Health care finance: basic tools for nonfinancial managers

ch. 1 Introduction to Healthcare Finance --
History --
Concept --
How Does Finance Work in the Healthcare Business? --
Viewpoints --
Why Manage? --
Elements of Financial Management --
Organization's Structure --
Two Types of Accounting --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 2 Four Things the Healthcare Manager Needs to Know About Financial Management Systems --
What Does the Manager Need to Know? --
How the System Works in Health Care --
Information Flow --
Basic System Elements --
Annual Management Cycle --
Communicating Financial Information to Others --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 3 Digital Age: Changing the Landscape of Healthcare Finance --
High-Tech and High-Touch Approaches --
Patient Engagement --
Social Media --
Resource Allocation --
Changes in Health Information Technology --
Population Health and the Digital Age: Crossing at the Intersection --
Additional Trends and Complexities: Other Delivery Systems --
Summary --
Information Checkpoint --
Key Terms --
Other Acronymns --
Discussion Questions --
Notes --
ch. 4 Assets, Liabilities, and Net Worth --
Overview --
What Are Examples of Assets? --
What Are Examples of Liabilities? --
What Are the Different Forms of Net Worth? --
Information Checkpoint --
Key Terms --
Discussion Questions --
ch. 5 Revenues (Inflow) --
Overview --
Receiving Revenue for Services --
Sources of Healthcare Revenue --
Grouping Revenue for Planning and Control --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 6 Expenses (Outflow) --
Overview --
Disbursements for Services --
Grouping Expenses for Planning and Control --
Cost Reports as Influencers of Expense Formats --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 7 Cost Classifications --
Distinction Between Direct and Indirect Costs --
Examples of Direct Cost and Indirect Cost --
Responsibility Centers --
Distinction Between Product and Period Costs --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 8 Cost Behavior and Break-Even Analysis --
Distinctions Among Fixed, Variable, and Semivariable Costs --
Examples of Variable and Fixed Costs --
Analyzing Mixed Costs --
Contribution Margin, Cost-Volume-Profit, and Profit-Volume Ratios --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 9 Understanding Inventory and Depreciation Concepts --
Overview: The Inventory Concept --
Inventory and Cost of Goods Sold ("Goods" Such as Drugs) --
Inventory Methods --
Inventory Tracking --
Inventory Distribution Systems --
Calculating Inventory Turnover --
Overview: The Depreciation Concept --
Book Value of a Fixed Asset and the Reserve for Depreciation --
Computing Tax Depreciation --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
Appendix 9-A A Further Discussion of Accelerated and Units of Service Depreciation Computations --
Accelerated Book Depreciation Methods --
ch. 10 Staffing: Methods, Operations, and Regulations --
Staffing Requirements --
FTEs for Annualizing Positions --
Number of Employees Required to Fill a Position: Another Way to Calculate FTEs --
Regulatory Requirements Regarding Staffing --
Summary --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 11 Reporting as a Tool --
Understanding the Major Reports --
Balance Sheet --
Statement of Revenue and Expense --
Statement of Changes in Fund Balance/Net Worth --
Statement of Cash Flows --
Subsidiary Reports --
Summary --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 12 Financial and Operating Ratios as Performance Measures --
Importance of Ratios --
Liquidity Ratios --
Solvency Ratios --
Profitability Ratios --
Information Checkpoint --
Key Terms --
Discussion Questions --
ch. 13 Time Value of Money --
Purpose --
Unadjusted Rate of Return --
Present-Value Analysis --
Internal Rate of Return --
Payback Period --
Evaluations --
Resources --
Information Checkpoint --
Key Terms --
Discussion Questions --
Note --
Appendix 13-A Present-Value Table (The Present Value of $1.00) --
Appendix 13-B Compound Interest Table: Compound Interest of $1.00 (The Future Amount of $1.00) --
Appendix 13-C Present Value of an Annuity of $1.00 --
ch. 14 Trend Analysis, Common Sizing, and Forecasted Data --
