In a recent newsletter we reviewed the 5 key components of a successful financial analysis. Following these can create nearly overnight revenue increases with little to no additional expense. In todays economic situation where we all have to do more with less I thought these ideas may be of interest. Let’s discuss the essential components of a financial analysis.
Essential Components of a Financial Analysis
Getting Paid For What You Do
It sounds simple but “revenue leaks” can cause an organization to lose valuable capital. A thorough review of the organization’s service to payment operations can identify these leaks and ensure that they do not continue.
The saying goes “cash is king” and cash is the life blood of any organization. A solid financial review needs to include the identification of all revenue sources and the setting of benchmarks at all levels of the organization including service contracts, payers, and grants.
If your organization needs to “fund its mission” or “create shareholder value” a critical component of a financial review is to evaluate the expenses required to generate that revenue. This review will allow organizations to identify programs, services, and offices that bring value to the organization.
Do you know which payer pays within 30, 60, 90 days or hardly ever? Do you know the total cost to your organization related to the submission of claims? The answers to these questions are critical to all organizations. Understanding your payer aging can stabilize cash flow and increase both the top and bottom line.
Brian Johnson BHM’s SVP of Finanace and Claims Operations stated “Few things are more vital to the success of an organization than a financial analysis”
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