1. BMC Health Service Research 2015 By Gang Nathan Dong PERFORMING WELL IN FINANCIAL MANAGMGMENG AND QUALITY OF CARE

2. ARTICLE REVIEW

3. Content Introduction Method Summary Critics Conclusion Recommendation

4. Introduction Financial management is pivotal in any organization since the success and failure of organization depend on how assets are managed. Role of finance management in health service organization is to plan for acquire and utilize funds or capital to maximum the efficacy and value of enterprise. Researcher in this research, studies finance driven management culture could affect quality of care in U.S Hospitals. This research attempts to determine whether the process measures of treatment quality are correlated with hospital financial performance.

5. Method The panel of study was hospital care quality and financial condition between 2005 and 2010 for cardiovascular disease treatment at acute care hospitals in USA. Process measure for cardiovascular disease treatment and hospital level financial condition ratio were collected from data base of hospital compare and cost reports. The dependent variable was quality score. The independent variable was total asset, financial leverage, profit margin, asset turnover, current ratio, day cash on hand, days patient accounts receivable and total salary to revenue.

6. Summary The summary statistic of all variable for the entire sample was N=13,273. the average quality score was 0.79 with min being 0.1 and max being close 1. In the sample 57% were non profit hospital and 22% were public hospitals. The result shows that non profit hospitals provide better quality of care than public hospitals. Hospitals with larger total assets, more use of financial leverage, higher asset turnover and fewer days patients account receivable are associated with better quality of care. However those with more days cash on hand and higher costs salary to revenue are associated with lower quality service.

7. Content… These research indicates that there is a statistically significant relationship between hospital finance performance and quality of care. The quality of treatment for cardiovascular patient rises in the year following an increase in hospital profitability, financial leverage and labor costs. Urban hospital reports better quality score than those located in rural area. Profit driven hospitals may do harm than good to patients However some hospitals have been performing both in finance and quality of measures.

8. Critics Quality score of hospital compare dataset is more an indication of hospital performance on certain processes of care e.g for standards and compliance rather than a measure of treatment outcome e.g mortality rate. The focus of study was on the measure of care quality for clinical conditions related to cardiovascular disease however this condition accounts for smaller portion of hospital admission which lead to higher level of internal invalidity. The data on hospital financial condition do not provide important details of managerial strategies and incentives that can potentially improve quality measures of treatment processes.

9. conclusion This research finds that hospital profitability, financial leverage, asset liquidity, operating efficiency and costs are important determinant of health care quality The result suggested that, when a hospital made more profit, had the capacity to finance investment using debt, paid higher wages presumably to attract more skilled health professionals, its quality of care would generally improve. In other place the lack of finance strength may result in lower standard of health care services.

10. Recommendation The author declares that Lack of financial strength may result in lower standard of health care service so its important to monitor the quality of care in hospitals with poor financial strength. Profit induces hospitals to enhance both quantity and quality of services they offer so its important to do ongoing mentoring and support to maintain good quality of service. Generally, Commitment should be maintain between hospital finance managers since hospital profitability, financial leverage, asset liquidity, operating efficiency and cost are important determinant of health care quality.

11. Reference BMC Health Service Research 2015 Dong, licencee Biomed Central 2015

12. Thank You!!