Question

Describe the major objectives of financial management in healthcare organizations.

Answer 1

The major objectives of financial management in healthcare organization are as follows

• Generating income from healthcare activities - The finance managers prepares strategies and implement it to generate adequate income so that the healthcare organization can provide health services for long run and recover its expenses. They also guide investment in assets, equipments and reviews the rates on healthcare services.
• Protecting the tax status of the organization - The finance managers ensure the compliances with law and taxes and also helps in fulfilling the requirements of tax exemption in healthcare services and protecting its tax status.
• To keep an eye on internal spending - It is important for the finance managers of the healthcare organization to monitor the internal spending by doctors or physicians to avoid the chances of Fraud in the healthcare organization.
• To deal with insurance companies - Insurance companies are profit oriented and they ask for discounts if large number of patients are taking their policies so the finance managers of healthcare organization helps to break a profitable deal with the insurance company and helps to avoid any loss in terms of payments for there healthcare services.