Comparing Financial Environments: Government, Non-Profit

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Comparing Financial Environments-Government, Non-for Profit vs. For Profit Jasmin Dedic HCS 577 March 19, 2012 Ralph Gigliotti Comparing Financial Environments-Government, Non-for Profit vs. For Profit Regardless of what criteria are used to measure the size of our health care industry, result would always indicate that it is a big business. Its proportion of gross domestic product (GDP) has been steadily increasing in the past few decades, and it has now grown to approximately two trillion dollars. The financial environment of the health care sector is divided between for-profit, not-for-profit and government organizations. Although, all these organizations share a common goal, they differ in their business approach and when it…show more content…
Since non-profit business are not owned by their board of directors, people in charge of the organization work to improve the general performance of the hospital and serve the community they belong to. St. Francis is a system of hospitals that is privately owned for profit business. For profit hospitals when compared to non-profit and government owned, have a much simpler way of measuring their success, and evaluating their financial situation. Their main financial objective is to earn profit. For-profit organizations are funded by investors who are usually the main executives of the company, therefore their focus stays true to the name “for-profit”, and there isn’t much gray area as to what is the financial mission of those types of hospitals. “Their business accounting and financing are concerned almost exclusively with the goal of maximizing profits or cash flows.” (Howard,…show more content…
It basically summarizes how well or how poor the organization performed, and no other statistics or numbers matter. Therefore, St. Francis was the one system that suffered the most during the recent recession, caused by the steep drop in stock market. Since it is investor owned, naturally, investors were slightly afraid to reinvest into the company, after having to take a huge financial hit caused by the decline in economy. On the other hand, the MED hospital has been experiencing financial difficulties for the last decade. Being the government owned facility and also being extremely important to the wider community as the only true trauma center in the area, it was “bailed-out” by the federal and the state governments on several occasions. The last check was for $40 million, combination of federal and state/local funding, and financial experts expect similar checks to arrive to the Med, and the hospitals major money woes could be over in the foreseeable future (Memphis Commercial Appeal,

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