IHP 450 Final Project Guidelines and Rubric Overview The final project for this course is the creation of a capital budget proposal in which you will analyze a specific healthcare organization, identify areas of need and/or improvement within the organization, research various options to address these needs, and create a presentation in which you propose your options to decision makers. This will require close analysis of historical budgetary information for the organization, research regarding healthcare trends, and careful alignment of your proposal to the organization’s mission, vision, and values. The final product represents an authentic demonstration of competency because, while healthcare organizations differ greatly, managers in various departments in various organizations must present changes to processes, the purchase of new equipment, the addition of employees, and many other changes to executives and boards to obtain approval. A specific example of the necessary presentations department managers often perform is a capital budget proposal, whereby managers identify the various needs or areas of improvement in their department and prepare proposals for decision makers. In addition to the analysis and presentation needs discussed, this assessment will provide you with the opportunity to apply the financial budgetary knowledge you have gained throughout this course to a healthcare organization, as you would in the real world. While you will not be building the organization’s entire budget yourself, you will be discussing how your proposal impacts the current budget and what impact your proposal will have on future financial statements if implemented through the creation of a projected departmental budget that implements your proposal in the upcoming year. To complete this project, you will utilize one of two provided case studies, which will include the financial statements and information necessary for you to analyze while preparing your budget request. Your final submission will be a presentation (either PowerPoint or an equivalent tool) with speaker notes, along with a projected departmental budget for the next year. You will not have to record your presentation. The project is divided into four milestones, which will be submitted at various points throughout the course to scaffold learning and ensure quality final submissions. These milestones will be submitted in Modules Two, Four, Five, and Six. The final product will be submitted in Module Seven. In this assignment, you will demonstrate your mastery of the following course outcomes:      Analyze healthcare trends to inform effective decision making and financial planning within healthcare management Integrate effective communication and leadership principles into financial proposal presentations Articulate the purpose and importance of financial statements and principles for healthcare decision making Create realistic departmental budgets based on financial statements, healthcare trends, and strategic plans Create proposals that incorporate missions, visions, and values and align to strategic plans Prompt Your capital budget proposal presentation should use 12–20 PowerPoint slides (or similar presentation software) to answer the following prompt and it should include an accompanying projected departmental budget: Select one of the following two organizations and accompanying financial information to create a reasonable capital budget proposal that addresses the needs of the organization while aligning to the organization’s mission, vision, and values. Note that while you will submit a single proposal, your proposal might include multiple items. For example, you might propose that the organization acquire a new piece of equipment. Implementation of that item (the equipment) might require additional items such as software, spare parts, etc. In order to utilize real-world financial statements, you must choose one of the following organizations to provide the context, background information and organizational information for your proposal: Organization #1: Joslin Diabetes Center  Consolidated Financial Statements and Supplemental Information – 2013 and 2012  Consolidated Financial Statements and Supplemental Information – 2012 and 2011 Organization #2: Venice Family Clinic  2012 Annual Report  Consolidated Financial Statements for the Year Ended June 30, 2012 Specifically, the following critical elements must be addressed; however, the following order is not necessarily the order in which you will present: I. Introduction A. Financial Condition: Describe the overall financial condition of the organization based on financial statements and explain your reasoning. [ B. Healthcare Trends: Describe what current healthcare trends influenced your proposal. Could any of these trends impact the organization financially? C. Proposal Items: List your proposal items and indicate how each one is linked to the organizational mission, vision, and values. You might need to infer the vision or values based on the information provided in the organization’s annual reports, website, etc. D. Organizational Strategic Goals: How will your proposal further the strategic goals of your department and/or organization as a whole? You might need to infer the strategic goals based on the information provided in the organization’s annual reports, website, etc. II. Proposal A. Options: What options are available for each item in your budget proposal? You