Healthcare Accounting
Trends in Expenses and Revenue
CIOX Health is an industry leader in health information management. According to the latest financial results, the company generates a whopping $5.3 billion in annual revenue. Specifically, the 2021 financial results show that the company raised 5.3 billion. With 4000 employees, the average annual revenue per employee was estimated to be $1,324,000. The company also receives significant financial boost from private investors. Private equity, which comprises individual investment, stands at $30 million. Looking at the revenue results, CIOX Health performs comparatively better than other industry players. Nonetheless, the different health information companies are generally in the same field as CIOX, even though they do not compete against each other head-to-head.
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Much of CIOX’s revenue goes to fund its primary role, producing health records per the patients’ and hospital requests. In 2018, the company had 2.12 billion pages of health records. Out of these, 1.74 billion pages were requested by hospitals, while physicians requested 381.4 million pages. Apart from the 2.12 billion pages requested by patients, numerous others were invited by ROI firms and designees, bringing the total traffic to 7.1 billion pages (May & Noether, 2019).
Consequently, the lower bound average cost of producing a page of health records is 0.18. The average cost per page against the total number of pages produced (7.1 billion) translates to $1.3 billion, the total expenditure for unlimited page requests (May & Noether, 2019). It is worth noting, however, that this expenditure is essentially an estimate since it is subject to changing market circumstances. This expenditure is too high for an electronic health records (EHR) organization. By industry standards, CIOX Health had predicted that its expenditure would not exceed $773 million, but the results show it exceeds the target (May & Noether, 2019). Such an occurrence can be a pointer to an inefficiently run organization.
Reducing Expenses without Reducing the Quality of Services and Healthcare
One of the most effective strategies to reduce healthcare organization costs is embracing dialogue with frontline service providers. Service providers in an organization like CIOX are mostly IT experts. Therefore, the CEO should invite them to discuss ways to reduce costs. Such a meeting should not only be called when errors are identified, but it should instead be a norm regarding ensuring quality service delivery. These staff should also meet with the head of the compliance department. The ultimate goal is to ensure that the average cost of producing a page of electronic health records per patient reduces significantly.
Also, CIOX Health can partner with other relevant health stakeholders in the digital information market to enhance efficiency and cut costs. An example of a successful partnership with industry peers is when CIOX Health acquired Diameter Health. CIOX aimed to collaborate with the industry’s best to provide comprehensive clinical data. Diameter Health prides itself on producing the best clinical information retrieval. The partnership will go a long way to ensure efficient chart retrievals and actionable clinical data insights. Such a partnership will go a long way in helping the company acquire valuable and actionable clinical data at a relatively lower cost.
Another strategy is to develop measures geared toward improving EHR usability and safety. Currently, there are no universally accepted metrics to enhance the performance of EHR. Therefore, it is hard to set targets for patient safety improvement and correctness of data. Some common errors that have resulted from the lack of performance measurement metrics include medication errors due to inaccurate data and unnecessary alerts on situations that do not require alerting. Fortunately, the National Quality Forum developed a guide that can measure quality (Safdari et al., 2015). Vendors like CIOX will use the guide to ensure it fulfills quality standards while reducing costs. Some of the National Quality Forum recommendations seek to reduce the cost incurred by EHR facilities. Once the guide is implemented, the cost reduction benefits will be of value to hospitals and EHR vendors like CIOX.
Reimbursement Strategy
As healthcare provision transitions from the traditional pay-for-service structure to value-based reimbursement, EHR will play a key role in achieving the goal. One way to improve value-based reimbursement is through leveraging electronic data visibility (Conrad et al., 2014). Hospitals can use the EHR to enhance delivery since it reduces the chance of medical errors and ensures high quality. Also, CIOX can leverage its capabilities to collect data from a wide range of sources; as the number of data increases, analytics opportunities that have the potential to reduce the cost of healthcare significantly will emerge. By taking advantage of digitally available medical sources and using automation, time waits among patients will be reduced considerably. Also, the strategy will go a long way to ensure cost savings since the inconveniences of pen and paper are no longer there.
