MHA 5001, Health Care Financial Management 1
Course Description
Utilizes standard financial tools to manage healthcare organization capital resources. Topics include capital funding,
project management, costing and budgetary methods, capital formation, and infrastructure investment strategies.
Course Textbook
Finkler, S. A., Purtell, R. M., Calabrese, T. D., & Smith, D. L. (2013). Financial management for public, health, and not-forprofit
organizations (4th ed.). Upper Saddle River, NJ: Prentice Hall.
Course Learning Outcomes
Upon completion of this course, students should be able to:
1. Describe key methodologies for the practical application of financial management in healthcare organizations.
2. Explain variable and fixed costs, direct and indirect costs, and cost accounting principles for healthcare services
or processes.
3. Compare and contrast the external financing options that are available for healthcare organizations today.
4. Describe the financial approach to strategic healthcare planning, considering how managers can participate most
effectively in this process.
5. Discuss change, innovation, and learning as they relate to the financial management of healthcare organizations.
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6. Discuss the future of healthcare financial management in the United States.
Credits
Upon completion of this course, the students will earn three (3) hours of college credit.
Course Structure
1. Study Guide: Each unit contains a Study Guide that provides students with the learning outcomes, unit lesson,
required reading assignments, and supplemental resources.
2. Learning Outcomes: Each unit contains Learning Outcomes that specify the measurable skills and knowledge
students should gain upon completion of the unit.
3. Unit Lesson: Each unit contains a Unit Lesson, which discusses lesson material.
4. Reading Assignments: Each unit contains Reading Assignments from one or more chapters from the textbook.
5. Suggested Reading: Suggested Readings are listed in the Unit VII study guide. Students are encouraged to
read the resources listed if the opportunity arises, but they will not be tested on their knowledge of the Suggested
Readings.
6. Unit Assessments: This course contains five Unit Assessments, one to be completed at the end of Units I, II, IV,
VI, and VII. Assessments are composed of written-response questions.
7. Unit Assignments: Students are required to submit for grading Unit Assignments in Units II, III, IV, V, VII, and
VIII. Specific information and instructions regarding these assignments are provided below. Grading rubrics are
included with each assignment. Specific information about accessing these rubrics is provided below.
8. Ask the Professor: This communication forum provides you with an opportunity to ask your professor general or
course content related questions.
9. Student Break Room: This communication forum allows for casual conversation with your classmates.
MHA 5001, Health Care
Financial Management
Course Syllabus
MHA 5001, Health Care Financial Management 2
CSU Online Library
The CSU Online Library is available to support your courses and programs. The online library includes databases,
journals, e-books, and research guides. These resources are always accessible and can be reached through the library
webpage. To access the library, log into the myCSU Student Portal, and click on “CSU Online Library.” You can also
access the CSU Online Library from the “My Library” button on the course menu for each course in Blackboard.MHA 5001, Health Care Financial Management
The CSU Online Library offers several reference services. E-mail (library@columbiasouthern.edu) and telephone
(1.877.268.8046) assistance is available Monday – Thursday from 8 am to 5 pm and Friday from 8 am to 3 pm. The
library’s chat reference service, Ask a Librarian, is available 24/7; look for the chat box on the online library page.
Librarians can help you develop your research plan or assist you in finding relevant, appropriate, and timely information.
Reference requests can include customized keyword search strategies, links to articles, database help, and other
services.
Unit Assignments
Unit II Homework
Please read the “The DMV” case study on pages 306-307 in your textbook. The questions on pages 307-308 have been
modified. Answer the questions below using the information found in the case study and the required reading. Compile
your answers in a Word document, and upload it in Blackboard.
Answer the following questions:
1. Prepare a monthly operating budget for the DMV for the fiscal year ending August 31, 2014. Determine the
operating surplus and deficit for each month and for the year as a whole. Use one page or worksheet in your
spreadsheet to list all of the base information, and another for the operating budget. (Hint: It may be easier to
prepare the budget if you add a third page or worksheet to calculate the number of transactions each month.)
NOTE: Students may access a 60-day trial version and/or purchase the required Microsoft software at
http://technet.microsoft.com/en-us/evalcenter/jj192782.aspx. The Microsoft trial version can only be downloaded
one time.
