Healthcare Financial Planning

Sound budgeting and financial planning in healthcare organizations is crucial to maintaining service levels and running a sustainable operation. In an uncertain economy, costs can rise faster than revenues – a challenging situation for any management professional. Healthcare managers have additional issues to contend with, such as fluctuating insurance and Medicare reimbursement rates.

Experienced healthcare managers meet these core challenges every day. Whether overseeing private practices or hospital facilities, these management professionals are responsible for pursuing a healthy bottom line in the delivery of quality healthcare.

The Healthcare Manager’s Role in Financial Planning

Achieving a strong financial performance is a goal of every healthcare organization. In pursuit of this objective, healthcare managers often use a multi-faceted approach of proven techniques and best practices, including:

• Comparative Benchmarks: Benchmarking is a process of learning good practices from other organizations, implementing the practices and setting measurable standards to track progress. Obtaining and analyzing external benchmark data for costs and productivity can help a facility set its own criteria. Annual reviews enable healthcare managers to identify opportunities for savings and ways to fill budget gaps.
• Accurate, High-Performing Budgeting: Based on benchmarks and past performance, healthcare managers set accurate budgets for each department. Low-performing departments may be given targeted cost-per-workload goals and be evaluated more often to help them improve.
• Establishing Accountability: Experienced healthcare managers know that reaching target budgets should be an expectation, not a vaguely defined target. They often collaborate with department managers and the finance team, instilling accountability into the process from senior management, down. Improving financial planning for healthcare organizations means that each department is required – not encouraged – to meet its budget.
• Tracking and Managing Expenses: By analyzing national statistics and trends for medical practice expenses, healthcare managers can establish their own standards for expenses. Proper tracking of each cost center is essential for proper budget management. Department managers must be held responsible for holding down expenses at every opportunity. Saving money is often easier than bringing in more revenue – and every dollar saved goes right to the bottom line.
• Monitoring Variances: By tracking expenses properly, it’s easier to catch variances immediately. Monitoring variances enables healthcare managers to enact corrective action quickly, before a cost center gets out of control.
• Achieving Balance: While reducing costs is a primary objective, healthcare managers must also help the organization deliver continuously improving quality, patient satisfaction and employee fulfillment.

How can individuals interested in pursuing an advanced career in healthcare learn the high-level financial expertise required to manage costs and deliver effective care? The targeted education provided by an MBA program with a specialization in Healthcare Management is a great place to begin.

Pursuing an MBA in Healthcare Management Can Lead to a Satisfying Career

The advanced financial planning and budgeting ability described here are required knowledge for many healthcare administration jobs. While some entry-level healthcare management positions require at least a bachelor’s degree, many employers show preference to candidates with advanced degrees, such as a Master’s degree in Business Administration (MBA). Acquiring specialized knowledge by earning an MBA in Healthcare Management could give you a competitive edge when pursuing senior-level jobs in healthcare administration.

An MBA in Healthcare Management program provides the depth of knowledge required to succeed in health services organizations such as physicians’ groups, hospitals and long-term care facilities. Students enrolled in an MBA in Healthcare Management program are given the opportunity to hone critical thinking, teambuilding and communication skills, as well as to learn the specific concepts and management techniques unique to the healthcare industry.

Coursework may include managerial economics, financial management, healthcare policy, strategic management and organizational behavior. The curriculum is designed to combine practical leadership with a solid understanding of today’s complex healthcare system. Graduates of MBA in Healthcare Management programs are typically well-positioned to contribute to the ongoing sustainability and profitability of a wide variety of healthcare organizations.

Exploring Jobs in Healthcare? Consider an MBA in Healthcare Management

If you’re ready to challenge yourself and advance in your career, why not explore the many opportunities in healthcare management? Learning the concepts behind healthcare financial planning can bring your career goals within sight. You can begin your career preparation by enrolling in an MBA program with a Specialization in Healthcare Management. 

Category: Healthcare Management