Question

What are the issues in budgeting and accounting for the performance of service lines in hospital

Answer 1

Healthcare finance leaders are under more pressure than ever to support their organizations by managing uncertainty, volatility, and risk. As a result, financial planning is more complex than ever, evolving from a function-focused activity into integrated financial and operational planning that touches the entire organization.

As both payment and strategic planning shift to become more service- and population-centric, financial planning methodologies are shifting as well. Increasingly, financial planning uses driver-based approaches to help organizations model the impact of possible changes in volume and mix of patient populations (often referred to as clinical service lines) on revenue and expenses.

These projections can also be used to determine departmental targets, adjusting workload drivers to project the relative impact across various components of care.