BOOK
Financial Management for Nurse Managers and Executives - E-Book
Cheryl Jones | Steven A. Finkler | Christine T. Kovner | Jason Mose
(2018)
Additional Information
Book Details
Abstract
Learn how financial management fits into the healthcare organization. Financial Management for Nurse Managers and Executives, 5th Edition covers the latest accounting and financial management practices distinctly from the nurse manager’s point of view. Topics include how financial management fits into the health care organization, financial accounting, cost analysis, planning and control management of the organization’s financial resources, various management tools, and the future of financial management with respect to healthcare reform and international accounting standards. This new edition includes updated information on the Affordable Care Act, Accountable Care Organizations, Value Based Payment, and Team and Population Based Care.
- Nursing-focused content thoroughly describes healthcare finance and accounting from the nurse manager’s point of view.
- Numerous worksheets and tables including healthcare spreadsheets, budgets, and calculations provide you with specific examples of how to apply financial management principles to nursing practice.
- NEW! Information about the Affordable Care Act details how changes and developments affects coverage for millions of Americans.
- NEW! Value-Based Payment reimbursement information details what nurse executives need to know in order to use this new system
- NEW! Coverage of Accountable Care Organizations provides current information on one of the emerging forms of managed care and how it works within the financial system of healthcare.
- NEW! Team-and Population-Based care information covers how to work with healthcare professionals outside of nursing.
Table of Contents
| Section Title | Page | Action | Price |
|---|---|---|---|
| Front Cover | Cover | ||
| Inside Front Cover | IFC | ||
| Inside front cover | i | ||
| You’ve just purchased more than a textbook! | ii | ||
| Front matter | iii | ||
| Financial management | iii | ||
| Copyright | iv | ||
| Dedication | v | ||
| Reviewers | vii | ||
| Preface | ix | ||
| About the authors | xiii | ||
| Cheryl bland jones, phd, rn, faan | xiii | ||
| Steven A. finkler, phd, cpa | xiii | ||
| Christine t. kovner, phd, rn, faan | xiv | ||
| Jason n. mose, phd, mba, ms, chfp | xiv | ||
| Table of Contents | xv | ||
| 1 Introduction and overview | 1 | ||
| Chapter goals | 1 | ||
| ❃ Introduction | 1 | ||
| ❃ Financial management in health care organizations | 2 | ||
| ❃ The structure of health care organizations | 2 | ||
| Line versus staff authority | 3 | ||
| Centralized versus decentralized organizations | 3 | ||
| ❃ The role of the chief financial officer and other financial managers | 4 | ||
| The finance function | 4 | ||
| The financial accounting function | 5 | ||
| The managerial accounting function | 5 | ||
| Internal control function | 6 | ||
| ❃ The role of the chief nurse executive in financial management | 6 | ||
| ❃ The role of midlevel and first-line nurse managers in financial management | 7 | ||
| ❃ The role of staff nurses in financial management | 7 | ||
| ❃ Interactions between fiscal and nurse managers | 8 | ||
| ❃ Responsibility accounting | 8 | ||
| Responsibility centers | 8 | ||
| ❃ Financial management framework of this book | 9 | ||
| Foundations of health care financial management (part I) | 9 | ||
| The health care environment | 9 | ||
| Financing of health care | 10 | ||
| Key issues in applied economics | 10 | ||
| Quality, costs, and financing | 10 | ||
