To Lease or Not to Lease
There is always much debate around the subject or owning vs. leasing, anything. We all immediately assume owning is the right choice because why lease it when you can own it, right? Or maybe wrong? I will further discuss the advantages and disadvantage of leasing a medical office, medical equipment and office furniture.
Medical Office or Headquarters
Advantages of leasing a medical office over owning is freeing up working capital. With the money that is freed up from a lease payment and not a property payment you can focus more on other aspects of the business. Also, the ability to borrow funds, if needed, are is there as opposed to if you have a commercial mortgage.
A second advantage of leasing a medical office is you have your choice of where to lease. A lease payment can and should be less than a if you bought the property. Leaving you the option of renting in a great location with high traffic and away from competition.
Lastly, is when you are not the landlord you are not responsible for the maintenance on the outside of the building and for some leases you are not responsible for the inside. Either way your lease agreement is written you will not be responsible for at least the outside of the building, once again freeing up more working capital.
The disadvantages of leasing a medical office is you lose out on the tax deductions that come from having a commercial mortgage. Deductions include mortgage interest and property taxes. Another disadvantage of leasing is the option of additional income from you becoming the landlord, i.e. owning the building and leasing out offices.
Owning an office space also can fund ones retirement. By owning the office you are able to let the p...
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... a decision. After going over the advantages and disadvantages of leasing a medical office, I recommend that we move forward with selling the headquarters building and leasing it back from the owners. There are more advantages to leasing medical office than owning it.
I also recommend that the medical equipment be leased and not owned. Technology moves to rapidly for any medical company to keep up with the new medical equipment. But I do recommend that all office furniture be bought out right and not leased. The risks involved in leasing the furniture and not buy are too uncertain.
In conclusion, leasing has plenty of advantages and disadvantage. Leasing works for some things and but not for all. In the healthcare field it is in our advantage to lease a medical office and medical equipment but not in our advantage to lease medical office furniture.
Supposedly, the national average occupancy rate of hospitals is lower than it should be because of rising costs of hospital care. Factors causing variations in occupancy rates are hospital size, product diversification, and urgent versus non-urgent
General Practices Affiliates is considering an offer from Titus Lake Hospital to join under a provider leasing model. Under a provider leasing model, Titus Lake Hospital is purchasing General Practices Affiliates’ services. The practice will retain control of personnel, management, and practice policies. Titus Lake Hospital submitted financial reports to assure transparency during the lease agreement process. The following analysis will discuss whether Titus Lake hospital is a viable financial partner for General Practice Affiliates, possible implications of the lease, and recommendations.
This will be a great opportunity for the organization to decrease patient safety issues among providers, patients receiving medications timely, consults accurately prepared, decreasing the likelihood of the patient having to make several trips to the facility and consult being completed timely. The will be decrease in provider burn-out, decrease in clinic cancellation and better continuity of care and promoting patient satisfaction. 75 percent of hospitals in the United States use locum tenens. The benefits of bringing a highly trained physician on board, even if the intention is short-term, are many for your private practice, hospital or clinic. They can help with provider shortage, increase patient volume thus generating more revenue for the organization, help to decrease burn out and rescheduling of patients, and provide a safer environment even if it is only short term (Becker’s Hospital
Buying and leasing are two very different approaches to obtaining a vehicle while both have their advantages and disadvantages both can also benefit the purchaser. There are many differences between the two but the primary difference is with buying money is paid to own the vehicle and with leasing money is paid to use the vehicle. According to the site www.towtrucknet.com/financing.htm, of the 15.5 million new vehicles sold in 1998 a record 5.3 million were leased. The three main differences are payments/price, depreciation value, and valuable differences.
The lessee must record the rights and obligations associated with all leases as a right-of-use (ROU) asset and a corresponding liability with the present value of future lease payments. In another word, the impact on the balance sheet for both capital and operating leases is the same at original recognition. However, the effect on the subsequent income statement and cash flow would be significant different based on the lease’s classification. For income statement purpose, lessees of capital leases should recognize amortization expense on ROU asset and interest expense on the lease liability separately, whic...
