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Serving the Ivory Tower: Managing Risk at the University of California 
See what has made the UC's risk managers so successful...how they developed their careers and succeeded in a competitive risk management market.
by Ritza Vaughn in Risk Management Magazine (www.rmmag.com)
The University of California (UC) is one of the largest and
most acclaimed institutions of higher learning in the world. Chartered in 1868, UC began classes in Oakland with 10
faculty members and 38 students. Today, the University has a $14 billion budget and encompasses 10 campuses, five
medical schools and teaching hospitals, three law schools and a statewide division of agriculture and natural resources.
Academic study at UC spans more than 150 disciplines, and approximately 42,000 students graduate from UC campuses each
year.
Managing the risk management program of this large and diversified
educational institution is a mammoth undertaking that requires a staff of 33 risk professionals. Interestingly, of those
33 staffers, 21 of them are women, which illustrates how much the demographics of today's risk managers have changed
from just 10 or 20 years ago.
To see what has made the UC's risk managers so
successful, this article will look at how they have developed their careers and succeeded in a competitive risk
management market. Six of UC's risk managers were chosen as a cross-section for the rest of the team. Three of them work
at the senior management level out of the risk management headquarters office in Oakland, and three of them work on the
front lines at various campuses and medical centers.
All six place a huge
emphasis on building relationships and consensus. They feel connected to the University's mission of academic excellence
and stress the importance of education in their programs. Finally, they all believe in leveraging technology to help
analyze risks and implement appropriate loss control programs. These characteristics have helped UC run a successful
risk management program that has controlled costs and improved results throughout the
University.
Sherry Carletta, Interim Director of Risk Management
As interim director of risk management for
the University of California's risk management program, Sherry Carletta oversees risk management responsibilities for
the entire program. She works within the Office of the President Risk Management (OPRM), a department within the
division of business and finance.
The mission of OPRM is to develop and
maintain programs that protect the University from unanticipated loss by providing systematic risk analysis, developing
techniques to reduce potential exposure to loss, and procuring and administering insurance and self-insurance
programs.
"We have a strong affiliation to the University's educational
environment, and a strong vested interest in this aspect of our job," says Carletta. "We try to educate everyone about
risk management. I deliver a presentation several times a year to various departments entitled, 'Everyone is a Risk
Manager.'"
Carletta believes every employee can play an important role in risk
management and loss control. Her presentation provides people with a general overview of how to think like a risk
manager.
"For instance, there may be a faculty member that wants to take a
group to Europe for an archeological dig," says Carletta. "Some campus business officers will just wait for the
pictures, but they must be trained to say, What type of transportation are you going to take? Have you gotten signed
waivers? What type of contracts do you have in place for accommodations?' We help people to think about the bigger
picture."
"In my job, I get the most gratification from working with people
and providing assistance to the various locations and their unique programs," says Carletta. One such project was
finding a new claims system for the University. "It ended up being very rewarding to implement a new system that
delivered huge improvements for all our users," she says. "The primary benefit was that our risk managers were able to
access and analyze loss information."
Cheryl Lloyd, Manager of the General Liability Program
As
manager of UC's General Liability Program, Cheryl Lloyd deals with a wide variety of claims, including personal injury,
employment and automobile liability. "I may see a standard slip-and-fall, an alleged racial discrimination and an
employment liability case all in one week," she says. "I really enjoy the realm of general liability. There's a lot of
gray area that requires interpretation, analysis and continual definition."
Many
times, Lloyd has to convince people to think like her. She recognizes she cannot make people change, but she can show
them the value and importance of risk management and why it is in their best interest.
"It's a hard sell and I get some push back,' but when I explain how risk management affects their
bottom line, I get their attention," she says. "When people understand where the money is going and why, then they have
the knowledge and hopefully the incentive to bring about change."
In terms of
trends, Lloyd believes employment practices will continue to be a huge issue in her program. "There's a great deal of
allegiance to the University," says Lloyd. "People feel connected to our community. Imagine the difficulty an employee
experiences when they're terminated, or they're injured and can't perform their work here
anymore."
