In this thoroughly revised and updated third edition of Fundamentals of Health Care Financial Management, consultant and educator Steven Berger offers a practical step-by-step approach to understanding the fundamental theories and relationships guiding financial decisions in health care organization.
Set in a fictional mid-sized hospital, the book is written in diary form, taking the reader into the inner workings of the finance executives office. This introduction to the most-used tools and techniques of health care financial management includes health care accounting and financial statements; managing cash, billings and collections; making major capital investments; determining cost and using cost information in decision-making; budgeting and performance measurement; and pricing. As in the previous editions, this book introduces key practical concepts in fundamental areas of financial management.
Table of Contents
Tables, Figures, and Exhibits
Preface
Acknowledgments
The Author
CHAPTER ONE: JANUARY
What Is Health Care?
What Is Management?
What Is Financial Management?
Why Is Financial Management Important?
Ridgeland Heights Medical Center: The Primary Statistics
Pro Forma Development
Living with the Finance Committee and Board of Directors Calendar
Year-End Closing
CHAPTER TWO: FEBRUARY
Accounting Principles and Practices
Objectives of Financial Reporting
Basic Accounting Concepts
Basic Financial Statements of a Health Care Organization
Uses of Financial Information
The Financial Statements
Preparing for the Auditors
Analysis of Sensitive Accounts
February Finance Committee Special Reports
CHAPTER THREE: MARCH
Strategic Financial Planning: Five-Year Projections
RHMC Strategic Financial Planning
Ratio Analysis
The Capital Plan and Its Relationship to the Strategic Plan
CHAPTER FOUR: APRIL
Medicare and Medicaid Net Revenue Concepts
Calculation of Medicare and Medicaid Contractual Adjustments
Implications of the Balanced Budget Act of 1997
Implication of the Medicare Modernization Act of 2003
Managed Care Net Revenue Concepts
Preparation of the Medicare and Medicaid Cost Report
Ratio of Costs to Charges
Presentation of the Audited Financial Statements to the Finance Committee
CHAPTER FIVE: MAY
Fundamentals of Revenue Cycle Management
Patient Registration: To Which Division Should It Report?
Calculation of the Allowance for Doubtful Accounts and Bad-Debt Expense
Calculation of the Allowance for Contractual Adjustments
CHAPTER SIX: JUNE
Budget Preparation: The Beginning
Budget Calendar
Volume Issues
Capital Budgeting: June
Accounting and Finance Department Responsibilities
June Finance Committee Special Agenda Items
CHAPTER SEVEN: JULY
Budget Preparation: The Middle Months
Capital Budgeting: July
Regulatory and Legal Environment
Other Regulatory and Business Compliance Issues
Corporate Compliance
Accreditation Issues
Patient Satisfaction Issues
CHAPTER EIGHT: AUGUST
Capital Budget: August
Operating Budget
Budget Variance Analysis
Budget Variance Parameters
Flexible Budgeting
Cost Accounting and Analysis
August Finance Committee Special Agenda Items
CHAPTER NINE: SEPTEMBER
Operating Budget
Capital Budget: September
Cash Budget
Physician Practice Management Issues
CHAPTER TEN: OCTOBER
Information Systems Implications for Health Care Financial Management
Information Technology Strategic Plan Initiatives
HIPAA Implementation Issues
Selection of a New Health Care Information System
Budget Presentation to the Board Finance Committee
October Finance Committee Special Agenda Items
CHAPTER ELEVEN: NOVEMBER
Preparation of the Budget Results and Delivery to the Department Managers
Budgeting and Spreading Contractual Adjustments by Department
Issues Involving RHMCs Cost Structure
How to Improve the Organizations Cost Structure
Supply Chain Management in Health Care
Benefi ts of Tax Status for Health Care Organizations
Preparation and Implications of the Annual IRS 990 Report
CHAPTER TWELVE: DECEMBER
Getting Ready for Year-End ReportingAgain
Open-Heart Surgery Pro Forma
December Finance Committee Special Agenda Items
Looking into the Future of Health Care Finance
References
Index
The Author
Steven Berger is the founder and president of Healthcare Insights, LLC, which specializes in the teaching of health care general and financial management issues. Healthcare Insights has also created INSIGHTS, the health care industry's best practice decision support software. With more than thirty years experience in the field, he presents health care finance and general management seminars throughout the United States and Canada. He is the author of numerous books and articles on the topic of health care finances.