HCM640 Unit 1 DB2_2024
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Applied Managerial Finance (HCM640-2402B-01)
Unit 1, Discussion Board Post 2
March 21, 2024
What is the importance of financial information to the hospital?
Quality of care and hospital financial performance are statistically strongly associated. Costs, operational effectiveness, asset liquidity, financial leverage, and hospital profitability play significant roles in healthcare quality (Dong, 2015). Hospitals can utilize financial information regarding clinical data and electronic health records to analyze and improve healthcare outcomes. These insights provide valuable information on improving the quality of care and operational efficiency and can help decrease risk. This data can help an organization make decisions about where to focus and how to improve both operationally and the care provided to patients.
Who are the various users of the hospital financial information, and how is the information used in healthcare decision-making?
Although it is commonly acknowledged that the Vice President of Finance, Chief Financial Officer, and Chief Executive Officer are the primary users of a hospital's financial data, many other staff members and stakeholders also frequently interact with this data. Hospital accountants, financial managers, controllers, auditors, and financial analysts play crucial roles in the hospital's financial health in addition to these executive positions. Health information managers are vital in developing cost-effective and efficient healthcare strategies using financial data to manage patient billing and create departmental budgets.
Financial data is vital for managing employee pay and patient accounts, lowering organizational risk, guaranteeing value-driven treatment, and financing medical research. This financial information is vital for handling employee salaries and patient accounts, reducing organizational
risk, ensuring value-driven care, funding research, and exploring new revenue-generating avenues (Lane, 2021).
Discuss the differences between financial and managerial accounting and how each applies to healthcare facilities?
Financial accounting is the method of converting accounting data into financial reports that are shared with both internal and external stakeholders. Alternatively, managerial accounting is a more internalized process that tracks an organization's transactions and looks at future forecasting. Financial accounting gathers and presents data about a healthcare facility's overall performance. Conversely, managerial accounting provides more specific information about earnings by region, clientele, product category, and individual products. Financial accounting data is more likely to be shared
with outside parties, whereas managerial accounting reports are more likely to be given to company insiders (Strydon, 2022). References
Applied Managerial Finance (HCM640-2402B-01)
Unit 1, Discussion Board Post 2
March 21, 2024
Dong, G. N. (2015). Performing well in financial management and quality of care: evidence from hospital process measures for treatment of cardiovascular disease. BMC Health Services Research
, 15
(1). https://doi.org/10.1186/s12913-015-0690-x
Lane, L. (2021, April 14). Healthcare Organization Financial Statements Best Practices | Healthcare Accounting | Richter. Blog.richterhc.com. https://blog.richterhc.com/health-care-organization-
financial-statements-understanding-best-practices
Strydom, L. (2022, May 30). Financial Accounting vs. Managerial Accounting: What’s the Difference? The Balance. https://www.thebalancemoney.com/financial-accounting-vs-managerial-accounting-
5201154
Utilizing Financial Data in Healthcare. (2023, April 24). Koombea. https://www.koombea.com/blog/financial-data-in-healthcare/
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Fixed
Asset
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=
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Net fixed assets
TA turnover =
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Total assets
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