Each thread and reply must include a biblical integration and at least 2 peer-re

Each thread and reply must include a biblical integration and at least 2 peer-reviewed source citations, in addition to the course textbook, in current APA format.
All
healthcare leaders play a role in the financial management of the
organization. Some may have a more impactful role in the day-to-day
financial care of the organization, and others may belong to sections which
generate or subtract notably from the overall budget, but all managers and
leaders within the organization are required to understand their financial
position and how their services add, subtract or influence the overall
budget. Some financial relationships which operations managers commonly examine
include; capital and projects, supply management and revenue, research and
reconciliation, labor and efficiency and utilization analysis (Guha &
Kumar, 2017). Understanding these relationships, and their context within
the healthcare ecosystem is required for operations managers to successfully
execute their projects. Additionally, financial outcomes may be one of the
measures of operational success or failure, so possessing an understanding of
financial statements is necessary. This includes understanding factors
which are under the control of the organization, such as scheduling, costs and
labor rates, and also factors which are out of the control of the organization,
such as customer utilization, reimbursement rates and supply costs (Langabeer &
Helton, 2021).
On
the topic of relationships within the workplace and community, the Bible shows
us that Christians are expected to love one another, collaborate and be of
service to the community. A notable example comes from 1 John 4:16, “God
is love. Whoever lives in love lives in God. This is how love is
made complete among us”, which teaches us that it is impossible to love God
without building relationships between others and working together (New International Version, 1978/2014).
Within
healthcare, the term revenue refers to a number of different ways the
organization earns money. Just as there are many ways to generate
revenue, there are also many ways to hinder revenue generation. The very
framework of our national healthcare matrix and insurance system is a known
hindrance to revenue generation. This is primarily due to the regulatory
and logistical constraints inherent to working with Medicare, Medicaid and
private insurers (Langabeer & Helton, 2021). Additionally,
reimbursement rates can vary between locality, procedure, severity and
diagnosis related group, all of which have the potential to affect the revenue
of the organization through unmodifiable factors. The price of supplies,
implants, equipment, service contracts and pharmaceuticals are often variable
due to fluctuations in utilization and demand. To the organization,
increases in these costs often results in a financial loss, since insurers
typically cap their reimbursements instead of allowing reimbursement
fluctuation based on the market. Moreover, many insurers actively
constrain services and utilization in an attempt to limit their own financial
loss, making the revenue cycle of the hospital less predictable and potentially
less profitable (Huitfeldt, 2021; Langabeer & Helton, 2021).
Three
broad categories of reimbursement exist at the organizational level; fee for
service, prospective payments and capitation. Fee for service
reimbursement is the simplest model, in which the patient pays for all costs
associated with their care. Capitation models involve paying a
predetermined amount for all healthcare services over a period of time.
And lastly, prospective payment systems reimburse based on rigid assumptions of
the cost, service utilization and resource consumption for each patient based
on their diagnosis (Langabeer & Helton, 2021). To the operational
manager, these reimbursement models require changes in organizational strategy
to remain financially balanced. For example, the fee for service approach
allows the organization maximum freedom to charge whatever rate they want for
services, thereby ensuring that profitability is always possible.
However, this approach receives heavy criticism for prioritizing organizational
profits above patient care, and is the least utilized method for
reimbursement.
In contrast, organizations that receive reimbursement via
a prospective payment system do so under the risk that they may not receive
full reimbursement for the services, supplies and costs associated with that
episode of patient care. Managing the many forms of reimbursement and
revenue generation within the organization are a critical function of
operations managers. In some cases, optimizing the reimbursement
practices of the organization will allow for improvements in other areas, such
as improved financial forecasting, quicker claim resolution, higher financial
efficiency, and improved health outcomes.