Financial Indicators Decision Making Simulation
What cost cutting options were chosen? Explain why those were chosen.
The cost cutting options chosen were reducing Agency staff and changing the skill mix. Reducing the agency staff will reduce cost, and save on premiums paid directly to contracted agencies. The cost for contracted staff is nearly double of the employees.
Changing the Skill mix was also recommended by hiring unlicensed personnel such as nursing assistants and patient care technicians. Training time for unlicensed personnel is much less than licensed personnel. In addition unlicensed personnel such as nursing assistants will be able to assist nurses with easy tasks such as feeding, changing, bathing, and moving patients. This will enable the RN to utilize his or her time more effectively for direct patient care. Which cost cutting loan option was chosen? Explain why.
Loan option two was initially chosen to repay the loan. This option was chosen because of the low interest rate at 9.0%, which would allow Elijah Heart Center (EHC) to have more funds initially. The only set back is the loan had a prepayment limitation of six months which would allow interest to accrue and add to the principle loan amount. After further investigation, it became clear that loan option one was the better choice because the funds could be paid sooner therefore accruing less interest. Which strategies for equipment acquisition were chosen? Explain why.
The strategies chosen for equipment acquisitions were to lease both the Ultrasound System and the High-Speed CT Scanner. Both would have a lower upfront payment and lower monthly payments. With technology changing within five to ten years the option for leasing would allow to upgrade the equipment at the end of the lease, therefore allowing the latest technology to be utilized at EHC. The X-ray machine would be purchased as a new product for the company. The lifetime of the equipment averages...
References: Anthony, M. K., & Vidal, K. (2010). Mindful Communication: A Novel Approach to Improving Delegation and Increasing Patient Safety. Online Journal Of Issues In Nursing, 15(2), 2. doi:10.3912/OJIN.Vol15No2Man02
Health Care Financial Accounting, Analyzing Financial Indicators for Decision Making
Murphy, M. C. (1996). Cutting healthcare costs through work force reductions. Hfm (Healthcare Financial Management), 50(7), 64.
Please join StudyMode to read the full document