Essay on Financial Environment
July-Monday 14th, 2014
Instructor Crystal Chilman
Financial environments in the health care industry provide a vital part in the service, quality, and care. Each health care organization fits differently within the environment. Financial management of each organization is needed for external and internal operations and financial status. The provision of health care services is dominated by not-for-profit (NFP) organizations, for-profit (FP), and governmental, (Gapenski, 2008).
The job of finance in health services organizations is to plan, acquire, and utilize resources to maximize the efficiency and value of his or her industry. These health care organizations will have …show more content…
1. One specific distinction of health care entities from another NP involves the requirements to comply with Medicare and Medicaid regulations that may involve additional checks and balances on the financial reporting system, (Lopez, Rich, & Smith, 2013). 2. Audits, internal controls, and monitoring efforts are different 3. Government run organization will have a wide range of resources 4. FP organization will have a better internal control system 5. Government run organizations do not focus on completion and the market 6. NFP hospitals do not pay property, sales, or income taxes 7. FP hospitals generate funds through issuing stocks 8. NFP hospitals can issue tax-exempt bonds and can accept tax-deductible contributions, (Duggan, 2011).
Where do they get Their Money?
NFP organizations will receive their funds from many methods. The funding will come from charitable donations like corporate philanthropy. Local, state, and federal governments will contribute to an NFP with government grants. Large and small family foundations will give endowments. Lastly, community foundations will pool funds to give to NFP organizations.
These health care organizations will receive their payment from reimbursement.