2. To what do you attribute the changing surplus/deficit pattern during the year?
3. What would happen to the overall deficit or surplus if the number of vehicles failing inspections increased from
15% to 30%? Keep in mind that vehicles must be re-inspected, so this would also increase the total number of
inspections. Does this give the DMV a reason to make its standards tougher? Is this good policy?
4. Suppose the DMV can decide when to implement the new digitized licensing system.
a. What would happen to the finances of the DMV if the new licenses are implemented at the beginning of
the year and issued throughout the year?
b. What would happen if the new licenses are not implemented at all during the coming year? In either case,
assume the total number of licenses issued for any month does not change. Is that assumption realistic?
How does it affect your results?
5. What other changes would you suggest that might help the DMV’s situation? What are the advantages and
disadvantages of the various suggested changes? Select an approach that you believe is best, create a
worksheet showing the resulting budget, and provide an explanation defending your choice of changes.
Information about accessing the Blackboard Grading Rubric for this assignment is provided below.
Unit III Homework
On pages 153-154 in your course textbook, please complete the following problems: 4-31 through 4-35. Answer the
problems using the information provided from Chapters 1-4 in the course textbook. Compile your answers in a Word
document, and upload it in Blackboard.
4-31. Millbridge Memorial Hospital provides comprehensive physical exams. The charge per exam is $100, while the
variable cost per exam is $65. Thirty percent of the patients who come in for an exam are private pay. They must pay the
MHA 5001, Health Care Financial Management 3
full charge. Seventy percent of the patients are covered by an insurance company that has an agreement with the hospital
that reduces the charge by 20%. The hospital has $210,000 in fixed costs per year. How many exams must the hospital
provide in order to break even?
4-32. The fixed costs of running a fund-raising dinner for Meals for the Homeless are $10,000 and the variable costs are
$75 per attendee. The facility where the event is being held can accommodate 500 people. Answer the following
questions about the event:
1. If Meals charged $275 per ticket, how many people would have to attend the gala for the organization to break
even on the event?
2. If Meals charged $300 per ticket, the contribution margin from each ticket sold would be: __________.
3. If 500 people attend the event, how much does the organization have to charge each attendee to earn a profit of
$100,000? (Assume costs from original problem are still in effect.)
4-33. A Greener World expects to have $15,000 in fixed costs. If its fixed costs do not change but the amount each
marcher raises through pledges declines from $55 to $50 and its variable cost/unit increases from $25 to $30, how much
will its break even quantity increase?
4-34. The Helensville Symphony incurs $3,000,000 of fixed costs each year. The variable cost for each person attending
one of the orchestra’s performances is $24. If the average charge for a ticket to attend a performance of the Helensville
Symphony is $100, how many tickets must it sell each year to break even?
4-35. Millbridge Family Services (MFS) currently operates a foster care program that is fully funded by the state. Changing
government priorities are expected to result in a 20% reduction in its state foster care funding for the upcoming fiscal year.
MFS’s management is considering eliminating the foster care program in the next fiscal year in light of these anticipated
funding cuts. The total foster care program expenses for the upcoming fiscal year is $120,000. The foster care program’s
budgeted expenses include $25,000 of salaries and occupancy costs that are allocated to its program budget from MFS
central administration. These allocated expenses of $25,000 are unavoidable even if the foster care program is
eliminated. What is the total relevant cost that should be considered in making this decision?
Information about accessing the Blackboard Grading Rubric for this assignment is provided below.
Unit IV Research Paper Outline
The research paper in this course gives you the opportunity to study an important healthcare finance problem or
challenge, analyze it in depth, and present your findings in an APA-formatted paper due in Unit VIII. Any topic introduced
in this course may be selected for your paper. It is a good idea to conduct Internet research on potential topics that you
are considering for your research paper before selecting one. You will want to determine that plenty of information is
available online for incorporation into your paper.
In preparing for the research paper, you will submit your research paper outline which will critically analyze issues related
to your topic.
The research paper outline you submit must meet the following requirements:
be at least one page in length (not including the cover and reference pages),
include an original thesis,
describe the approach that you will take to research the subject thesis,
describe key methodologies for the practical application of financial management in healthcare organizations,
discuss the future of healthcare financial management in the United States, and
include five references.
