Question

Hospital Administration and Management

1-Healthcare cost

Many Americans are concerned with the topic of healthcare costs, but not many understand the complexity of the topic.

Write a two-page paper that addresses the following: Explain the factors that are driving healthcare costs and discuss the effects they have on both inpatient and outpatient facilities.

Do some research on a hospital or healthcare setting where you would like to work.

Outline their financial structure; are they a nonprofit, for-profit, or government facility?

Explain the costs associated with their financial structure. Detail how you as a healthcare administrator can affect these costs, both positively and negatively. Hospital Administration and Management

Reference

Your textbook may be used as a reference. The APA format for your text is as follows:

Langabeer, J. R., & Helton, J. (2016). Health care operations management: A systems perspective (2nd ed.). Burlington, MA: Jones & Bartlett Learnin

Answer 1

There is a large and persistent increase in the annual healthcare costs across the United States. According to the AWHP(The Association of Washington Healthcare Plans) the factors driving these healthcare costs are:

1. Greater demand for services
2. New technology
3. Prescription drugs
4. Cost shift due to Under-funded Public Programs
5. Government regulation and mandates
6. Medical malpractice liability.

Greater demand for services:

The consistent increase in the population and the increase in the number of elderly put a tremendous stress on the health care.The over 50 population uses twice as much of the healthcare more than what they would have used in their 20's and over 60 people use them four times as much.This creates a greater demand for physicians ,nurses and other healthcare providers.

New technology:

The advancements in medical technology are without a doubt providing important break throughs in improving care and saving lives but they come at a significant cost.

Prescription drugs:

More number of prescription drugs written,use of high cost drugs and price inflation are the factors driving the increase in prescription drug costs.

Cost Shift due to Under-Funded Public Programs:

The public program reimbursements often do not cover the actual costs of care,which causes the healthcare provider to put pressureon the private insurers to cover up the shortfalls.The cost shifting in reimbursements which is low in public programs to higher rates in private reflects in the employers premiums.Unless the government programs covers the actual cost of healthcare,this will continue to drive up haelthcare costs.

Government regulations and Mandates:

There are literally hundreds of state codes, regulations and contract compliance requirements for those participating in public programs.The regulatory environment causes administrative burden to the insurers,thereby increasing the premium costs with no value to the consumers.

Medical Malpractice Liability:

Rising malpractice insurance premiums are driving up the practitioner's fees mainly in obstetrics and gynaecology and surgery.

The effects of this driving healthcare costs is that more outpatient facilitie are being established .

Many people prefer outpatient facilities because there is no overnight stay which reduces the expenses of the services provided.In relation to cost, outpatient facility is advantageous,but when looking at the care received by the patient theer is no monitoing of the patient post procedure.

In considering recovery post procedure,inpatient facilities have an advantage,because

• there is round the clock care in case of medical emergencies or complications
• patients have access to therapy
• healthy meals are provided as per requirement of patients

All of these come at a cost.

Financial structure of non-profit facility

A non-profit can be a single entity with one operating unit.Here all financial management decisions are made by a single set of managers who must raise the needed capital and allocate it within the organisation.A non profit organisation is generally exempt from taxation including both property and income tax and they have right to issue tax exempt debt.Non-profit facility have no share holders and no group of individuals with ownership rights to the facility's residual earnings.

For-profit facility

The for-profit firm is a business in which

• the owners(stock holders) are well-defined and exercise control by voting for a board of directors.
• they take profit from residual earnings
• they are taxable at federal,state and local levels.

As a hospital administrator my goal would be to

• reduce costs by finding waste and improving utilisation
• reduce variability and improve logistics flow by looking for most efficeint ways of movement of resources
• improve productivity
• improve quality of customer service
• continuously improve business processes.