The decision of Young to rent the condominium will provide advantages in terms of security deposit and rental payments for previous months because she did not face a significant financial commitment to pay for it. If she wants to buy the condominium, large amount of down payment needed to be paid by her. Monthly sales broker fees, closing costs, condominium fees, deed-transfer taxes and property taxes should be taken into account in the cost of a condominium fees. The rental fee is more cheaper compared to the purchase of a condominium. Young also a very professional person in investment banking after completing her studies in master. Thus, if she expects to pay at a higher price in the future, this will change the ability to buy and ability to pay the mortgage nowadays. Young consider to rents because it gives her chances to make a distribution and expand its
In summary the benefits or employing or deploying a patient portal clearly out weigh the concerns of the delaying the project. When correctly implemented and properly deployed the organizational advantages can be:
When leasing a vehicle, you can get more bang for your buck; meaning more features, and amenities from a higher trim level. The monthly payments are typically lower because you’re only paying for the depreciation of the vehicle during the specified lease term, and not the actual sales price. *** For example, on a $40,000 car, you’d finance the entire $40,000 purchase price with a car loan—with a car lease, you only pay a percentage of that. The car’s residual value is what the vehicle is expected to be worth at the end of the lease. The residual value is taken from the purchase price and the difference is what you make payments on. So if the car’s residual value is 55 percent after three years, for example, that means the $40,000 car would be valued at $22,000 at the end of the lease. The lease payments would be calculated based on the remaining $18,000 and not the full $40,000, along with interest, taxes and fees.
The NAL still favors buying over leasing by $1216. The only other consideration would be that lease may raise the earnings on asset ratio above 12%. But since the PV of the lease payments is greater than 90% of the FMV (assuming the purchase prices is FMV), then it would be considered a capital lease and the asset would go on the Balance Sheet. Therefore there are no earning over asset ratio advantages to leasing.
...staff would not be required to put in the overtime to compensate for the lack of workers. Patients would no longer have to suffer the neglect of the staff because he or she was too busy. Making sure the patient gets the best quality care reduces the time spent for recovery. Reducing the time spent for recovery increases the organization’s finances. Providing a safe facility also reduces the expenses on the private hospital’s budget. Ensuring a patient is safe can reduce potential use of ongoing treatment and services. Hiring the appropriate nursing staff needed can save the organization money. Instead of cutting back on staff, more staff needs to be hired to fulfil the needs of the patient. In the economy today, private hospitals need to focus on the overall long term effects of each action opposed to quick reactions resulting in financial strain for the facility.
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.
Physicians retain separate offices and finances. Often a central site is established to house administrative services and some or all ancillary services.
Both facilities will have the same Medical Director and one Director of Nursing running both locations. Management personnel will improve their communication by meeting once a week to discuss and brainstorm ideas; bill verification will be consistent in the two facilities; there will be a company wide purchasing system. To maximize revenues, there has to be a mix of out- patients and in patient care, there will be shorter stays in the future.
To create an office environment with a positive impact on you and the rest of the employees, select the right office furniture. You must know where to buy a desk and chair that will help boost productivity, filing cabinets and storage to keep the office organised and other items that will make every work day healthy and convenient for everyone.
If you need money to purchase assets for your business, leasing offers an alternative to traditional debt financing. Rather than borrow money to purchase equipment, you rent the assets instead. Leasing typically takes one of two forms: Operating leases usually provide you with both the asset you would be borrowing money to purchase and a service contract over a period of time, which is usually significantly less than the actual useful life of the asset. That means lower monthly payments. If negotiated properly, the operating lease will contain a clause that gives you the right to cancel the lease with little or no penalty. The cancellation clause provides you with flexibility in the event that sales decline or the equipment leased becomes obsolete. Capital leases differ from operating leases in that they usually don't include any maintenance services, and they involve your use of the equipment over the asset's full useful life.