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Running Head: FINANCIAL MANAGEMENT IN HEALTHCARE ORGANIZATIONFinancial Management in Healthcare OrganizationsCase of Aspen Valley HospitalBrennita DixonAmerican InterContinental University
FINANCIAL MANAGEMENT IN HEALTHCARE ORGANIZATION 1IntroductionFinancial management in healthcare organization entails the aspect of handling organization’s everyday financial operations with the view to reducing ineffective, duplicate and avoidable services that spur up costs without necessarily improving patient care (Gapenski & Pink, 2011). Effective care in a healthcare organization can be attained by evaluating the benefitsand costs of medical technologies and procedures. Often, healthcare organizations decide to buy sophisticated medical equipment to enable them to offer extended treatments or tests. In this respect, making such decision and coming up with the ideal way of paying for such equipment often require astute financial management in healthcare organizations (Nowicki, 2011). It is the responsibility of the healthcare managers to set accurate pricing of their care services, minimize administrative costs and the costs from medical malpractices as well as creating mixed-specialty general practitioner workforce. The importance and abundance of agency associations in healthcare organization distinguish its financial management from the other settings (Nowicki, 2011). In this regard, healthcare organizations are agents for capital providers, while medical insurance firms are agents for individuals who pay regular insurance premiums. Aspen Valley HospitalAspen Valley Hospital is a 25-bed for-profit community hospital representing the best two worlds; the friendliness and warmth of a small town as well as the technical expertise of a leading medical center (Aspen Valley Hospital (AVH), 2019). Moreover, the hospital has been merited a top twenty best practice in terms of financial stability. As a profit organization, AVH engages in various financial and economic activities geared towards improving its profitability. Managers, engage in contract negations as well as ensuring that the hospital has adequate cash tomeet its expenses like payroll. Currently, the AVH has around 354 employees on the payroll, and
FINANCIAL MANAGEMENT IN HEALTHCARE ORGANIZATION 2its primary source of revenue is cash received from patients and the third parties. According to Aspen Valley Hospital (2019), the payer mix of the patients served at the hospital is as follows: 14.6% of patients served are of Medicaid, 29.6% of patients are of Medicare while the remaining

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