As a high-profile public entity, UC goes to court on most
lawsuits. As a result, they like to learn from previous cases. Utilizing their claims system, risk managers can see how
many cases they have won, the best performing lawyers and results from specific judges.
"Campus risk managers dispersed throughout the state can run their own reports. They can take that information
and provide more insight to the University's vice chancellors," she says. They can say, "look how we're performing,
look at what it's costing us." Risk managers can't raise the red flag unless they can show the financial impact of
claims. Having a really good risk management information system and being able to get useful data out of it is like
coming out of a cave. How did we ever exist without it?"
Teresa Kielhorn, Manager of the Professional Medical & Hospital Liability Program
Teresa Kielhorn is the manager of the University's
Professional Medical and Hospital Liability Program, but her previous career spans both the military and
Hollywood.
"When I was in the Navy, I worked as a real-life judge advocate
general," she says. "Because of my experience, I served as a legal consultant to the TV series JAG. Looking back, it was
an invaluable experience to have started my career in the Navy. My Navy experience in healthcare law, risk management
and quality control led to my interest in commercial risk management.
"My current
position combines all aspects of traditional risk management, including risk financing, claims management, loss control
and prevention. As the Manager for the Professional Medical and Hospital Liability Program, I manage the self-insurance
program for the university physicians, nurses, dentists and other healthcare practitioners and all patient-related
allegations of negligence involving the university medical centers and facilities, including the nine campus student
health centers. If any of our physicians or hospital staff are sued, our program provides the defense and
indemnification."
Similarly, the risk managers at all the facilities are very
dedicated and knowledgeable people who work hard to improve patient care and reduce liability
exposure.
The Professional Medical and Hospital Liability self-insured program is
doing well in terms of its claim frequency and severity. "The risk managers and medical directors are all proactive in
terms of sharing information," says Kielhorn. "There's a lot of collaboration. Together, our mutual goal is to provide
excellent healthcare to patients."
Kielhorn notes that the University
relies heavily on sophisticated tracking and trending analysis. "Our technology tools are invaluable. We have two
systems, a system-wide computerized incident reporting program that tracks patient-related incidents and a claims
management database tailored to track specific risk factors."
Cynthia Rowe, Workers' Compensation Risk Manager at UC San Diego Medical Center
Cynthia Rowe is the workers' compensation manager at the San
Diego Medical Center, but before that, she was an industrial nurse, making sure employees received the best care. She
became a risk manager after realizing that despite her efforts, employees kept getting hurt, and she wanted to help
prevent injuries from occurring.
"In California, workers' compensation laws are
employee-friendly, and it can be very challenging for employers to control costs and medical care. The only way to
really be proactive is through safety and injury prevention," says Rowe.
"One of the reasons the university risk management program is so successful is because OPRM allows us to
customize programs to meet our specific needs. For instance, one program that our site started was an accident
investigation program," she says.
Now, after receiving a claim, the accident
investigator meets with the supervisor and the injured employee. They return to the site of injury and basically
re-enact the accident. They find out what caused the injury and agree on action items. The employee might agree to
practice proper body mechanics in the future. The supervisor may take the information back to the unit meeting, letting
people know how to avoid this type of injury in the future.
"Our current
claims system has allowed me to track the results of this program," she says. "Before the system was in place, I had to
develop reports in Excel. Now, all the information is available at my fingertips. The accident investigations program is
in its infancy, but we've already seen a 25 percent decrease in injuries."
Rowe's
background as a nurse gives her an obvious advantage. "The staff knows that when I make a request, I understand the time
restraints and stresses they're under. That has helped our employees feel more connected to the risk management
program," she says. "I've always said that our people are our greatest asset. They keep the medical center running.
Likewise, we should do our best to protect them from injuries in the work environment."
Nance Hove, Director of Risk Management at UC Irvine Medical Center
Nance Hove has worked at UC for 14 years, the last eight of
which have been in risk management. Her previous role was administrative in nature, but she always had a passion to
pursue law.
"I went through a paralegal program and an extensive healthcare
law program. The timing was right. I was just finishing up when a position opened up in risk management at UC Irvine
Medical Center," says Hove. This center has over 450 beds, 1,200 physicians and approximately 500 new residents each
year.
