$ FINANCE & ACCOUNT DEPT. OF

HOSPITAL $ Dr. Mahesh

Hospital Management -Overview

FINANCE & ACCOUNT DEPT. OF HOSPITAL 2

Hospital Management

NEED OF FINANCIAL MANAGEMENT1. Era of voluntary, missionary hospital is gone.

2. Public opinion about hospital is changing.

3. When hospital is financially sound it can meet the need of community any way.

4. Quality of hospital services can be improved by financial management.

FINANCE & ACCOUNT DEPT. OF HOSPITAL 3

FUNCTIONS (1/2)

1. Maintains extensive accounting records.

2. A unique number is assigned and file opened for each patient.

3. Charges for each utilised hospital services are maintained in pts account.

4. Compiles all charges and issues bills; also collects cash and unpaid bills.

5. Records all financial transactions including control of cash, purchases and cost of free services.

FINANCE & ACCOUNT DEPT. OF HOSPITAL 4

FUNCTIONS (2/2)

6. Pay-roll records managing and maintaining time cards, absenteeism, leaves on loss of pay, salaries, benefits at termination of service etc.

7. Assists in preparing the hospitals budget, estimating the need of various departments, pts load and income

8. Costing of dept. And services, dept. Income and expenses, cost of service helps for setting of fees.

9. Handles accounts payable on purchases of equipments and supplies.

FINANCE & ACCOUNT DEPT. OF HOSPITAL 5

Accounts Management(1/2)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 6

Sr .no. Requirement

1 Employee database

2 Patient database

3 Daily OPD registration

4 Daily IPD registration

5 Daily investigation

6 Daily cash receipt from OPD

7 Daily cash receipt from IPD

8 Daily cash receipt from Lab/Investigation

9 Daily admit report

10 Multiple payment mode report (Cash/Cards)

11 Insurance card payment report

Accounts Management(2/2)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 7

Sr .no. Requirement

12 Daily discharge report

13 Service invoice with service Tax

14 Payroll

15 Balance sheet

16 Profit and loss account

17 Bank reconciliation

18 Outstanding receivable and payment

REVENUE GENERATION (1/2)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 8

REVENUE GENERATION (2/2)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 9

LIABILITIES (1/2)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 10

LIABILITIES (2/2)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 11

SAMPLE BALANCE SHEET

FINANCE & ACCOUNT DEPT. OF HOSPITAL 12

PATIENT – REGISTRATION TO CHECK OUT

FINANCE & ACCOUNT DEPT. OF HOSPITAL 14

CASUALTY PATIENT BILLING Pt approaches casualty

Treatment is given as required if pt doesn't require admission

billing and discharge

Further plan of care

Admission pt is transferred in case of

non availability of bed/services/

Pts relatives are asked to make payment

Pt shifted to allocated bed

FINANCE & ACCOUNT DEPT. OF HOSPITAL 15

CASH FLOW

FINANCE & ACCOUNT DEPT. OF HOSPITAL 16

LOCATION (1/2)

1. Must be located on the administrative corridor adjacent to the entrance from the main lobby

2. Must have privacy and freedom from frequent interruptions as it delivers functions like billing and cashing

3. Space requirement1. Office for director of financial services2. Space for chief account officer3. Clerical area

FINANCE & ACCOUNT DEPT. OF HOSPITAL 17

LOCATION (2/2)

4. Cashiers must located in separate cabin in all major depts. where cash/card transactions occur.

5. Billing section near to cashier booth

6. Waiting area for pts/relatives

7. Separate room for pay roll section

8. Storage room for supplies , pts records and other records

9. Cashier must have safe for keeping cash until it sent to bank

10. A fireproof cabinet for storing valuable records

FINANCE & ACCOUNT DEPT. OF HOSPITAL 18

ORGANIZATION

1. Head of financial management unit

2. Controller/director of financial services who reports directly to the CEO.

3. Actual configuration will vary depending on the size of dept.

FINANCE & ACCOUNT DEPT. OF HOSPITAL 19

PROBLEM SITUATIONS

1. Manual bills leads to excessive delays

2. Late charges from supportive service departments like x-ray, laboratory and dietary.

3. Good percentage of missing bills and lost charges .

4. Incorrect information from pts such as wrong address leads to follow-ups and recovery of unpaid bills almost impossible.

5. Fraud and theft in various operations of unit

FINANCE & ACCOUNT DEPT. OF HOSPITAL 20

INTERNAL CONTROL

1. It is impossible for the CEO to direct supervise over all employees

2. It is mechanism by which the work of one employee acts as a check on the work of other .

3. Ex. store keeper doesn't have control over inventory records, cashier don't have access to accounting records.

4. It has been estimates that one in every ten employee steals habitual in hospital so internal control is necessary.

FINANCE & ACCOUNT DEPT. OF HOSPITAL 21

SAMPLE BILL(1/3)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 22

SAMPLE BILL(2/3)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 23

SAMPLE BILL(3/3)

FINANCE & ACCOUNT DEPT. OF HOSPITAL 24

Dr. Mahesh

FINANCE & ACCOUNT DEPT. OF HOSPITAL 25