| Financial accounting (part II) | 11 | ||
| Accounting principles | 11 | ||
| Analysis of financial statement information | 11 | ||
| Cost analysis (part III) | 12 | ||
| Cost management | 12 | ||
| Determining health care costs and prices | 12 | ||
| Planning and control (part IV) | 12 | ||
| Strategic management | 12 | ||
| Budgeting concepts and budget preparation | 12 | ||
| Controlling operating results and variance analysis | 13 | ||
| Benchmarking, productivity, and analysis of costs | 13 | ||
| Managing financial resources (part V) | 13 | ||
| Short-term financial resources | 14 | ||
| Long-term financial resources | 14 | ||
| Looking to the future (part VI) | 14 | ||
| Forecasting | 14 | ||
| The nurse as entrepreneur | 14 | ||
| Nursing and financial management: Current issues and future directions | 15 | ||
| ❃ Implications for nurse managers and executives | 15 | ||
| ❃ Key concepts | 15 | ||
| I Foundations of health care financial management | 17 | ||
| 2 The health care environment | 18 | ||
| Chapter goals | 18 | ||
| ❃ Introduction | 18 | ||
| ❃ The structure and characteristics of the U.S. health care system | 19 | ||
| Key characteristics of the U.S. health care system | 19 | ||
| Cost, access, and performance | 19 | ||
| Governance | 21 | ||
| Quality, equity, and health disparities | 21 | ||
| Cost, price, and quality transparency | 22 | ||
| Emphasis on acute and episodic care as opposed to preventive and integrated care | 22 | ||
| Uncertainty, the ever-changing health care landscape | 23 | ||
| ❃ Health care reform | 23 | ||
| Progression of health care reform in the U.S. | 24 | ||
| The patient protection and affordable care act | 25 | ||
| Increasing access to care, improving quality, and containing costs through health insurance coverage | 27 | ||
| Slow the growth of health care costs and improve the quality of health care | 28 | ||
| ❃ The key stakeholders in the health care system | 30 | ||
| Providers | 31 | ||
| Nurses | 31 | ||
| Physicians | 32 | ||
| Hospitals | 33 | ||
| Accountable care organizations | 33 | ||
| Federally qualified health centers | 34 | ||
| Retail clinics | 35 | ||
| Government | 36 | ||
| Other providers | 36 | ||
| Suppliers | 36 | ||
| Consumers | 37 | ||
| Regulators | 37 | ||
| Educational and research institutions | 38 | ||
| Payers | 39 | ||
| Individual consumers | 39 | ||
| Insurers | 39 | ||
| Employers | 40 | ||
| Government | 41 | ||
| Impact of the aca on key stakeholders | 42 | ||
| Nurses | 42 | ||
| Physicians | 42 | ||
| Hospitals | 42 | ||
| Consumers | 43 | ||
| Insurers | 44 | ||
| Governments | 44 | ||
| ❃ Implications for nurse managers and executives | 44 | ||
| ❃ Key concepts | 44 | ||
| ❃ Suggested readings | 44 | ||
| 3 The financing of health care | 47 | ||
| Chapter goals | 47 | ||
| ❃ Introduction | 47 | ||
| ❃ Health care financing | 48 | ||
| Drivers of health care costs | 48 | ||
| Fee-for-service reimbursement | 49 | ||
| Physician, facility, and drug costs | 49 | ||
| Fragmentation and lack of care coordination in the delivery system | 49 | ||
| High administrative burden on providers, payers, and patients | 49 | ||
| Changing demographics, lifestyle choices, and the rise of chronic conditions | 50 | ||
| ❃ Major sponsors of health care | 50 | ||
| The health insurance system | 50 | ||
| Insurance fundamentals | 50 | ||
| Insurance premium | 51 | ||
| Adverse selection | 51 | ||
| Moral hazard | 51 | ||
| Coinsurance, deductibles, and copayments | 52 | ||
| Customary and reasonable charges | 52 | ||
| ❃ Types of health insurance plans | 53 | ||
| Indemnity plans | 53 | ||
