Running Head: REFLECTIVE JOURNAL
1
3-2 Reflective Journal: Mini Case Study
REFLECTIVE JOURNAL
2
Physician owners can adopt a number of measures to improve their profitability
without increasing the rates of the products. For increasing profits, it is essential to
understand the association between costs and expenses. Cost primarily refers to
expenditure, whereas expense refers to the consumption of an item or commodity that
has been acquired. So, the cost can be considered to be the money that is spent on
acquiring an asset. On the other hand, the expense is the amount that is spent while
consuming the asset. The formula relating to profit is presented below:
Profits = Revenue – Expenses
In the equation, profit is the money that is remaining after deducting expenses
from revenue or income. Revenue is the income that is earned by an organization, and
expenses refer to the money that is paid by an organization. While trying to increase the
profitability of an entity, it is equally necessary to try not to let the cost and expenses
rise. An effective method is to ascertain the break-even point. It is the specific point at
which the revenue and the costs are the same, and thus there is no profit or loss.
• The first recommendation to increase the profitability of a physician owner
without increasing the rate involves ensuring the receipt of reimbursement of services
that have been rendered. For maximizing the reimbursement that is received, it is
necessary to ensure that the staff has expert knowledge of coding. By making sure that
they have the necessary skills so that proper coding can be done and the possibility of
leaving out potential reimbursements can be eliminated.
• Another recommendation is to upgrade the collections that are made at the very
point of service. In order to increase profitability, it is essential to collect deductibles as
REFLECTIVE JOURNAL
3
well as copays when the services are delivered to the end-users. The staff who sits at
the front desk must have a thorough understanding of what is due from which customer.
The insight can help them to put in consistent efforts to collect the money for rendered
services.
• Another effective measure for increasing the level of profitability in the healthcare
setting is by reducing the expenses that are incurred. Avoidable expenses need to be
managed carefully since they have the potential to erode the overall profitability. For
reducing unnecessary expenses, the staff can be given proper training so that they can
carry out their roles and responsibilities efficiently. ad ad
REFLECTIVE JOURNAL
4
References
Nowicki, M. (2021). Introduction to the Financial Management of Healthcare
Organizations . Buy Introduction to the Financial Management of Healthcare
Organizations (Gateway to Healthcare Management) Book Online at Low Prices in
India | Introduction to the Financial Management of Healthcare Organizations
(Gateway to Healthcare Management) Reviews & Ratings. Retrieved May 18,
2022, from https://www.amazon.in/Introduction-Financial-Management-Healthcare-
Organizations/dp/156793904X
