Health Care Budget

1072 Words Oct 7th, 2012 5 Pages
HCS 577
September 2012

Health Care Budget
Manage a health care organization is not an easy task, the compromise with the community to provide an excellent service and the responsibility of keeping the profitability and viability of the organization makes health care management a complex and every day challenging profession. It require effective practices to avoid the failure of the business.
Independently if the organization is not-for-profit or for-profit, a vital duty of the management team is to keep the organization finances in a status that allows it to operate, and produce a level of revenue that secure its existence over the years. To reach these objectives, managers must perform key functions that involve planning, decision
…show more content…
That is the case of the Patton-Fuller Community Hospital, a for-profit organization founded in 1975 by on-site practicing physicians, which principal objectives are to provide an excellent patient care to the community it serves and as any other for-profit organization, enhance the wealth of its stockholders (Albert, Brooks, Borze & Stoops, LLC, 2009).
To apply effective management practices PFCH corporate officers work together to develop annual budgets to focus on operational decisions surrounding the increasing of revenues and decreasing of expenses, control, and reduction of costs, and maintaining a healthy cash flow.
Looking at the 2009 Operating Budget, is easy to deduct that PFCH management team has been practicing successful management techniques augmenting the revenues in almost 10% from 2008 in comparison with not even a 6% in expenses increase. For 2010 the percentages of increase are lower based on the assumption that a three percent general deflation rate for prices in 2009 will continue into 2010 as a result of the weak economy (Virtual Organizations, 2011). The figures are as follows: Patient revenue and total revenue will increase three percent in 2010, and even if it is at a decreased rate with little or no increase in patient volume, resulting of new managed care contracts, the tendency of having a major increase in revenues than expenses continues with only a 1.26% expenses increase.
Another good

More about Health Care Budget