Universal Healthcare Service Financial Planning Order Instructions:
Universal Healthcare Service Financial Planning Sample Answer
Introduction
Financial planning is an affirmative financial action that is spelled for a long period of time.
It is established upon a set of goals in order to promote the mission and vision of a company. Financial planning is the most appropriate way of managing health sector budgets through allocation and well-targeted long-range solutions. It is a step by step financial process that enables the health institution achieves its strategic vision and dwell on its mission (Thompson, 2008)
Universal Health Service financial plan for the year 2012-2014
Step one: Mission and vision of Universal Health Services
Mission: Provide superior healthcare services that patients recommend to families and friends, physicians prefer for their patients, purchasers select for their clients, employees are proud of, and investors seek long term results.
Core Value: Service excellence, continuous improvement in measurable ways, employee development, teamwork, compassion, ethical and fair treatment.
Step two: Performance of Universal Health Service as compared to the past
According to the 2016 UHS annual report, its main focus is on provision of quality care to its patients as it improves its financial performance and efficiency. This is through more efficient use of professional and paraprofessional staff, monitoring and adjusting staffing levels and equipment usage, improving patient management and implementing more efficient billing and collection procedures. According to the recorded UHS’S financial information, the company’s income has been increasing. Net income attributable to UHS increased from $35 million to $545 million during 2014 as compared to $511 million during 2013 whereas it also increased from $67 million to $511 million during 2013 as compared to $443 million during 2012 (UHS, 2016).
UHS also dwells on corporate social responsibility by providing charitable care to patients who have a gross income of less than 400% of the federal poverty guidelines. This is in an attempt to improve the image of the institution and cooperate with the community. It does not pursue collection of amounts that qualify as charity care and are therefore not reported in its net revenues. The estimated cost of providing charity care in the years 2014, 2013 and 2012 was $78,475, $ 95,675 and $131,890 respectively (UHS, 2016).
Step three: A plan which incongruent with both the vision and mission of UHs based on its capital budgets
Capital budgets are majorly for the purposes of procuring projects, assets, and programs. They are long term budgets in themselves. According to (Mclean, 2003) a capital budget is one that assumes that the asset procured, will be pay to pay for itself through generating revenue or acquiring support through funding externally. This, therefore, means if the proposed asset is not in a position to pay for itself, then it should not be purchased.
Although UHS is a non-profit making hospital, the issue of capital budgeting is a matter of essence. It should be noted that over the years UHS has been on the front line to conduct acts of philanthropy to its organization. According to (UHS, 2016) the hospital has been ranked as a top performer through its registration of billions in earnings. In the year 2012, UHS collected a total of $(789,590) from all of its investing activities. The amount moved to even a higher notch in 2013 where cumulatively they acquired $ 884,241. And in 2014 a total amount of $1,035,876 was also gathered. All this endowment should be put in good use so as to assist in providing good patient care by constructing buildings, diversify the specialties available and also purchasing more land.
Step four: Harmonize the UHS’ financial goals together with its strategic goals
A good and long term image of an organization helps it maintain good credit. This in return helps it promote the strength of their credit (Thompson, 2008). A positive rating will only occur if the organization’s profit margin over the years is positive. In UHS, it has recorded a rise in profit margins over the three consecutive years. In 2012 it recorded $450,467 in 2013 $530,077and a higher amount in the year 2014 $544,921. The results are positive despite the fact many people have recently lost their medical covers.
Step five: Identify and evaluate both the micro and macro environments of UHS in order to create new opportunities.
This financial plan cannot be successful if UHS does not invest in evaluating the mentioned environments. This is done through constant reviewing of their financial positions and also the macro environment. Ensuring that all the strategic plans are based on its strength. UHS has a very strong management team that ensures that all departments result to yield revenues which amount to 73% of its total income (UHS, 2016). In the consecutive years that is 2012 -2014 UHS has developed from providing acute care hospitals to surgical and behavioral healthcare centers and in 2014 has introduced ambulatory surgery and radiation services.
Future decisions of UHS should be based on its big strength which is its managerial team and the fact that it has been recognized as the largest hospital. This new opportunities identified should provide a guideline on how financial projections can be developed by UHS. New opportunities are usually accompanied by risks. They include changes in cost of operation of activities, patient revenues and changes in productivity. All risks should be assessed. With new opportunities come expected net present values this ought to be assessed in order to evaluate the new opportunities then an optimal decision should be chosen (Mclean, 2003)
Step six: Evaluate and monitor all steps
According to the financial statements provided by UHS, their total operating revenue has continually increased. From 2012-2014 the sum amount of operating revenue rose from $ 799,231 to $1,035,876. This means that debts and funds are being well managed (McLean, 2003).
Universal Healthcare Service Financial Planning References
McLean, R. (2003). Financial management in healthcare organizations. new York: Clifton Park,.
Thompson, A. S. (2008). Crafting and executing strategy. New York: McGraw Hill:1-17.
UHS. (2016). 2014 Annual Report- Universal Health Services. UHS. New York: Retrieved from http://www.uhsinc.com/media/288196/2014-annual-report.pdf.
