Research Topics: Health Finance Management

Managing finance in health and social organizations   Executive Summary             The main goal of this paper is to provide a business case analysis on the proposed new service extensions in cataract eye surgery in one of the hospitals at Hong Kong East Cluster of Hospital Authority. In this regard, the discussion involves the analysis of the potentials of this service using different techniques such as Stakeholder’s analysis, PESTLE analysis and Forced Field Analysis. In terms of financial aspects, this report has been able to use Cost Benefit Analysis of the said venture. Further, this case also provides some important details on how the hospital can get financial support for the said service extension. In this regard, the hospital can get financial support from different institutions such as government, non-government organisation, sponsorship from multinational companies based in HK and others.             The analysis have found out that with the objective of the hospital to provide services to patients with cataract is possible if the market environment would be able to create a market which is supportive and cooperative.   Introduction             A business analysis is an important tool to help an organization asses the viability of starting a new organizational venture. It provides important information needed to make the critical decision of whether to go forward with a new venture. The purpose of the analysis is to make sure that the institution is on the right track. The goal of the analysis is to enable the organization to determine whether or not to proceed with a project and to identify any important risks associated with the project. The feasibility of a project can be ascertained in terms of technical factors, economic factors, or both. A business case study is documented with a report showing all the ramifications of the project. It is a preliminary study undertaken before real work of a project starts to ascertain the likelihood of the project’s success. This type of study helps in finding alternative solutions to a problem and presents recommendation on the best alternative. Aside from these, the feasibility analysis will also help the decision makers to determine the major aspects of implementing new organizational activities or ventures (, 2001). In establishing a new venture, one of the most important business aspects that should be considered is the financial capabilities of the organization. In this particular report, being able to recognize the needs of improving the quality of life of the old patients at Hong Kong East Cluster of Hospital Authority and to be able to shorten the waiting for these patients, one of the hospitals are proposing a new service extension for the Cataract eye surgery which can be done under local anaseathetic in a case to case basis.  In this regard, the goal of this study is to provide a clear financial project plan for the proposed extension service in one of the hospitals. This report will provide a discussion will include the analysis of the current environment of HK in terms of health and social contexts and to provide ways on how this service would be pursued in terms of financial aspects.   Overview of the Service             The case was about the financial analysis for the establishment of a new service extension for patients who need eye cataract surgery.  It can be said that eye cataract is one of the growing problems among older patients (, 1998). In Hong Kong, hospitals has been able to realized the need for a service that would help cataract patients live a normal life buy offering a free or cheaper cataract eye surgery.             The cataract eye surgery service is established to provide patients, especially older patients to have free medications and surgery with their cataract, for them to live a normal and quality life. Basically, this type of service will give patients the chance to enhance their health condition with the best service at the least cost.  The service will be implemented in one of the hospitals in Hong Kong East Cluster of Hospital Authority.             Analysis of the Proposed Service Extension             In the proposed service for cataract surgery, it is important to analyze the market environment of the said service portfolio to determine the potentials of the proposed service. In this regard, the market environment will be analyzed using some tools like stakeholder’s analysis, PESTLE analysis and Force Field analysis.                         Stakeholder analysis             In order to have an effective implementation of the new service extension   it is essential to analyze the stakeholders who will be active or involved in the new healthcare service for cataract eye. The main goal of this analysis is to identify who among the stakeholders will have high and interest on the problem, which will have the authority to influence others for the cataract eye surgery amongst elderly. Further, this stakeholder analysis also aims on identifying who are the subjects, players, bystanders and actors involved in the said service extension. The stakeholder analysis will be discussed using the stakeholders’ grid. HIGH     INTEREST   Patients with cataract, most especially older patients         Health care providers, community or local government and federal government Non-government organization, volunteer groups, media, Educational organization       Relatives Parents Youth         Community or local healthcare providers, Department of health and federal government International Institution   LOW POWER/INFLUENCE HIGH In this proposed service extensions the potential stakeholders include the hospital administration, community health organizations, HK government, the cataract patients, funders and HK government health regulators and policy