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Q/ Financial Accounting is the process of recording, summarizing and reporting transactions and revenue-expense generations in a time period. For example, investors or sponsors need to verify an account statement before showing interest in associating with the business. How does this type of accounting influence financial management?
ANSWER 200 words including one scholarly peer reviewed article reference………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
Unique Aspects of Health Services & Financial Management
COLLAPSE
Compare the two types of accounting functions.
The main role played by financial management is to come up with strategies that will aid in the acquisition of management funds to ensure that there is the maximization of the company’s value and output. Therefore, in a healthcare setting its main goal is to be in a position to bring forth new revenue streams and at the same time find creative ways through which it can cut costs and also manage its investments long-term. There is no doubt that what the healthcare sector requires is effective methodical financial management strategies that will enable them to succeed to provide quality care to their patients and also contribute to the bottom line. Some of the sources of funding for non-profit organizations include religious, charity, and educational funds. In return for helping their community, the government is exempted from paying tax may it be income or local property tax. However, the financial stability of non-profit organizations is highly dependent on the funding received from the sources mentioned above (Current Issues in Health Care Financial Management, 2021).
Notably, the government and private organizations will be in a position to provide several services that are found in healthcare and education that will ensure there is healthcare that will ensure that there is public safety. It is important to note that individuals with their families will make use of the services that are made available by public and private organizations to get the financial management resources that are required so that one can live a healthy lifestyle. These services can have a major impact on financial management in the healthcare sector. However, the services provided by both public and private companies can have an impact on the financial management of the health sector. Public institutions are in a position to provide a wide range of social services that are mainly educational and healthcare. On the other hand, the private sector is at the forefront in terms of the provision of services that are focused on public safety and social assistance.
Describe how the accounting functions affect operational oversight.
There are a lot of payments made to healthcare providers by third-party payers as opposed to the patients receiving the services. Simply put, when medical services are provided, payments are made to the company and not the individual that provided services. The providers send their payments to the providers that provided a service charge for the services provided. The rest of the payment remains with the provider so that they can provide additional services and make investments concerning the growth of their business and other purposes they deem fit. However, the fact that the payments are made by third parties, means that the payments are made in form of claims from the insurance or reimbursements by governments. This brings about an oversight issue in that most healthcare providers are mostly concerned with what their account holds as opposed to the provision of quality healthcare (Alessie et al., 2020).
How do these unique features affect the financial management of the sector?
The healthcare industry is very sensitive since it deals with the provision of proper healthcare that looks into the well-being of individuals. Therefore, this calls for the industry to be more effective and methodological in the management of finances to be able to succeed in providing quality healthcare to all their patients. Therefore, there is a need for proper structures and plans that will ensure that they are systematic and effective. The Non-governmental organization’s main goal is to ensure that they make improvements in public services. As a result, they are exempted from paying any form of taxes to the government this means that the general public or rather a community benefits immensely. It is also a requirement that they maintain their tax-exempt status by following all the laws and regulations as provided by the constitution. On the other hand, those in the private sector are required to continue generating income to remain profitable. It is the responsibility of the financial manager in the healthcare industry to maintain and negotiate fair rates and prices with the insurance providers. All this in a bid to ensure that they keep most of the patients covered while at the same time getting the right amount of payment for the services they provide. Although in terms of the reimbursement of the insurance. However, the more the payment is delayed and doesn’t reach the hospital the less effective the quality of services is since the services provided are a loan in essence. Therefore, in the event that the insurance companies do not reimburse there will be a strain on the healthcare services. In the event the spending rises, there will be so much pressure on the insurers, government, and patients (Alessie et al., 2020).
References
Alessie, R. J. M., Angelini, V., Mierau, J. O., & Viluma, L. (2020). Moral hazard and selection for voluntary deductibles. Health Economics, 29(10), 1251-1269. https://doi.org/10.1002/hec.4134
Current Issues in Financial Management in Health Care. (2021, June 25). Wake Forest University. https://onlinehealth.wfu.edu/blog/financial-manage…