| Managed care | 53 | ||
| Point of service | 54 | ||
| Consumer directed plans | 54 | ||
| Public insurance programs | 55 | ||
| Medicare program | 55 | ||
| Medicaid and chip programs | 56 | ||
| Other sources of financing | 57 | ||
| Alternative payment approaches | 57 | ||
| ❃ Paying health care providers | 58 | ||
| Hospital payment | 59 | ||
| Prospective payment systems | 59 | ||
| Negotiated rates | 60 | ||
| Pay for performance | 60 | ||
| Charity care | 61 | ||
| Paying hospital and other providers under accountable care organizations | 61 | ||
| Nurse payment | 63 | ||
| Physician payment | 63 | ||
| Home health agency payment | 64 | ||
| Hospice payment | 65 | ||
| Nursing home payment | 65 | ||
| Funding nurse education | 66 | ||
| ❃ Approaches to control cost and payments for care | 66 | ||
| ❃ Implications for nurse managers and executives | 67 | ||
| ❃ Key concepts | 67 | ||
| ❃ Suggested readings | 68 | ||
| 4 Key issues in applied economics | 71 | ||
| Chapter goals | 71 | ||
| ❃ Introduction | 71 | ||
| ❃ Fundamental concepts of economics | 72 | ||
| Economic goods | 72 | ||
| Utility | 72 | ||
| Marginal utility | 72 | ||
| Marginal cost | 72 | ||
| Savings | 73 | ||
| ❃ Supply and demand | 73 | ||
| Free enterprise | 73 | ||
| An example of supply and demand | 73 | ||
| ❃ Elasticity of demand | 74 | ||
| ❃ Economies of scale | 75 | ||
| Increasing returns to scale | 75 | ||
| Decreasing returns to scale | 75 | ||
| ❃ Economics and incentives | 75 | ||
| ❃ Market efficiency | 76 | ||
| ❃ Redistribution of resources | 76 | ||
| Collective action | 77 | ||
| Equity improvement | 77 | ||
| ❃ Market failure | 77 | ||
| Government intervention | 77 | ||
| Lack of full information | 78 | ||
| Lack of direct patient payment | 79 | ||
| Monopoly power | 79 | ||
| Monopsony power | 80 | ||
| Government-induced inefficiency | 80 | ||
| Externalities | 80 | ||
| ❃ The market for nurses | 80 | ||
| ❃ Implications for nurse managers and executives | 82 | ||
| ❃ Key concepts | 82 | ||
| ❃ Suggested readings | 83 | ||
| 5 Quality, costs, and financing | 84 | ||
| Chapter goals | 84 | ||
| ❃ Introduction | 84 | ||
| ❃ What is quality, and how is it measured? | 85 | ||
| ❃ The impetus for integrating quality, cost, and financing | 88 | ||
| Quality reporting | 88 | ||
| Balanced scorecards | 95 | ||
| The magnet movement | 96 | ||
| The baldrige award | 96 | ||
| ❃ Relationships among health care quality, costs, and financing | 99 | ||
| A business case for quality | 101 | ||
| ❃ Implications for nurse managers and executives | 103 | ||
| ❃ Key concepts | 103 | ||
| ❃ Suggested readings | 103 | ||
| II Financial accounting | 109 | ||
| 6 Accounting principles | 110 | ||
| Chapter goals | 110 | ||
| ❃ Introduction | 110 | ||
| ❃ The basic framework of accounting | 111 | ||
| ❃ The key financial statements | 111 | ||
| The statement of financial position | 111 | ||
| The operating statement | 112 | ||
| ❃ Accounting terminology | 113 | ||
| Assets | 113 | ||
| Liabilities and owners’ equity | 114 | ||
| Revenues and expenses | 116 | ||
| ❃ The recording and reporting process | 117 | ||
| Journal entries | 117 | ||
| Ledgers | 117 | ||
| Reporting information | 117 | ||
| ❃ Generally accepted accounting principles | 118 | ||
| The entity concept | 118 | ||
| Going concern | 118 | ||
| The matching principle and cash versus accrual accounting | 118 | ||
| The cost principle | 119 | ||
| Objective evidence | 119 | ||
| Materiality | 119 | ||
| Consistency | 120 | ||
| Full disclosure | 120 | ||
| ❃ Fund accounting | 120 | ||
| ❃ Implications for nurse managers and executives | 120 | ||