makers. Accordingly, various stakeholders have varying amounts and kinds of power, and those with the greatest influence shape a strategy from a number of specific decisions ( & , 2001) Stakeholders are given the outmost authority in any business setting, like in this case the implementation of the new service for cataract eye service. Their power and importance is beginning to gain slighter advantage when compared to an organization’s management team. Stakeholders provide a diverse influence to both kinds of organizations and they guide the people in the organization so that the goals will be met. In this regard, the stakeholders for this proposed service extension can be considered as significant for the decision making of pursuing new service of cataract eye surgery in one of the hospitals in Hong Kong East Cluster of Hospital Authority. According to  &  (2001), product and service design involves translating stakeholder needs into service requirements, formulating quality goals and cost target, documenting specifications, refining existing products and services, and developing new ones as well.  With these, stakeholder analysis, the hospital management can be able to modify the new service extensions to meet the needs and demands of the stakeholders and most especially the patients.               PESTLE Analysis             The environment for the cataract eye service is also analyzed through the use of PESTLE analysis.   Political The new service of cataract eye surgery will not get any good reputation, trust and success if it will not be aware of what is happening in the political sector Hong Kong, especially in line with the health policies by the Department of Health and Hospital Authority. The hospital should guarantee that sure they are aware of the political situation of the country and the company has its position with regards to political issues and that the management of the hospital who will implement the said services should be prepared for any problems concerning the political sector (, 2001). The government or organizational jurisdictions or responsibilities involved includes department of health ( & , 2006), local and national government and their international linkages who are supporting the notion of having quality living. The responsibility of the government is to establish an organization which focuses on the new service extension management about cataract eye surgery. In addition, the government is responsible in providing financial support to the hospital that will pursue that said health project. The government should make a new policy that engage in enabling hospital authority that will disseminate information about the problem.   Economic Throughout the years, it can be said that one of the problems of HK health authority is with regards to their financial stability. With the reformations made by the HK government, it can be said that the country’s economic stature is doing well that’s why they try to improve their services to give the best healthcare services that meets the needs of their patients. It is not only the economic situation of the hospital that should be taken note of but also the economy of the country, the hospital management should be able to check first the economic status of the country they are operating in before making decisions because making decisions during a difficult time on the economy of another country may cause catastrophe for the company. The role of the government in regulating health care providers will be limited to ensuring that providers and payers do not engage in anticompetitive practices and that the safety of patients is protected ( and , 1998). This means that the government tries its best to reduce the healthcare costs at all levels for the consumer’s benefits.   Social The hospital management that proposes the implementation of the new service for the patients with cataract makes sure that the service they offer and will be accepted by the general public. The hospital management restricts and does not authorize the implementation of new services which they know will cause outbursts or complains from different group in the society. The hospital management makes sure that they have a very good relationship with different sector in the society.   Technological As part of the new service that will be implemented in one of the hospitals in HK, the management offered new innovations in the technological sector and introduced new concepts with regards to cataract eye surgery.  Since technology rapidly changes the company makes sure they are updated to what is happening and they can adjust to these changes. The company makes sure that the services they have are updated with regards to technology and if new technologies emerge they can compete with this kind of service.   Legal             In any country there are laws that need to be followed. These laws restrict or allow any action to be done. The laws make sure that the people do what is right and just. It prevents any arguments or differences. The hospital management makes sure that it follows the different laws and provisions provided by Department of health of Hong Kong and the Hospital Authority.  In addition, the hospital management also makes sure that the different healthcare laws are followed in any actions and activities they made.   Environmental The world is starting to be more conscious of building a better future for the people. Every possible way to ensure a better future is used. Different organizations are doing things to ensure that the future will be a bright one. The hospital management makes sure that the services that would be given will cause minimal problems to the environment.   