Information about accessing the Blackboard Grading Rubric for this assignment is provided below.
Unit V Homework
On page 251 in your textbook, please complete problems 7-29 through 7-33 listed below for convenience. Compile your
answers in a Word document, and upload it in Blackboard. MHA 5001, Health Care Financial Management
Answer the following problems:
MHA 5001, Health Care Financial Management 4
7-29. Millbridge Hospital buys its supplies in bulk and has recently switched vendors. The first purchase Millbridge made
was for 500 boxes of gauze at $3.46 a box. The purchase had payment terms of 2/15 N/30. Millbridge earns four percent
on its idle cash. Should it take the discount or not? Justify your answer by showing calculations. (Refer to Appendix 7-B to
solve this problem.)
7-30. Meals for the Homeless usually experiences seasonality in its cash balances. In December, contributions from
donors increase its cash balances, and then these balances are used throughout the following year. By the fall, Meals for
the Homeless has a tight cash flow. It has a line of credit with its bank, which allows it to draw up to $500,000 at seven
percent interest per year. During 2013, Meals for the Homeless draws down $135,000 on October 1 and repays it at the
start of business on January 3, 2014—exactly 94 days later. How much should it pay back on January 3, and how much
of that is interest?
7-31. Meals for the Homeless has many sources of income, but they pay Meals very differently. Specifically, Meals has
contracts with the city, county, and state to provide food services. In addition, Meals has contracted with a private
foundation to augment its foods with more healthful options. The city owes Meals $400,000, half of which is current, onequarter
is more than 30 days but less than 61 days old, 15% is between 61 and 90 days old, and the remainder is more
than 91 days old. The county owes Meals $900,000, only one-third of which is current, another one-third is more than 30
days but less than 61 days old, and the remainder is more than 90 days old. The state owes Meals $1.5 million, 40% is
current, 30% is between 30 and 60 days old, 20% is between 61 and 90 days old, and the remainder is more than 91
days old. The foundation owes Meals $150, 000, of which half is current and the other half is more than 30 days but less
than 61 days old. Prepare an accounts-receivable aging schedule for Meals by total dollars and percent.
7-32. Millbridge Hospital receives earned income from several sources: Medicare, Medicaid, private insurance, and selfpay
customers. The federal government owes the hospital $7 million, 60% is current, 30% is between 31 and 61 days old,
and the remaining 10% is between 61 and 90 days old. The state owes the hospital $5 million for Medicaid, 40% of which
is current, 30% is between 31 and 60 days old, 20% is between 61 and 90 days old, and the remainder is more than 91
days old. Private insurance owes the hospital $4 million, half of which is current, 25% is between 31 and 60 days old, and
the remaining percent is more than 91 days old. Self-pay customers owe $1 million, 30% is current, 40% is 31 to 60 days
old, 10% is 61 to 90 days old, and the remainder is more than 91 days old. Prepare an accounts-receivable aging
schedule by total dollars and by percent.
7-33. Millbridge Hospital buys 10,000 boxes of latex gloves every year. Each box costs the hospital $7 dollars. The cost to
place an order for the gloves—which covers the employee staff time, shipping costs, the hospital’s receiving center for
inventorying, for example—is estimated at $50 dollars per order. Carrying costs (for storing the boxes, verifying the
inventory periodically, etc.) are estimated at 50 cents per box per year. Millbridge uses a six percent interest-cost
assumption in its calculations. How many boxes should be ordered at a time? How many orders per year should there be?
What are the total ordering and carrying costs at the EOQ (economic order quantity)? Contrast these costs at the EOQ to
the total cost if all boxes were simply ordered at the start of the year. (Refer to Appendix 7-A to solve this problem.)
Information about accessing the Blackboard Grading Rubric for this assignment is provided below.
Unit VII Homework
Please read “The Stratton Township Park” on pages 308-311 in your course textbook. Complete questions 1-5 listed
below and found on pages 310-311 using the information found in the case study and any of the required reading. MHA 5001, Health Care Financial Management
Compile your answers in a Word document, and upload it in Blackboard.
Question 1: Prepare an annual program budget for the Stratton Township Park including golf operations; the pool;
concerts; other park activities including tours, nature visitors, and general concessions; and administrative costs. Show
the line-item details for each function by natural account and summarize the budget for the park as a whole.