"My main role is planning and implementing a comprehensive risk
management program," she says. "But I also play a significant role in patient advocacy. It comprises about 30 percent of
my time. I meet with three or four patients a week. These patients may be upset with the care they've received. Even if
it's a less-than-optimal outcome, if we communicate, we show these patients we care and can reduce the chance of
litigation."
Education and training initiatives result directly from Hove's
ability to analyze claims. She tries to pinpoint patterns, such as a consistent lack of documentation. She can then go
back and conduct training in those areas. For instance, every year Hove provides a legal in-service to new residents and
interns. She explains the medical center's policies, what medical malpractice will mean to them, and what happens if
they are involved in litigation.
"Every year, one out of the 500 new
residents is going to need to talk with me within the first three to four weeks" says Hove. "It's important they know
that I am a resource. I try to teach them key, but simple, risk techniques such as how to walk in the shoes' of their
patients."
Hove likes to walk the medical center floors. "Visibility is an
important part of my job," she says. "I get out and see what's happening. When I hear about an unhappy patient, I help
mitigate the situation. Our goal is to have happy patients. It's our utmost concern."
Trenna Hunter, Campus Risk Manager for UC Santa Barbara
As the campus risk manager for UC Santa Barbara, Trenna Hunter
spends about 40 percent of her job in risk management. In her career, Hunter rose up the ranks of the university
system."I had a significant amount of experience in information technology and financial management, but in the area of
risk management, I ended up taking courses and learning on the job."
"I get a lot
of gratification from my risk management responsibilities. I enjoy working with our attorney. He has won a significant
number of lawsuits brought against the University. I like collaborating with him and getting him the information he
needs to defend our cases."
Hunter reports directly to the vice chancellor of UC
Santa Barbara, but she also interacts with OPRM. "One of the reasons the University's programs have been so successful
is due to the efforts, dedication and leadership coming from the office of the president," she says. "They
have a daunting task, but do a laudable job."
Having an analytical nature,
Hunter focuses on injury trending. "One of the best initiatives the University has undertaken was obtaining a new claims
system. The vice chancellor is a numbers person. He wants to know where the money is going. With this system, I can
obtain accurate information, analyze loss patterns, and benchmark our results against other campuses," says
Hunter.
By performing data analysis with the claims system, Hunter
discovered that the facilities department, which handles groundskeeping and janitorial services, accounted for 50
percent of loss days. As a result, UCSB is now focusing on that department in terms of training and injury
prevention.
For Santa Barbara, the number of injuries is average, but the
costs per injury are fairly high. "We've instituted a new initiative to meet with our treating physicians," says Hunter.
"The physicians have been very receptive to our comments and our objective to improve results. Our end goal is to
improve our return-to-work program. These face-to-face meetings give us a chance to build a pathway, particularly when
we feel there is a need for UCSB to provide the doctor with our perspective on a particular case."
Lessons Learned from UC
Appreciation for the risk management profession
continues to grow, as does the profile of women in risk management. There are significant opportunities in the industry
to learn from others and to share information regarding new and effective programs.
The University of California is a shining example of how this can be achieved. Its risk managers
work together to build positive relationships between their individual departments and business units. And at the same
time, they do this while never forgetting to strive for common goals of educating people University-wide about risk
management strategies, reducing the costs of the program, and improving outcomes for the benefit of students, faculty
and staff.
Senior risk management staff members respect the diversity of
the various University locations, especially the on-site medical and teaching facilities. As a result, they provide
front-line risk managers at the University's campuses and medical centers with the support and authority to design their
own unique programs. Not only do these provide opportunities for true innovation, but they also allow the University's
risk managers to address their unit's specific exposures and high-risk areas.
This collaborative and supportive way of doing things has fostered a mutual respect from front-line risk
managers, who recognize the value of the tools, support and leadership that senior management provides. As increased
risk and instability continue to be an ever-present factor in today's society, these common threads of success can be
lessons for everyone to learn from.
Reprinted with permission from Risk Management Magazine. Copyright 2004 RIMS, Inc. All rights reserved.
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Kevin Confetti