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Financial Strategy for Rosewater Hospital

Rosewater Hospital faces financial limitations due to high operating costs and a barely sufficient 58% patient admission rate. It seeks to align revenues with expenses and increase admissions. Two alternatives are considered: 1) reconstruct idle beds into more economical wards or 2) implement firmer collection policies and early payment discounts. Based on risk, costs, benefits and ease of implementation, option 2 is recommended. The hospital should also evaluate expenses, especially utilities, to determine savings from option 1. An action plan is proposed to form committees, finance and implement the project over 6-12 months, with evaluation.

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Lester Sanchez
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661 views2 pages

Financial Strategy for Rosewater Hospital

Rosewater Hospital faces financial limitations due to high operating costs and a barely sufficient 58% patient admission rate. It seeks to align revenues with expenses and increase admissions. Two alternatives are considered: 1) reconstruct idle beds into more economical wards or 2) implement firmer collection policies and early payment discounts. Based on risk, costs, benefits and ease of implementation, option 2 is recommended. The hospital should also evaluate expenses, especially utilities, to determine savings from option 1. An action plan is proposed to form committees, finance and implement the project over 6-12 months, with evaluation.

Uploaded by

Lester Sanchez
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Strategy Case: Rosewater Hospital

Rosewater Hospital is a medium-sized facility that offers patients medical services and other treatment
services. It was formed in Manila by a group of practicing physicians who came together to serve the
city and the ill through medical treatment, counseling, and other means of medical intervention.
With a 58 percent admission rate, Rosewater Hospital faces high electric bills, since both rooms are
air-conditioned. Their employees' pensions and benefits are fixed expenses that remain constant
regardless of the number of patients enrolled. Rosewater Hospital is required by statute to admit any
patient regardless of ability to pay the deposit.
Title of the case: Rosewater Hospital
Time Context: May 2021
Perspective: Consultant to the chief executive
Central Issue: Addressing the financial limitations of the hospital as to continue the institution’s
operations due to the barely sufficient admission rate.
Statement of Objective:
1. To align financial inflows of the institution to the outflows
2. To increase the admission rate of the hospital
Areas of Consideration:
1. The Hospital is compelled by the law to admit a patient even without a deposit payment
2. Fixed cost on the wages and salaries of the employment regardless to the number of patients
admitted
Alternative Courses of Action:
1. Reconstruct the idle beds into an economic friendly wards
2. Firmer collection of payments and implement discount scheme for early payments
Decision Matrix
Variables Alternatives
Reconstruct the idle beds into Firmer collection of payments and
an economic friendly wards implement discount scheme for early
payments
Risk 2 5
Costs 1 3
Benefits 5 2
Ease of implementation 4 3
Total 12 13 (highest)

Conclusions: The stressing factor of the institution is the constant high costs that the hospital is
incurring with barely sufficient financing due to the unpredictable admission of patients which is the
main source of income.
Recommendations: Rosewater hospital should reassess the expenses especially utilities to
determine the economic benefits that the institution will have if the first alternative will be implemented.

Action Plan:
Activities Objectives Division Persons Costs Time
Responsibl
e
Formation of To forms team that are Head Committee Php300,000 3 weeks
committees assigned to specific task Project head
of the project Committee
implementation
Financing of To support the project Project Committee Php500,000 3 months
the project economically Financing head
Construction To implement fully the Monitoring Committee Php5,000,000 6 months
project Committee head
Evaluation of To have feedbacks on Head Committee Php100,000 2 weeks
the project how effectively the project Project head
has solved the problem Committee

Gantt chart 2020

Activities Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
Formation of x x x x x x X
committees
Financing of the x x x x x x X
project
Construction x x x x x
Evaluation of the x x x x x x x x x x x
project

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