Because of the current fiscal situation, the Stratton Township needs to reduce its operating costs. As usual, the park is on
the list of targeted operations. As the finance director for the township, you have been asked to work with the park’s
manager to explore possible options.
Question 2: Based on the information in the budget, find the break-even green fees for the golf course and the break-even
admissions charges for the pool. You may assume that the volume of users will not change with increases in pricing. You
may also assume that the course will operate for a full 130 days.
a. Do both break even analyses based on the cost of delivering services with and without the allocated management
salaries.
b. Do you think the park can realistically charge these fees to park users? What might the consequences of raising
fees be economically, politically, and in a public relations sense?
MHA 5001, Health Care Financial Management 5
Question 3: The park manager wants to know whether it makes sense to shut down one or more of the operations at the
Stratton Township Park. Determine the impact of shutting down the golf course, the pool, the concert series, and the
tours, and show the overall marginal impact of making each of these changes. Be sure to include all marginal revenues
and all marginal expenses in your calculations.
Question 4: After completing these analyses, the manager has decided to recommend three changes to the Park’s
budget.
First, he plans to increase green fees for golf to $5 above the break-even price excluding allocated management costs
and rounded to the next highest multiple of $.50. Since competitive private clubs in the region cost $100 or more for a
round of golf, he does not believe that an increase in price will result in a decline in the number of golfers using the
course.
Second, he wants to raise pool admission charges to $4.50. Given the demographics of those who use the pool, he
believes that raising prices by $1.00 will result in a 5% drop in attendance.
Third, he wants to eliminate three of the concerts the township had planned for the next year.
Prepare a revised budget for the Stratton Township Park reflecting these changes. Will these budget modifications meet
the township’s goal of reducing the subsidy it would have given to the park in the next fiscal year by 20%?
Question 5: After receiving your analysis of the impact of eliminating the concerts and raising green fees and pool
admission charges, the park manager has asked you to come up with some additional proposals for meeting the
township’s subsidy reduction goal. What would you recommend?
Information about accessing the Blackboard Grading Rubric for this assignment is provided below.
Unit VIII Research Paper
The assignment for Unit VIII is the research paper, which is to be written on the topic that was submitted and approved in
Unit IV of the course.
The research paper must meet the following requirements:
include an original thesis statement,
be at least five pages in length (not including the title page and references page),
include at least 10 references, and
correctly employ APA style formatting.
Information about accessing the Blackboard Grading Rubric for this assignment is provided below.
APA Guidelines. MHA 5001, Health Care Financial Management
The application of the APA writing style shall be practical, functional, and appropriate to each academic level, with the
primary purpose being the documentation (citation) of sources. CSU requires that students use APA style for certain
papers and projects. Students should always carefully read and follow assignment directions and review the associated
grading rubric when available. Students can find CSU’s Citation Guide by clicking here. This document includes examples
and sample papers and provides information on how to contact the CSU Success Center.
MHA 5001, Health Care Financial Management 6
Grading Rubrics
This course utilizes analytic grading rubrics as tools for your professor in assigning grades for all learning activities. Each
rubric serves as a guide that communicates the expectations of the learning activity and describes the criteria for each
level of achievement. In addition, a rubric is a reference tool that lists evaluation criteria and can help you organize your
efforts to meet the requirements of that learning activity. It is imperative for you to familiarize yourself with these rubrics
because these are the primary tools your professor uses for assessing learning activities.
Rubric categories include: (1) Assessment (Written Response) and (2) Assignment. However, it is possible that not all of
the listed rubric types will be used in a single course (e.g., some courses may not have Assessments).
The Assessment (Written Response) rubric can be found embedded in a link within the directions for each Unit
Assessment. However, these rubrics will only be used when written-response questions appear within the Assessment.
Each Assignment type (e.g., article critique, case study, research paper) will have its own rubric. The Assignment rubrics
are built into Blackboard, allowing students to review them prior to beginning the Assignment and again once the
Assignment has been scored. This rubric can be accessed via the Assignment link located within the unit where it is to be
submitted. Students may also access the rubric through the course menu by selecting “Tools” and then “My Grades.” MHA 5001, Health Care Financial Management
Again, it is vitally important for you to become familiar with these rubrics because their application to your
Assessments and Assignments is the method by which your instructor assigns all grades.