will want to have various options ready that will meet your needs because one option may not be approved by your supervisor or board, but another option may better fit their needs. [HCM-450-02] B. Financial Research: Describe the cost-benefit of each option based on relevant information and research. Information and research can include research on the items or vendors, organizational numbers, price quotes, and more. Be sure to provide relevant documentation in an appendix or reference slide (e.g., sources for the cost of the items in your proposal, company resources, and financial calculations) to show the depth of your research and the various options available. C. Organizational Resources: Identify what resources would be needed to implement one of the options in your proposal (e.g., support from information technology, accounting, janitorial, volunteers). D. Communication: What method of communication would be used to notify departments across the organization and what methods would be used throughout proposal implementation? Justify the appropriateness of your suggestions. III. Budget A. Statements: What statements were utilized for formulating your proposal? Why? Select the appropriate statements for analysis and defend your choices. B. Expenses: What major expenses are associated with your proposal items and what budgetary accounts are impacted? C. Reasoning: Based on the previous year’s budget data, why did you select these budget items for adjustment over other options? D. Ratios: Research the various ratio options (including ROI) used for reviewing financial statements. Determine what ratios you will use for your proposal items and explain why. E. Ratio Calculations: Using budget statements, formulate calculations that support each recommendation. F. Projected Departmental Budget: Create a projected departmental budget for the upcoming year that incorporates the costs of the proposed changes. IV. Impacts and Justification A. Short-Term Impact: What short-term impact will this request have on the overall financial statements used for decision making and on financial planning? B. Long-Term Impact: What long-term impact will this request have on the overall financial statements used for decision making and on financial planning? C. Cost-Benefit: What is the percentage increase in financial need? How does this balance with the potential value added by your requests? What is the cost-benefit of these requests? D. Strategic Planning: Provide an explanation for each budget request in your proposal, taking into consideration strategic plans. How do your budget requests show strategic planning and forethought? E. Conflicts: Describe the strategic impact and any potential ways in which your recommendations might conflict with the overall strategic vision. Milestones Milestone One: Major Trends In Module Two, you will submit a short paper analyzing the potential impact of healthcare trends on the finances and mission of healthcare organizations. This milestone will be graded with the Milestone One Rubric. Milestone Two: Cost-Benefit Factors In Module Four, you will submit a short paper explaining why working capital, classification of cost elements, utilization trends, cash flow, and managing the revenue cycle are important factors to consider when determining cost-benefit. This milestone will be graded with the Milestone Two Rubric. Milestone Three: Departmental Budget and Presentation Outline In Module Five, you will create a budget for a healthcare department and outline your capital proposal presentation. This milestone will be graded with the Milestone Three Rubric. Milestone Four: Implementation Options and Cost-Benefit In Module Six, you will submit a short paper describing options for implementing your capital budget item(s), their cost-benefit, and their anticipated impact on key healthcare operating indicators. This milestone will be graded with the Milestone Four Rubric. Final Submission: Capital Budget Proposal In Module Seven, you will submit your final project. It should be a complete, polished artifact containing all of the critical elements of the final product. It should reflect the incorporation of feedback gained throughout the course. This submission will be graded with the Final Project Rubric (below). Deliverables Milestone Deliverable Module Due Grading One Major Trends Two Graded separately; Milestone One Rubric Two Cost-Benefit Factors Four Graded separately; Milestone Two Rubric Departmental Budget and Presentation Outline Implementation Options and Cost-Benefit Five Graded separately; Milestone Three Rubric Six Graded separately; Milestone Four Rubric Final Submission: Capital Budget Proposal, including Projected Departmental Budget Seven Graded separately; Final Project Rubric Three Four Final Project Rubric Guidelines for Submission: A comprehensive proposal presentation will be between 12–20 slides; however, the content and quality of those slides are more important than the quantity. All resources must be appropriately cited in APA format. All speaker notes must be written in the “notes” section of each PowerPoint. In addition to your presentation, you must submit a final draft of your proposed departmental budget, which you drafted in Milestone Three using the Departmental Budget Template. Critical Elements Exemplary (100%) Introduction: Financial Meets “Proficient” criteria and Condition evidences keen ability to interpret financial statements to gain