Mini Cases are intended to assist the student in understanding how to apply…

Instructions:

Mini Cases are intended to assist the student in understanding how to apply the financial skills introduced in financial management. Students will prepare a 1-page report on each of the mini cases from the text reflecting their application of the financial concept and theory. The report should focus on the specific issue found in the case and demonstrate the opinions and perspectives of the student and how they feel the issue should be addressed.

Use the format APA7.

Use 2 references and one them has to be the following:

We are using this book please use it as reference and for citation. Also the mini case is located in this book: Introduction to the Financial Management of Healthcare Organizations, Eighth Edition

        by Michael Nowicki (Author)

Mini case Study ( Page 191)

The CARES Act provided $100 billion in financial relief to hospitals responding to the COVID-19 pandemic. The act includes a 20 percent increase in Medicare payments to hospitals for their COVID-19 patients. However, studies have indicated that the costs associated with COVID-19 patients may be 35 percent more than original DRG payment rates, or 15 percent more than relief payment rates (Reese 2020). For a hospital that admits COVID-19 patients, list the possible solutions to this cost crisis after examining the methods of cost accounting explained in this chapter.

Sample Solution

Report on the Cost Crisis for COVID-19 Patients in Hospitals

Introduction The COVID-19 pandemic has created a cost crisis for many hospitals in the United States. The CARES Act provided financial relief to these hospitals by increasing Medicare payments by 20 percent. However, the cost associated with COVID-19 patients is 35 percent more than the original DRG payment rates, and 15 percent more than the relief payment rates. In this report, the possible solutions to this cost crisis will be examined using the methods of cost accounting.

Possible Solutions

1. Activity-Based Costing (ABC) Activity-based costing is a cost accounting method that assigns costs to products based on the activities required to produce them (Nowicki, 2020). Hospitals can use this method to accurately determine the costs associated with COVID-19 patients and allocate these costs to the products produced. This will allow the hospital to better understand the cost structure and make decisions that will reduce costs.
2. Lean Management Lean management is a process improvement approach that focuses on maximizing value while minimizing waste (Nowicki, 2020). Hospitals can apply lean management principles to the COVID-19 response to eliminate waste and reduce costs. For example, they can streamline the processes for admitting and treating COVID-19 patients to minimize waste and increase efficiency.
3. Cost Reduction Programs Cost reduction programs are initiatives designed to reduce costs in a specific area of the organization (Nowicki, 2020). Hospitals can implement cost reduction programs…Order a customized and more comprehensive answer here