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In the health care fields there are so many things that are put to light. How the management is going to handle the budgeting and how one would know where to put the money and how it is going to better the company. There are major differences between the profit, nonprofit and government environment type companies. This will outline the differences and the similarities of the companies and the way that they are operated and services provided to the patients/clients. For Profit
Privet/ public Hospitals: For the profit companies that works with the patents and their health care needs there are many things that one would have to take in considerations like the cost of care and the needs that they have such as medications, hospitals stay and the needed help after the patient is needing after their stay in the hospital. The policies that are unique in the financial environment are that there are things that one would have to think about. The ways that the care is being given to the patients, the cost of the needed services. What are the most needed service and the cost to maintain that needed service. The facilities are always having to change the budget because of the consist changes in the ways that health care is given and the changes in technologies and treatments and medications, the new and improved ways that providers are giving care and the updated information that is used to treat and protect the patients.
The ways that financial management practices are prevalent in the financial environment for hospitals is the needs to cover cost and be able to pay the staff, providers and bills for the operation of the hospitals monthly charges. There is always going to be shifts in the budgets to make sure that the needed things are provided for. The cost of the hospital may change due to the fact of the needs of the patients and their needs. There are also the needs of the payment structure of the staff and hospital. If there is a shortage of funding then there is a staff shortage. According to Health Forum LLC (January 2, 2014.),” Single, freestanding hospitals may be categorized as a system by bringing into membership three or more, and at least 25 percent, of their owned or leased non-hospital pre acute or post-acute health care organizations. System affiliation does not preclude network participation.” Non Profit
Health care centers (income based): The nonprofit organizations work on the bases of the patients that are not able to afford the cost of health care and are in need of help paying their health care bills. The nonprofit health care facilities are the ones that sometimes suffer because of the lack of funding and there for some times will have to close their doors because of this. There are many things that are in a factor when it comes to the financial concepts of the nonprofit organizations. One thing is that the nonprofit is mainly based on donations that are given to the places that provide services to the patients. The financial budgeting is depending on the donations that are given every month and the cost of the operations of the current health care facility. There is an operation margin of 3-5 per cent that has to be maintained for the organizations to be in operation. The funding of this is hard to come to when there is no funding and that this could be a major problem.
According to Altoona Regional (2010),” Hospitals need to make substantial capital investments to provide the best and latest care techniques.” The nonprofit organizations have the problem of making sure that they have the funding for their services and the needed help to pay the operation fee and charges that comes in. Larger nonprofit organizations are required to publish their financial reports detailing their income to the government. In many aspects they are similar to corporate business entities though there are many major differences.
But because they are a nonprofit organization they are able to have tax exemptions that will help when it comes to the money being given to the organization. But this will only work to their favor if they meet the requirement of the Federal tax laws. One of the problems that come to play is resource management and the way that the money and services are used. There may be founding put in to one thing when there is a more dire need in another sector of the organization. Government
Medicare: The government financial environment is a major different place in its own. There is a federal and state that organize the funding for the help that is being offered and does change every year when the budget is made up for the year. There have been some things that have been cut because there was no funding for the services that was funded like Planned Parenthood in some cities. And because of this there is no guarantee that the funding will always be there. The state and federal government have to make a budget to see what funding is being given out and how it is going to benefit the people and the facilities that is in need of the founding.
There is also the cut of cost on health care help such as Medicaid and Medicare and there are many people that are not getting the help or are restricted because there is no funding to fully support the health care help. Government health businesses also may seek to promote the welfare of their executives and employees and improve the surrounding city communities. The revenues and expenditures that are needed is controlled and strongly influenced through the budgetary and management process. According to Holland & Knight LLP (1996–2014),” Many state and local governments are struggling with how to finance much needed infrastructure improvement projects”
The major differences from the health care financial environment and just a business environment are that if the health care loses funding then there are many people that would go without the heath care they need. If a business goes without finding then there are others out there that can replace the organization that had to close their doors. There are many things that can happen to a organization and with poor management there is the possibility of losing out on the clients that they have and them going to another place that offers the same services. So in closing there are many ways that the financial reasons that some organizations will stay open and what would happen to them if they lose the finding that they are in need of. There is always the worry about how the money is going to be handled and what the budget calls for and what is on the top of the priority list.
Health Forum LLC. (January 2, 2014.). Fast Facts on US Hospitals . Retrieved from http://www.aha.org/research/rc/stat-studies/fast-facts.shtml Altoona Regional. (2010). What is a nonprofit community health care system?. Retrieved from http://www.altoonaregional.org/about_nonprofit.htm Holland & Knight LLP. (1996–2014). We Understand Your Issues. Retrieved from http://www.hklaw.com/clientsectors/government-entities/rences: