Reimbursements In Health Care Essay

Outline and discuss the major categories of reimbursements and costs in a health care organization. How do they influence each other?

The art of financial governance is fulfilled by overseeing daily operations which include staffing and labor and making sure employees have the tools necessary to complete the task. The second financial management responsibility includes planning for and implementing financial instruments that provide a blueprint of the organization’s long-term financial needs. Often this may include sub-responsibilities such as managing and implementing a budget, collaborating with the financial department to ensure the budget is sustained, purchasing and managing inventory, and pricing and managing costs. Further financial

Our most important text provides an illustration of how value can be calculated by taking into consideration the physician’s expertise, time, medical devices used, and the intricacy of the procedure, thus determining the price for healthcare services this process is known as activity-based costing which is universally used in healthcare facilities. Although, activity-based costing serves as a primary basis for price and cost estimates. Administrators must take into consideration factors that influence pricing and costs such as government programs that limit the number of reimbursements, for example, “bundled payments, provider discounts, provider write-offs, services provided as charity, copays and coinsurance, third-party payments, low-versus high-payers sources (Medicare (low)/Employer or Private Insurance (high payer), ethical liabilities, pay mix and cost shifting along with fixed and variable costs. Other factors include competitiveness of the market and supply and demand within the geographic area” (Baack, Fischer, 2013 para. 6.2). Other challenges that an administrator may face when evaluating prices and costs include product and service quality, ensuring healthcare services remain affordable and competitive and ensuring products are geared towards the market the facility