Your proposal report should answer the following prompt: Considering the major forces in healthcare today, what improvements or changes would you propose for your selected organization? How would your proposal add value to the organization, and what impact would your proposal have in terms of the financial and budgetary considerations?
The proposal that you are creating may require you to address these aspects in a different order. Please organize your report in the manner that seems the most logical for your topic.
Specifically, you must address the following rubric criteria:
- IntroductionWhat are the major forces affecting the delivery of healthcare today? Discuss these forces and their corresponding impacts on today’s healthcare environment.Impact of Forces: What healthcare service and delivery opportunities and challenges exist because of the forces discussed above? Define the challenges and opportunities that exist for today’s healthcare leaders.Opportunities: Based on your analysis of the major forces, impacts, and opportunities provided, consider the specific organization that you selected. What opportunities exist for this organization, and how do these opportunities relate to the big-picture view of healthcare?Proposal: What is your proposal for addressing identified issues or improvements within your organization? In other words, what changes are you trying to incorporate in your selected organization?
- Financial and Budgetary ConsiderationsFinancial Statements: What financial statements will you utilize in making your proposal, and how will you use these statements?Proposal Impact: What impact will your proposal have on the organization’s financial statements? Articulate the impact using appropriate terminology.Flexed Versus Fixed: How would your proposal be different if using a flexed budget versus a fixed budget? In other words, how would the use of one type of budget versus the other impact your proposal, and how would your proposal impact the budget? (Evaluate the differences between a fixed and a flexed budget.)
- Proposal JustificationRatio Selection: What ratios will you use to support your proposal and why? Select the ratio or ratios that would be the most appropriate.Ratio Results: Calculate the selected ratios and articulate the results using accurate terminology. What do the results tell you about the viability of your proposal?Short- and Long-Term Impact: Based on your calculations and financial statement analysis, determine the short-term and long-term impact on the organization and the organization’s financials. What is the short-term and long-term financial impact of your proposal for the organization? How can you plan to strategically mitigate the impact on the financials of the company, or how will your proposal help inform strategic planning in the short and long term?
- Closing Statement/ ConclusionAdded Value: What value will your proposal add to the organization? Justify the value or improvement your proposal will add for the organization, in consideration of trends in healthcare.Justification of Proposal: How appropriate is your proposal based on your financial analysis? Justify your proposal based on the financials and budgetary considerations. If you feel that your proposal is not appropriate given your analysis, explain why, with support of your reasoning.
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Project Milestone
In exploring opportunities for the Cleveland Clinic, a key focus for the capital budget
proposal revolves around enhancing medical technology and infrastructure. The clinic’s
commitment to innovation and medical breakthroughs positions it to leverage opportunities in
acquiring state-of-the-art medical equipment (Ernst & Young 2022). Investment in advanced
diagnostic tools, treatment technologies, and information systems aligns with the clinic’s
reputation for cutting-edge healthcare services. This strategic capital expenditure can
significantly improve patient care, foster medical research, and reinforce the institution’s position
as a global leader in healthcare.
The proposal also encompasses facility upgrades and renovations, reflecting the clinic’s
dedication to providing a patient-centric environment. Addressing issues related to facility
improvements aligns with the big-picture view of healthcare, emphasizing the significance of
patient experience and well-designed healthcare spaces (Nordin et al., 2021). By investing in
modernizing and expanding facilities, the Cleveland Clinic can ensure compliance with the
highest safety standards, accommodate technological advancements, and create an atmosphere
conducive to optimal healthcare delivery.
Furthermore, the capital budget proposal includes investments in ongoing training and
development programs for healthcare professionals. Recognizing the dynamic nature of medical
advancements, these programs aim to keep the clinic’s staff abreast of evolving practices and
emerging technologies (Haleem, 2022). This commitment to continuous education aligns with
the broader healthcare landscape. It positions the Cleveland Clinic as an institution focused on
the ongoing development of its workforce to meet the ever-changing healthcare industry needs.
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3
References
Ernst & Young LLP. (2022). Cleveland Clinic Health System Consolidated Financial Statements and
Supplementary Information Years Ended December 31, 2022 and 2021. Cleveland Clinic: Every
Life Deserves World-Class Care. https://my.clevelandclinic.org//scassets/files/org/about/financial-statements/cchs-2022-w-ob-nonob.pdf?la=en
Nordin, S., Swall, A., Anåker, A., von Koch, L., & Elf, M. (2021). Does the physical environment
matter?-A qualitative study of healthcare professionals’ experiences of newly built stroke
units. International Journal of Qualitative Studies on Health and Well-Being, 16(1), 1917880.
