Week 1 Discussion – Organizational Structure

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  • Introduce yourself to your peers by sharing something unique about your background. Explain how you expect this course to help you move forward in your current or future career.
  • What challenges might you expect if an organization felt it necessary to change its organizational structure? How would you address these challenges?
  • Be sure to respond to at least one of your classmates’ posts.

Week 2 Discussion – Reimbursement

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For medical professionals and institutions, the importance of reimbursement in healthcare cannot be overstated: this is how they are paid, of course, and how they are able to continue providing services to consumers. But, as folks on both sides of the equation know, healthcare is far from simple, and neither medical decision-making nor healthcare reimbursement rates are simple—they are continually being reformed.

Ideally, healthcare providers would be able to make course-of-treatment decisions for their patients through patient symptoms, diagnosis, open discussions, and insight gleaned from the patient’s medical history. In other words, in an ideal world, consideration of how providers will be paid would not hinder physicians from making the soundest medical directives for the patient. However, we do not live in an ideal world, and complications in healthcare reimbursement often interfere with what may be the best course of treatment for particular patients. This is an important consideration for medical professionals, administrators, and lawmakers. However, a new trend is emerging: doctors who don’t take health insurance. These providers have opted to take cash payments, set up payments plans, or offer a monthly subscription. A growing number of doctors simply are not taking contracts with insurance companies, although the concentration varies by region and by specialty. That leaves patients to pay the market rate the doctor charges, and then submit a receipt to get reimbursement for out-of-network coverage, if they have it (1).

  • What are the ethical implications associated with each model? If you were the business office manager of a small practice, which payment model would you prefer and why?
  • Be sure to respond to at least one of your classmates’ posts.

Sources

Learn.org. No date. What Does a Medical Biller Do?

Links to an external site. https://learn.org/articles/What_Does_a_Medical_Biller_Do.html

Learn.org. No date. What Does a Medical Coding Specialist Do?

Links to an external site. https://learn.org/articles/What_Does_a_Medical_Coding_Specialist_Do.html

Week 2 Activity – Healthcare Finance Questions

 

Overview

This activity will help prepare you for the assignment in Week 3. For this activity, you will choose an organization to research and create questions to ask as part of that research.

Instructions

For the Week 3 Assignment, you will be expected to investigate the financial condition of a health services organization (HSO) of your choosing. In preparation for the Week 3 Assignment, you are expected to submit a Microsoft Word document explicitly addressing the following:

  1. Utilizing the Strayer Library or other credible sources, you are to identify an HSO. Once identified, in a paragraph, share the name of the organization and provide a high-level overview of what kind of organization it is (e.g., home health, hospice, tertiary care facility, long-term care, subacute care, pharmaceutical, biotechnology, etc.) and the segments of the population that it supports.
    • You will want to be sure there is plenty of information available about the organization, particularly financial information. This means you’ll likely need to choose a large organization that is required to make financials public.
    • One of the best ways to understand a company’s financial health is to review its financial statements, including the balance sheet, income statement, and cash flow statement. These statements provide information about the company’s assets, liabilities, revenues, expenses, and cash flow. You can typically find these statements in a company’s annual report if non-profit.
    • For publicly traded HSOs, regulatory filings with the Securities and Exchange Commission (SEC) can provide additional information about the company’s financial performance, management, and risks. These filings include the annual report, 10-K, 10-Q, and proxy statement
  2. To gain a better understanding of the financial condition of your chosen health services organization, its budget preparation process, and fiscal planning strategies, you will develop five questions that you will answer as part of your investigation. Ideally, these would be questions you would ask a management official responsible for the financial planning of the organization. It is important that you provide a brief explanation for why you chose to include each of the 5 questions.
    • Think about questions that will give you greater insight into what the company looks for when preparing their annual budget, their fiscal planning strategies, and how they monitor their financial condition throughout the year and make necessary adjustments.
    • Optional: You may also choose to use these questions to interview a financial manager within a healthcare organization. The interview would then be the source of your information instead of the research.