Common Sizing --
Trend Analysis --
Analyzing Operating Data --
Importance of Forecasts --
Operating Revenue Forecasts --
Staffing Forecasts --
Capacity Level Issues in Forecasting --
Summary --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 15 Using Comparative Data --
Overview --
Comparability Requirements --
Manager's View of Comparative Data --
Uses of Comparative Data --
Making Data Comparable --
Constructing Charts to Show the Data --
Information Checkpoint --
Key Terms --
Discussion Questions --
Note --
ch. 16 Operating Budgets --
Overview --
Budget Viewpoints --
Budget Basics: A Review --
Building an Operating Budget: Preparation --
Building an Operating Budget: Construction --
Working with Static Budgets and Flexible Budgets --
Budget Construction Summary --
Budget Review --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
Appendix 16-A Creating a DRG Budget for Respiratory Care: The Resource Consumption Approach --
Background --
DRG Budget for Respiratory Care --
Notes --
Appendix 16-B Reviewing a Comparative Operating Budget Report --
Comparative Report to Review --
Checklist Questions and Answers for the Comparative Budget Review --
ch. 17 Capital Expenditure Budgets --
Overview --
Creating the Capital Expenditure Budget --
Budget Construction Tools --
Funding Requests --
Evaluating Capital Expenditure Proposals --
Information Checkpoint --
Key Terms --
Discussion Questions --
Note --
Appendix 17-A A Further Discussion of Capital Budgeting Methods --
Assumptions --
Payback Method --
Unadjusted Rate of Return (AKA Accountant's Rate of Return) --
Net Present Value --
Internal Rate of Return --
ch. 18 Variance Analysis and Sensitivity Analysis --
Variance Analysis Overview --
Three Types of Flexible Budget Variance --
Two-Variance Analysis and Three-Variance Analysis Compared --
Three Examples of Variance Analysis --
Summary --
Sensitivity Analysis Overview --
Sensitivity Analysis Tools --
Summary --
Information Checkpoint --
Key Terms --
Discussion Questions --
Note --
ch. 19 Estimates, Benchmarking, and Other Measurement Tools --
Estimates Overview --
Common Uses of Estimates --
Example: Estimating the Ending Pharmacy Inventory --
Example: Estimated Economic Impact of a New Specialty in a Physician Practice --
Other Estimates --
Importance of a Variety of Performance Measures --
Adjusted Performance Measures Over Time --
Benchmarking --
Economic Measures --
Measurement Tools --
Information Checkpoint --
Key Terms --
Discussion Questions --
Note --
ch. 20 Understanding the Impact of Data Analytics and Big Data --
Introduction --
Defining Data Analytics --
Two Basic Approaches to Data Analytics --
Data Analytics and Healthcare Analytics Serve Many Purposes --
Data Mining --
Impacts of Healthcare Analytics --
Challenges for Healthcare Analytics --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 21 Understanding Investment and Statistical Terms Used in Finance --
Investment Overview --
Cash Equivalents --
Governmental Guarantor: The FDIC --
Long-Term Investments in Bonds --
Investments in Stocks --
Privately Held Companies Versus Public Companies --
Investment Indicators --
Statistics Overview --
Commonly Used Statistical and Other Mathematical Terms --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
ch. 22 Business Loans and Financing Costs. --
Overview of Capital Structure --
Sources of Capital --
Costs of Financing --
Management Considerations About Real Estate Financing --
Management Decisions About Business Loans --
Information Checkpoint --
Key Terms --
Discussion Questions --
Appendix 22-A Sample Amortization Schedule --
ch. 23 Choices: Owning Versus Leasing Equipment --
Purchasing Equipment --
Leasing Equipment --
Buy-or-Lease Management Decisions --
Accounting Principles Regarding Leases --
Information Checkpoint --
Key Terms --
Discussion Questions --
Note --
ch. 24 Strategic Planning and the Healthcare Financial Manager --
Major Components of the Strategic Plan: Overview --
Introduction --
Six Major Components --
Varied Approaches to Strategic Planning --
Examples of Mission, Vision, and Value Statements --
Recognizing a Special Status or Focus Within the Statements --
