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The financial manager's role in the Voluntary Effort.
Hospital Financial Management
|December 13, 1978
Summary
The Voluntary Effort initiative aims to reduce hospital cost increases by 2% annually. Financial managers are crucial for achieving this goal by managing costs and improving hospital operations.
Area of Science:
- Health Care Management
- Hospital Administration
- Financial Management
Background:
- The "Voluntary Effort" initiative seeks to build on its initial success by targeting a further 2% reduction in the annual rate of hospital cost increases.
- Hospital financial managers are integral to the hospital management team, responsible for evaluating operational goals and management effectiveness.
Purpose of the Study:
- To highlight the critical role of financial managers in achieving the "Voluntary Effort" cost-reduction goals.
- To emphasize the importance of financial managers in developing a cost-effective healthcare financing and delivery system.
- To encourage the development of management teams capable of creating such a system through in-service training.
Main Methods:
- The study emphasizes the strategic responsibilities of financial managers, including reviewing operating goals and management effectiveness.
- It references the Hospital Financial Management Association's Code of Action as a guide for financial managers.
- The approach involves financial managers determining the feasibility of institutional decisions, interpreting regulations, and providing data to management and the community.
Main Results:
- The success of the "Voluntary Effort" is contingent on hospital managers effectively navigating challenges such as minimum wage and social security tax increases, cost containment, and inflation.
- Financial managers are key to providing the data and analysis necessary for informed decision-making.
- Initiating in-service training programs is encouraged to build a capable management team.
Conclusions:
- Financial managers play a pivotal role in the success of the "Voluntary Effort" by ensuring financial feasibility and effective cost management.
- The initiative aims to establish a cost-effective healthcare system through strategic financial oversight.
- Continuous development of management teams and adherence to professional codes are essential for sustainable cost control in hospitals.