center, the Safe Medical Devices Act SMDA establishes mandatory reporting requirements for certain healthcare facilities when a medical device has or may have caused or contributed to a patient death or serious injury. These requirements apply to device user facilities, which include hospitals, nursing homes, and ambulatory surgical facilities.

Hospitals are explicitly required to report device-related deaths to both the FDA and the manufacturer, and serious injuries to the manufacturer or the FDA if the manufacturer is unknown. Nursing homes and ambulatory surgery centers are also considered device user facilities under the Act and must comply with similar reporting obligations.

Physician offices, however, are generally not classified as device user facilities under SMDA reporting rules and therefore are not subject to the same mandatory reporting requirements, although voluntary reporting is encouraged.

Legal and regulatory objectives emphasize timely compliance with FDA reporting mandates, maintenance of documentation, and coordination with manufacturers and regulatory authorities to mitigate risk and enhance patient safety. Therefore, the SMDA reporting requirements apply to nursing homes, ambulatory surgery facilities, and hospitals.