Haleem, A., Javaid, M., Singh, R. P., & Suman, R. (2022). Medical 4.0 technologies for healthcare:
Features, capabilities, and applications. Internet of Things and Cyber-Physical Systems, 2, 12-30.
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Draft Proposal for Final Project
Major Forces Affecting the Delivery of Healthcare Today
The delivery of healthcare in today’s world is influenced by several factors as the field
continues to advance in service delivery. The development of technology is one of the most
notable. Incorporating digital health records technology, telemedicine, and digital health records
has yielded profound improvements in patient care and healthcare operations (Senbekov et al.,
2020). This technology allows for improved diagnostic capabilities, remote consultations, and
real-time data sharing. Healthcare executives, however, face difficulties due to the quick speed of
technological advancement, as they need to adjust and make investments in cutting-edge
equipment. Nevertheless, staying current and acclimating to the modifications that are occurring
or may occur is more crucial now than it has ever been. If these reforms are implemented,
healthcare providers would suffer tremendously, with the most significant paying the
implementation burden.
Another factor that influences healthcare delivery is the aging population. Healthcare
institutions face increasing demands in handling chronic illnesses and offering extended care due
to the expanding elderly population. This situation offers healthcare practitioners an opportunity
to specialize in geriatric care. Nevertheless, it also brings challenges in ensuring the accessibility
and affordability of these services. In addition, healthcare policing and regulation impact how
healthcare is delivered to the people. According to (Fording & Patton, 2020). government
policies such as the Affordable Care Act in the US influences the provision of financial service
in healthcare settings. Such regulations create opportunities for innovative care models and
expanded insurance coverage but also pose administrative and financial challenges for healthcare
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leaders. Due to the need to comply with regulations, healthcare firms constantly add full-time
staff members; 25% of these personnel are doctors and nurses (Boggs et al., 2022). Even if some
of these rules do not enhance care, it costs the business more to comprehend them and meet the
requirements for document exertion.
Impact of Forces on Healthcare Service and Delivery
Healthcare leaders today find a range of opportunities at their fingertips. By addressing
the special requirements of elderly patients, these services contribute to raising the standard of
healthcare as a whole. Additionally, the use of contemporary healthcare technologies like
electronic health records, wearable technology like smartwatches, web-enabled eyewear, and
telemedicine helps expand the scope of patient care. It leads to better patient outcomes and
healthcare delivery. In alignment with evolving healthcare policies, healthcare leaders can delve
into innovative care models, like accountable care organizations and bundled payment systems,
which emphasize quality over quantity and refine care strategies (Brown, 2022). Furthermore,
broadening the range of services to meet the growing need for long-term care and the
management of chronic illnesses represents a practical path for healthcare leaders to more
effectively meet the evolving healthcare demands of the populace.
Conversely, the healthcare system poses several challenges that impede its constructive
influence on society. For instance, technological developments have made it possible to provide
remote, individualized care, which has improved patient outcomes and experiences. However, in
order to guarantee the security of patient information, healthcare executives must manage the
complexities of data privacy and cybersecurity. Furthermore, cost is a significant factor
influencing how healthcare is delivered. More people now have access to reasonably priced
healthcare due to the Affordable Care Act (ACA) medical coverage initiative (Collins et al.,
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2022). Even though people have access to technological improvements to address healthcare
requirements, there is still greater spending on healthcare than most other nations in the globe.
4
References
Boggs, K. M., Sullivan, A. F., Espinola, J. A., Gao, J., & Camargo, C. A. (2022). Evaluation of
the American Hospital Association annual survey for health services research in
emergency medicine. Journal of the American College of Emergency Physicians Open,
3(2). https://doi.org/10.1002/emp2.12704
Collins, S. R., Schoen, C. S., Radley, D. C., & Hayes, S. L. (2022). Access to primary and
preventive health care across states prior to the coverage expansions of the Affordable
Care Act. https://doi.org/10.15868/socialsector.25005
Brown, C. J. (2022). Rural Hospital Sustainability: Meeting the Challenges of Healthcare
Transformation and Strategies for Effective Implementation: Perspectives of Rural
Healthcare Leaders (Doctoral dissertation, The University of North Carolina at Chapel
Hill).
Fording, R. C., & Patton, D. (2020). The Affordable Care Act and the Diffusion of Policy
Feedback: The Case of Medicaid Work Requirements. RSF: The Russell Sage
Foundation Journal of the Social Sciences, 6(2), 131–153.
