Business Evaluation of Hospital

Powerful Essays
Business Evaluation of Hospital

“With the foundation and commitment of our spiritual heritage and values, our mission is to promote the heath and well-being of the people in the communities we serve through a comprehensive continuum of services provides in collaboration with the partners who share the same vision and values.”

This mission statement explains the goal and purpose of Faith Community Hospital. Unfortunately, it seems that a large number of employees either forget the meaning of the mission statement or have made their own. At the present time, there does not seem to be a clear direction for the employees to follow. In order to get everyone on track and make this hospital successful, we must focus on three preliminary areas. The three areas are organizational processes, ethics issues, and communication systems. In order to effectively correct the tribulations that plague Faith Community Hospital, we must first get to the root of the underlying problems.

All companies, including not-for profits, must make enough money in order to stay in business. At the present time, Faith Community Hospital is having difficulty in their organizational processes which is affecting the overall operations. Currently, Faith Community Hospital has a seven percent decrease in patient population. The cost per patient last year was $217, this year it has risen to $240. This increase along with the decrease in patient population has had a negative impact on the revenue earned. In addition, twenty-eight percent of the costs are fixed costs. Unfortunately increasing patient count is not easily done, unless there is extensive marketing done, which requires money. First items to address are analyzing the fixed costs. All contracts must be reviewed and renegotiated, if feasible. In addition, the hospital’s payor mix should be thoroughly reviewed and analyzed. Identifying the percentage of patients according to financial classification will reveal a multitude of information. For example, if Medicare patients are a large percentage of the payor mix, Faith Community Hospital can gear programs to the elderly population. Identifying the self-pay population may allow further investigation as to where these patients are coming from. For example, a large portion of the self-pay population may be contributed to non-insured patients that cannot afford healthcare or in...

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... Faith Community Hospital is a not-for-profit, there are still bills to pay. Second, is the overall operation of the hospital. In order to increase profits, you must either increase income or reduce costs. Unfortunately, it is not that easy to increase profits, however, the hospital has the capability to reduced fixed costs. The mission statement this hospital has explains the goal and purpose of the hospital. It seems that a large amount of staff members have either forgotten the mission statement or have made up their own. This is causing turmoil within the hospital. The hospital will work more efficiently and effectively, if everyone works toward the same goal. In order to accomplish this, there must be a clear communication system set up. The right hand needs to know what the left hand is doing. By opening up the channels of communication, the hospital will tap into a large resource of information, their employees. After all, everyone in the hospital is in the same boat. If everyone works together, the hospital will prosper and grow. If not, the hospital will be in jeopardy.


Velasquez, M. (1998). Business Ethics Concepts and Cases. New Jersey: Prentice Hall