Force Field Analysis             Aside from the stakeholder and Pestle analysis, this business report will also include Force Field Analysis (See Appendix 1). FFA is a useful approach for analyzing all the forces for and against a certain decision ( & , 2004). In this regard, force field analysis is a specialized approach of weighing the cons and pros. The following figure presents the Forced Field analysis for the proposed service extensions about cataract eye surgery. Forces against Change Score Cost problem 2 Inability to meet the needs of the patients         1 Inability to provide quality service. 1 Forces for Change Score The needs of the healthcare providers for having new service extensions that will help patients with their cataract. 3 The need of individuals with eye cataract especially older patients in HK to avail services which is cheaper or free. 2 Enables Patient’s to have a quality living. 3                                 Having a total of 8 for the forces for change and just 4 for forces against the implementation of the new service, there is a favoring score of 8:4 for implementing the new service extensions.   Feasibility Analysis of the Service             There are various ways on identifying the feasibility of the implementation of the new service for cataract eye surgery in one of the hospitals in HK. In this regard, this financial analysis would use the Cost-benefit analysis. Cost-Benefit models require a well-informed respondent or group to provide subjective information regarding characteristics of the project under consideration. Such methods typically avoid conventional economic data (,  & , 2003), such as projected sales, profit margins, and costs, but rely more on subjective assessments of strategic variables, such as fit with corporate objectives, competitive advantage, and market attractiveness. Included in this category are checklists and their extension, scoring models ( 1993, ). Cost benefit techniques rely on the subjective inputs of characteristics that are likely to be known. Cost benefit techniques recognize the lack of concrete financial data at earlier stages of the project and the fact that financial analysis is likely to yield unreliable results. Because of limited information and because only a tentative commitment is required during the early stages of the project, benefit methods are the most logical evaluation tool. In Cost benefit analysis, all costs and benefits are measured and compared in monetary terms (, 2003).             The Cost benefit analysis for the implementation of the new service in HK hospital is shown below.             New Service Extensions Needs Costs New equipment for the cataract eye surgery. HK .2 million Room renovation costs HK 0, 000 Other Costs HK 0, 000 Total Costs HK1.9 million Benefits: ·         Ability to alleviate sufferings of patients with eye cataract/ , 000/ year ·         Expanding and extending better community relations/0 000/ year <ul type="disc" style="margin-bottom: 0in"> <li class="MsoNormal" style="color: #333333; text-align: justify; line-height: 200%"> Improved efficiency and reliability of the services extended to patients: estimate: .7 million/ year </li> <li class="MsoNormal" style="color: #333333; text-align: justify; line-height: 200%"> Improved patient service and retention: estimate: 0,000 / year </li> <li class="MsoNormal" style="color: #333333; text-align: justify; line-height: 200%"> More ability to manage hospitals sales effort: 0,000 / year </li> </ul> Total Benefit: HK .22 million /year Payback time: .8 million / .22 million = 1.7 of a year = approx. 20 months   The payback time is commonly known as the break even point of the analysis. It is said that it is important than the overall benefit of a service can deliver. As anticipated, the estimates of the benefit given by the new service can be noted as quite subjective. In spite of this, the management of the hospitals in cooperation with the Hospital Authority is very likely to pursue the implementation, given the short payback period.   Strategy to gather Enough Funding to pursue the service             In order to pursue the new service extension for cataract eye surgery in one of the hospitals in HK, the management and the healthcare professionals should be able to gather enough funding. In this regard, there are many ways that the hospital can be used to implement the said service extensions.             One of which is through the help of the local government of Hong Kong. Local government is a large portion of the overall health care safety net in Hong Kong, providing direct-care services and funding such items as public hospitals, transportation, educational outreach, and housing subsidies (, 2001). Government agencies are established at the local, state or provincial, and federal levels to provide public health services. Health agencies at the state, county, or city level vary according to the need of the area. Their funds, generally from taxes, are administered by elected or appointed officials (, 2004). Local health departments have responsibility for developing programs to meet the health needs of the people, providing the necessary staff and facilities to carry out these programs, continually evaluating the effectiveness of the programs, and monitoring changing needs.  State health organizations are responsible for assisting the local health departments specifically by providing funds for implementing new services needed by the public. In addition, the hospital that will implement the said can also raise funds and financial budgets from different non-government organizations which addresses the needs for having quality living among elder patients with cataracts and other patients. The finance committee can also make some adjustments on the budget and can even seek external help from other organizations for additional funding. During the actual running of the new service, the hospital manager must make sure that proper allocation of the budget will be provided for the new service. With this, proper accounting of resources must be done, taking note of the progress of the cataract eye surgery service and using graphs to monitor the progression of the project. The finance committee of the said service can also seek help from different organizations; especially multinational organizations that are based in Hong Kong in helping them have enough budgets to pursue the project. Herein, the management is able to create good relationships to potential industries that would sponsor then their financial needs to pursue the project. Solicitation is another important way to gather funds from private and public individuals, groups or corporations.   