Financial Emphasis Within the Statements --
Relaying the Message --
Strategic Planning Cycle and Its Process Flow --
Process Flow for Creating Goals, Objectives, and Action Plans --
Process Flow for Creating Action Plans and Their Performance Measures --
Planning Cycle Over Time --
Managers' Responsibilities --
Federal Governmental Agencies Must Prepare Strategic Plans --
Why are Federal Planning Requirements Important to Us? --
Introduction: Requirements, Plans, and Performance --
Example: The VA Office of Information Technology IT Strategic Planning Cycle --
Introduction --
VA Office of Information Technology IT Strategic Planning Cycle: An Example. VA Planning Cycle's Process Flow --
Planning Cycle Definitions for this Example --
Management Responsibilities Within the Planning Cycle --
Tools for Strategic Planning: Situational Analysis and Financial Projections --
Situational Analysis --
Financial Projections for Strategic Planning --
Case Study: Strategic Financial Planning in Long-Term Care --
Appendix 24-A: Sample SWOT Worksheets and Question Guides --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
Appendix 24-A Sample SWOT Worksheets and Question Guides --
Introduction --
Scoring Summary Sheet for EHR Adoption and Implementation --
Three Internal Worksheets for Strengths and Weaknesses --
Internal Worksheet for EHR Information Technology (IT) Staff --
Internal Worksheet for Other Staff Involved in EHR --
Internal Worksheet for Technology and Capital Funding --
External Worksheet for Opportunities and Threats --
ch. 25 Putting It All Together: Creating a Business Plan That Is Strategic --
Overview --
Elements of the Business Plan --
Preparing to Construct the Business Plan --
Service or Equipment Description --
Organization Segment --
Marketing Segment --
Financial Analysis Segment --
"Knowledgeable Reader" Approach to Your Business Plan --
Executive Summary --
Assembling the Business Plan --
Presenting the Business Plan --
Strategic Aspects of Your Business Plan --
Information Checkpoint --
Key Terms --
Discussion Questions --
ch. 26 Understanding Strategic Relationships: Health Delivery Systems, Finance, and Reimbursement --
Introduction --
Defining Health Delivery Systems --
Defining the Area of Healthcare Finance --
Defining the Area of Healthcare Reimbursement --
Strategic Relationship Between the Healthcare Delivery System and Finance --
Strategic Relationship Between Finance and Reimbursement --
Third-Party Reimbursement and Government Expenditures: Another Strategic Relationship --
New Focus on the Relationship Between Finance and Healthcare Delivery --
Reimbursement and Physicians: An Ongoing Strategic Challenge --
Information Checkpoint --
Key Terms --
Other Acronyms --
Discussion Questions --
Notes --
ch. 27 Understanding Value-Based Health Care and Its Financial and Digital Outcomes --
Value-Based Concept: Introduction --
Value-Based Progress in the Private Sector --
Value-Based Progress in the Public Sector --
Value-Based Education Efforts --
Value-Based Legislative Reform --
Quality Measurement: The Concept --
Value-Based Public Reporting in the Private Sector --
Value-Based Public Reporting in the Public Sector --
Financial Outcomes --
Digital Outcomes --
Value-Based Strategic Planning by the Private Sector --
Value-Based Strategic Planning by the Public Sector --
Conclusion: The Future --
Information Checkpoint --
Key Terms --
Other Acronyms --
Discussion Questions --
Notes --
ch. 28 New Payment Methods and Measures: MIPS and APMs for Eligible Professionals --
Introduction --
Legislative Reform and MACRA: An Overview --
Payment Choices: MIPS Versus APMs --
MIPS Incentives --
How Are MIPS Physicians and Other Eligible Professionals Paid? --
MIPS Composite Performance Score --
MIPS Performance Categories --
How MIPS Scoring Works --
MIPS Required Reporting Affects Payment --
Data Submission --
APM Incentives[--](Choice #2) --
Eligible Professionals Within APMs --
How Are Advanced APM EPs Paid? --
How Significant Participation Works --
Advanced APM Participation Standards --
Scoring Standard for APMs --
Creating Physician-Focused Payment Models (PFPMS) --
Building the Measurement Development Plan for MIPS and APMs: Developing New Quality Measures --