understanding of financial conditions Introduction: Meets “Proficient” criteria and Healthcare Trends evidences keen insight into application of current healthcare trends to organizations Proficient (85%) Accurately describes the overall financial condition of the organization based on the financial statements Needs Improvement (55%) Describes the overall financial conditions of the organization, but with gaps in accuracy or detail based on the financial statements Accurately describes the current Describes the current healthcare healthcare trends that influence trends that the proposal was the proposal and how they based on and how they impact impact the organization the organization financially, but financially with gaps in detail or accuracy Introduction: Proposal Meets “Proficient” criteria and Links each proposal item to the Links each proposal item to the Items evidences keen understanding of organization’s mission, vision, organization’s mission, vision, and how to further missions, visions, and values, comprehensively values, explaining each and values in organizations explaining each connection connection, but lacks detail Introduction: Strategic Meets “Proficient” criteria and Clearly details how the proposal Explains how the proposal will Goals evidences keen insight into the will further the strategic goals further the strategic goals of the methods for further strategic of the organization organization, but with gaps in goals clarity or detail Proposal: Options Meets “Proficient” criteria and Provides reasonable Provides implementation options evidences keen analysis of implementation options for for each proposal item, but potential options for proposal each proposal item options are not reasonable implementation Proposal: Financial Meets “Proficient” criteria and Describes the cost-benefit of Describes the cost-benefit of the Research evidences keen insight into the the listed options based on listed options, but with gaps in research and information relevant research and relevant research and information requirements of financially information sound proposals Proposal: Meets “Proficient” criteria and Accurately and clearly identifies Identifies the organizational Organizational evidences keen insight into the the organizational resources resources that will be needed for Resources organizational needs for that will be needed for proposal proposal implementation, but proposal implementation implementation lacks accuracy or clarity Not Evident (0%) Does not describe the overall financial conditions of the organization Value 2.74 Does not describe the current healthcare trends that the proposal was based on and how they impact the organization financially Does not link each proposal item to the organization’s mission, vision, and values, explaining each connection Does not explain how the proposal will further the strategic goals of the organization 6.4 Does not provide implementation options for each proposal item 6.4 Does not describe the cost-benefit of the listed options 6.4 Does not identify the organizational resources that will be needed for proposal implementation 6.4 6.4 6.4 Proposal: Communication Proposes methods for communicating budgetary changes and communicating throughout proposal implementation to departments across the organization, and justifies the appropriateness of these methods Meets “Proficient” criteria and Selects and comprehensively evidences keen understanding of defends the appropriate the use of financial statements financial statements for use in for proposal creation the proposal Does not propose methods of communication for notifying departments across the organization and for proposal implementation 6.4 Does not select and defend financial statements for use in the proposal 6.4 Budget: Expenses Meets “Proficient” criteria and evidences keen understanding of the breakdown of budgets and expenses Does not identify the major expenses associated with the proposal and the budgetary accounts that would be impacted 2.74 Budget: Reasoning Meets “Proficient” criteria and evidences keen understanding of the use of budgetary information for informing future budgets Does not justify why the selected budgetary accounts were chosen for adjustment 2.74 Budget: Ratios Meets “Proficient” criteria and evidences keen insight into the use of ratios for financial analysis and budget support Meets “Proficient” criteria and calculations are performed correctly, resulting in accurate and applicable results Meets “Proficient” criteria and demonstrates keen insights into the specific needs of the department Meets “Proficient” criteria and evidences keen insight informing decision making and planning in healthcare Does not select and justify ratios to use for support of the proposal 6.4 Does not calculate the selected ratios 2.74 Budget: Statements Budget: Ratio Calculations Budget: Projected Departmental Budget Impacts and Justification: ShortTerm Impact Meets “Proficient” criteria and evidences keen insight into the communication needs across departments for successful implementation Proposes methods for communicating budgetary changes and communicating throughout proposal implementation to departments across the organization, but does not justify the appropriateness of these methods Selects and defends financial statements for use in the proposal, but statements are not appropriate or not comprehensively defended Accurately identifies the major Identifies the major