Comparative Summary
Comparative Summary
HCS/577
June 8, 2013
Destiny Chen
Stephanie Hildreth
Comparative Summary
In the health care industry there are different types program sector organizations, which has its own uniqueness. The different sectors of health care are divided amongst the for-profit, non-profit, and government organizations because they all have a common goal but the financial aspect is the same when it comes to providing care to patients. Within the three types of organization types, the financial need is collected and reported differently due to the organization common goal, financial environment and community outlook. In my research, to give a clearer picture I have chosen an organization that represents each health care sectors environment and they are: Park Plaza Hospital a for-profit organization, American Diabetes Association (ADA) a not-for-profit organization, and U.S. Department of Veterans Affairs as a government organization. In this paper, I will use these organizations to show comparison the structure of each financial environment, the uniqueness of each environment and the prevalent practices of each organization in their financial environment. Collectively by identifying this in each entity will explain why effective financial management is more difficult in health care than in other industries.
Financial Structure Many organizations based on the need and the common goal has different financial structures. According to Investopedia (2013), the definition of a financial structure is “a mixture that directly affects the risk and values of a business or organization”. When organizations form a financial structure they are basically trying to decide how much money they may need to borrow and how much debt and equity to obtain (Investopedia, 2013). To keep the financial structure at a minimum, the financial manager have to make sure that they employ the least expensive sources of funds for the organization to use (Investopedia, 2013). The financial
HCS/577
June 8, 2013
Destiny Chen
Stephanie Hildreth
Comparative Summary
In the health care industry there are different types program sector organizations, which has its own uniqueness. The different sectors of health care are divided amongst the for-profit, non-profit, and government organizations because they all have a common goal but the financial aspect is the same when it comes to providing care to patients. Within the three types of organization types, the financial need is collected and reported differently due to the organization common goal, financial environment and community outlook. In my research, to give a clearer picture I have chosen an organization that represents each health care sectors environment and they are: Park Plaza Hospital a for-profit organization, American Diabetes Association (ADA) a not-for-profit organization, and U.S. Department of Veterans Affairs as a government organization. In this paper, I will use these organizations to show comparison the structure of each financial environment, the uniqueness of each environment and the prevalent practices of each organization in their financial environment. Collectively by identifying this in each entity will explain why effective financial management is more difficult in health care than in other industries.
Financial Structure Many organizations based on the need and the common goal has different financial structures. According to Investopedia (2013), the definition of a financial structure is “a mixture that directly affects the risk and values of a business or organization”. When organizations form a financial structure they are basically trying to decide how much money they may need to borrow and how much debt and equity to obtain (Investopedia, 2013). To keep the financial structure at a minimum, the financial manager have to make sure that they employ the least expensive sources of funds for the organization to use (Investopedia, 2013). The financial
References: (n.d.). Retrieved from http://www.investopedia.com/terms/f/financial-structure.asp Finkler, S., & Ward, D. (2006). Accounting Fundamentals for Health Care Management. Sudbury: Jones and Bartlett. Sackman, K. (n.d.). Retrieved from http://www.afscme.org/news/publications/health-care/the-new-health-care-delivery-system-a-guide-for-nurses/the-rise-of-for-profit-organizations Burns, L. R. (2012). Business of healthcare innovation (2nd edition). GB: Cambridge University Press. U.S. Department of Veterans Affairs. (n.d.). Retrieved from http://www.va.gov/ American Diabetes Association. (n.d.). Retrieved from http://www.diabetes.org/