Communication Forums
These are non-graded discussion forums that allow you to communicate with your professor and other students.
Participation in these discussion forums is encouraged, but not required. You can access these forums with the buttons in
the Course Menu. Instructions for subscribing/unsubscribing to these forums are provided below.
Once you have completed Unit VIII, you MUST unsubscribe from the forum; otherwise, you will continue to
receive e-mail updates from the forum. You will not be able to unsubscribe after your course end date.
Click here for instructions on how to subscribe/unsubscribe and post to the Communication Forums.
Ask the Professor
This communication forum provides you with an opportunity to ask your professor general or course content questions.
Questions may focus on Blackboard locations of online course components, textbook or course content elaboration,
additional guidance on assessment requirements, or general advice from other students.
Questions that are specific in nature, such as inquiries regarding assessment/assignment grades or personal
accommodation requests, are NOT to be posted on this forum. If you have questions, comments, or concerns of a nonpublic
nature, please feel free to email your professor. Responses to your post will be addressed or emailed by the
professor within 48 hours. MHA 5001, Health Care Financial Management
Before posting, please ensure that you have read all relevant course documentation, including the syllabus,
assessment/assignment instructions, faculty feedback, and other important information.
Student Break Room
This communication forum allows for casual conversation with your classmates. Communication on this forum should
always maintain a standard of appropriateness and respect for your fellow classmates. This forum should NOT be used to
share assessment answers.
MHA 5001, Health Care Financial Management 7
Grading
Assessments (5 @ 7%) = 35%
Homework (4 @ 7%) = 28%
Unit IV Research Paper Outline = 7%
Unit VIII Research Paper = 30%
Total = 100%
Course Schedule/Checklist (PLEASE PRINT)
The following pages contain a printable Course Schedule to assist you through this course. By following this schedule,
you will be assured that you will complete the course within the time allotted.
MHA 5001, Health Care Financial Management 8
MHA 5001, Health Care Financial Management Course Schedule
By following this schedule, you will be assured that you will complete the course within the time allotted. Please keep this
schedule for reference as you progress through your course.
MHA 5001, Health Care Financial Management
Unit I Introduction to Health Care Financial Management
Review: Unit Study Guide
Read: Chapter 1: Introduction to Financial Management
Submit: Assessment
Notes/Goals:
Unit II Planning – Part I
Review: Unit Study Guide
Read: Chapter 2: Planning for Success: Budgeting
Chapter 3: Additional Budgeting Concepts
Submit: Assessment
Homework
Notes/Goals:
Unit III Planning – Part II
Review: Unit Study Guide
Read: Chapter 4: Understanding Costs
Submit: Homework
Notes/Goals:
Unit IV Planning – Part III
Review: Unit Study Guide
Read: Chapter 5: Capital Budgeting
Chapter 6: Long-Term Financing
Submit: Assessment
Research Paper Outline
Notes/Goals:
MHA 5001, Health Care Financial Management 9
MHA 5001, Health Care Financial Management Course Schedule
Unit V Implementing and Controlling Results
Review: Unit Study Guide
Read: Chapter 7: Managing Short-Term Resources and Obligations
Chapter 8: Accountability and Control
Submit: Homework
Notes/Goals:
Unit VI Reporting Results I
Review: Unit Study Guide
Read: Chapter 10: Taking Stock of Where You Are: The Balance Sheet
Chapter 11: Reporting the Results of Operations: The Activity and Cash Flow Statements
Submit: Assessment
Notes/Goals:
Unit VII Reporting Results II
Review: Unit Study Guide
Read:
Chapter 12: Unique Aspects of Accounting for Not-for-Profit and Health Care Organizations
Chapter 13: Unique Aspects of Accounting for State and Local Governments—Part I: The Recording
Process
Chapter 14: Unique Aspects of Accounting for State and Local Governments—Part II: Reporting
Financial Results
Suggested Reading: See Study Guide
Submit: Assessment
Homework
Notes/Goals:
Unit VIII Financial Analysis
Review: Unit Study Guide
Read: Chapter 15: Financial Statement Analysis
Chapter 16: Financial Condition Analysis
Submit: Research Paper
Notes/Goals: MHA 5001, Health Care Financial Management