Implementation and Evaluation Plan The following contains the suggested implementation plan for the new service extension in line with cataract eye surgery. After the planning phase is over (and agreed), it is a signal of the implementation phase begins. Once the activity is in motion, it acquires a direction and momentum which is totally independent of anything that was predicted. The key elements to the control of the changes are the milestones and established means of communication. The milestones are a mechanism to monitor progress; for the team, they are short-term goals which are far more tangible than the distant completion of the entire project. This maintains the momentum and encourages effort for the team; it allows the team to judge their progress and to celebrate achievement throughout the activity rather than just at its end.    Dangers in review There are dangers avoiding this new service implementation review, it is either too frequent or too drastic. The lack of sustainability to the extension activity of the hospital can lead to plan revisions which shake the team’s confidence in any particular version destroying the stability of the planned approach. Decide objectively, and explain beforehand, when the review phases will occur and make this a scheduled milestone in itself. Even though the situation may have changed since the last review, it is important to recognize the work which has been accomplished during the provisional. First, the organisation do not want to abandon the project since the team will be demotivated feeling that they have achieved nothing. Secondly, this work itself is part of the new situation which has been done, it should provide a foundation for the next step or at least the basis of a lesson well learnt. Existing achievements of team should always be building up.   Time Time is sometimes one of the problems since there are organizations that are demanding for unrealistic time. For these service extension activities, realistic schedule viewed by the team should be imposed.  Outside world are not allowed to deflect team form what knows to be practical. If the impose a deadline upon which is impossible, the team will clearly state this and give reasons.  For this instance, the project teams must determine the most appropriate time to start the implementation of the project; the sooner, the better. Planning for error One of the most common errors in planning is that assuming there will be no errors in the implementation which in effect, the schedule is not based on the plan. On the other hand, recognizing that errors will occur is the reason for implementing a monitoring strategy on the project. However, by cautiously considering errors in advance you can make changes to the original plan to enhance its tolerance. The team that would implement the must try to predict where the errors will occur by examining the activities’ list. The risky areas might then be given a less strict time-scale – actually planning-in time for the mistakes. Another option is to apply a different strategy, or more resources, to such activities to minimize the disorder in the project.   Evaluation This new service are planned in order to provide healthcare services for those individual who cannot afford a high priced surgery for their eye cataract. The suggested strategy that can be used to pursue this is to achieve government, healthcare authority, community and citizen’s support with the said extension service.  Herein, the action plan is given to guide the health organisation and hospitals for the implementation of the said change. The hospitals must be able to have effective implementation of such change so that they will achieve the main objective of he said development and that is to increase the adherence of patients to isolation.   Reflective Commentary             Perhaps improving healthcare organisation by providing new services which are demanded by patients is considered a tough decision, especially when considering different aspects. In this regard, I have learned that, if healthcare organisation are not constantly improving and growing in their capacity to meet the needs of the patients, then they are losing ground and failing in their mission of service in terms of helping the patients alleviate from suffering and enabling them to live quality life. The analysis have also served as an enlightenment for the notion that managing finances for new institutional service extension is considered to be complex and extremely difficult to handle. In order to make sure that this service extension (cataract eye surgery) would pursue for the benefits of the people with cataract, the HK federal and local government including hospital authority must be able to shift the policies that would address these needs. In this regard, the problems regarding the financial needs of this new service should be given solution to ensure that the objective will be met effectively.   Reference:         Appendix Appendix 1   Credit:ivythesis.typepad.com

Managing finance in health and social care organization

Managing finance in health and social organizations Executive Summary The main goal of this paper is to provide a busine...