Principal principles: Critical accounting and financial concepts for healthcare leaders

by MGMA March 12, 2020

Financial acumen is deeply interwoven in the provision of healthcare, impacting every healthcare leader and how they lead their practice and care for patients. Healthcare leaders can be embedded in a variety of private, academic/academic-affiliated and company-based organizations, which range from small to large and single specialty to multispecialty. Issues requiring financial acumen include daily operations, brick-and-mortar expansion, acquisition of community practices, potential mergers and partnerships with implications for technical and professional revenues and expense management. Significant expenditures on staff and expensive equipment are oftentimes involved.

Financial competence is a key differentiator for successful physician and administrative leader partnerships in today’s unpredictable and ever-changing healthcare landscape. Volatile and uncertain environments compel healthcare leaders to seek out and host conversations on methods to become more financially competent. Leaders are discovering the need to be well versed in accounting and finance as it relates to their healthcare practice. To encourage these conversations and to develop financially competent physician and administrator leaders, organizations can embed financial accountability and thought-provoking cost analysis experiences into everyday practice management.

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