expenses expenses associated with the associated with the proposal and proposal and the budgetary the budgetary accounts that accounts that would be would be impacted, but impacted identification is not accurate Justifies why the selected Justifies why the selected budgetary accounts were budgetary accounts were chosen chosen for adjustment based on for adjustment, but not based on analysis of previous year’s previous year’s budget budget Selects appropriate ratios to use Selects and justifies ratios to use for support of the proposal and for support of the proposal, but justifies logically does not select appropriate ratios or justification is not logical Calculates the selected ratios Calculates the selected ratios, but based on the budget statement not based on the budgetary analysis statement analysis Creates a projected budget that Creates a projected budget but is Does not create a departmental applies the proposed changes missing key elements of a budget applying the proposed to the specific department departmental budget changes to a specific department 2.74 Logically determines the shortterm impact of the proposal on the financial statements and organizational financial planning 6.4 Determines the short-term impact of the proposal on the financial statements and organizational financial planning, but with gaps in logic Does not determine the short-term impact of the proposal on the financial statements and organizational financial planning Impacts and Meets “Proficient” criteria and Justification: Long-Term evidences keen insight into Impact informing long-term financial planning Impacts and Justification: CostBenefit Meets “Proficient” criteria and cost-benefit is accurate given the financial information and potential value Impacts and Meets “Proficient” criteria and Justification: Strategic reflection evidences keen insight Planning into strategic financial and management planning in healthcare Impacts and Justification: Conflicts Articulation of Response Meets “Proficient” criteria and evidences keen insight or intuition regarding potential conflicts with healthcare organizations’ strategic visions Logically determines the longterm impact of the proposal on the financial statements and organizational financial planning Determines the cost-benefit of the proposal based on detailed analysis of financial information and potential value added Reflects thoroughly upon and explains in detail how the budget proposal evidences strategic planning and forethought Accurately describes the strategic impact of the proposal and identifies logical, potential conflicts with the overall strategic vision of the organization Submission is free of errors Submission has no major errors related to citations, grammar, related to citations, grammar, spelling, syntax, and organization spelling, syntax, or organization and is presented in a professional and easy-to-read format Determines the long-term impact of the proposal on the financial statements and organizational financial planning, but with gaps in logic Determines the cost-benefit of the proposal, but not based on analysis, or analysis of financial information and potential value added is not detailed Reflects upon and explains how the budget proposal evidences strategic planning and forethought, but reflection lacks comprehensive attention or explanation lacks detail Describes the strategic impact of the proposal and identifies potential conflicts with the overall strategic vision of the organization, but with gaps in accuracy or logic Submission has major errors related to citations, grammar, spelling, syntax, or organization that negatively impact readability and articulation of main ideas Does not determine the long-term impact of the proposal on the financial statements and organizational financial planning 6.34 Does not determine the costbenefit of the proposal 2.74 Does not reflect upon and explain how the budget proposal evidences strategic planning and forethought 2.74 Does not describe the strategic impact of the proposal nor identify potential conflicts with the overall strategic vision of the organization 6.4 Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas 4.08 Earned Total 100% Milestone 3: The Venice Family Clinic 1 Milestone 3: The Venice Family Clinic Oodusanya Olawunmi February 11, 20118 IHP-450 Professor David Abalat Milestone 3: The Venice Family Clinic 2 A departmental budget can be described as a tool used to project both income and expenses of a given department within a healthcare organization. In the year 2012, the Venice Family Clinic’s total income amounted to $41,052,317 and had expenses amounting to $42,866,572. The income to expenses ratio of 41:42 indicates that the clinic suffered a loss for the represented year. However, with proper budgeting, the clinic can avoid such miscalculations in the future. The major part of the expenses related to the healthcare and the “Children First” program, while a bigger part of the income came from donations from third-party reimbursements, community support, and government support. The budget for the upcoming 2017 fiscal year would raise departmental income from $41,052,317 to $42,250,000 and would lower departmental expenses from $42, 866,562 to $42,000,000, leading to a profit of $250,000. This would largely be from more fundraising through community support and through decreasing the numbers of patients seen who couldn't afford healthcare costs or caring for people