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Roles of a Financial Manager in Healthcare

Introduction

The hospital sector management is a very dynamic and at most ever-changing occupation that has the opportunity to undertake a varied number of duties and responsibilities. As a manager in the sector one is supposed to be flexible enough and ready to handle whatever duties he is allocated without much ado. The time span spent in a certain job depends on the hospital concerns and the human resource related demands. As a financial manager in this hospital I am indebted to partake various sensitive roles for the smooth running of the organization by ensuring that the company resources are well utilized. The starting initial duty that I should play involves the human resources management. This is a section of management that deals with hiring, firing, recruitment, scheduling, vocational, off days, motivation, monitoring, controlling and availing the right environment to the members of staff for the attainment of best results. As a financial chief I should ensure that the enumeration packages are distributed according to the specifications of the labor laws and salaries are paid in time to facilitate the efficiency in the line of duty. I should be all over heals to the members who are not meeting the specifications of the corporation and let them account for their doings failure to which they should be either fired and the organization gains savings on the scarce resources or instill displinary actions on them. Secondly, it’s the duty of a financial manager to order for supplies.The various departments through their heads are supposed to forward their departmental requisitions and the financial manager should analyze them before placing orders to the potential suppliers. If there are some elements of dought clarifications should be sought and appropriate remedies instilled. Third responsibility involves setting of rates for the health care services being offered. The amount of charges should represent the actual job done by our members of staff and the overall organization. This should be considerable to meet the cost that were incurred and the percentage profit that is usually targeted. No overcharging, undercharging or favors should be allowed because of social connections or family ties. Beyond these responsibilities I should be able to come up with financial plans that will enable the expansion of the organization programs or the bringing in of new ones. Budgetary allocation of growth and modifications should be able to meet the demands of the organizations. There should be no over allocation because it is likely to cause wastage of resources and neither should there be under -allocation that hinders the proposed efforts of taking the organization to the next level which is an upper position. Preparation of financial statements that have the ability to show the hospital position financially is another function that as a financial manager I should play. These should be drawn in such away that they are able to give a detailed summary and an image of what the future holds for the company. The most crucial financial statements includes the balance sheet which shows the financial position and income statement that show how much we are making. Finally the financial manger shall be responsible of monitory and control of the cash receipts and disbursements towards the attainment of the operational and investment needs of the hospital.

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Related calculations of Certificate Deposits

Certificate of deposit according to William & Andrew (2006).Refers to time deposit which is a financial product the financial corporations such as banks and credit Companies offers to their varied consumers. The certificate of deposit is the same as savings account because they are all having insurance cover as a must and are free of risks. These accounts are different from banks in that they a specified fixed duration and interest rate. The Certificate of Deposit should be held till maturity after which the money and the interest accrued is withdrawn

To calculate the amount at the end of the period the following formula is used:

Formula

The future of CD calculated in every year is as follows:

Metro bank:

Yr 1: FV= PV + INT

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= 231,000 *(1+6/365)1yr

=231,000*(1+0.016438)1yr

=231,000*1.016438*1yr

=$234,795.33

Yr 2=FV2 = PV x (1+I) x (1+I)

= 231,000*(1+5.25/365)2

= 231000*1.01438*2

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= $468,643.56

Yr 3= FV3 = PV x (1+I) x (1+I)

231,000*(1+.4.5/365)*3

= 231,000*1.011233*3

= $701,543.836

Yr 4 =FV4= PV x (1+I) x (1+I)

=231,000*(1+3.75/365)*4

= 231,000*(1+0.01027)*4

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= $933,489.48

Yr 5 =FV2 = PV x (1+I) x (1+I)

=231,000*(1+3/365)*5

=231,000*1.008196*5

=$1,164,467.213

West side savings:

Yr 1 FV= PV + INT

=231,000*(1+6.25/365)1yr

=231,000*1.017*1

=$234,955.47

Yr 2 FV2 = PV x (1+I) x (1+I)

=231,000*(1+5.5/365)*2

=231,000*1.0150*2

=$468,961.64

Yr 3 FV3 = PV x (1+I) x (1+I)

=231,000*(1+4.75/365)*3

=231,000*1.0130*3

=$702,018.49

Yr 4 FV4 = PV x (1+I) x (1+I)

=231,000*(1+4/365)*4

=231,000*1.0196*4

=$934,126.03

Yr 5 FV5 = PV x (1+I) x (1+I)

=231,000*(1+3.25/365)*5

=231,000*1.0089*5

=$1,165,284.25

The amounts that shall be acquired from both companies are somehow similar though Westside savings seem to be offering a better deal.

Risk contracting in medical care

The risk sharing programs grew significantly through out the era of 1990s between the health centers and the providers of the risk contracts. The contracting of risks is fine for the attainment of control over the organization current and future costs. The benefit of the health care having into place the risk contracts is dependant on the fact that they are the actual neophyte takers of risk in the hospital service provision and the managers of the medical care. Health centers and the service industry in general are the organizations that require a greater deal of control in the utilization of resources, improving of the standards of the quality they provide, having the power to create an allocation of premiums, the ability to keep expenditure under control and the capability to gather the information they require to make it through by having to contract for the associated risks. (Finkler, 2006). The merit of having to contract for a medical risk depends on the dramatic variation in the patterns of referrals and the utilization that will occur due to availability of inpatients. Risk contacting will be significance in that the population that shall be accessing the facilities and using the health care services is mean’t to decline and this will be as a result of the primary gate keeper’s purview reasonably because they are members of the enormous networked basic care.

The other factor that shall need the risk contracting benefit is that the referrals within the health sector are meant to go up while the outpatient services shall go to the negative end. More so the patient utilization of resources within the health centers is significantly going down and the hospitals will tend to derive the budgeted profits from the same avenue despite the decrease in expenditure by the patients. Hospital and other health care centers are faced by the financial risk which is going to be curbed by the essence of risk contracting (Baker.2005).The health care specialist are faced by the risk of information.This is critical for them to be able to give services that are needed in the managed health care. The specialist calling for information involves the nitty gritty things about their patients, their capability, possibility and the probability that the patients have towards the utilization of health care facilities and the services given out and the figures that depict the nature of referrals and expenditure of the patient’s patterns and prospects. Due to the availability of machines that can detect and decode this information which afterwards human resources do have the chance to make an analysis of, the health care specialist are faced by double risks in that they not only lack information but they also do not have relevant members of staff to do the analysis. Steven, 2003, says that, Contracting for the information risk does ensure that the data and information are available in a position which the health systems and basic care are able to benefit from it. The other risk that the health care systems face is the loss of demand and market. This does depict in short term the loss of profit and strategically delayed attainment of success.(Steven, 2003).The loss of market share is very crucial to the operational needs of the health care and revenue loss will most likely jeopardize sustainability of the unit. Risks that are facing the health sector are very technical and any ignorance shall lead to regrettable endings. Due to this it’s very critical to have the company risks undertaken by another party. With the three most critical risks which are information lack, market share and financial loss being contracted the company can go on with its operations without any worries, risk contracting is usually meant to shift trouble from the company to the providers of risk contracting service.

References

William, O. C. & Andrew, E.C. (2006).Essentials of health Care Finance. New Yolk. Jones & Bartlett Publishers.

Baker. (2005).Healthcare finance: Basic tools for Non financial Managers. New Yolk. Jones & Bartlett Publishers.

Steven, R.E. (2003).Health care Finance and Economics. New Yolk. Jones & Bartlett Publishers.

Finkler, S. (2006).Accounting Fundaments for Health care Management. New Yolk. Jones & Bartlett Publishers.

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