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Please answer each question in 250 words or more with references and in text citation.
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Explanation & Answer
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Running Head: The Healthcare Industry
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The Healthcare Industry
Student Name:
University Affiliation:
Instructor:
The Healthcare Industry
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Discussion 1: Question 2
The healthcare sector, being one of the largest in the world, forms a large part of the
economy of most developing countries. The sector constitutes many industries, each comprising
of trained professionals who deliver quality healthcare services to consumers. The main
industries that constitute the healthcare sector include the health services industry which carries
out hospital activities, the pharmaceutical and biotechnology industry, health insurance industry,
medical equipment and supplies industry and consulting firms (WHO, 2015). Consulting firms
provide consultation services in the fields of physiotherapy, midwifery, hydrotherapy, medical
massage, speech therapy among others. The health sector also consists of educational and
research institutions, some of which are government sponsored while others are private
institutions.
Healthcare finance is money set aside by the government or non-government
organizations to cater for the cost of provision healthcare services to individuals. The services
are usually paid for in form of government programs such as Medicaid and Medicare, and also
by employers through private health insurance plan (NHE Fact Sheet, 2015). Healthcare finance
enables organizations to plan for and acquire healthcare resources for individuals at a convenient
and less costly price. Employers use healthcare finance to cater for the wellbeing of their
employees.
Healthcare finance consists of two broad areas which include financial accounting and
managerial accounting. It is concerned with accounting and financing functions of a healthcare
organization. Financial accounting involves keeping records of financial transactions within an
organization and providing a summary of the transactions. Managerial accounting involves
The Healthcare Industry
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managers making financial decisions based on theories, concepts and principles derived from the
organization (Jody B. et al., 2000).
The Healthcare Industry
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Discussion 2: Question 1
Primary business organizations can be of three main forms; sole proprietorship,
partnerships and corporations. Each of these forms of businesses has its financial advantages and
disadvantages (Brunei 2016).
Sole proprietorship is a form of business owned by one person, the sole proprietor, who
carries out all the activities involved in the business. Some of the advantages of this form of
business are that the procedures of its formation are simple and less costly. Government
regulations involved are minimal and the sole proprietor pays low cooperate taxes compared to a
partnership or a co-operation. The owner also enjoys all of the profits alone. However, the sole
proprietor has unlimited liability and bears all the debts and losses of the business. Capital
involved is limited thus limited chances of expansion. Furthermore, the existence of the business
depends on the existence of the sole proprietor, thus if he/she dies, the business also dies.
Partnership form of business is one created by two or more people under the Partnership
Act. The starting costs are low compared to corporations, with minimal procedures. The profits
of the business are divided equally among the partners and are taxed as personal income. Some
of the disadvantages include unlimited liability where the life of the business depends on the life
of the partners. Losses and debts are also shared equally among the partners and there are still
limited chances of expansion since they cannot sell shares to the public.
A corporation is a form o...