Healthcare Financial Management HA 520 Unit 2 Assignment
Financial Terminology and Health Care Finance
Lashunda Carter
Kaplan Univeristy
Abstract
Due to the evolving health care industry, financial management is extremely important. Anyone pursuing financial management in the health care industry must have exceptional skills and knowledge. According to Brumley (2015), “The industry has been changing in big ways since long before the Affordable Care Act took effect. Medicare 's coding system for billing and the advent of electronic medical records are examples of these changes” (para. 1). Financial management consist of many duties such as maintaining cash cushion for unforeseen costs, negotiating contracts, and also ensuring cash is available for payroll. On an executive level, financial management is the process of providing upper management with the data needed to make strategic plans for an organization’s future (Brumley 2015). In this paper I will discuss financial terminology and health care finance. After reviewing two recent healthcare industry related articles regarding financial terms, I will provide a brief summary on both articles, explaining the financial terms listed as well as how these terms are applied in healthcare.
Financial Terminology and Health Care Finance
Financial management plays a major role in the overall success of a business. According to Gapenski (2006), “The primary role of financial management is to plan for, acquire, and utilize funds (capital) to maximize the efficiency and value of the enterprise. Financial management can become very challenging in healthlcare due to the industry changing at a rapid pace. The Affordable Care Act is one of the many reasons healthcare providers and insurers had to recalculate their plans and premium structures (Brumley 2015). In addition to the Affordable Care Act, healthcare providers have also had to redesign their finance functions due to health care providers such as Medicare. Medicare has demanded healthcare
Lashunda Carter
Kaplan Univeristy
Abstract
Due to the evolving health care industry, financial management is extremely important. Anyone pursuing financial management in the health care industry must have exceptional skills and knowledge. According to Brumley (2015), “The industry has been changing in big ways since long before the Affordable Care Act took effect. Medicare 's coding system for billing and the advent of electronic medical records are examples of these changes” (para. 1). Financial management consist of many duties such as maintaining cash cushion for unforeseen costs, negotiating contracts, and also ensuring cash is available for payroll. On an executive level, financial management is the process of providing upper management with the data needed to make strategic plans for an organization’s future (Brumley 2015). In this paper I will discuss financial terminology and health care finance. After reviewing two recent healthcare industry related articles regarding financial terms, I will provide a brief summary on both articles, explaining the financial terms listed as well as how these terms are applied in healthcare.
Financial Terminology and Health Care Finance
Financial management plays a major role in the overall success of a business. According to Gapenski (2006), “The primary role of financial management is to plan for, acquire, and utilize funds (capital) to maximize the efficiency and value of the enterprise. Financial management can become very challenging in healthlcare due to the industry changing at a rapid pace. The Affordable Care Act is one of the many reasons healthcare providers and insurers had to recalculate their plans and premium structures (Brumley 2015). In addition to the Affordable Care Act, healthcare providers have also had to redesign their finance functions due to health care providers such as Medicare. Medicare has demanded healthcare
References: Arnow, M., Jr. & Xakellis, G. C. (2001). Making Your Balance Sheet Work for You. Retrieved from http://www.aafp.org/fpm/2001/0600/p27.html Baker, J. J., & Baker, R. W. (2009). Healthcare finance. New York, NY: Jones & Bartlett Publishers. Brumley, S. (2015). Role of Financial Management in Health Care. Retrieved from http://smallbusiness.chron.com/role-financial-management-health-care-76263.html Gapenski, L. (2006). Understanding Healthcare Financial Management. Retrieved form http://www.ache.org/pubs/chap1-3gapenski5th.pdf Gul, S., Sajid, M., & Razzaq, N. (2012). The relationship between dividend policy and shareholder’s wealth