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Healthcare Finance: What is the Break-even Analysis Approach and its Application in Health Care Organizations?

Unfortunately, hospital and health care budgeting of resources has become increasingly important in this cost-conscious era of health care. The last decades of cost-controlled medicine have required fiscally conscious approaches to the healthcare for many organizations, often at the expense of patient services. A financial analyst must strive to minimize this, yet still keep the organization afloat. A segment that does not make money or at least break even for the health care provider may have to be eliminated.

Health care facilities may take longer to break even on their initial investment than other


forms of businesses. Also, the break-even period for primary care is different compared to tertiary care. Still, developing any break-even action plan begins with a clear understanding of any significant shortfalls against benchmark, with a special focus on provider productivity in terms of visits, relative value units (RVUs), and net patient revenue. Ideally, office or site managers can assist in the development of a break-even action plan using break-even analysis to ensure that patients are inconvenienced as little as possible.

Reducing the number of provider and nonprovider staff, closing practice s

Some common words found in the essay are:
, Halley Lloyd, health care, primary care, break-even action plan, break-even action, terms visits, break-even analysis, revenue expense, action plan,
Approximate Word count = 409
Approximate Pages = 2 (250 words per page double spaced)


  

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