c428-task1-financial-resource-management

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C428 Task1 - Financial Resource Management Financial Resource Management in Healthcare (Western Governors University) Scan to open on Studocu Studocu is not sponsored or endorsed by any college or university C428 Task1 - Financial Resource Management Financial Resource Management in Healthcare (Western Governors University) Scan to open on Studocu Studocu is not sponsored or endorsed by any college or university Downloaded by sheera nasir (nasirsheera4@gmail.com) lOMoARcPSD|30548438

Betty Makileni FINANCIAL RESOURCE MANAGEMENT IN HEALTHCARE – C428 Task 1 Student ID: 000725152 A1. In its capacity as a not-for-profit corporation, Seamus is obliged to diligently explore cost-cutting strategies that are both financially and socially responsible. As healthcare prices rise, it is vital to restructure our healthcare coverage. To replace the current fee-for-service model, we are actively studying the Managed Care Organization (MCO) models listed below: Preferred Provider Organization (PPO), Point of Service (POS), and Health Maintenance Organization (HMO) Preferred Provider Organization (PPO) - PPOs were developed in response to patients' requests for greater choice in selecting their healthcare providers and the declining popularity of HMOs. Although this kind of MCO permits employees to select their own healthcare providers, in-network providers are more affordable. Monthly fees are paid by employees and are automatically withheld from their paychecks prior to taxes. Depending on whether a provider is in or out-of-network, a variety of different coverage rates and percentages are offered. There are fixed reimbursement rates for both. Due to this volatility, PPOs are not the most affordable option. Under a PPO, the company is unable to select its own providers, which could place a burden on the employee or patient rather than the company and raise questions about the quality of care. The QSEHRA or HRA tax benefits are also included with the PPO plan, depending on the number of employees in the business. Point Of Service (POS) – POS is a mixture of PPO and HMO insurance plans. With this plan, employees are free to select either an in-network doctor or a doctor outside of network. However, in order to be referred to a specialist, a primary care physician is needed. Out-of-network providers have higher out-of- pocket costs, whereas in-network providers have lower out-of-pocket costs. Health Maintenance Organization (HMO) - HMOs not only offer funding for medical costs but also have the ability to provide patient care and treatment. An HMO is a structure for an insurance plan that includes doctors, insurance companies, and hospitals. They utilize a range of techniques to manage costs. The main strategy is to have a network of providers that the patient must use or risk being uninsured. Employers choose HMOs because they often have lower out-of-pocket costs and make an effort to support their employees' daily health and preventative treatment in addition to emergency care. Since they bear the full financial burden of the costs associated with receiving medical treatment outside of the HMO's network, employees are typically more likely to consult in-network doctors who are a part of the HMO. The number of employees who work for the company determines the tax advantages. A1A. I will now offer the following suggestions for how to implement each of these tactics: Downloaded by sheera nasir (nasirsheera4@gmail.com) lOMoARcPSD|30548438

Cost-Saving - HSA helps with out-of-pocket medical costs even though PPO has the highest rates. Members who are in good health and seeking preventative treatment would benefit from this. This plan would not be advantageous for those who have families and serious health issues because the out-of-pocket expenses would be significant. A PPO does offer the liberty of choosing the provider, too. Even though an HMO plan limits your choice of providers, your expenditures as an employee will be lower even if you add more family members. HMO plans frequently have modest copayments, out-of-pocket expenses, and premiums. With regard to choosing an in-network or out-of-network doctor, a POS plan seeks to strike a medium ground on cost between an HMO and PPO plan. Tax Deductible Considerations - Various tax deductions and credits are available for each of the aforementioned suggested schemes. These deductions are determined by the size of Seamus and the typical hourly wage of the employer. We would be regarded as a significant employer if the company had more than 50 employees. This size of non-profit qualifies for a 35% tax credit, however, the exact amount will depend on the number of employees and average pay. This sum would be applicable to the PPO, POS and HMO plans mentioned above. Other Tax Advantages - Deductions for premiums from gross income can lower an employee's income tax, which is another tax benefit. This would apply to each of the three plans. Additionally, the total amount of HSA contributions may be deducted from taxes. Fiscal Management Improvements - The management would have far more control over budgeting and be able to estimate the expenses of employee benefits if Seamus left the current fee-for-service plan, which has unpredictable costs. Additional savings and excess money will become apparent and used elsewhere if the budget is more exact. As a result of these budgetary advancements, forecasting will be possible, which promotes economic growth and security. The three stated options make this scenario conceivable. A1B. Two of Seamus Company's financial management concepts that would support moving forward with a managed care organization would be cost and control. Cost-effectiveness is crucial for the continued success of Seamus. Seamus is a non-profit, therefore it has to be very careful with its spending. They will have to report any grants or government help they may have gotten in order to be eligible for renewals and additional support. Data should demonstrate all implementation benefits by contrasting the existing situation with the aforementioned HMO, PPO, and POS plans. We will have more control over our budget if we can predict the costs associated with employee benefits. We will be able to contribute to and evaluate achievement and performance if we can understand our financial and operational circumstances. A1C. By making provision for foreseeable healthcare costs, which the company may also profit from a tax perspective, the solutions mentioned above support Seamus' objectives of lowering the costs of the company's health insurance policies. Research and evaluation of each option will be necessary in order to determine which is best for the needs of the present and the future. Forecasting the future will help us be more cost-effective and budget more effectively overall. This will allow Seamus to develop further and better serve the neighborhood. A2A. The Preferred Provider Organization (PPO) is the strategy I'd like to examine. Due to the possibility that some employees may not utilize their benefits, PPO plans do carry a risk when it comes Downloaded by sheera nasir (nasirsheera4@gmail.com) lOMoARcPSD|30548438