1
Financial and Budgetary Considerations
Financial Statements
Financial statements are formal documentation of financial activities and positions within
businesses. These statements offer a comprehensive overview of business organizations’
financial performance and position during a specific time frame (Robinson, 2020). In making my
proposal, I will incorporate an income statement that serves as a brief overview of Cleveland
Clinic’s financial performance during the recent year. Income statements comprise a profit and
loss statement, a balance sheet, and a cash flow statement. I will use it to evaluate the internal
and performance of Cleveland Clinic and provide insights into the organization’s proficiency in
generating profit from clinical operations.
Balance sheets are critical financial documents as they present a snapshot of an
organization’s financial status at a specific moment. They comprehensively reflect three key
elements, including assets, liabilities, and equity (Robinson, 2020). Assets represent the
resources owned by the organization, liabilities denote the obligations and debts owed by the
organization, and equity constitutes the owners’ residual interest in the company’s assets after
subtracting liabilities. Therefore, I will use the balance sheet to provide a concise overview of the
company’s financial health at a specific point, facilitating informed decision-making. I will also
use it to evaluate financial leverage by examining the balance between assets and liabilities and
offer valuable insights into the Cleveland Clinic’s overall financial structure.
According to Mouzas and Bauer (2022), cash flow statements are essential in monitoring
cash movement within an organization over a specific timeframe. They are used in classifying
activities into three main categories, including operating, investing, and financing. Operating
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activities involve cash dealings related to essential business operations, such as revenue and
expenses. Investing actions encompass money transactions linked with long-term assets, like
equipment and property, through acquisitions. Furthermore, financing activities involve cash
transactions with the organization’s owners and creditors, including debt and equity transaction
sales (Mouzas & Bauer, 2022). Therefore, I will use cash flow statements to perform a Liquidity
Assessment, revealing the Cleveland clinic’s capability to meet short-term obligations. I will also
use it to gain insights into investments and financing, which would provide an overview of how
the company strategically invests in operations and secures capital for sustained growth.
Proposal Impact
The proposed capital budget is intended to have positive impacts on Cleveland Clinic. On
the Income Statement, increased capital expenditures are anticipated to elevate the depreciation
of expenses, potentially influencing net income. Instantaneously, the balance sheet is expected to
change with the increase in assets, including medical equipment and facilities, and a potential
rise in liabilities if the funding involves debt. While the initial capital outflows for expenditures
may momentarily impact Cash Flow, the proposal foresees long-term advantages that enhance
operational efficiency and contribute to sustained cash generation.
Flexed Versus Fixed
In the financial realm, the distinction between fixed and flexible budgets holds critical
implications, especially in the context of the proposed capital budget. A fixed budget
presupposes unchanging activity levels, providing a straightforward assessment of the proposal’s
impact. However, its limitation lies in the neglect of variable shifts in activity levels, a crucial
aspect in dynamic environments like healthcare where patient volumes fluctuate. On the other
hand, flexed budgets dynamically accommodate changes in activity levels, aligning more
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realistically with the healthcare landscape (Draheim, 2021). Given the inherent variability in
patient volumes, a flexed budget proves essential for accurately reflecting the proposal’s impact,
offering a clear understanding of how financial dynamics may evolve in response to varying
levels of operational activity. In the healthcare sector, where adaptability is paramount, a Flexed
Budget emerges as a more adept tool for comprehensive financial planning and analysis.
Proposal Justification
Ratio Selection
The selection of specific financial ratios is essential for a comprehensive assessment of
the proposed capital budget’s impact on the Cleveland Clinic. The ratios that I have selected that
would be the most appropriate for my proposal include Return on Investment and Current Ratio.
According to Saputra (2022), the Return on Investment (ROI) serves as a critical metric, offering
insights into the profitability of the proposed investments. Therefore, calculating the ROI will
enable a quantifiable evaluation of the returns generated relative to the costs incurred, aiding in
informed decision-making. The Current Ratio would provide snapshots of the clinic’s short-term
liquidity and capacity to meet immediate obligations. These selected ratios offer a better
understanding of the financial implications, profitability, risk exposure, and liquidity relevant to
the proposed capital budget.
Ratio Results
ROI Calculation: (Net Profit / Total Investment) * 100.
Total investment = $4,468,850
Net profit =Total revenue – Total expenses
Total expenses= $6,687,178
Total revenue=$15,177,317
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Net profit= $8,490,139
ROI= (8,490,139 / 4,468,850) * 100
ROI=189.98%
Current Ratio Calculation: Current Assets / Current Liabilities.
