Assignment 2: Case Study Answers

Gross Revenue – Gross revenue continued to make positive strides in March with gross revenue $327k in excess of budget. Gross revenue for the Hospital was $302k over budget for the month, with the largest over budget variances in Radiology ($329k), Lab ($111k) and Cardiology at ($70k). The largest under budget variances were in Med Surge ($112k) and Oncology ($85k). The Medical Group’s gross revenue was essentially on budget, with notable over budget variances in NLH Orthopedics ($82k)

The Co-op reported losing $19.3 million in 2014 and $3.5 million in the first quarter through March 2015 and based on the Center for Medicare and Medicaid Services lost $22.7 million from January through June 2015.

The total revenue of any firm is calculated by adding the total sales of good and services in a given period mostly one year as explained by Austin, (2002). According to St Jude children’s Research Hospital’s financial statement for the year ending June 2014, the total revenue totalled to $ 410,148,655. It was achieved by the addition of net patient service revenue ($ 104,014,142), research grants and contracts ($ 93,786,845), net investment income ($ 201,569,845), net assets released from restrictions (0) and other revenues ($ 10,778,398).

The loss portion of whole activities, which is 1.5 billion net loss. Inasmuch as workers’ compensation fund is 2 billion loss.

However, over the years Blake Memorial Hospital’s economic position has gotten worse. Blake Memorial Hospital’s previous

| ▪ increase more women patients; additional 2000 visits per year▪ increase profit, net profit is $62,400(See Exhibit 3)

The Bureau of Labor and Statistics groups the Houston area consumer price index for government expenditures into a 3 counties. Economically, Houston, Galveston, and Brazoria are considered a tri-area index and are placed together into regional operations. Medical care expenditures for the region are reported to have a consumer price index change at 2.1% since 2014. In comparison, HCRIS continues effort to report public information about Healthcare costs and estimates through any hospital or organization that receive financial reimbursement from the department of Health and Human Services. The reports are considered authenticated and an accurate representation of healthcare costs or expenditures within the United States. Institutional providers that receive government reimbursement are required by law to submit their reports to Medicare, or the Medicare reportable contractor. These reports are then compiled and reported in a CSV file for consumer and public analysis.

Over the past five years, federal and state budgets have been shrinking, and decreasing federal funding has resulted in reimbursement cuts for the industry surpassing profitability. Healthcare reform expanded access to insurance for some industry patients, but many states chose not to expand access to federal healthcare. Adding to the changes, other provisions of the recent healthcare legislation, the Centers for Medicare

At December 31, 2010, LOL had $270 million of net operating loss carryforwards. Of these,

Though they are not entirely comprehensive tools, a great deal can be learned about a hospital or other healthcare organization for-profit or not-for-profit from an examination of their annual financial documents (Finkler & Ward, 2006). The balance sheet and statement of revenue and expense can both yield valuable clues even in the absence of other evidence about changes that might be occurring in the organization, a definition of the type and degree of certain problems that it might be facing, and potential opportunities for improvement in performance that might exist (Finkler & Ward, 2006). Comparing two or more years' worth of financial information yields even more valuable insights, tracking movement in the hospital or other organization's ability to finance its activities and thus continue providing services at the same level, quantity, and scope as current operation.

Gross Revenue – October’s consolidated gross revenue was $636k under budget. The Hospital’s gross revenue was $460k below budget, with the largest under budget variances occurring in Radiology ($284k), Lab ($169k), and Oncology ($91k). Hospital

Have you ever had a colonoscopy or endoscopy – where they take a camera and look through your mouth down into your stomach; or a camera that goes in your rectum that looks through your bowel and intestines?

Hospitals and health systems in the U.S. are experiencing a remarkable transformation in their business models directed from numerous influences that are projected to ultimately turn the industry around. Pressures include providers troubled with the quantity of services they are responsible for, to providers who concentrate on presenting high-cost services that give emphasis to sustaining healthy populations (Dunn & Becker, 2013).

Based on the information you have provide, you have a net income of $16,342 instead of a net loss. Meaning if the revenues and gains minus the expense and loss are positive than you have a net income while a net loss result is negative. For example, if you have a net income of $10, 000 than you company is gaining, but if you have a net loss of $10,000 your business is losing money. So, the overall money that your business has earned is $16,342 after tax. Which means that your business account is receiving money instead of losing. The details of the net income calculation are reported in the business income statement.

For our best case projections, we used a scenario where both treatment center and professional memberships increased by 25% and ad sales increased by 50% over the five year period. This resulted in an initial increase of 69% to net income and 32% to net cash flow in the 4th Quarter of 2017. Over the five year period, the best case scenario increased net income by 27% and net cash flow by 26%. A five year income of $1.1 million from our baseline scenario increased to $1.4 million in our best case.