Week 3 Discussion – Ratio Analysis

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There are three financial statements that are prepared regardless of the business structure (nonprofit, private; nonprofit, public; for-profit, private; or for-profit, public):

  1. Balance sheet.
  2. Income statement.
  3. Statement of cash flows.

These statements are used by health services managers to assess how well the leadership team is doing in managing assets, properly leveraging debt and equity, maintaining liquidity and solvency, and achieving profitability. This is done by examining the relationship between figures on the statements and through a process known as ration analysis. There are many stakeholders interested in certain financial ratios, such as lenders, vendors, leadership, personnel, and the community.

There is a fourth financial statement referred to as the statement of change in equity, which provides explanations for changes in a firm’s equity; however, it isn’t typically used in performing ratio analysis.

For this discussion:

  • You are an administrative intern and your boss, the controller, has asked you to identify one asset management ratio, debt management ratio, liquidity ratio, solvency ratio, and profitability ratio that you believe to be the most important to an organization, and then prepare a brief defense of your choices.
  • Be sure to respond to at least one of your classmates’ posts.

Week 3 Assignment – Healthcare Finance Research

Overview

For the Week 2 activity, you selected a health services organization (HSO) and then developed five research questions to gain a better understanding of the financial condition of your chosen HSO; its budget preparation process; and fiscal planning strategies related to the financial management of the organization. For this assignment, you will provide thorough responses to each question and report your key findings.

Instructions

Using the HSO you identified in the Week 2 activity, use the Strayer Library and other reputable sources to locate publicly available financial information that will provide you with the answers to the five questions you developed in Week 2.

You will then write a three-page paper in which you include each of the following components:

  • Develop an introduction to your chosen healthcare organization.
    • The name of the selected organization and background information, such as its location, size, focus, services provided, demographics of patients served, for-profit or nonprofit status, et cetera.
    • Indicate whether the organization has a separate finance or business department and, if so, who is responsible for the department.
    • Any other information that may help explain the chosen organization. For example, is it unique in how its finances are managed? If so, how?
  • Develop research-based answers to the five previously created questions.
    • A response to each of the five questions you created in Week 2. This should include specific information pertaining to the chosen healthcare organization’s budget preparation process, fiscal planning strategies, and how the financial condition of the organization is routinely monitored and corrective actions are taken when necessary.
  • Assess any differences and similarities between what you have learned from the textbook, videos, and other readings with what you have learned in your research.
    • This is the section of the paper where you assess any differences between what you have learned in this course and what is reflected in your research. This is also an opportunity to identify connections between cost and quality and explore the interplay of performance improvement, regulatory compliance, provider relationships, and payors. Keep in mind that the background and context of the organization play a role in how these pieces fit together.

This course requires the use of Strayer Writing Standards (SWS). The library is your home for SWS assistance, including citations and formatting. Please refer to the Library site for all support. Check with your professor for any additional instructions.

Week 4 Discussion – Leveraging Cost Volume Profit Analysis

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Complete the following for this week’s discussion:

  • How do you leverage the information obtained through cost volume profit (CVP) analysis to determine the goods and services provided to consumers? Please justify your response.
  • Be sure to respond to at least one of your classmates’ posts.

The following resource may help you visualize how changes and input variables affect the profit and loss scenario:

Week 5 Discussion – Price Setters and Price Takers

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It can be postulated that there are two scenarios when it comes to price setting by providers and provider organizations. Providers refer to those practitioners eligible to bill third-party payers for the services they provide to patients. Provider organizations are facilities where care is delivered to patients. The first scenario is that providers and provider organizations are considered “price takers,” in that the rates of reimbursement are set by the payers with little to no input from providers and organizations. The second scenario is that providers and organizations set their own prices and that payers are expected to pay these rates. These strategies will be explored in this week’s discussion.

  • Briefly discuss what is meant to be a price setter or price taker, the strategies employed in both approaches, and a clear listing of the pros and cons associated with each price setting strategy. After weighing the pros and cons of each, which approach do you feel best meets the needs of the key stakeholders?
  • You will be expected to respond to the initial posting of at least one peer. In this response, you should share what you liked about the posting and why, and then what you believe could strengthen your peer’s recommendation.

Week 5 Assignment – Strategic Financial Analysis

Overview

The purpose of this assignment is to familiarize you with financial statements, the need to align the financials and the strategic direction of the firm, and the process of performing horizontal and vertical analyses of a company’s balance sheets and income statements.