Current liabilities =$2,828,321
Current Assets= $3,315,324
The results from the Return on Investment (ROI) calculation have turned out to be
189.98%, which is a positive indication of the financially viable proposal. A positive ROI means
that the gains generated from the proposed investments exceed the costs incurred, reflecting a
robust potential for profitability (Saputra, 2022).
The Current Ratio calculation reading is 1.172. this reinforces the viability of the
proposal, particularly in the short term. The ratio is above 1, demonstrating good short-term
financial health and indicating that the clinic has sufficient current assets to cover its immediate
obligations, including current liabilities (Saputra, 2022). This implies a sound liquidity position,
providing confidence in the Clinical capability of meeting its short-term financial commitments.
Short- and Long-Term Impact
In the short term, the clinic may experience a boost in cash outflows due to the capital
investments, potentially impacting liquidity. However, these outflows are strategic and directed
towards improved facilities and advanced technology, which can enhance the overall patient
experience and attract a greater number of patients (Sirnelä, 2021). While there might be a
temporary strain on liquidity, the high Current Ratio suggests that the clinic possesses the
financial strength to meet immediate obligations, mitigating short-term financial risks.
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Over the long term, the capital budget is anticipated to increase operational efficiency,
leading to enhanced patient care and the potential for sustained revenue growth. Infusing modern
facilities and cutting-edge technology will likely attract more patients, foster a positive
reputation, and contribute to long-term financial stability (Sirnelä, 2021). Continuous training
programs for staff ensure adaptability to evolving healthcare practices, supporting the clinic’s
commitment to innovation and maintaining a high standard of care. The positive ROI signifies
that the proposed investments are aligned with sustainable profitability, positioning the
organization for long-term success.
Strategic Mitigation and Planning:
According to Tummalapudi (2021), careful cash flow management and phased
implementation of capital projects can be considered to strategically mitigate any potential shortterm financial strains. Prioritizing investments based on immediate impact and revenue
generation potential can help balance short-term cash outflows. Moreover, aligning the proposed
budget with the organization’s broader strategic goals ensures that each expenditure contributes
to the long-term vision.
The proposal also informs strategic planning by aligning with the clinic’s commitment to
innovation and patient-centric care. The capital investments position the organization for future
growth, technological adaptation, and excellence in healthcare delivery (Tummalapudi, 2021).
Continuous monitoring of financial ratios, like the Current Ratio and ROI, will be crucial for
ongoing financial health assessment and adjustment of strategies as needed.
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References
Draheim, D. (2021). Towards Turning Ideal Management Accounting Practice into Reality with
Total Budgeting and the Interactive Budget Warehouse.
Mouzas, S., & Bauer, F. (2022). Rethinking business performance in global value chains. Journal
of Business Research, 144, 679-689.
Robinson, T. R. (2020). International financial statement analysis. John Wiley & Sons.
Saputra, F. (2022). Analysis Effect Return on Assets (ROA), Return on Equity (ROE), and Price
Earning Ratio (PER) on Stock Prices of Coal Companies in the Indonesia Stock
Exchange (IDX) Period 2018-2021. Dinasti International Journal of Economics, Finance
& Accounting, 3(1), 82–94.\
Sirnelä, L. (2021). Measuring organizational performance for profitability and operational
success: the case of a private health care organization.
Tummalapudi, M., Killingsworth, J., Harper, C., & Mehaney, M. (2021). US construction
industry managerial strategies for economic recession and recovery: A Delphi study.
Journal of Construction Engineering and Management, 147(11), 04021146.
1
Cleveland Clinic
Company’s website: https://my.clevelandclinic.org
Consolidated Financial statements: https://my.clevelandclinic.org//scassets/files/org/about/financial-statements/2q-2023-interim-unaudited-fs-mda.pdf?la=en,
Financial statements:https://my.clevelandclinic.org/-/scassets/files/org/about/financialstatements/cchs-2022-w-ob-nonob.pdf?la=en
The healthcare organization that I have chosen is Cleveland Clinic. Cleveland Clinic, a
renowned nonprofit healthcare organization with a network of clinics, hospitals, and other
healthcare facilities, is based in Cleveland, Ohio. The organization is well-known for its
multispecialty education sites, research, and superior hospital and clinical services (Cleveland
Clinic, 2023). Cleveland offers a variety of medical disciplines, including neurology, oncology,
and cardiology. Furthermore, it also offers medical innovation and outstanding patient care in the
healthcare field.
