Attached.

Running head: HEALTH CARE ADMINISTRATION

Health Care Administration
Student’s Name
Institution Affiliation
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7.1 Departmental Costing and Cost Allocation + Service Line Cost & Pricing
The health care sector is undergoing numerous changes, an aspect that has affected health
care administration. One of the changes taking place involves reducing the reimbursements health
care facilities receive (KaufmanHall, n.d.). The United States government is continuously cutting
back on the money it allocates for reimbursement. As such, hospitals and other facilities have to
find new and effective ways to manage the little amount of money they have access to meet their
bottom lines. Despite this setback, there are a couple of approaches health care organizations can
take to ensure they effectively plan and budget on how to use the resources at their disposal.
The first approach revolves around aligning the organization's predictions and budgetary
plans (KaufmanHall, n.d.). At the beginning of each financial year, organizations make forecasts
with regard to their expected performance financially and otherwise. Some of these predictions
come to pass while the rest remain unattainable. After the fiscal year culminates, these
organizations need to analyze their predictions against the actual performance they managed to
attain (Spencer, 2015). Doing this allows an organization to determine why their predictions did
not come to pass and make the requisite adjustments to ensure the situation does not repeat itself
in the future.
Most health care organizations develop financial and performance plans that extend beyond
a single financial year (KaufmanHall, n.d.). Therefore, it is imperative that these organizations
create model scenarios that will help them understand the market dynamics within their selected
period that might affect their performance and bottom lines. Finally, on this approach,
organizations need to ensure the strategies they come up with fit into the operational budgets they
developed. The second approach emphasizes the essence of integrating statistics into budget
formulation (KaufmanHall, n.d.). As such, they should establish the statistics associated with the

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workload of each department within a health care facility and then determine how they relate with
the global drivers.
Such consolidation not only promotes accurate budget-making but also improves
accountability (Spencer, 2015). Many organizations are now seeing the essence of incorporating
patient data in their budgeting process; thus, they are integrating service analytics into their fiscal
planning. Doing this allows them to make more accurate forecasts of workload projections. The
first approach is the most effective because it accords an organization an opportunity to realize the
mistakes they made, making it harder for their predictions to get realized. They can use the
information they collate from such an analysis to improve the quality of their fiscal and
performance forecasts, in the process, making them more accurate (Spencer, 2015).
7.2 Financial Compliance and Ethical Decision-Making
The core goals of any health care organization are to not only provide high-quality patient care
but also to improve patient safety. Accurate and fair financial reporting allows these organizations
to attain these two goals (Mizra et al., 2019). One of the benefits of this is that it increases
accountability within the health care industry, an aspect that allows for efficient utilization of
resources. When healthcare organizations are required to accurately report their fiscal
performance, they are more likely than not to take greater care of how they manage their resources
since organizations know they will have to account to shareholders regarding how and why they
used a particular resource when offering their services.
Accurate and fair financial reporting helps health care facilities eliminate wastages within
their processes and procedures that might interfere with effective service delivery (Mizra et al.,
2019). The first step when seeking to eliminate wastages is to publish accurate reports of an
organization's performance. Doing this allows the organization to identify the potential wastages

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and then work towards getting rid of them. Eliminating these wastages allows the organizations to
effectively provide medical services to patients v. The health care industry often comes under
criticism for the high cost of medical services.
One of the reasons for the escalating high cost of care is inaccurate financial reporting.
Sometimes hospitals overcharge patients or recommend unnecessary tests, all of which increase
the amount of money patients have to part with when seeking medical attention. They know it is
wrong, and as such, do not include such charges in their financial reports. However, requiring them
to disclose all fees charged to patients will make these organizations think twice before
overcharging patients since they know when they make such a disclosure, their unethical practices
will come to light. Therefore, accurate and fair fiscal reporting will inadvertently help lower
healthcare costs (Mizra et al., 2019).
Operating without accruing debts is nearly impossible, irrespective of what industry an
organization operates under (Mizra et al., 2019). As such, publishing fair and accurate fiscal reports
gives health care organizations a chance to improve their debt management. Failure to manage
debt can adversely affect the performance and durability of an organization. Therefore, to avoid
such an occurrence, health care providers need to publish accurate financial records. Business
trends and market dynamics often change an aspect that makes accurate fiscal reporting even more
important. When an organization does this, they are able to look back at their published data,
identify potential weaknesses and risks, and then develop strategies that will help address such
limitations and inadvertently improve not only their fiscal performance but their overall service
delivery (Mizra et al., 2019).
7.3 Health Care Revenue Cycle

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Maintaining the fiscal well-being of most health care providers is not an easy feat,
considering the reducing rate of reimbursement taking place and the rapidly increasing cost of
health care (Becker & Ellison, 2019). Many organizations are ...