Simulation Review Hcs 405

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Simulation Review HCS 405 February 16, 2015 Simulation Review Gilbert Sanchez, the Chief Executive Officer (CEO) of Elijah Heart Center (EHC) has requested the accounting firm Huber & Guizot perform an audit of the current budget being used by EHC to reverse the current financial shortfall they are facing. (University of Phoenix, 2012). Elijah Heart Center is an advanced coronary care unit that can accommodate one hundred and forty patients. The financial department of EHC has stated that patient volume and revenues are growing rapidly however the accounting statements clearly show that profitability is dropping. (University of Phoenix, 2012). Elijah Heart Center faces operating with a cash shortfall of almost $2,500,000.00. Mr. Sanchez has requested a two year plan to reverse the current trend and make the hospital profitable again. New equipment is badly needed to continue quality care for the patients as well as an expansion of the current facility to be able to handle the rise in patient volume. (University of Phoenix, 2012). Many factors could have been involved in causing the financial problems that Elijah Heart Center is facing. All hospitals are financially vulnerable, especially in today’s economic situation. Over the years deep funding cuts have been implemented by the government that has reduced the amount hospitals are reimbursed for Medicare and Medicaid patients. Managed Health care systems such as PPO’s and PHC’s have also added to the financial pressure by continuing to discount the payments being received by health care facilities. (University of Phoenix, 2012). After examining the current budget being used by Elijah Heart Center the following recommendations to Mr. Sanchez are made: to minimize cash outflow and maximize the inflow of revenue, the best suggestions are: 1) Reduce benefits being provided to the employees of EHC and 2)
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