with bad debts (which resulted in a loss of $113,446 for the 2012 fiscal year). Strategic planning involves predicting the financial future of an organization for the next 3 to 10 years, and planning such budgeting accordingly. One important thing to consider is the decline of Medicare and Medicaid and the possible privatization of such healthcare forums by the next presidential administration. Reimbursements for such healthcare totaled $9,303,267 in 2012, so we can expect such revenue to decrease in the next decade. I propose a conservative budget of around $5,000,000 for the next 3 years and $3,000,000 for the following 7 years. There are a few short-term options that the Venice Family Clinic has for increasing revenue while decreasing costs, including investing in more short-term investments while Milestone 3: The Venice Family Clinic 3 decreasing the number of patients who have no access to healthcare. While these changes would be beneficial to the clinic in the near future, at the other end of the spectrum, there are a few long-term options that would also benefit the clinic. One such change would include utilities and rent, with expenses totaling $9,303,267 in 2012. If the clinic were to buy its land and construct a facility rather than renting space, as well as using renewable resources such as solar panels, such expenses could be minimized in the future even though expenses would increase with building costs for the immediate future. I would budget nearly $15,000,000 for the next few years and then decrease the amount to $6,000,000 for the following years. Proposal: Organizational Resources There is a multitude of resources that the Venice Family Clinic can use to organize their budget. One such way is through hiring an outside professional consultant to draft a budget for our clinic. We can also use electronic systems such as Excel. Budget: Statements The regular statements are an important aspect of budgeting. They allow for us to make sure we are upholding our budget properly and that the Venice Family Clinic is not losing a mass amount of money. I would recommend brief quarterly review statements and a comprehensive annual statement. Budget: Expenses I budgeted that many salaries would remain the same, though those for the RN and staffing decreased just slightly. This is only short-term, however, to allow for more medical supplies expenses. Since we will not be purchasing any new equipment in the upcoming year, equipment expenses have decreased by $100,000. We are allowing for some cushion room just in case of Milestone 3: The Venice Family Clinic 4 an emergency purchase. Equipment leases also decreased just slightly to allow for more insurance coverage. Budget: Reasoning I budgeted for fewer expenses overall, which would lower the expenses of Venice Family Clinic by $55,591, thereby increasing overall profitability. This is more vital understanding that the clinic, unfortunately, suffered a loss of over $1.5 million in the year 2012. As a non-profit organization, it is important for the clinic to break even at best, hence why I budgeted conservatively. Budget: Ratios and Ratio Calculations Total Net Patient Revenue was calculated/budgeted to equal $19,340,000, and the Total Net Expenses was budgeted to equal $8,689,000. The Total Net Profit would then be calculated using the equation: Net profit= (net revenue)/(net expenses) Net profit= ($19,340,000)/($8,689,000) Net profit= 2.226 Impacts and Justifications: Long-term and Short-term The budget is largely beneficial on a short-term basis because it does not allow for much room for equipment purchases, leasing, or pay raises. The argument for such is because the clinic has been losing a lot of money, it is important to curb those loses, whether by purchasing less equipment or through paying employees just a little less before the clinic is forced to shut down. However, looking at the proposal for the long-term, an increase in insurance coverage will cover any emergencies that may not be in the foreseeable future. Milestone 3: The Venice Family Clinic 5 Impacts and Justifications: Strategic Planning Strategic planning prompts a budgeter to anticipate where the clinic will be in the future, such as within 5 to 10 years. This budget doesn't position the clinic for much growth within the next few years with decreased equipment budgeting and decreased leasing. Impacts and Justifications: Conflicts The only conflicts that may result from the new budget proposal would be from a slight decrease in the annual salary of some of the staff at the Venice Family Clinic. However, this would be fixed through reminding the staff that we are, indeed, a non-profit organization, and the money saved would go towards bettering healthcare in our community. CAPITAL BUDGET PROPOSAL VENICE FAMILY CLINIC Oodusanya Olawunmi February 11, 2018 - - PROJ E CT ED DE PART ME NTAL BUDG ET CLAYTON GENERAL HOSPITAL FY 2016 Proposed Operating Budget Nursing Unit 3rd Floor Dec 15 YTD 2016 Budget Increase/Decrease Comments GROSS REVENUE Inpatient Revenue Per Diem ( $4,000 per patient day) DRG (Diagnostic Related Group- $5,000 per procedure) Percent of charges Outpatient Revenue Infusion (CPT-code) Radiology (CPT-Code) Other Revenue Total Gross Patient Services Revenue $ Contractural Allowance Total Net Patient Services Revenue $ MD RN LPN Other Staff Per diem cost (staffing) Fringe Benefits Travel Total Salary Expense $ $ $ $ 12,480,000 4,800,000 960,000 12,480,000 