| ❃ Key concepts | 120 | ||
| ❃\tSuggested readings | 121 | ||
| 7 Analysis of financial statement information | 122 | ||
| Chapter goals | 122 | ||
| ❃ Introduction | 122 | ||
| ❃ The audit | 123 | ||
| ❃ Balance sheets and operating statements | 124 | ||
| ❃ Statement of cash flows | 124 | ||
| ❃ Statement of changes in net assets or equity | 126 | ||
| ❃ Notes to financial statements | 127 | ||
| ❃ Ratio analysis | 127 | ||
| Common size ratios | 128 | ||
| Liquidity ratios | 129 | ||
| Solvency ratios | 130 | ||
| Efficiency ratios | 132 | ||
| Profitability ratios | 133 | ||
| ❃ Management reports | 134 | ||
| ❃ Implications for nurse managers and executives | 134 | ||
| ❃ Key concepts | 134 | ||
| APPENDIX TO CHAPTER 7 Additional Sample Financial Statements | 136 | ||
| ❃ Suggested readings | 136 | ||
| III Cost analysis | 145 | ||
| 8 Cost management | 146 | ||
| Chapter goals | 146 | ||
| ❃ Introduction | 146 | ||
| ❃ Basic cost concepts | 146 | ||
| Definitions | 146 | ||
| Fixed versus variable costs | 148 | ||
| Cost graphs and the relevant range | 150 | ||
| The impact of volume on cost per patient | 150 | ||
| Marginal cost analysis | 151 | ||
| Relevant cost case study | 152 | ||
| ❃ Cost estimation techniques | 153 | ||
| Adjusting costs for inflation | 153 | ||
| High-low cost estimation | 154 | ||
| Regression analysis | 155 | ||
| Mixed costs and regression analysis | 156 | ||
| Multiple regression analysis | 158 | ||
| ❃ Break-even analysis | 158 | ||
| Example of break-even analysis | 159 | ||
| Using break-even analysis for decision making | 161 | ||
| Break even and capitation | 161 | ||
| Break-even analysis cautions | 161 | ||
| ❃ Implications for nurse managers and executives | 162 | ||
| ❃ Key concepts | 162 | ||
| ❃ Suggested readings | 163 | ||
| 9 Determining health care costs and prices | 164 | ||
| Chapter goals | 164 | ||
| ❃ Introduction | 164 | ||
| ❃ Costs for reporting versus costs for management control | 165 | ||
| ❃ Traditional cost-finding methods | 166 | ||
| The medicare step-down approach | 166 | ||
| A detailed look at the cost-finding approach | 166 | ||
| Accumulate direct costs for each responsibility center | 166 | ||
| Determine bases for allocation | 167 | ||
| Allocate from cost centers to profit centers | 167 | ||
| Allocate costs to units of service | 169 | ||
| Is good-enough cost finding good enough? | 170 | ||
| ❃ Costing out nursing services | 170 | ||
| Solutions to the costing problem | 171 | ||
| Why change the costing approach? | 173 | ||
| Should costing be linked to diagnosis related groups? | 174 | ||
| ❃ Specific approach to costing nursing services | 175 | ||
| ❃ Limitations of the relative value unit approach | 176 | ||
| Patient classification versus other workload measurement | 176 | ||
| Indirect nursing costs | 176 | ||
| Staffing mix | 176 | ||
| ❃ Product line costing | 177 | ||
| Direct care hours | 177 | ||
| Standard costs | 178 | ||
| ❃ Nursing intensity weights | 179 | ||
| ❃ Activity-based costing | 179 | ||
| ❃ Setting prices | 180 | ||
| Total financial requirements | 180 | ||
| Rate-setting approaches | 181 | ||
| Cost-based prices | 181 | ||
| Negotiated prices | 181 | ||
| Market prices | 181 | ||
| ❃ Financial reimbursement for nursing services | 182 | ||
| Pay for performance (p4p) | 182 | ||
| ❃ Implications for nurse managers and executives | 183 | ||
| ❃ Key concepts | 184 | ||
| ❃ Suggested readings | 185 | ||
| IV Planning and control | 187 | ||
| 10 Strategic management | 188 | ||
| Chapter goals | 188 | ||
| ❃ Introduction | 188 | ||