You will be provided with a scenario and a variances analysis. You will use the information in both to create a memo in which you demonstrate your audit financial statements and expenditures based on organizational priorities.

Instructions

Scenario

You’re a healthcare administration fellow at the prestigious Stanford Healthcare. You have been rotating through the various departments over the past nine months and now you have the honor of working under the mentorship of Chief Financial Officer Linda Hoff.

Stanford Medicine includes Stanford Healthcare, Stanford Children’s Hospital, and Lucile Packard Children’s Hospital Stanford. This organization uses an integrated approach to strategic planning, which incorporates jointly agreed-upon strategic priorities from its various entities. It also ensures a high degree of congruence in strategic focus by each entity.

Before outlining the strategic priorities for Stanford Medicine, it is important to note that a firm’s directional strategy comprises three discrete yet interwoven components: vision, mission, and goals (or, in this case, priorities). Armed with this knowledge, you have familiarized yourself with the vision, mission, and priorities of Stanford Medicine. Below is what you found.

When examining a company’s financials, it is prudent to keep the directional strategy of the company in mind. After all, in order to advance many strategic priorities, which include fulfilling the mission and positioning the organization to achieve its vision for the future, proper management of the firm’s scarce resources is vital. Failure to properly manage the financial performance of the organization can compromise the company’s ability to maintain a competitive advantage in the marketplace.

Our Vision

Precision Health: Predict. Prevent. Cure. Precisely.

We will heal humanity through science and compassion by leading the biomedical revolution in precision health.

Our Mission

Improving Human Health Through Discovery and Care.

Through innovative discovery and the translation of new knowledge, Stanford Medicine improves human health locally and globally. We serve our community by providing outstanding and compassionate care. We inspire and prepare the future leaders of science and medicine.

Strategic Priorities

A collaborative endeavor involving the entire community, the Stanford Medicine integrated strategic planning process yielded a framework that is human-centered and discovery-led, focused on three overarching priorities for our enterprise.

By enhancing our strengths and achieving our goals in these priority areas, we will amplify our preeminence and remain uniquely positioned to lead the biomedical revolution in precision health, ensuring our continued ability to guide healthcare through significant global changes.

Value Focused

Provide a highly personalized patient experience.

Ensure a seamless Stanford Medicine experience.

Digitally Driven

Amplify the impact of Stanford innovation globally.

Deliver human-centered, high-tech, high-touch care and revolutionize biomedical discovery.

Lead in population health and data science.

Uniquely Stanford

Accelerate discovery in and knowledge of human biology.

Discovered here, used everywhere: advanced fundamental human knowledge, translational medicine, and global health.

Ensure preeminence across all our mission areas.

Variance Analyses

Normally, managers are expected to examine positive and negative variances, and then speculate as to possible explanations for the observed variances. Following this initial assessment, managers would be expected to dig deeper into those variances of greatest concern to the organization to uncover the actual causes for the variances, and then implement necessary corrective actions. Digging into all variances would be costly and, quite frankly, a misuse of time and energy.

The CFO asked one of her financial analysts to conduct a variance analysis of the company’s consolidated balance sheets and income statements for fiscal years 2015, 2016, 2017, and 2018, which has been completed. The analyst determined the variances for each account (line item) captured in the financials. Now that this first step has been accomplished, the CFO would like you to pay particular attention to the negative variances contained in the spreadsheet and focus on those variances you believe to be potentially the most impactful to Stanford.

The financial analyst completed your variance analysis over time, which is referred to as a horizontal analysis, and then proceeded to create a common-size balance sheet and income statement for each of the four fiscal years (2015-2018). The common-sized financials are captured in the provided spreadsheet.

Financial Management and Strategic Direction

Once you’ve completed your horizontal and vertical analyses of the financial statements, you should be able to get a sense of how well management has managed the financial resources of the company in support of its strategic direction. In business, the strategic direction should be evident in its vision and mission statements, and strategic priorities. The strategic priorities should support the company’s mission, and the mission should help advance the firm’s vision for the future. Failure to effectively manage the company’s financial resources can seriously compromise the firm’s ability to fulfill its mission and, subsequently, its vision.

