Essential Components of a Financial Analysis

In a recent newsletter we reviewed  the 5 key components of a successful financial analysis. Following these can create nearly overnight revenue increases with little to no additional expense.  In todays economic situation where we all have to do more with less I thought these ideas may be of interest.

Getting Paid For What You Do

It sounds simple but “revenue leaks” can cause an organization to lose valuable capital.  A thorough review of the organization’s service to payment operations can identify these leaks and ensure that they do not continue.

Cash Flow

The saying goes “cash is king” and cash is the life blood of any organization.  A solid financial review needs to include the identification of all revenue sources and the setting of benchmarks at all levels of the organization including service contracts, payers, and grants.

Expense Review

If your organization needs to “fund its mission” or “create shareholder value” a critical component of a financial review is to evaluate the expenses required to generate that revenue.  This review will allow organizations to identify programs, services, and offices that bring value to the organization.

Payer Aging

Do you know which payer pays within 30, 60, 90 days or hardly ever?  Do you know the total cost to your organization related to the submission of claims?  The answers to these questions are critical to all organizations.  Understanding your payer aging can stabilize cash flow and increase both the top and bottom line.

Brian Johnson BHM’s SVP of Finanace and Claims Operations stated “Few things are more vital to the success of an organization than a financial analysis”

Technology Changes Business Travel

I read with interest a recent article about airlines loss of business travelers over the past few years.  Last year business travel was down 60%. They expect business travel to be up this year.  The article went on to say that the industry does not expect to get back any more than half the  business it lost because of technology advances.  We recently assisted a managed care company to become URAC accredited in 3 areas over a  short period of time.  This would have in the past involved lots of travel and on-site meetings.  We did all of it with just one face to face meeting (excluding  a mock survey and the actual URAC survey).   All the rest of the preparation was done via web conferencing.  This reduced the cost by at least half.  Not only was it very cost-effective but the technology lead to superior results, possible because of the way you can focus participants using web-based technology.  If your organization needs high quality cost-effective health care consulting services please contact us for a free consultation.