Capital Expenses: Financing an Electronic Health Record System

timer Asked: May 3rd, 2018
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Question Description

In today's world of healthcare, capital expenses are a common element to the financial management process. In fact, all healthcare organizations, at some point, must convert to an Electronic Health Record (EHR) system to be compatible with the rest of the world. However, this is a major capital expense that will cost many healthcare organizations millions of dollars. Purchasing an EHR system will undoubtedly require the acquisition and use of long-term assets under a capital budget.

The final assignment of your project will require you to make a recommendation to finance an EHR system, based on information from previous assignments (see attached). You will compile all the information in a proposal format, which will be addressed to the organization's executive managers. You will create a separate presentation as an overview of your proposal. This assignment includes an 8 page paper and a 7 slide power-point presentation.

Your organization is considering financing a 1.5 million dollar EHR system (if an EHR system not a good fit for your case, you can choose any major health information system/technology but the 1.5 million dollar reference should remain the same). Based on the financial outlook of your case/organization, make a recommendation to purchase or not purchase the system. You will need to draw on the material you have learned in throughout the class and assignments; as well as background information from your case description. Collectively, that information will serve as the foundation to support your recommendation.

Your final Financial Analysis report should be a minimum of eight (8) pages in length, excluding title and reference pages.

  • Introduction of case and financial challenges and issues; perspective of financial challenge (Introduction)
  • Report on assets and liabilities, cash flows and financial position, etc (Financial Statements).
  • Examination of financial analysis methods (Financial Analysis Methods).
  • Interpretation of financial management and capital management; influences for capital investments and decision-making (Capital Management).
  • Assessment of EHR implementation (or relevant information system) and recommendation; using supportive information from financial management assignments (Proposal)
    • Summarizes and presents a collection of financial management concepts, strategies and methods; applicable to case financial position, needs and challenges.
  • Make sure to use block letter formatting and proposal formatting guidelines. You will need to include a title page. Remember, your audience is the organization's executive managers. Make sure to use proper audience tone.
  • Include an APA formatted reference page to include at least five (5) academic sources, such as a book or an academic scholarly journal, to support your topic. You should reference your academic sources by including at least five (5) in-text citations. Academic scholarly journals can be access through the Rasmussen Online Library.

Your Presentation should be created in MS PowerPoint to include a minimum of seven (7) slides. You will also add a narration to your presentation that should be 15-20 minutes in length.(I will narrate, make sure to put the information i am to narrate in the note section of the presentation). *Remember It must be enough to narrate a minimum of 15 minutes. Be sure to discuss your project components in a concise, yet effective manner. You should highlight key points of each component of the Financial Analysis Report, leading up to your EHR recommendation outcome. Include graphical displays (such as graphs or other pictorials) to add visual interest and support of your information.(Please do not forget the graphs! Use a professional tone and keep in mind that you are presenting to the executive management team; consider their interests as stakeholders.

Presentation Outline-7 slides, title and reference slide separate.

  • Introduction
  • Summary of financial statements
  • Summary of financial analysis methods
  • Findings of capital management influences
  • EHR recommendation outcome
  • Summary/Conclusion
  • APA formatted reference slide

Unformatted Attachment Preview

CASE STUDY: Interim Chief Financial Officer Case Study: Trinity Mother Frances Health System: Tyler, Texas Warbird provides customized healthcare finance team, including an interim CFO, to help leading health system move forward with key financial initiatives The Opportunity Recognized as a leader in quality and rated as the number one hospital in the state of Texas for patient safety, Trinity Mother Frances Health System in Tyler was in need of financial leadership after the retirement of its long-time CFO. Trinity had embarked on the construction of a heart hospital and the installation of the EPIC electronic information system yet days of cash-on-hand was strained and the organization was not prepared to enter the bond market for financing. The Solution Lindsey Bradley, president and CEO of Trinity, turned to Warbird Consulting Partners. Working with Warbird, Trinity was able to engage a customized team of healthcare finance experts that included an interim chief financial officer through Warbird’s Healthcare CFO Consulting Network, as well as key financial staff through Warbird’s On-Demand Services. In addition to interim CFO Pamela Vukovich, a healthcare finance expert with more than 29 years’ professional experience, including 11 years as a chief financial officer, Warbird also provided seasoned interim professionals to serve as internal audit director, tax manager and director of physician services, as well as several financial analysts. Working onsite with the Trinity executive leadership team three-to-four days a week, Pam and the Warbird team collaborated with the hospital’s finance department to devise a detailed plan of action to put the organization on financial track. With her expertise, Pam spearheaded the development of a long-range financial plan that included a return-oninvestment analysis for the EPIC and heart hospital projects, and helped define the need for bond financing for expected capital outlays in the next three years. After the long-range plan was approved by the Trinity finance committee and executive leadership team, Pam prepared the organization for review by Fitch and Moody’s. Trinity’s current ratings were confirmed and Pam led the combined finance team in working with investment bankers to execute a successful bond issue. In addition to addressing the immediate financial challenges facing Trinity, Pam worked with CEO Lindsey Bradley to restructure the finance department and its functions for longterm improvement, including instituting a department of internal audit, and defining its responsibilities, staffing models and detailed audit programs. She also reviewed Trinity’s investment practices and policies and recommended key changes in cash management and investment allocations to Trinity’s finance committee. All of these changes were implemented and have resulted in a more robust finance function with greater returns and lower risk. Finally, Pam worked with Lindsey and Trinity COO Ray Thompson to rewrite the CFO job description and provided expert input during the selection process for a permanent CFO. Trinity selected Joyce Hester, an internal candidate, and Pam has continued to consult with Trinity as a mentor for the new CFO with regular update calls to provide counsel in the areas of bond financing, investments and more. Results Warbird’s expertise in healthcare finance management and its ability to build a customized On-Demand team to meet the hospital’s specific needs provided the following results for Trinity Mother Frances Health System: • New Chief Financial Officer • New bond financing at attractive rates • Established department of internal audit • Robust investment policies, including new asset allocations for corporate and retirement funds, and an improved cash management system • Completed reviews of ratings, which were confirmed • Restructured bond portfolio with reduced interest expense and lower risk • Process to review and standardize physician incentive compensation programs • New record keeping and investment management firm for the system’s 403(b) pension plan, which resulted in significant annual savings to participants • Long-range financial plan and model, which could be updated by Trinity staff in the future • Standardized financial analysis and capital analysis ...
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