Question

Increased demand for health care services leads to an increasing need for health care organizations to be cost-efficient. What are the factors that impact an organization's financial viability?

Answer 1

Financial viability

Financial viability is an ability of the hospital’s to generate and maintain an inflow (revenue)of finance resources that is greater than the outflow (expenses) of financial resources.

Factors that have an impact on the financial viability of the hospital are:

1. Payor low reimbursement rates (the difference between incurred cost and reimbursement received for delivering the patient care)

2. Types of the patient : uninsured or older – the more number of the uninsured patient or older people are visiting to the emergency department for their basic health care that need not require emergency services and these services go unpaid.

3. Higher cost of hospital resources: advanced equipment, staff training