4,920,000 960,000 1,296,000 2,880,000 1,850,000 24,266,000 1,324,800 3,312,000 1,850,000 24,846,800 3,842,280 20,423,720 $ 3,950,000 20,896,800 1) Patient days are based on the average census for each month; consider a 1 month average of 260 patient days multiplied by 12 months ($4,000 per patient day) 2) DRG is based on a per procedure (fee for service) regardless of length of patient stay/In 2015 there were 80 procedures per month (960 year) at $5,000/per procedure 3) Company B pays only 80% of gross charges ( Gross charges related to company B were $2,2000,000 for 2015) 4) CPT code provides a finance determined price for this servicebased on chargable amounts. In 2015 there 90 infusions per month @ $1200 5) CPT code provides a finance determined price for this service based on chargable amounts. In 2015 there were 80 per month @ $3,000 Revenue could be from a Grant or community health event Note: Formula provided (adding inpatient and outpatient revenue) This is a percentage estimate based on the amount of chargable gross revenue that will NOT be reimbursed based on insurance and self-pay discounts EXPENSES Salaries $ 2,500,000 800,000 350,000 180,000 360,000 2,770,000 45,000 7,005,000 2,500,000 800,000 350,000 180,000 360,000 2,770,000 50,000 7,010,000 485,000 265,000 750,000 495,000 266,500 761,500 10) If patient revenue is increasing you would anticipate that medical supplies would increase. Likewise, if revenue decreases, supplies will decrease 150,000 110,000 153,000 498,000 508,000 182,509 154,996 39,500 15,500 80,000 1,741,505 8,751,505 12) This number could change based on capital budget requests 6) Salary rates for MD is negoitatied in the contract 7) Consider 200 FTE's and any annual pay for performance increases 8) Staffing needs are based on census and volumes Administrative staff 9) Staffing determination based on census Benefits are listed at 20% of Salary amount. Therefore, if you increase salaries multiply by 20% by the new salary figure to arrive at new benefits amount Travel is an estimate based on what travel is expected for the year. As a manager you may need to send staff to a seminar or convention Note: Formula SUPPLIES Medical Supplies Office Supplies Total Supplies 11) Estimate for 2016 (Managers will try to cut costs when possible. However, there are times when the expense is necessary. Note: Formula OTHER EXPENSES Equipment Legal Fees Professional Fees Utilities Repairs and Maintenance Equipment Lease Insurance Depreciation & Amortization Miscellaneous Expense Bad Debt Expense TOTAL OTHER EXPENSES Total All Expenses $ $ $ $ 250,000.00 108,786 152,288 497,694 506,984 183,509 154,996 40,334 15,000 80,000 1,739,591 8,744,591 This line item will remain the same unless manager is aware of new circumstances This line item will remain the same unless manager is aware of new circumstances This line item will remain the same unless manager is aware of new circumstances This will stay the same or increase based on the age of equipment being used. If new machinery is being used this line item could reasonably decrease 13) This item will change if student's Capital Budget proposal item includes a Lease option. If not, enter prior year number 14) This item will change if student's Capital budget item requires additional insurance. If not, enter prior year number This item will change to follow the current depreciation schedule and if student's Capital budget item included a purchase of building or equipment. This line item is for the unexpected expenses that may occur through-out the year. Bad debt expense are the patient accounts receivable that can not be collected Note: Formula Note: Formula Clayton General Hospital Calendar Year 2016 Capital Budget Nursing Unit 3rd Floor Department #3500 ITEM REQUESTED Floor Scrubber Tablet Counters (2) Filing Cabinet Scanner for Inventory Intercom System Coding/Billing Specialist PURPOSE / USE facilities Prep room & radiology room 2 Staff Office Inventory cycle counts Replace outdated system Coder Updates TOTALS ITEM COST $ 6,000 5,000 2,500 18,000 35,000 2,000 $ Submitted by: Date : Jaleesa Tilford 68,500 INSTALLATION COST $ 1,000 $ 1,000 Approved by: 8-Oct-17 Date : TOTAL COST $ 6,000 5,000 2,500 19,000 35,000 2,000 $ 69,500 1 Running Head: VENICE FAMILY CLINIC Venice family clinic Name of student Professor’s name Course title Date 2 VENICE FAMILY CLINIC Financial condition of the Clinic From the 2012 financial report, the clinic’s total current assets total up to 9,913,386 while the current liabilities is 3,431,324. The current ratio is therefore 2.89. This ratio is a bit on the high end and may indicate that the clinic is not using its financing capabilities efficiently. However, the liquidity of the clinic is good, and it can, therefore, be able to meet its short-term financial obligation. The debt to equity ratio, on the other hand, is 0.21 which means that the clinic can finance most of its operations without the help of creditors. Net assets at the beginning of the year were 20,690,947 while at the end of the year it was 18,876, 692 which means that the clinic has a net operating loss of 1,841,255. This means that if the clinic continues this way it may be unable to sustain its operation as it may be unable to finance its operation. It should, therefore, aim to at least not to lose money by controlling its cost (Venice Family Clinic Financial Report, 2012) Healthcare trends that are likely to affect the Clinic Technology