In some countries their citizens don’t have to worry about finances to when it comes to healthcare, because it’s either provided by their government or it’s nonexistent. They don’t have to worry about which healthcare coverage to buy or how their providers get paid from their recent office visit. Either way, the role of finance in healthcare is very important it is what keeps the healthcare field to constantly improve and provide quality care for it patients. In this paper I will discuss the role of finance in healthcare and why it is important to its survival. I will also cover how hospital and clinic are reimbursed for their services and the role that health insurance has to do with all of it. According to Gapenski, Fundamentals of Healthcare Finance, the primary role of finance in health care is to plan for, acquire, and use resources to maximize the efficiency of the enterprise (Gapenski, 2013). The role of finance in healthcare is divided in to different sections that play a specific role in a healthcare organization. One of the sections that are first and foremost is planning and budgeting, which involves evaluating the financial effectiveness of current operation and planning …show more content…
Financing decision is made to raise funds to buy the assets that are necessary to support the organization operations. To support the organization growth they will have to make Capital investment decisions, to expand their business in order to keep up with competition. They would have to invest in purchasing new equipment and technology to stay abreast with the ever evolving healthcare field. They would have to acquire new office to enroll new patients into their healthcare system, which will increase the organization revenues to secure a stable financial
...t them attain the services easily and at lower costs. In addition, these hospitals have the potential of managing effectively their cash flow. A fixed and proper payment system to the workers of the small health centers can m motivates them to avail quality services to the medical beneficiaries. Small hospitals can be able to have bonus payment in case they provide care in areas short of professional health. Hence, small hospital can implicate appropriately their method of payment. Conversely, there might be a risk possibility when it comes to accessing low amount due to the nature of the illness of the patients, the involvement of high cost of treatment amongst many other factors. In the vent that the overall health care costs are more than earlier anticipated, the hospital and the doctor shall receive less profits. This can have a negative impact on the hospital.
Chapter 6 describes revenue determination. Write a 3-4 page paper to include: List and discuss the three payment-determination bases. Explain the difference between a “specific services” payment unit compared to a “bundled services” payment unit. Describe the three major ways that health care providers can control their revenue function. I expect at least 5 secondary sources properly cited and referenced for this paper.
The purpose of financial measurement in healthcare is to provide the community with the services it needs, at a clinically acceptable level of quality, at a publicly responsive level of amenity, at the least possible cost. This is done by providing healthcare finance managers with accounting and finance information to help accomplish the purpose of the organization (Nowicki, 2015). When making accounting decisions about budgeting and inventory control, an understanding of economics, statistics, and operations research is needed. Major Financial Measures
Baker, J. J. & Baker, R. W. (2014). Health care finance Basic tools for nonfinancial managers (4th ed.). Burlington, MA: Jones & Bartlett Learning
The fourth key point is payment models. In order to make sure quality health care is given across the board you have to follow the money. In this section it talks about an idea of restructuring the payment scheme. Using bundled payments “offer the potential for promoting equity by redirecting resources to health care values...
A health care system that provides free health care services to its entire citizen can be termed as universal health care. This is a situation where all citizens are protected from financial costs in health care. It is recognized around the globe as it provides a specific package of benefits to all citizens in the entire nation. For instance, free health care can result to improved health outcomes. In addition, it provides financial risk protection and an improved access to health services. There is an increasing debate on how citizen should be provided with free medical services. Although United State does not permit free health care services it should have free health care for all citizens. This is due to the fact that healthcare is the largest industry in United State. Due to the fact that United State is a rich country, it should have a healthcare system that provides free services such as treatment for its entire citizen. This will play a significant role, as it will stop medical bankruptcies in...
The first business principle that is associated with patient and system cost is manage cash flow very closely (Fisher,
Healthcare plays an important role in almost every person’s life at one point or another. Many times, one can get caught without, or underinsured and it can be detrimental to their livelihood. With the rising cost of healthcare, it is likely that having a national healthcare policy in place, and as an individual, being able to afford and obtain adequate health insurance has not been required until now. With the new national healthcare plan, it is required for all citizens to obtain and maintain some sort of public or private insurance policy. The rising costs can be attributed to many things. A significant reason for the astronomical cost of health care is because of the staggering amount of uninsured or underinsured individuals receiving medical attention and almost many never paying the bill. Those who do have insurance have seen a gradual increase in their premiums and deductibles to make up for this.
Health care is a capital-intensive business and most health care institutions survive on traditional equity and debt financing. Healthcare institutions consider leasing for various reasons: to avoid the lengthy process of capital budget requests, to avoid technological delays, to benefit from maintenance services and for convenience.
Medical debt is one of the top reasons why many households experience financial hardship. Countries such as South Africa have been living poverty for a very long time. Adding a fatal medical condition in the mix, will only make the financial impact that much greater for the denizens of that country. The South African government has made several attempts to implement a universal health care system across the board. Lanchet writers Bongani M Mayos (2012) and colleagues published an article, stating many challenges that would still need to be addressed in order for national health insurance to become available for all.
In a general sense the role of healthcare financing deals with the way insurance expenses are paid for. Financing is important because it the mechanism that is needed to pay for health insurance premiums. Having health insurance in the US is the primary way individuals and families acquire healthcare; and health insurance is also the primary way providers receive payments. “Providers…rely on the patients’ insurance status to be assured that they will receive payments for the services they deliver.” (Shi & Singh 2015:197) So in essence healthcare financing is a very important part of access for consumers and payment for providers. Financing has a very important impact on who receives health insurance.
Anticipate patients asking for discounts and payment plans. If they patient is convinced to go through with the healthcare service, it is likely that they will request some discount or an affordable payment plan to conveniently pay the expenses. It has also been found that some patients present themselves as uninsured, despite of having an insurance plan. Care must be taken to avoid such situations. Moreover, it is a good idea to have some payment plants that are affordable for the patient and at the same time beneficial to
Although health care is a great public superior, it is not pure. However, it is not equally available to all individual. The health care is demanding public services that are continuously distributed throughout the world. The health care service is only available in certain areas. Therefore, only the the more financial and functional will be able to access it. Financial status depends on prices of a particular health care. Functional reflects the quantity and structure of the health care provided services.
In order to provide affordable health care, government should have huge amount of money to be invested in the hospitals, for arranging doctors and for financing.
...provide information about an organizational financial stability and challenges. A health care organization, such as JHH, can evaluate financial statements and ratio analysis to benchmark performance, address financial challenges and initiate strategies to maintain financial solvency while providing health services to patients, family members, and the community