The Role of Finance in Healthcare Organization

To begin with, I would like to clarify what attention healthcare organizations should draw to finances. The primary role is to plan, acquire, and use financial resources to achieve organizational goals (Gapenski & Reiter, 2016). This process can be challenging, and a medical entity should have a specific document to guide and manage all the steps that refer to this sphere. Thus, a budget is a plan that reveals how an organization is going to receive and allocate resources over a specific period of time (Gapenski & Reiter, 2016). Thus, the following paragraph will comment on the manager’s role in overseeing the budget.

A few specific factors highlight the manager’s essential role in managing the budget. Firstly, it is possible to admit that it is a managerial tool. Even though this piece of information offers financial details, they are more useful for managers than financial experts because these data can be used for planning and implementing organizational expectations (Gapenski & Reiter, 2016). Secondly, senior executives should rely on budgets to ensure that their organization has sufficient resources to achieve the stipulated goals (Gapenski & Reiter, 2016). This statement denotes that managers should ensure that budgets are realistic and their targets can be met regarding the organization’s resources. Thirdly, managers complement budgets when it comes to analyzing the relative financial performance of a healthcare entity (Gapenski & Reiter, 2016). It refers to the fact that this financial statement can reveal whether an organization has economic issues in any of its spheres. The managers play an essential role here because they are capable of interpreting the budgets to identify whether the problems exist.

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In addition to that, the management’s prominent role above can lead to better quality-improvement budgeting decisions. As a rule, any quality-improvement processes are aimed at improving population health, promoting better patient experience, and reducing care costs (Taylor et al., 2020). This information demonstrates that the managers can only enhance the quality of care when they manage to provide patients with safer and more affordable medical services without increasing their costs. There is no doubt that senior executives can cope with the task with the help of the essential roles that they play in overseeing the budget. For example, managers can effectively and timely implement quality improvement initiatives when they are perfectly aware of the organizational goals and available resources. Interpretation of the budget information can reveal that the stipulated objectives can only be achieved after an intervention is introduced. Consequently, these findings demonstrate a robust connection between quality-improvement budgeting decisions and the managers’ roles.

References

Gapenski, L. S., & Reiter, K. L. (2016). Healthcare finance: an introduction to accounting and financial management. 6th edn. Chicago, Il: Health Administration Press.

Taylor, E. F., et al. (2020). Quality improvement in primary care. Web.

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