| ❃ Quality management | 189 | ||
| ❃ Strategic planning | 191 | ||
| The elements of a strategic plan | 192 | ||
| Mission statement or philosophy | 192 | ||
| Statement of long-term goals | 192 | ||
| Statement of competitive strategy | 193 | ||
| Statement of organizational policies | 193 | ||
| Statement of needed resources | 193 | ||
| Statement of key assumptions | 193 | ||
| Benefits of the strategic planning process | 194 | ||
| Implementing a strategic management process | 194 | ||
| ❃ Long-range planning | 195 | ||
| ❃ Program budgeting and zero-base budgeting | 196 | ||
| Zero-base budgeting | 196 | ||
| Zero-base budgeting case study: Hemodialysis | 197 | ||
| Ranking decision packages | 199 | ||
| ❃ Business plans | 199 | ||
| What is a business plan? | 199 | ||
| ❃ Implications for nurse managers and executives | 199 | ||
| ❃ Key concepts | 199 | ||
| ❃ Suggested readings | 202 | ||
| 11 Budgeting concepts | 203 | ||
| Chapter goals | 203 | ||
| ❃ Introduction | 203 | ||
| ❃ Types of budgets | 204 | ||
| Operating budget | 204 | ||
| Long-range budgets | 204 | ||
| Program budgets | 205 | ||
| Capital budgets | 205 | ||
| Generation of capital budget proposals | 205 | ||
| Justification of capital requests | 206 | ||
| Evaluation of capital budget proposals | 207 | ||
| Payback method | 207 | ||
| Return on investment | 208 | ||
| Discounted cash flow methods | 208 | ||
| Product line budgets | 209 | ||
| Cash budgets | 209 | ||
| Cash budget preparation | 209 | ||
| Cash budget example | 210 | ||
| Special purpose budgets | 210 | ||
| ❃ The budget process | 210 | ||
| Budget timetable | 211 | ||
| Statement of environmental position | 212 | ||
| General goals, objectives, and policies | 212 | ||
| Organization-wide assumptions | 212 | ||
| Specification of program priorities | 212 | ||
| Specific, measurable operating objectives | 212 | ||
| Budget preparation | 213 | ||
| Budget negotiation and revision | 213 | ||
| Control and feedback | 213 | ||
| ❃ Implications for nurse managers and executives | 213 | ||
| ❃ Key concepts | 213 | ||
| APPENDIX TO CHAPTER 11 Time Value of Money | 215 | ||
| ❃ Introduction | 215 | ||
| ❃ Time-value-of-money calculation mechanics | 215 | ||
| ❃ The present cost approach | 215 | ||
| ❃ The net present value approach | 216 | ||
| ❃ The internal rate of return approach | 217 | ||
| ❃ Using computer spreadsheets for time-value-of-money computations | 217 | ||
| Examples | 218 | ||
| Present value | 218 | ||
| Rate | 219 | ||
| Number of periods | 220 | ||
| Periodic payments (in arrears) | 220 | ||
| Periodic payments (in advance) | 220 | ||
| Net present value | 220 | ||
| Internal rate of return | 221 | ||
| ❃ Summary | 221 | ||
| ❃ Key concepts | 222 | ||
| ❃ Suggested readings | 222 | ||
| 12 Operating budgets | 223 | ||
| Chapter goals | 223 | ||
| ❃ Introduction | 223 | ||
| ❃ Workload budget | 224 | ||
| Activity report | 224 | ||
| Adjusting units of service | 225 | ||
| Calculating workload | 225 | ||
| ❃ Expense budget: Personnel services | 226 | ||
| Average daily census and occupancy rate | 227 | ||
| Staffing requirements and full-time equivalents | 227 | ||
| Productive versus nonproductive hours | 227 | ||
| Assignment of staff by type and shift | 228 | ||
| Fixed staff | 229 | ||
| Converting staff and full-time equivalents to positions | 229 | ||
| Calculating ftes by type and shift | 229 | ||
| Establishing positions | 230 | ||
| Calculating labor cost | 231 | ||
| Straight-time and overtime salaries | 231 | ||
| Differentials and premiums | 233 | ||
| Fringe benefits | 234 | ||
| Special situations | 234 | ||
