Financing Quality Improvement Project

Scenario

You are the administrator of a healthcare facility. You and your management team are constantly searching for ways to deliver cost-effective and higher quality care in your facility. Your department managers’ main goal is to deliver quality patient care, but they do not always consider all of the financial factors that impact the budget, which can affect their ability to implement quality improvements.

One of your primary responsibilities is to make decisions with the financial team. As you prepare to discuss this year’s budget with the managers, it would be beneficial if the managers gain a better understanding of the various internal and external financial factors that drive the budget and impact their ability to make quality improvements. After speaking to your department managers, you realize that there is a need for more information in order to become a more cohesive team before the budget planning process begins. You decide to send an email to the department managers to prepare the managers from each department.

Directions

Several department managers have stated that they are interested in learning about the factors within the organization’s finances that they have control over and that impact the budget. This will give them the ability to determine the areas where they can find cost savings and implement quality improvements. It will be essential that the managers are able to effectively communicate this information to the staff they oversee.

Email Attachment: You research on the internet to find a creative way to outline this information, and you come across a template that you decide will be an effective way to communicate this information to your department managers. You will use the template to create an email attachment that outlines the internal and external financial factors to send to the department managers prior to the budget planning process. It will be important to discuss factors that impact the budget and that managers and your organization have control over throughout the year. To support your managers, you will first want to address the following internal financial factors in your email attachment:

• Explain how internal financial factors of a healthcare organization influence the quality of patient care. Specifically, discuss how a healthcare organization’s revenue and expenses, including employee wages, support or limit a manager’s ability to improve quality of care.
• Identify at least two departmental expenses that a manager might have oversight for. Describe how each of these departmental expenses relate to quality of patient care. For example, managers oversee full-time employee (FTE) hours and supply budgets.

There are often factors that affect your organization’s finances that you and your managers do not have control over. These factors can have a large impact on the budget and a manager’s ability to make quality improvements. To improve transparency of the external influences that play a role in the budget, address the following external financial factors in your email attachment:

• Explain how the following external financial factors support or limit a healthcare organization’s ability to improve the quality of patient care:
  • Negotiated contracts with insurance (PPOs, HMOs, commercial insurance)
  • Non-negotiated (Medicare and Medicaid) payments (workers’ compensation, PIP-Auto)
  • Reimbursement standards and reporting (pay-for-performance [P4P], fee-for-service)
  • Vendors (supplies, durable medical equipment, etc.)

Email Message: You have created an attachment for your email to the department managers, but still would like to drive home the importance of their role in knowing how healthcare finance relates to quality improvement. To support your managers, you decide to address the following in the body of the email:

• Describe the role and importance of a manager to maintain oversight of the budget, and how that can support quality-improvement budgeting decisions in a healthcare organization

What to Submit 

1. Email Attachment
   Create an email attachment using the Email Attachment Template. The attachment must inform your managers on the relationship between healthcare finance and quality improvement. Properly cite all sources.
2. Email Message
   Submit an email message to your department managers using the Email Message Template. Address the importance of the manager role in healthcare finance and quality improvement in the body of your email. Your email message should not exceed 500 words. Properly cite all sources.

Email Attachment Template

Directions: Fill in each blank cell in the tables below with your responses. The template will expand as you type. Be sure to include sufficient information to address how each financial factor relates to quality improvement. Include in-text citations.

Internal Financial Factors
Revenue
Organizational Expenses
Employee Wages
Departmental Expenses

External Financial Factors
Negotiated Contracts
Non-Negotiated Payments
Reimbursement Standards & Reporting
Vendors