Timelines for Developing Quality Measures --
Framework for MACRA Quality Measurement --
Conclusion: Benefits and Costs of the Quality Payment Program --
Three Incentive Programs as They Existed Before MIPS: A Reference --
Alternative Payment Models: A Reference --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
Appendix 28-A Meaningful Use: Modified and Streamlined with a New Name --
How Meaningful Use Has Evolved --
Changes to Allowable MU Stages --
Changes to Meaningful Use Requirements --
Conclusion: Advancing Care Information Becomes the New Meaningful Use --
Acronyms --
Notes --
ch. 29 Standardizing Measures and Payment in Post-Acute Care: New Requirements --
Impact Act: New Directions for Post-Acute Care --
Why Focus Attention on Post-Acute Care? --
New Alternative Payment Model for Four Care Settings --
Standardized Data and Interoperability: The Keys to PAC Reform --
Standardizing Assessment and Measure Domains for PAC Providers --
Electronic Reporting Timelines for PAC Providers --
Public Reporting: Impact Act Requirements --
Impact Act Benefits and Costs: A Summary --
Meeting Strategic Goals --
Conclusion: Innovation in the Digital Age --
Future: Change Is Inevitable --
Information Checkpoint --
Key Terms --
Other Acronyms --
Discussion Questions --
Notes --
ch. 30 ICD-10 Implementation Continues: Finance and Strategic Challenges for the Manager --
ICD-10 E-Records Overview and Impact --
Overview of the ICD-10 Coding System --
ICD-10-CM and ICD-10-PCS Codes --
E-Record Standards and the ICD-10 Transition --
ICD-10 Benefits and Costs --
ICD-10 Implementation: Systems Affected and Technology Issues --
Understand Technology Issues and Problems --
Example: Comparison of Old and New Angioplasty Codes --
ICD-10 Implementation: Training and Lost Productivity Costs --
Who Gets Trained on ICD-10? --
Costs of Training --
Costs of Lost Productivity --
Introduction: About ICD-10 Key Performance Indicators --
Key Performance Indicators to Assess ICD-10 Progress --
Using KPIs to Track ICD-10 Implementation Progress --
Reviewing KPI Results --
Creating Action Plans to Deal with Problems --
Building Specific Action Plans to Correct Deficiencies --
ICD-10 Implementation: Situational Analysis --
Implementation Planning Recommendations --
Situational Analysis Recommendations --
Commencing an Information Technology SWOT Matrix for ICD-10 --
Summary --
Information Checkpoint --
Key Terms --
Discussion Questions --
Notes --
Appendix 30-A ICD-10 Conversion Costs for a Midwestern Community Hospital --
Authors' Note --
Introduction --
Scenario --
Note --
ch. 31 Case Study: The Doctor's Dilemma --
Offer: "Sell Your Practice to Us" --
Seeking to Understand Healthcare Finance Reform --
Researching Acquisition Viewpoints and Industry Trends --
Considering Other Physicians' Reactions --
What Will Dr. Matthews Decide? --
Notes --
ch. 32 Case Study: Strategic Financial Planning in Long-Term Care --
Background --
Framework of the Board's Mandate --
Industry Profile --
Feasibility Determination --
Notes --
ch. 33 Case Study: Metropolis Health System --
Background --
MHS Case Study --
Appendix 33-A Metropolis Health System's Financial Statements and Excerpts from Notes --
Excerpts from Metropolis Health System Notes to Financial Statements --
Appendix 33-B Comparative Analysis Using Financial Ratios and Benchmarking Helps Turn Around a Hospital in the Metropolis Health System --
Appendix 33-C Proposal to Add a Retail Pharmacy to a Hospital in the Metropolis Health System --
ch. 34 Mini-Case Study 1: The Economic Significance of Resource Misallocation: Client Flow Through the Women, Infants, and Children Public Health Program --
Confronting the Operational Problem --
Environment --
Peak-Load Problem --
Method --
Results --
ch. 35 Mini-Case Study 2: Technology in Health Care: Automating Admission Processes --
Assess Admissions Process --
Areas to Automate --
Fax and Document Management --
Communication Is Important --
Referral Tracking and Approval --
Analyzing Referral Activity --
Hours Saved --
Examples and Exercises --
Supplementary Materials: The Mechanics of Percentage Computations --
Solutions to Practice Exercises.