| ❃ Expense budget: Other-than-personnel services | 235 | ||
| ❃ Budget submission, negotiation, and approval | 236 | ||
| ❃ Implementing the approved budget | 236 | ||
| ❃ Summary of steps in the operating budget process | 237 | ||
| ❃ Implications for nurse managers and executives | 237 | ||
| ❃ Key concepts | 237 | ||
| APPENDIX TO CHAPTER 12 Retaining and Recruiting Staff | 240 | ||
| ❃ Introduction | 240 | ||
| ❃ Retaining staff | 240 | ||
| Nurse satisfaction | 240 | ||
| Fringe benefits | 241 | ||
| Retention programs | 241 | ||
| Clinical ladders | 242 | ||
| Why nurses leave | 242 | ||
| Determining the cost | 242 | ||
| ❃ Recruiting staff | 243 | ||
| Recruiting and retaining “older” nurses | 244 | ||
| ❃ Implications for nurse managers and executives | 244 | ||
| ❃ Key concepts | 244 | ||
| ❃ Suggested readings | 244 | ||
| 13 Revenue budgeting | 246 | ||
| Chapter goals | 246 | ||
| ❃ Introduction | 246 | ||
| ❃ The revenue budget | 247 | ||
| Why aren’t all nursing units revenue centers? | 247 | ||
| When are nurse managers and executives responsible for a revenue budget? | 248 | ||
| The elements of a revenue budget | 248 | ||
| Prices or rates | 248 | ||
| Volume estimates | 250 | ||
| Environmental scan | 251 | ||
| ❃ Revenues from managed care | 251 | ||
| Capitation versus fee-for-service | 252 | ||
| Money flows under capitation | 253 | ||
| Developing capitated rates | 253 | ||
| Setting a capitation rate: An example | 254 | ||
| Incentive risk pools | 255 | ||
| ❃ Implications for nurse managers and executives | 256 | ||
| ❃ Key concepts | 256 | ||
| ❃ Suggested readings | 257 | ||
| 14 Performance budgeting | 258 | ||
| Chapter goals | 258 | ||
| ❃ Introduction | 258 | ||
| ❃ The performance budgeting technique | 259 | ||
| Determining key performance areas | 259 | ||
| Technical steps in performance budgeting | 259 | ||
| ❃ Performance budget example | 260 | ||
| ❃ Developing performance area measures | 263 | ||
| Quality of care | 263 | ||
| Staffing | 264 | ||
| Cost control | 265 | ||
| Increased productivity | 265 | ||
| Patient and staff satisfaction | 265 | ||
| Innovation and planning | 266 | ||
| Direct care | 266 | ||
| Indirect care | 266 | ||
| Other | 266 | ||
| ❃ Multiple measures | 266 | ||
| ❃ Summary of the performance budgeting process | 267 | ||
| ❃ Implications for nurse managers and executives | 267 | ||
| ❃ Key concepts | 267 | ||
| ❃ Suggested readings | 268 | ||
| 15 Controlling operating results | 269 | ||
| Chapter goals | 269 | ||
| ❃ Introduction | 269 | ||
| ❃ The budget as a tool for motivation | 269 | ||
| ❃ Motivation and incentives | 270 | ||
| ❃ Motivation and unrealistic expectations | 271 | ||
| ❃ Communication and control | 271 | ||
| ❃ Using budgets for interim evaluation | 271 | ||
| ❃ Variance analysis | 271 | ||
| ❃ Traditional variance analysis | 272 | ||
| Unit and department variances | 273 | ||
| Line-item variances | 273 | ||
| Understanding variances | 273 | ||
| ❃ Flexible or variable budgets | 274 | ||
| ❃ Flexible budget variance analysis | 275 | ||
| The volume variance | 276 | ||
| The quantity, or use, variance | 276 | ||
| The price, or rate, variance | 276 | ||
| ❃ Determination of the causes of variances | 276 | ||
| ❃ The mechanics of flexible budget variance analysis | 277 | ||
| Data for flexible budget analysis | 278 | ||
| An example of volume, price, and quantity variances | 278 | ||
| ❃ Revenue variances | 281 | ||
| ❃ Implications for nurse managers and executives | 282 | ||
| ❃\tKey concepts | 283 | ||
| ❃\tSuggested readings | 283 | ||