is transforming healthcare with an emphasis on patient-centered treatment. There is a lot of integration taking place in the operation, administrative and clinical aspects of health centers. This is because health centers are becoming more systemic and goal focused. As a result, they are developing strategies with the intention of improving the patient’s experience. This even involves the use of analytics to anticipate patterns as well as guide decision making One of the most worrying trends that is likely to impact the Venice family clinic is uncertainty about reimbursements by insurance companies and medical schemes. Premiums in insurance are increasing and there is a lot of debate concerning the restructuring of Medicaid as well as Medicare (Baechler, Cummings, Norris, Scott & Dahl, 2016) 3 VENICE FAMILY CLINIC There has also been an increasing demand for value. In Medicare and Medicaid, the physician’s payment will depend on the quality of care the patient receives. The valuation of the quality received has been made possible by the use of electronic health records (Baechler, Cummings, Norris, Scott & Dahl, 2016) Telemedicine is another trend. People are now demanding access to healthcare at all time. Self-monitoring technology has hit the market and this enables patients to keep track of their vitals. There are also a lot of applications that help consumers with information on their health. Patients are now demanding convenient access to healthcare (Baechler, Cummings, Norris, Scott & Dahl, 2016) Hospitals are also adopting a design thinking strategy which is meant to increase the effectiveness of service delivery. Through this strategy, the hospitals can anticipate challenges in design and therefore develop control measures to ensure that will deal with these challenges. The management can be able to think through the clinical, operational and administrative aspects of the organization which ensures that they can implement smarter and more costs effective means of providing healthcare. This ensures that the staff increases productivity and that the patients receive the most quality care possible. This helps helped the clinic reach new levels of efficiency as well as improve the experience of the patient (Baechler, Cummings, Norris, Scott & Dahl, 2016) Opportunities and Challenges Opportunities • Design thinking is a strategy that the hospital has recently employed while working on a children’s clinic and it has enabled the company to increase the efficiency of operation as 4 VENICE FAMILY CLINIC it can think through the clinical, operational and administrative aspects of the organization which enables to serve its clientele better (Doss, 2014) • Increased use of technology will lead to better delivery of healthcare to patients which is a key focus for the clinic • The clinic is always devoted to quality services and the increased emphasis on quality services for patients will on increase the popularity of the clinic Challenges • Most of the clinic’s patients do not have insurance or any income, and as a result, the company has to go the extra mile to stretch the funds they receive to provide patients with quality services. Therefore uncertainty about medical schemes and regulation threatens the stability of the clinic • Investment in technology is costly for a company which relies mostly on donations • Since the clinic deals with low-income families, it may be difficult to implement all time access to healthcare as they may be unable to afford these technologies. These services require a digital platform Implications for the organization’s mission The goal of the clinic is to provide quality health services income to low-income groups. The trends in healthcare may improve delivery they, however, may come at a cost the hospital may be unable to bear. It relies on grants from both government and non-government organizations and other fundraising techniques such as art auctions. However, if the Medicaid and the Medicare programs are at risk the longevity of the clinic may be at risk since most of the patients benefit from these programs. The clinic may be unable to bear the cost without these programs. VENICE FAMILY CLINIC References Baechler, C., Cummings, A., Norris, B., Scott, R., & Dahl, M. W. (2016). Health Systems: The Next Generation-Panel 1: Industry Trends in Healthcare Delivery. Doss, H. (2014, May 23). Design Thinking In Healthcare: One Step At A Time. Retrieved January 21, 2018, from https://www.forbes.com/sites/henrydoss/2014/05/23/design-thinking-inhealthcare-one-step-at-a-time/ Venice Family clinic Financial Report (2012). Retrieved January 21, 2018, from https://hab.hrsa.gov/sites/default/files/hab/program-grants-management/audits/partc/veniceclinic2012.pdf 5 Running head: HEALTH CARE AND FINANCE MILESTONE ONE Health Care and Finance Milestone One Oodunsanya Olawunmi IHP-450 January 21, 2018 Professor David Abalat 1 HEALTH CARE AND FINANCE MILESTONE ONE 2 Financial condition of the Clinic From the 2012 financial report, the clinic’s total current assets total up to 9,913,386 while the current liabilities are 3,431,324. The current ratio is therefore 2.89. This ratio is a bit on the high end and may indicate that the clinic is not using its financing capabilities efficiently. However, the liquidity of the clinic is good, and it can, therefore, be able to meet its short-term financial obligation. The debt to equity ratio, on the other hand, is 0.21 which means that