According to Ernst & Young LLP. (2022), Cleveland has been pioneered by many
successful medical breakthroughs, including being the first to perform a successful face
transplant and coronary artery bypass surgery. The organization has also been regarded and
ranked as a performing hospital in performing heart, cardiology, and vascular surgery in the past
twenty years. It has a children’s clinic where it conducts pediatric operations and is ranked the
best on the honor roll. Since its foundation, Cleveland Clinic has transformed the world of
medicine through extensive innovations and research they conduct and share with the world.
2
Among many successful breakthroughs, other Cleveland innovations include the discovery that
damaged brain cells can regenerate, and they were the first in the world to conduct deep brain
stimulation surgery to restore brain functions after stroke. Recently, Cleveland Clinic has
developed a vaccine that can be used to prevent triple-negative breast cancer (Orsini et al., 2020).
In addition, they discovered serotonin, a neurotransmitter that affects the body and moods, and
brain mapping techniques that pinpoint epileptic seizures. They have made diagnosing and
treating the world’s complex medical problems possible.
3
References
Cleveland Clinic. (2023). We’re here when you need us — for every care in the world.
https://my.clevelandclinic.org/
Ernst & Young LLP. (2022). Cleveland Clinic Health System Consolidated Financial Statements
and Supplementary Information Years Ended December 31, 2022 and 2021. Cleveland
Clinic: Every Life Deserves World-Class Care. https://my.clevelandclinic.org//scassets/files/org/about/financial-statements/cchs-2022-w-ob-nonob.pdf?la=en
Orsini, E., Mireles-Cabodevila, E., Ashton, R., Khouli, H., & Chaisson, N. (2020). Lessons on
outbreak preparedness from the Cleveland Clinic. Chest, 158(5), 2090-2096.
1
Cleveland Clinic
Students Name
Institutional Affiliation
Professors Name
Course Name
Date
2
Cleveland Clinic
Company’s website: https://my.clevelandclinic.org
Consolidated Financial statements: https://my.clevelandclinic.org//scassets/files/org/about/financial-statements/2q-2023-interim-unaudited-fs-mda.pdf?la=en,
Financial statements:https://my.clevelandclinic.org/-/scassets/files/org/about/financialstatements/cchs-2022-w-ob-nonob.pdf?la=en
The healthcare organization that I have chosen is Cleveland Clinic. Cleveland Clinic, a
renowned nonprofit healthcare organization with a network of clinics, hospitals, and other
healthcare facilities, is based in Cleveland, Ohio. The organization is well-known for its
multispecialty education sites, research, and superior hospital and clinical services (Cleveland
Clinic, 2023). Cleveland offers a variety of medical disciplines, including neurology, oncology,
and cardiology. Furthermore, it also offers medical innovation and outstanding patient care in the
healthcare field.
According to Ernst & Young LLP. (2022), Cleveland has been pioneered by many
successful medical breakthroughs, including being the first to perform a successful face
transplant and coronary artery bypass surgery. The organization has also been regarded and
ranked as a performing hospital in performing heart, cardiology, and vascular surgery in the past
twenty years. It has a children’s clinic where it conducts pediatric operations and is ranked the
best on the honor roll. Since its foundation, Cleveland Clinic has transformed the world of
medicine through extensive innovations and research they conduct and share with the world.
Among many successful breakthroughs, other Cleveland innovations include the discovery that
damaged brain cells can regenerate, and they were the first in the world to conduct deep brain
stimulation surgery to restore brain functions after stroke. Recently, Cleveland Clinic has
3
developed a vaccine that can be used to prevent triple-negative breast cancer (Orsini et al., 2020).
In addition, they discovered serotonin, a neurotransmitter that affects the body and moods, and
brain mapping techniques that pinpoint epileptic seizures. They have made diagnosing and
treating the world’s complex medical problems possible.
4
References
Cleveland Clinic. (2023). We’re here when you need us — for every care in the world.
https://my.clevelandclinic.org/
Ernst & Young LLP. (2022). Cleveland Clinic Health System Consolidated Financial Statements
and Supplementary Information Years Ended December 31, 2022 and 2021. Cleveland
Clinic: Every Life Deserves World-Class Care. https://my.clevelandclinic.org//scassets/files/org/about/financial-statements/cchs-2022-w-ob-nonob.pdf?la=en
Orsini, E., Mireles-Cabodevila, E., Ashton, R., Khouli, H., & Chaisson, N. (2020). Lessons on
outbreak preparedness from the Cleveland Clinic. Chest, 158(5), 2090-2096.
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