| 16 Variance analysis: Examples, extensions, and caveats | 284 | ||
| Chapter goals | 284 | ||
| ❃ Introduction | 284 | ||
| ❃ Aggregation problems | 284 | ||
| ❃ Exception reporting | 286 | ||
| ❃ Interpretation of variances | 286 | ||
| ❃ Rigid staffing patterns | 288 | ||
| ❃ Causes of variances | 290 | ||
| ❃ Investigation and control of variances | 290 | ||
| ❃ Performance budgets and variance analysis | 291 | ||
| ❃ Implications for nurse managers and executives | 293 | ||
| ❃\tKey concepts | 293 | ||
| ❃ Suggested readings | 294 | ||
| 17 Benchmarking, productivity, and cost-benefit and cost-effectiveness analysis | 295 | ||
| Chapter goals | 295 | ||
| ❃ Introduction | 295 | ||
| ❃ Benchmarking | 296 | ||
| Benefits of benchmarking | 296 | ||
| Benchmarking approaches | 296 | ||
| The benchmarking process | 297 | ||
| Requirements for successful benchmarking | 298 | ||
| Limitations of benchmarking | 299 | ||
| ❃ Productivity | 299 | ||
| Productivity standards | 299 | ||
| Unit costing | 300 | ||
| Unit costing and productivity standards | 302 | ||
| Productivity improvement | 302 | ||
| ❃ Cost-benefit and cost-effectiveness analysis | 303 | ||
| Cost-benefit analysis | 304 | ||
| Determine project goals | 304 | ||
| Estimate project benefits | 304 | ||
| Estimate project costs | 304 | ||
| Discount cost and benefit flows | 305 | ||
| Complete the decision analysis | 305 | ||
| Cost-effectiveness analysis | 305 | ||
| ❃ Comparative effectiveness research | 305 | ||
| ❃ Implications for nurse managers and executives | 306 | ||
| ❃ Key concepts | 306 | ||
| ❃ Suggested readings | 308 | ||
| V Managing financial resources | 309 | ||
| 18 Short-term financial resources | 310 | ||
| Chapter goals | 310 | ||
| ❃ Introduction | 310 | ||
| ❃ Current assets | 311 | ||
| Cash and marketable securities | 311 | ||
| Short-term cash investment | 311 | ||
| Cash flow versus revenue and expense | 312 | ||
| Cash budgets | 312 | ||
| Maintaining security over cash | 313 | ||
| Accounts receivable | 313 | ||
| Preadmission data collection | 313 | ||
| Credit policies | 314 | ||
| Ongoing data collection | 314 | ||
| Discharge review and billing | 314 | ||
| Aging of receivables | 315 | ||
| Cash receipt and lock boxes | 316 | ||
| Inventory | 316 | ||
| Perpetual inventory | 316 | ||
| Economic order quantity | 316 | ||
| ❃ Current liabilities | 318 | ||
| Accounts payable | 318 | ||
| Payroll payable | 319 | ||
| Notes payable | 319 | ||
| Taxes payable | 319 | ||
| Other payables made on behalf of employees | 319 | ||
| ❃ Implications for nurse managers and executives | 320 | ||
| ❃\tKey concepts | 320 | ||
| ❃\tSuggested readings | 321 | ||
| 19 Long-term financial resources | 322 | ||
| Chapter goals | 322 | ||
| ❃ Introduction | 322 | ||
| ❃ Equity sources of financing | 322 | ||
| Philanthropy | 323 | ||
| Corporate stock issuance | 324 | ||
| Government grants | 324 | ||
| Retained earnings | 324 | ||
| ❃ Debt sources of financing | 324 | ||
| Mortgages and long-term notes | 325 | ||
| Leases | 326 | ||
| Bonds | 327 | ||
| Taxable versus tax-free bonds | 327 | ||
| Bond ratings and insurance | 328 | ||
| Zero-coupon bonds | 329 | ||
| Debt refinancing | 329 | ||
| ❃ Feasibility studies | 330 | ||
| ❃ The future of health care financing | 330 | ||
| ❃ Implications for nurse managers and executives | 331 | ||
| ❃ Key concepts | 331 | ||
| ❃ Suggested readings | 332 | ||
| Vi Looking to the future | 333 | ||
| 20 Forecasting | 334 | ||
| Chapter goals | 334 | ||
| ❃ Introduction | 334 | ||
| ❃ Quantitative methods for forecasting | 334 | ||
| Data collection | 335 | ||
