Generally Accepted Accounting Principles in Health Care

You have been asked by a health care magazine to write a series of articles focusing on health care financial concepts. The articles will be included in five consecutive issues and will be geared towards readers with little knowledge of finance. You must ensure that the articles are both informative and engaging to your audience. You must also ensure that your articles relate financial principles to the health care industry.

The role of finance in Health Care Systems, Inc. as a regional not-for-profit hospital relates to both the accounting and financial management aspects of the business. Facets of both accounting and financial management are intertwined with maximizing productivity by way of managing and analyzing financial operations to ensure resources are being utilized properly (Gapensiki, 2013). The divulgence of financial reports to managers and investors will aid in the development of plans and budgets for future growth, assess acceptable levels of financial risk, manage contracts appropriately and make decisions related to capital investments allowing the organization to expand service offerings thereby demonstrating greater value in the community. Operating as a not-for-profit entity requires that the hospital operate exclusively in the interest of the public for a charitable purpose. Through understanding who the primary third party payers

g. On December 31, 2012, the company completed the work on a contract for an out-of-province company for $7,900 payable by the customer within 30 days. No cash has been collected and no journal entry has been made for this transaction.

A major aspect of health care organization operation is that of financial management. Financial management of health care organizations incorporates ethical standards and proper reporting practices. Financial practices and ethical finance concerns are important to the success of any organization, particularly within the health care industry. The four elements of financial management, generally accepted accounting practices (GAAP), and general financial ethics standards are part of ensuring fair and accurate financial reporting from health care organizations. Examining examples of ethical standards of conduct and reporting standards helps to understand the

Effective financial management is the basis of thriving health care organizations. Organizations must make good investment decisions based on objective analysis (Healthcare Financial Management Association [HFMA], 2005). Integration of financial management principles provides decision makers with guidance to make capital decisions maximize mission-based benefits at effective costs (HFMA, 2005). An operating budget is the statement of profit and loss for the entire organization. Various health care entities prepare operating budget for the following year for discussion and approval by top management (Academic Writing Tips, 2011). At the end of the year, departmental managers provide an account for the previous year’s

Managers who are managing health care organizations must be attentive to the accounting practices and must obey and practice the financial management procedures to be able to solve any issues if any should arise. With the continuation of the high costs of health care managers as well as consumers must know how to budget carefully. According to All Business. (2010), the cost of providing health care services, patients way of payment for these services and the environment in which those patients reside and receive those services are important elements that affect the care this is or may not be

“Reimbursement” in healthcare refers to the decision of the entity paying for an item or service (called the “payor”) of whether a particular item or service is covered by a particular healthcare payment program for the patient at issue and therefore eligible for payment. “Payors” refers to the entity through which an individual has healthcare coverage. The federal government is the largest single payor of healthcare services in the United States through a variety of federal healthcare programs such as the Medicare and Medicaid programs established under the Social Security Act (SSA).

In this paper I have defined accrual and cash basis accounting. Also, I have answered the following questions: Explain the difference between the accrual basis of accounting and the cash basis of accounting. What are the major reasons for using accrual accounting? What are the purpose of a journal and a ledger? Give an example of a contra-asset, and explain how it is recorded on the ledger as a transaction. Explain what a “prepaid expense” is and how it is recorded on the ledger as a transaction. What are the major differences in recording transactions for a for-profit organization versus a not-for-profit, or are there any? List and record each transaction

This course is designed as an introduction to the terminology, processes, functions, and financial reports commonly encountered in health care operations. This course introduces the concepts of basic managerial financial functions, such as budgeting, reimbursement methods, and the responsibilities of health care financial

Controlling is ensuring the validity and accuracy of all financial information within the firm. Controlling will become very profound as the industry overall undergoes fundamental change in regards to operations. Legislation imposed by the federal government regulates, to a certain extent, how health care organizations operate. As such, management must be able to control costs and assess the validity of the financially information presented to them. If the organization fails to do so, the results could be devastating. First, loses will occur due to the excessive lack of control. The organization may be forced to lower spending in some areas of compensate for the aggressive spending in others. In addition, the reputation of the firm could be harmed. Patients and other vendors may be unlikely do business with the firm for fear of the company's lack of financial security. Therefore, in order to ensure the continuity of the business, the firm must have adequate methods by which to check the validity of its financial information. Third party audits, independent audits, check and balances and management oversight all will help ensure that the overall financial position of the firm is sound and credible.

Student Cases with Solutions to accompany Accounting & Auditing Research: Tools & Strategies (7th edition)

In the health care world finances play a significant role in the quality of care rendered to the consumer. There is no health care facility that is the same when it comes to their financial management because it is needed both internally and externally to ensure that it runs properly. Today’s health care field consist of either not-for-profit organizations, for-profit organizations and governmental, (Gapenski, 2008).

Financial management of health care organizations can be a complex challenge for health care managers, from the basic elements of financial management to the heavy burdens of ethical compliance and accuracy. In this paper the subject to discuss is financial reporting practices and ethical standards in health care, how health care reform is changing and making these organizations more accountable, and summaries of generally acceptable accounting principles and general financial ethical standards.

The following pages present a brief analysis of sample data from one healthcare organization. Accompanying this written report are spreadsheets of the company's financial data its balance sheet and its statement of revenue and expenses that provide not only the figures from the audited reports of the hospital examined, but also show the change from year to year on each item as both a dollar amount and a percentage. Changes of more than five percent are considered worthy of discussion, and as these documents show much

Healthcare managers participate in various important roles that allow them to form and maintain flourishing organizations. Managers ought to be aware of the decisive elements of management and the generally accepted accounting principles. At the same time, they must realize, stick to, and put into effect the general financial ethical standards. Successful management of finances of healthcare is one of countless tests that mug the organization. Revenues and expenses of the organization are essential because they establish the external and internal finances of the company. The