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to utilization. The freedom to select providers, locations, and services makes a PPO advantageous from some angles. We must make sure that the freedom to choose is not outweighed by the higher costs, though. Employee participation is absolutely necessary for this plan to be the best option for Seamus because PPO plans have higher expenses for both the business and the employees. A2B. With the adoption of more service benefits, Seamus Company will experience the following three financial gains: The finance division would be the first area where Seamus would gain financially. Employees would only have one choice under a PPO plan, which would make it simpler for the finance department to adequately budget all expenses. Additionally, they would have better control over and ability to assign precise payments. The second advantage of switching from a fee-for-service to a PPO plan is that we will save money when using in-network providers, pay lower premiums, have more flexibility, and receive higher-quality medical care. The insurance program might set the Seamus Company apart from rival businesses. By having the edge to gain and preventing the highly qualified workers from leaving the agency owing to greater benefits offered at a different position, can be financially advantageous to the organization. The third advantage I will talk about is that fee-for-service business results in cost uncertainty. More consistency and the capacity to estimate costs precisely will come if the company switches to an MCO. A2C. With the adoption of more service benefits, Seamus Company will experience the following three financial drawbacks: Although Seamus makes an effort to offer a just and equitable plan, usage is not guaranteed. Even with education, financial shock from the high deductible can be demoralizing. Both Seamus and the employee can end up losing their monthly premium payments as a result. The increasing cost of premiums is the second negative financial aspect. There is a chance that the premium would rise with time, just like with any service. With the clear monthly premiums, Seamus will be able to predict their financial requirements to cover these hikes or assess them in order to make plan changes. Underutilization of the PPO plan, particularly if an employee has minor medical issues, would be the third financial disadvantage. Even though employees might not always need to use their healthcare benefits, the Seamus Company would still be responsible for paying the higher PPO plan premium. Offering healthcare premiums to employees who won't use the plan would be a waste of money. A2D. Seamus would gain from employee adoption of the new healthcare benefits because they will be more confident that resources are not being wasted on pricey plans that employees might not use. Employees and the organization both stand to gain if employees use the plan for essential and necessary services. Employee retention and satisfaction will be higher if they feel taken care of by receiving high- quality treatment in an economical way. Downloaded by sheera nasir (nasirsheera4@gmail.com) lOMoARcPSD|30548438

A3A. Access to reduced gym memberships and inexpensive services for healthy meal delivery are two financial advantages of external healthcare alliances. These collaborations would convey that the business values its workers. The agreements offer uncommon employee advantages that would appeal to personnel and enhance their employment. A gym membership may also help prevent on-the-job injuries because physically fit people experience fewer accidents. This may also help prevent off-site accidents, which would lead to fewer missed attendance and more reliable job performance. If the employees are able to get healthy meals from the meal delivery service while still at work rather than leaving the office to get fast food will result in healthy living for them while also increasing output and dependability. A3B. The potential for underuse is a cost disadvantage of external healthcare partnerships. Gym memberships are frequently purchased but seldom used. It would not be cost-effective cooperation if these kinds of benefits were not used to their full potential. The food delivery plan is comparable in this regard. Employees may feel distrustful or discouraged from using other benefits, which would further waste money, if the level of service or the food served isn't up to par. A3C. An outside partnership would be extremely beneficial to The Seamus Company. These advantages benefit all parties involved. After weighing the advantages and disadvantages of doing business with an outside party, I believe staff would benefit from a gym partnership. A3Ci. Overall healthy lifestyle is the basis for this choice's explanation. Having access to a gym encourages living a physically and emotionally healthier lifestyle. Relationships with local gyms provide Seamus with a number of associated benefits. We can utilize these gym memberships in conjunction with the new health insurance advantages to heal from ailments or wounds, achieve various physical or weight reduction goals, and lower the number of mental health diagnoses. The ability to perform daily tasks is increased, and going to the gym can be a good way to meet people. For Seamus, a positive work atmosphere and culture is fostered by content employees. Downloaded by sheera nasir (nasirsheera4@gmail.com) lOMoARcPSD|30548438

c428-task1-financial-resource-management

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