Sample Essays on Factor’s that Impact a Healthcare Entity’s Financial Position

Health Care Organizations

Health care organizations financial position is affected by several factors.Firstly, government greatly influences the finances of these organizations through taxation,subsidies and donations. The government provides free hospital equipment, pharmaceutical products and a portion of the staff.The government affects the health care entities finances both positively and negatively. Through free donations, subsidies especially to public health sector and finally through availing cheap and readily accessible pharmaceutical products the health care entities finances is influenced positively .Negatively it’s through imposing high taxes especially to private health care facilities.Another factor is the tendency of most patients seeking medical care in progressed stages of illness when it’s expensive to treat them. Thirdly, the pressure from the government and the general population to provide cheap and affordable services compelling them to run under constrained budget with little or no profit. Technology is another factor that has improved the financial position of these organizations by reducing operating costs.

Payer mix is a word used in medicine to describe the relation between government, insurance firms and individual revenue payment to health care facilities.Payer mix comes into play since most hospitals receive payments from different payers. The payers include Medicare,Medicaid,private insurers and non-profit corporations. Some patients are also not covered by any Insurance and therefore pay their bills in cash.Some of these payers tend to negotiate for the method of payment while others have a fixed method of payment.For example some will pay acertain percent of the bill,others pay on a daily basis and others will only pay when the bill exceeds a certain amount.Medicare and Medicaid have a complex mode of payment and all these affect the financial position of health care entities.The uninsured patients greatly affect the financial position of a health care facility due to bad debts. The economy will affect the amount of money the government and the general population is willing to spend on health care. During depression more people are unable to paytheir medical bills thus affecting negatively the position of the health care entities(Clough, Richman & Glickman, 2015).

Informatics plays a great role in health care systems. To begin with, they assist in public health surveillance and data analysis to predict the future position of the health care system. Secondly, informatics helps in administration, finance and accounting and remote monitoring of outpatients.

Information Technology (IT) has improved the documentation of health related data to a global scale. This makes it accessible to any person in need of it from any location (Davis &Pavur, 2014).IT enables doctors, patients and paramedics to become aware of new information quickly. This information can be about availability and prices of pharmaceutical products and services. Application such as e-prescription allows patients to get prescriptions from pharmacists and doctors remotely. Another application is personal health information which allows the doctors to access patients’ history and medical records securely and privately(Gianchandani, 2011).



Gianchandani, E. (2011). Toward smarter health and well-being: an implicit role for networking and information technology. J Inf Technol, 26(2), 120-128.

Davis, M., &Pavur, R. (2014). Understanding claims-based quality profiles in primary care practice. Health Care Management Review, 39(4), 293-304.

Clough, J., Richman, B., & Glickman, S. (2015). Outlook for Alternative Payment Models in Fee-for-Service Medicare.JAMA, 314(4), 341.