Easy assignment 1

Hospitals afford diagnostic and therapeutic services to those who need more than several hours of care. Hospitals must be licensed by the state and undergo inspections for compliance with state regulations (Gapenski 2013). Most hospitals are accredited by The Joint Commission, which is intended to promote high standards of care. Accreditation provides eligibility for participation in the Medicare and Medicaid programs.

Hospitals are classified as either general acute care facilities or specialty facilities. General acute care facilities provide general medical and surgical services and selected acute specialty services (Gapenski 2013). These facilities account for most hospitals and have comparatively short spans of stay. Specialty hospitals limit the admission of patients to specific ages, sexes, illnesses, or conditions (Gapenski 2013). Specialty hospitals frequently sustain lower expenses than general hospitals because they do not need the overhead connected with providing various diverse forms of care and services.

Hospitals are classified by proprietorship as governmental, private not-for-profit, or investor owned. Government hospitals constitute 25% of all hospitals and are divided into federal and public entities. Federal hospitals serve special purposes such as DOD and VA hospitals. Public hospitals are funded wholly or in part by a city, county, tax district, or state. Federal and Public hospitals provide substantial services to indigent patients (Gapenski 2013). Private not-for-profit hospitals are nongovernment entities organized for the sole purpose of providing inpatient healthcare services (Gapenski 2013). Roughly 80% of all private hospitals are not-for-profit entities and 60% of all hospitals are private hospitals. For serving a charitable purpose, these hospitals obtain several benefits, including exemption from federal and state income taxes, exemption from property and sales taxes, eligibility to receive tax-deductible charitable contributions, favorable postal rates, favorable tax-exempt financing, and tax-favored annuities for employees. The residual 15% of all hospitals are investment-owned hospitals, whose titleholders profit directly from the revenues created by the business. Dissimilar from not-for-profit, these hospitals pay taxes and sacrifice the other benefits of not-for-profit status.

Physicians hold a chief responsibility for defining which hospital services are delivered to patients and how long patients are hospitalized. Therefore, physicians play a crucial role in shaping a hospital’s costs and profits and henceforth its financial condition.

Ambulatory care encompasses services provided to patients who are not admitted to a hospital or nursing home. Associated to hospital-based services, these innovative settings offer patients more amenities and convenience and, in many situations, lower prices. Patients who required hospitalization due to the intricacy, strength, invasiveness, or peril connected with certain procedures are now able to be treated in ambulatory locations. Health insurers have instituted payment mechanisms that provide incentives for providers to perform services on an outpatient basis. Ambulatory facilities are not as expensive to run and are less often subject to licensure and certificate-of-need protocols than are hospitals.

Home health care is a substitute to nursing home care but is not readily accessible in numerous rural areas. Third-party financiers, particularly Medicare, have shown mixed signals sufficiently compensating for home health care. Several home health care businesses have been forced to close due to a new, less lavish Medicare payment system.

Long-term care entails healthcare services provided to people who lack all or some functional capability. Long-term care is a hybrid of healthcare and social services. Nursing homes are a main provider of this care.

Nursing home care is accessible at two levels: Skilled Nursing Facilities (SNF) and Nursing Facilities (NF). SNFs offer the level of care contiguous to hospital care. Services must be delivered under the direction of a physician. NFs are envisioned for those that don’t need hospital or SNF care but whose mental or physical circumstances necessitate daily continuousness on one or more medical services.

Long-term care facilities are more plentiful than hospitals, but are smaller than hospitals, and are licensed and inspected by states. The elderly are excessively high users of healthcare services and are chief users of long-term care. Upsurges in demand for long-term care facilities are estimated, as the proportion of the US residents aged 65 or older is anticipated to raise from less than 15% in 2010 to 20% in 2030.

Integrated delivery systems can be organized in several ways, however, the significant features of such systems are that the organization has the capacity to undertake full clinical obligation for the healthcare requirements of a distinct population. In agreements with some insurers, the integrated delivery system obtains fixed expenditures for each plan-covered life and henceforth shoulders both the financial and clinical risks connected with providing healthcare services.

To be an active competitor, integrated delivery systems must curtail the delivery of needless services, for the reason that extra services generate further costs but don’t automatically result in added profits. The objective of integrated delivery systems is to provide all required services to its member population in the lowest-cost setting. Clinical integration between the various providers and mechanisms of care is critical to attaining quality, cost efficiency, and patient satisfaction.

There are numerous potential benefits attributed to an integrated delivery system. Patients are kept in the corporate network of services. Providers have access to managerial and functional specialists. Information systems that track all features of patient care can be established more easily than under a fragmented care model, and the costs to develop them can be shared. Larger, versatile establishments have improved access to capital. The ability to recruit and retain management and professional staff is enhanced. Healthcare insurers can be presented a complete on-stop-shop of services. A full array of healthcare services can be better planned and delivered to meet the needs of a distinct population. Many of these population-based labors characteristically are not offered by stand-alone providers.

Despite the advantages of integration, health system administrators have found that handling large, diverse enterprises is problematic. Frequently, the financial and patient care gains projected were not obtained, and several systems have dissolved. Healthcare reform lawmaking has formed extra incentives that are anticipated to foster the formation of a new category of integrated delivery systems, the accountable care organization.

The healthcare sector of our economy is growing rapidly in size and complexity. The role of financial information in the decision-making process cannot be overstated. It is incumbent on all healthcare decision makers to become accounting-literate in our financially changing healthcare environment.

References

Gapenski, C. (2013). Fundamentals of Healthcare Finance, 2nd Edition. Retrieved on December