The End of Hospital Cost Shifting, Term Paper Example

Finance and Budgeting

Establishing a budget for the proposed facility requires the identification of key factors that require financial analysis and discussion. This process will enable the organization to be successful in creating budget for the new facility from its inception. This strategy is essential to the success of the organization and the development of forecasting techniques that will determine how to budget in the coming years. Furthermore, identifying the appropriate services that the older adult population requires in the surrounding areas is critical to a successful budgeting and spending effort for the organization. The chosen budgeting and costing model must demonstrate its congruence with the requirements of the target population and their needs with respect to patient care (Rosen, 2011).

Patient Reimbursement Structure

For the desired patient population, the Medicare Prospective Payment System will be used and will provide a predetermined level of reimbursement for the required services, rather than the cost of each individual service. Based upon the type of treatment plan and procedure that are required, the organization will be reimbursed for a specific number of days, and if the organization is able to treat the patient more quickly, the hospital is able to achieve cost savings over time. Spending for Medicare-based services must be controlled so that patients receive high quality care and the required procedures in a timely manner (Himmelstein & Woolhandler, 2012). Medicare costs are significant; therefore, they require a high level of control in order to provide the desired services for this patient population (Himmelstein & Woolhandler, 2012). The costs of patient care for older adults continue to increase; therefore, cost containment strategies and improvements in patient care quality are essential to ensure that reimbursements are sufficient to achieve the desired outcomes (Birkmeyer et.al, 2012). Furthermore, productivity must be high and must demonstrate a greater focus on productivity in the healthcare environment across a variety of areas, including inpatient care and outpatient services (Frakt, 2011).

The following tables provide an example budget and cost structure for Golden Age Hospital and the services that it will provide:

Conclusion and Recommendations

Based upon the above referenced table, the anticipated profit for the organization with the $687,375. Therefore, the organization must be able to focus on its budget from the ground up and to determine how to best approach its future with the appropriate services in place for the target population. This is a critical aspect of the organization so that its leaders are able to be effective in their roles and in treating the expected number of patients once hospital construction is complete and the facility is open to the public. As a result, budgeting for the organization is of critical importance and requires an ongoing effort to be successful in its efforts to budget effectively and to provide the services that older adults require on a continuous basis. At the same time, Medicare reimbursements for patient-related services must also be considered as a means of ensuring that the organization is successful across all focus areas and in its efforts to provide superior patient care quality and customer services to the surrounding community.

References

Birkmeyer, J. D., Gust, C., Dimick, J. B., Birkmeyer, N. J., & Skinner, J. S. (2012). Hospital quality and the cost of inpatient surgery in the United States. Annals of surgery, 255(1),

Frakt, A. B. (2014). The End of Hospital Cost Shifting and the Quest for Hospital Productivity. Health services research, 49(1), 1-10.

Himmelstein, D. U., & Woolhandler, S. (2012). Cost control in a parallel universe: Medicare spending in the United States and Canada. Archives of internal medicine, 172(22), 1764-1766.

Rosen, S. (2011). Innovations in Costing Health Care Delivery Models: Boston University’s Experience.