Healthcare Financial Systems

Tightening cash flows attached with the chances of increased capital spending are a cause for concern among healthcare system executives. In a recent report by the Healthcare Financial Management systems entitled "Financing the Future", some startling conclusions were reached regarding current capital spending the deteriorating financial condition of hospitals are making capital access more difficult.

The break between the things are actually widening as to capital or financial access, creditworthiness, and the ability to finance the future. As for the predictions of future financial expenditures, the study compiled some interesting statistics like 72% of CFO's expect capital expenditures to increase in the next five years; 85% of hospital CFO's surveyed said they thought it would be more difficult f or their organizations to fund capital expenditures in the future and 63% responded that they expected to be more dependent on cash from operations to fund capital needs.

Staying as advanced as possible with new equipment technologies and replacing aging plants are a key priority among health providers. These health care financial organizations also must spend money on cleaning up old liabilities and build outpatient facilities in order for their operations to be viable in the future. Expenditures for updated equipment likely over $1 million for an updated PET scanner are however not being matched by income. Reduced Medicare reimbursements have not covered costs. As a consequence, healthcare financial systems have had to make up the difference. From the perspective of the patient, they do not want to visit a facility that merely keeps up. Patients are now paying more out of pocket operating cost than ever before. Accordingly, they expect to be able to profit from the technological advances they read about in the newspapers.

The actual difference between what need of the patients and what cash-starved healthcare providers can provide is ever widening. This difference is likely to remain in effect if factors such as the Medicare state of affairs, escalating malpractice insurance premiums, and technology that is costly continue to squeeze cash flows.

Now the provider can work with financial service companies that really know healthcare; which means a company that can truly understand the provider's goals and strategies as well as the particular needs of the patients. They need to work along with some companies that put forth financial solutions like equipment leasing that don't sacrifice or compromise other segments of the business.

Shed assets that are a financial drain on the healthcare financial system provider. They need to settle on which real estate assets are productive for the future accomplishment of the business and which are not. Such as the medical office buildings are hard to maintain and manage. Selling the quality to a third party owner can relieve the provider not only the headaches of property management, but can free up cash and improve the balance sheet dramatically. Control operating cost and improve operational functions. Although most of the financial expenses of a hospital or practice are fixed in nature, there are still strategies that can be employed to improve the bottom line.

• Cassandra Bagley
• 11/02/2009, 10:59 AM
• 0 Comments