Simulation Review Paper on Elijah Heart Center

Elijah Heart nub (EHC), is a healthc atomic number 18 agreement focused on cardiac health. The easiness is equipped to handle the full spectrum of cardiovascular processs for physicians and perseverings. The infirmary similarly provides out affected role processs for less invasive procedures and clinical care. Although the organizations tolerant volume is stable and increasing in volume rapidly, thither is a deficit in regards to profitability. As the senior pecuniary consultant, I go away present plans for short term and long term goals if needed. I give to a fault recommend special measures to modernize the hospital and provide specific plans for hospital expansion.Financial Portfolio Elijah Heart Center has managed to stay in physical process due to clarified patient services. In the process of great patient care, poor financial finales have been do in the past that instanter hinder the profitable spectrum of the organization. Research data revealed that issues that have affected this organizations financial budget. The data revealed that (EHC) gave large discounts to manage care companies. The treat staff was affected because higher(prenominal) wages were paid to outside agencies who supplied involve nurses.Of course when dealing with government health funded insurance carriers such as Medicare, the reimbursement levels are well be utter budget standards. Insurance calculates are non current and based on past medical be which stunts the financial growth of the hospital. Liabilities have increased and ? of the liabilities are related to accounts payable. The hospital equipment will need replacement soon due to extensive usage. other issue is the constant placement of unused equipment in patients rooms. This causes conflict because if the equipment is placed in the patients room, it is considered is supposed to be charged to the patient.Phase 1 Capital Shortage Bridging a running(a) slap-up shortage is one of the st str amplifylegie s that keep help increase the hospitals revenue if a true concrete plan can be formulated. Once entirely data was received, suggestion from the Executive bill of fare was realisen into consideration before any final decision was to be made. The main focus to be considered while bringing forth a strategic plan, is to understand the healthcare business as a whole. tally to Baker and Baker (2009), The health care industry is a service industry.It may have inventories of medical supplies and drugs, only when those inventories are necessary to service delivery, not manufacturing functions. With this information in mind, two specific cost acid options were chosen geared toward staffing and patient care. The get-go option workressed was to mitigate the staff employ from outside sources. Nursing and other employees who were hired via contracts worked for higher rates of pay. This rate is normally double the amount of the staff employee. Depending on the specific position and pay grade, large quantities of contract workers drains the current financial budget and reserves.The goal macrocosm strived for is the ability to take money being paid out to contract workers, and use it to hire staff at a reasonable rage of hire. This leads into the second option that was chosen. Changing the dexterity mix is a great strategy to help retain employees, add to their skills to make them more of an asset, and increase the employee morale. It is k nowadaysn that without contract staff to appendage nursing the strain of patient care would increase. That is why it is necessary to apply the staff already in house that known the routine to be open to learning more skills.The asset to this strategy is that the nurses who are hired for full time status will enter an organization that promotes right clinical learning. The projected outcome of this plan is a net nest egg of at least 90% the first year, and an increase of financial savings by the second net year. Loan Options A decision in regards to loan options is a strategic method that can be denigrating to the company deficit if not chosen correctly. After consulting with the executive team, the decision to select a refurbished loan with a lower interest rate of 9% was better than selecting a in the buff loan with an interest rate of 9. 5%. Having the option to refinance a new loan would not be as lucrative or flexible in the first years of loan repayment. Outcome of Decision The outcome of these two decisions showed major(ip) improvements among the internal/external working environment as well as decreased overloaded expenses. The loan (option 2), was the best excerpt $1,500. 000, with a low interest rate of 9. 00%. The interest rate is lower than loan (option 1), at 9. 45% interest. The Monthly payments of $131. 177 versus $131. 490 was also appealing. The cost cutting strategies worked for (EHC) and improvement was at present seen.Phase 2 Funding Options for Equipment Acquisitions The worki ng capital shortfall is now under control at (EHC). With the increased patient flow, the technological aspects of the hospital must(prenominal) now be addressed. After meeting with the hop on of Directors, gigabyte Sanchez stated the desire to purchase medical equipment to continue to provide excellent care to clients. The option was given after consultation to either bribe new or refurbished medical equipment by acquiring a loan, or acquiring the equipment on lease (capital or operating).In large healthcare organizations, there is constant competition between departments for funding request for new equipment and supplies. According to Baker and Baker (2009), the reason for new equipment is needed must be clearly stated. The acquisition cost must be a reasonable figure that contains all appropriate specifications. The number of years utilizable life that can be reasonably extended from the equipment is also an master(prenominal) assumption. Mr. Sanchez provided all the necessa ry information needed. A different and daring rise was used to purchase the equipment needed for the hospital.The High Speed CT Scanner, roentgenogram Machine and Ultrasound were all purchased on a Refurbished Equipment Loan. The optimal choice was to purchase the High Speed CT Scanner on a Refurbished Equipment Loan, the X-Ray Machine on a Capital Lease. The choice made for this issue was concrete. The most cost efficient method was used to vamp up the equipment in use at the present time. The refurbished loan amount was purchased at a 9 % interest rate.When checking the balance sheet, the wide-cut assets and total liabilities were the selfsame(prenominal) at $230. 621. Phase 3 Options for Capital Expansion Now that the capital shortage and equipment acquisition were addressed and the financial improvement of the hospital is rising, there is now a need for added space. The executive committee have plans to add 100 new private rooms as well as consider the expansion other depart ments such as operative suites, endoscopy, surgical suites, and womens service. Other expansions include 5 operating suites along with septette Cardiac Catheterization Labs. Also, twenty critical care patient rooms were also on the list to be added. The options available for selection included, Tax-Exempt revenue enhancement Bonds, HUD 343 Loan Insurance Program and individual(a) Bank Funding.I chose Private Bank Funding. The interest rate is slightly higher than the other options but the Net Present Value (NPV) was better than the total cost of the project. The total cost was $75,000 and the (NPV) came to $180. 250. According to Baker and Baker (2009), the Net Present Value, is a discounted cash flow method. It is based on cash flows in that it takes all the cash (incoming and outgoing) into account over the life of the equipment over this life of the equipment ( or if applicable, over the life of the relevant project).The strategic collaboration between the Board Executives and myself resulted in a great outcome, bringing overall improvement to the organization. I learned the importance of financial budgeting and streamlining with the focus on staff and patient satisfaction. I honestly would not change my decision on this simulation. I feel confident in my decisions as the consultant. I will take what I have learned from this assignment and apply the methods used to represent a competent financial budget as well as monitor and maintain adequate employee staffing ratios.