Submission

Based on the provided scenario, create a 3-4 page business memorandum to Linda Hoff, Stanford’s CFO. For guidance on writing a memo, take a look at this Sample Memo [DOCX]

Download Sample Memo [DOCX].

In your memo, codify your findings and interpretations from the horizontal and vertical analyses and the level of alignment in the company’s fiscal management and strategic direction. Include the provided Excel spreadsheet you used to complete your analysis as an attachment to the memo. In this memo, you will:

  1. Review the year-over-year variances contained in the audited Stanford balance sheets and income statements for fiscal years 2015-2018 in the  Week 5 Assignment Spreadsheet [XLSX]
  • Download Week 5 Assignment Spreadsheet [XLSX]. You’ll be expected to pay particular attention to the negative variances (color-coded in red) that you believe to be potentially the most impactful to Stanford and provide a rationale for that belief.
  • Hypothesize as to the reasons for the negative variances. Be sure the hypothesis is supported by evidence from the scenario, the balance sheets, and income statements.
  • Explain the proportional changes in the common size results over the four fiscal year time frame and identify notable changes in the ratios. Also include a hypothesis, supported by a rationale, to suggest why these anomalies may exist.
  • Identify notable patterns and variances that warrant further investigation and justify both with evidence from the three-year period. Specify the potential consequences of the variances to justify the need to examine these variances further.
  • Assess whether the vision, mission, and goals of the organization are aligned with its current financial position and provide an explanation of why it does or does not align. Provides specifics from the variance analysis to support the assessment.

Week 6 Discussion – Strategic Planning and Business Plan

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Ascertain the importance of strategic planning for an organization.

  • Suggest one strategy to structure the strategic planning session for a midsize nonprofit health organization that is competing with several for-profit facilities in the area. Then determine your approach to communicate the mission, vision, and value statements for the strategic planning. Provide a rationale for your response.
  • Use Basic Search: Strayer University Online Library to research articles on business plan creation within health organizations. Next, based on your research and analysis, recommend three best practices of business plan creation, and support your response.
  • Be sure to respond to at least one of your classmates’ posts.

Week 7 Discussion – Financial Risks

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If managers could have just one wish, many would ask for a crystal ball. With this tool, there would never be any worry about risk. The manager could look into the crystal ball and know exactly what will happen with each decision. Unfortunately, we do not have this luxury and must use other tools and techniques to determine the risks we face for the decisions we make. Understanding the financial risks will be the focus of this week’s discussion question.

  • In what ways do you believe the trade-off of Risk-Return might influence organization and individual investment decisions?
  • Be sure to respond to at least one of your classmates’ posts.

Week 8 Discussion – Capital Analysis

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Relevant cash flows are inflow and outflow of cash, of which the inclusion or exclusion from investment appraisal can affect the overall investment decision. (1) It isn’t easy to forecast cashflow as it requires looking several years into the future.

  • What three factors do you believe influence cash flow projections? In your response, justify your position through the use of examples, two peer-reviewed sources, and the like.
  • Because these projections are important, identify two ways you can maximize the accuracy of the forecast.
  • Be sure to respond to at least one of your classmates’ posts.

Sources

  1. Hybrid Accountant. No date. Relevant Cash Flows of Capital Budgeting. https://accountantnextdoor.com/relevant-cash-flows-of-capital-budgeting/

Week 8 Assignment – Capital Budget Analysis

Overview

For this assignment, you will be provided with a spreadsheet containing projected numbers for two different patient services programs. You will need to download the Program Projections [XLSX]

Download Program Projections [XLSX] spreadsheet and use it to conduct your analysis.

Instructions

You are a member of the financial services department at Benson Regional Medical Center. The chief financial officer and chair of the capital budgeting committee, Dana Foster, has requested that you perform some capital analysis of two proposed patient service programs.

You have been provided with a spreadsheet that covers much of the projected financials for each of the proposed programs. Your task is to perform an analysis of that information and provide your recommendation to the capital budgeting committee as to which program they should pursue.

You have been asked to create a presentation to present your findings to the capital budgeting committee.

Using the provided spreadsheet, complete a capital budgeting analysis on the information provided in the spreadsheet. Specifically, you will need to identify a net present value (NPV), internal rate of return (IRR), and a discounted payback period for proposed Program #1 and Program #2. You will present your finding in a presentation.