| Appropriate data time periods | 335 | ||
| What data should be collected? | 336 | ||
| Graphing historical data | 336 | ||
| Analysis of graphed data | 337 | ||
| Random fluctuations | 339 | ||
| Seasonality | 339 | ||
| Trend | 339 | ||
| Seasonality and trend | 339 | ||
| Forecasting formulas | 340 | ||
| Random fluctuations | 341 | ||
| Seasonality | 341 | ||
| Trend | 341 | ||
| Seasonality and trend | 343 | ||
| ❃ Using computers for forecasting | 345 | ||
| Big data and health care analytics | 349 | ||
| ❃ Qualitative methods for forecasting | 349 | ||
| Nominal group technique | 349 | ||
| Delphi technique | 350 | ||
| ❃ Expected value | 350 | ||
| ❃ Implications for nurse managers and executives | 350 | ||
| ❃ Key concepts | 350 | ||
| ❃ Suggested reading | 351 | ||
| 21 The nurse as entrepreneur | 352 | ||
| Chapter goals | 352 | ||
| ❃ Introduction | 352 | ||
| ❃ Characteristics of nurse entrepreneurs | 353 | ||
| ❃ Opportunities for nurse entrepreneurs | 353 | ||
| Starting your own business | 354 | ||
| ❃ Legal and financial issues | 355 | ||
| ❃ The business plan | 355 | ||
| The steps in developing a business plan | 356 | ||
| Project proposal | 356 | ||
| Product definition | 356 | ||
| Market analysis | 356 | ||
| Rough financial plan | 357 | ||
| Detailed operations plan | 357 | ||
| Detailed financial plan | 358 | ||
| Pro forma financial statements | 358 | ||
| Forecasting and capital budgeting | 358 | ||
| Sensitivity analysis | 358 | ||
| Examination of alternatives | 359 | ||
| The elements of a business plan package | 359 | ||
| ❃ Examples of entrepreneurs | 360 | ||
| Example 1 | 360 | ||
| Example 2 | 360 | ||
| Example 3 | 360 | ||
| Example 4 | 360 | ||
| ❃ Implications for nurse managers and executives | 361 | ||
| ❃ Key concepts | 361 | ||
| ❃ Suggested readings | 361 | ||
| 22 Nursing and financial management: Current issues and future directions | 362 | ||
| Chapter goals | 362 | ||
| ❃ Introduction | 362 | ||
| ❃ Nursing financial management research | 362 | ||
| ❃ Current and future issues in financial management in nursing | 364 | ||
| ❃ The evolving role of the nurse executive in financial management | 365 | ||
| Setting organizational policy | 365 | ||
| Continuing organizational responsibility for nursing expenses | 366 | ||
| Assuming organizational responsibility for nursing revenues | 366 | ||
| Assuming an organizational role in new ventures | 367 | ||
| Responding to extraorganizational changes | 367 | ||
| Government relations | 367 | ||
| Payer relations | 367 | ||
| ❃ Future role of first-line and midlevel nurse managers in financial management | 368 | ||
| ❃ The nurse as a policymaker for financing health care | 368 | ||
| Lobbyist | 368 | ||
| Policymaker | 368 | ||
| ❃ Implications for nurse managers and executives | 369 | ||
| ❃ Key concepts | 370 | ||
| ❃ Suggested readings | 370 | ||
| Glossary | 372 | ||
| A | 372 | ||
| B | 372 | ||
| C | 372 | ||
| D | 372 | ||
| E | 372 | ||
| F | 372 | ||
| G | 372 | ||
| H | 372 | ||
| I | 372 | ||
| J | 373 | ||
| L | 373 | ||
| M | 373 | ||
| N | 374 | ||
| O | 374 | ||
| P | 374 | ||
| Q | 375 | ||
| R | 375 | ||
| S | 375 | ||
| T | 375 | ||
| U | 376 | ||
| V | 378 | ||
| W | 378 | ||
| Y | 390 | ||
| Z | 390 | ||
| Index | 391 | ||
| A | 391 | ||
| B | 391 | ||
| C | 392 | ||
| D | 393 | ||
| E | 394 | ||
| F | 394 | ||
| G | 395 | ||
| H | 395 | ||
| I | 396 | ||
| J | 396 | ||
| K | 396 | ||
| L | 396 | ||
| M | 396 | ||
| N | 397 | ||
| O | 398 | ||
| P | 398 | ||
| Q | 399 | ||
| R | 400 | ||
| S | 400 | ||
| T | 401 | ||
| U | 401 | ||
| V | 401 | ||
| W | 401 | ||
| Z | 401 |