the clinic can finance most of its operations without the help of creditors. Net assets at the beginning of the year were 20,690,947 while at the end of the year it was 18,876, 692 which means that the clinic has a net operating loss of 1,841,255. This means that if the clinic continues this way it may be unable to sustain its operation as it may be unable to finance its operation. It should, therefore, aim to at least not to lose money by controlling its cost (Venice Family Clinic Financial Report, 2012) Healthcare trends that are likely to affect the Clinic Technology is transforming healthcare with an emphasis on patient-centered treatment. There is a lot of integration taking place in the operation, administrative and clinical aspects of health centers. This is because health centers are becoming more systemic and goal focused. As a result, they are developing strategies with the intention of improving the patient’s experience. This even involves the use of analytics to anticipate patterns as well as guide decision making One of the most worrying trends that is likely to impact the Venice family clinic is uncertainty about reimbursements by insurance companies and medical schemes. Premiums in HEALTH CARE AND FINANCE MILESTONE ONE 3 insurance are increasing and there is a lot of debate concerning the restructuring of Medicaid as well as Medicare (Baechler, Cummings, Norris, Scott & Dahl, 2016) There has also been an increasing demand for value. In Medicare and Medicaid, the physician’s payment will depend on the quality of care the patient receives. The valuation of the quality received has been made possible by the use of electronic health records (Baechler, Cummings, Norris, Scott & Dahl, 2016) Telemedicine is another trend. People are now demanding access to healthcare at all time. Self-monitoring technology has hit the market and this enables patients to keep track of their vitals. There are also a lot of applications that help consumers with information on their health. Patients are now demanding convenient access to healthcare (Baechler, Cummings, Norris, Scott & Dahl, 2016) Hospitals are also adopting a design thinking strategy which is meant to increase the effectiveness of service delivery. Through this strategy, the hospitals can anticipate challenges in design and therefore develop control measures to ensure that will deal with these challenges. The management can be able to think through the clinical, operational and administrative aspects of the organization which ensures that they can implement smarter and more costs effective means of providing healthcare. This ensures that the staff increases productivity and that the patients receive the most quality care possible. This helps helped the clinic reach new levels of efficiency as well as improve the experience of the patient (Baechler, Cummings, Norris, Scott & Dahl, 2016) HEALTH CARE AND FINANCE MILESTONE ONE 4 Opportunities and Challenges Opportunities • Design thinking is a strategy that the hospital has recently employed while working on a children’s clinic and it has enabled the company to increase the efficiency of operation as it can think through the clinical, operational and administrative aspects of the organization which enables to serve its clientele better (Doss, 2014) • Increased use of technology will lead to better delivery of healthcare to patients which is a key focus for the clinic • The clinic is always devoted to quality services and the increased emphasis on quality services for patients will on increase the popularity of the clinic Challenges • Most of the clinic’s patients do not have insurance or any income, and as a result, the company has to go the extra mile to stretch the funds they receive to provide patients with quality services. Therefore uncertainty about medical schemes and regulation threatens the stability of the clinic • Investment in technology is costly for a company which relies mostly on donations • Since the clinic deals with low-income families, it may be difficult to implement all time access to healthcare as they may be unable to afford these technologies. These services require a digital platform HEALTH CARE AND FINANCE MILESTONE ONE 5 Implications for the organization’s mission The goal of the clinic is to provide quality health services income to low-income groups. The trends in healthcare may improve delivery they, however, may come at a cost the hospital may be unable to bear. It relies on grants from both government and non-government organizations and other fundraising techniques such as art auctions. However, if the Medicaid and the Medicare programs are at risk the longevity of the clinic may be at risk since most of the patients benefit from these programs. The clinic may be unable to bear the cost without these programs. HEALTH CARE AND FINANCE MILESTONE ONE References Baechler, C., Cummings, A., Norris, B., Scott, R., & Dahl, M. W. (2016). Health Systems: The Next Generation-Panel 1: Industry Trends in Healthcare Delivery. Doss, H. (2014, May 23). Design Thinking In Healthcare: One Step At A Time. Retrieved January 21, 2018, from https://www.forbes.com/sites/henrydoss/2014/05/23/design-thinking-inhealthcare-one-step-at-a-time/ Venice Family clinic Financial Report (2012). Retrieved January 21, 2018, from https://hab.hrsa.gov/sites/default/files/hab/program-grants-management/audits/partc/veniceclinic2012.pdf 6 
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