  • Design a PowerPoint presentation for the capital budgeting committee that includes all of the following:
    • Create a brief 1-2 slide description of the proposed programs.
    • Develop a comparison between the cash flow projects of each program from Year 0 to Year 5. Highlight the differences.
    • Compare the results and interpretation of the discounted payback period between both programs.
    • Compare the net present value (NPV) for each program.
    • Compare the Internal rate of return (IRR) for each program.
    • Develop a recommendation for which program the capital budgeting committee should take into consideration. Include supporting rationale.

Formatting Requirements

The presentation should be 8-10 slides in length and include speaker notes with each slide.

Week 9 Discussion – Capital Structure

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The mix of debt and equity financing used by an organization is called its capital structure. Many managers struggle with finding a balance between these two options. It is a critical decision, as it impacts the organization’s assets, liabilities, and bottom line.

There is a cost associated with raising money to finance capital projects (cost of capital). The main objective is to minimize the cost of capital.

  • What approach would you use to determine the optimal capital structure? Defend your position.
  • Be sure to respond to at least one of your classmates’ posts, comparing and contrasting the different approaches to the memorandum.

Week 10 Discussion – Revenue Cycle Management

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One hot topic in many healthcare organizations today is revenue cycle management. We typically do not get paid when services are rendered, nor do we get the full cost of providing that care. As a result, we incur costs for facilities, supplies, and labor that must be covered. The ultimate goal of revenue cycle management is to convert services into the correct amount of cash reimbursement. This can be a bit difficult for medical practices. One reason is that providers often forget it is a business.

  • Discuss the two reasons that support the importance of provider involvement in revenue cycle management.
  • Be sure to respond to at least one of your classmates’ posts.

Week 10 Assignment – Fiscal Planning and Management Presentation

Overview

For this assignment, you will create a narrated PowerPoint presentation designed to train others on the role of healthcare administrations in fiscal planning and fiscal management. This is your opportunity to demonstrate what you have learned about what fiscal planning and management can and should look like for healthcare administrators.

Instructions

As a regional healthcare administrator for a long-term care organization, you have been asked to train a new group of healthcare administrators who just completed their degrees. They have no work experience in healthcare administration or financial management. For this assignment, you will develop a 10-12 slide narrated PowerPoint presentation explaining the role of healthcare administrators in fiscal planning and financial management.

Your presentation should address each of the following:

  • Explain how fiscal planning ties into strategic planning. Be sure to provide at least two concrete examples. In this context, fiscal planning may be considered strategic financing.
  • Describe the role (direct or indirect) that healthcare administrators play in budgeting. Specifically, address the role administrators play in the construction and implementation of operating and capital budgets.
  • Assess how fiscal planning and financial management help ensure that provider organizations remain compliant with federal, state, and local regulations. Conversely, you should assess how those regulations impact fiscal planning and healthcare financial management.
  • Review the 4 Cs of healthcare finance: cost, capital, control, and cash by writing a brief definition of each and explaining, with rationale, the impact of the 4 Cs on the success of health service organizations.
  • Propose the application of Lean Six Sigma concepts as a tool for strengthening the revenue cycle of provider organizations.

Your presentation should meet the following formatting requirements:

  • Be 10-12 slides in length.
  • Include narrated content to match the presentation.
  • Include a cover slide and references slide (or slides). (These slides are not part of the 10-12 slide requirement.)
  • Include 3-5 quality references, one of which should be your course textbook.

Use Basic Search: Strayer University Library to find and include 3-5 quality references, one of which should be your course text.

This course requires the use of Strayer Writing Standards (SWS). The library is your home for SWS assistance, including citations and formatting. Please refer to the Library site for all support. Check with your professor for any additional instructions.

The specific course learning outcome associated with this assignment is:

  • Analyze the healthcare administrator’s role in fiscal planning and management.

Week 11 Discussion – Professional Development

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Choose a topic found on the HFMA website. Provide an overview of the topic in one paragraph.

  • Be sure to include an explanation regarding how it applies to something that you learned in the course. How do you think the HFMA can support your career growth and development?
  • Be sure to respond to at least one of your classmates’ posts.

HSA525 – Health Financial Management

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