Financial Matters for Health Care Professionals

Financial Matters for Health Care Professionals - Financial...

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Financial Matters for Health Care Professionals 1 Financial Matters for Health Care Professionals William Edwards HCA/270 Cynthia Bell
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Financial Matters for Health Care Professionals 2 Any successful company in the world has to focus on their money. Accounting and financial matters, matter to a company if that want to survive. In nature there is the law of the survival of the fittest. That same law applies to businesses, being financially sound and capable means surviving in a world full of predators. Whether, that business in a little family owned business or a huge corporation money matters. There are several different types of accounting practices and each one has a specific way of doing things. The health care industry is a business just like any other, and they have to be on top of all things money related to be successful. In health care there are three types of accounting; accrual accounting, cash flow accounting, and fund accounting. These different types of accounting are what health care agencies use to manage their finances. Accrual accounting in basic terms means that an organization seeing a profit from the time services are rendered, and before the money is actually paid or taken away. How does this work? If a patient enters the hospital to receive treatment their insurance pays the bill. Even thought the hospital may not receive that money for weeks they still count it as money earned because the services the patient received were billed to their insurance. Once the insurance pays the bill the hospital will receive the money, but they still count it as income before they receive it.
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This note was uploaded on 07/30/2011 for the course HCA 270 taught by Professor Kulick during the Spring '10 term at University of Phoenix.

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Financial Matters for Health Care Professionals - Financial...

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