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there are several ways that leaders monitor operations in the health care field. Occupancy rates, patient...

there are several ways that leaders monitor operations in the health care field. Occupancy rates, patient mix, payer mix, and several other factors. These are essentially all ratios used to monitor operations. Discuss specific ratios used in a hospital or nursing home and how they are impactful.

Expert Solution

Non-financial Ratios and its impact:

1. Case Mix Index (CMI) Measures the intensity of hospital services based on the acuity of patients treated.

2. Occupancy Percentage (OCCP) - Provides an efficiency measure of existing capacity utilization.

3. CMA Adjusted Admissions (CMAAD) provides a measure of total inpatient activity.

4. Length of Stay (LOS) - Indicates a longer average stay is indicative of greater intensity or level of care.

5. Full-Time Equivalents per Occupied Beds (FTEs/BED)- Provides a measure of stang effciency.

6. CMA Patient Days (CMAPD) - Provides a measure of hospital volume adjusted for intensity of patient treatment.

7. CMA Admissions per Bed (CMAAD/ BED) -Provides a measure standardizing inpatient activity produced by each bed.

8. CMA Admissions per FTEs (CMAAD/ FTEs) - Provides a measure of efficiency and a comparison of one hospital relative to another according to FTEs

Financial Ratios and its impact:

1.Total Margin: Measures total profitability as a percentage of total revenues, so it measures the ability of a business to control expenses.

2. Cash flow margin: Measures total cash flow before financial costs (interest) as a percentage of total revenues

3. Return on Assets: It measures the ability of a business to use its assets to generate income.

4. Return on investments: Measures cash flow before financial costs (interest) as a percentage of price-level adjusted total assets

5. EVA to capital: Measures the dollar amount of profit in excess of the amount required by a business’s capital suppliers per dollar of long-term capital.

6. Current Ratio: Measures the dollars of current assets per dollar of current liabilities.

7. Days in patient accounts receivable (Average collection period) (Days premiums receivable): Measures the average time that it takes an organization to collect its receivables.

8. Average payment period: Measures that average amount of time that elapses before the organization meets its current liabilities.

9. Days cash on hand: Measures the number of days that the organization could continue to pay its average daily cash obligations with no new cash resources becoming available.

10. Price/cash flow ratio (investor-owned businesses only): Measures how much investors are willing to pay per dollar of reported cash flow.

jeff jeffy answered 1 year ago

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there are several ways that leaders monitor operations in the health care field. Occupancy rates, patient...

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