Another strategy to enhance reimbursement is including a broad spectrum of patient treatment records beyond clinical records (Conrad et al., 2014). The medical records hosted at CIOX directly contribute to reimbursement opportunities for a patient. Firstly, incorporating comprehensive data records can provide the doctor or physician with critical information about a patient that may go unnoticed. For instance, EHR will give vital insights if an unconscious patient reports to a hospital. The EHR system updates healthcare providers if a patient is allergic to some medication. Besides, CIOX’s EHR platform should host more than mere clinical patient records but include a multidimensional patient treatment spectrum. Such an approach will prevent healthcare providers from giving patients costly medications they must pay for. The model also prevents unscrupulous doctors from providing care a patient does not need to make money. With comprehensive CIOX records, doctors who give patients the wrong biological medicines and blood transfusions will be held accountable.
Subsequently, as healthcare providers adopt EHR, they must be mindful that relying on the data alone is insufficient. That calls for the incorporation of data from other multiple sources. For instance, population-wide data offers critical insights that improve the quality of care and provide population-specific recommendations for health improvement. Such recommendations could be a game-changer as some seek to attain the best healthcare for the population at the lowest possible cost. Using various sources and practicing budgeting and financial analytics will be helpful.
Using Financial Performance to Build a Brand
Notably, branding seeks to influence people’s perception of a brand to influence them to buy services or products from a company. Also, branding aims to influence a buyer’s purchasing decision by providing a gratifying experience. As a healthcare organization, CIOX Health can rely on its exemplary financial performance to influence hospitals and other healthcare stakeholders to use their electronic health records.
One way CIOX can use its financial performance to brand is by adopting approaches that aim to impact the customer (Dorfleitner et al., 2019). In this case, the customers are the health facilities that seek to acquire records. CIOX Health can leverage its strong financial capabilities to make changes that impact the delivery of its services. For instance, the company can use its resources to update its system or get a new one. Occasionally, some patients complain that their records take too long to show, leading to poor patient treatment outcomes. By investing in stable and up-to-date software, the company will enable patients to access their health records seamlessly. To that end, hospitals and other health institutions that use CIOX’s records will see the reliability of their new system and patronize them even more.
Another aspect of financial performance in branding is to bolster investors’ confidence in a brand (Dorfleitner et al., 2019). As mentioned earlier, CIOX’s private equity stands at $30 million. Besides, the organization gets funding from fundraisings and donations from people of goodwill. Such investors and contributors cannot make financial commitments if the organization performs poorly. While investors expect investment returns, contributors also expect their money to impact the community positively. Therefore, transparent financial management and financial performance improvement will bolster their confidence.
References
Conrad, d. A., Grembowski, d., Hernandez, s. E., Lau, b., & Marcus-Smith, m. (2014). Emerging Lessons From Regional and State Innovation in Value-Based Payment Reform: Balancing Collaboration and Disruptive Innovation. Milbank Quarterly, 92(3), 568–623. https://doi.org/10.1111/1468-0009.12078
Dorfleitner, G., Rößle, F., & Lesser, K. (2019). The financial performance of the most valuable brands: A global empirical investigation. Heliyon, 5(4), e01433. https://doi.org/10.1016/j.heliyon.2019.e01433
May, S., & Noether, M. (2019). To implement specific provisions of the 21st Century Cures Act concerning “Interoperability, Information Blocking, and the ONC Health IT Certification Program. The Office of the National Coordinator for Health Information Technology (ONC).
Safdari, R., Ghazisaeidi, M., & Jebraeily, M. (2015). Electronic Health Records: Critical Success Factors in Implementation. Acta Informatica Medica, 23(2), 102. https://doi.org/10.5455/aim.2015.23.102-104
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Question 
A good financial strategy can constantly be improved. Knowing your organization’s finances provides the leverage to make decisions that affect the outlook and goals of the company. This assignment allows you to examine company practices from a financial lens, which provides insight into what drives financial decisions for a healthcare system.
Healthcare Accounting
Obtain a recent financial statement for your organization detailing expenses and revenues (This can be from within the last year. You may need to work with your supervisor to obtain a financial statement.).
Note: Discuss a financial statement with your faculty member if you cannot access it.
Write a 1,225- 1,550-word report on your organization’s significant expenses and revenue trends. Include the following points:
Analyze any trends in expenses and revenue that you see. Are they on target to meet budget goals?
How can your organization contain or reduce expenses without damaging services and quality of care?
Can your organization’s reimbursement strategy be improved to increase revenue? If so, what would it be, and how would it be implemented?
How can your organization use its financial performance to build its brand?
Cite any references to support your assignment.
Format your citations according to APA guidelines.