Cost control policy that is in effect at your organization. In this assessment, you will research a cost control policy that is in effect at your organization or one that you research.
In doing so, you will detail the impact this policy has on the organization, its unintended consequences, and a possible alternative.
All healthcare organizations must be aware of cost controls, regardless of nonprofit or for-profit status.
Managing costs at all levels of the organization affects the bottom line, which has a direct effect on all aspects of the organization. This assessment is designed to help you analyze why organizational policies are put in place. In addition, it will help you understand the role of operations in a healthcare setting, which is to ensure a high quality of care is maintained across all departments.
You are working in an organization that is conducting an audit of a determined number of policies to determine if they are effective in their current state or if improvements and updates are needed (and alternatives need to be created).
Health care organization could be a hospital system like Banner Health or a skilled nursing facility located in your town, or a surgical outpatient clinic. You should choose one facility and pick one policy and all write a cohesive paper/power point about it. You should NOT choose a federal generic broad policy like Obama Care/Affordable Care Act or Medicare or Medicaid.
Your first step is to find a policy at a healthcare organization related to cost controls. Include the following in your report.
Summarize the details of the policy:
1. When was the policy put in place?
2. Was it adopted system-wide, in one department, or multiple departments?
3. What does the policy address?
4. What is the potential impact of not following the policy at the organizational level? Unit level? Individual level?
Explain how the policy impacts fiscal aspects of the organization:
1. How does the policy act as a cost control?
Describe how the policy impacts the quality of patient care:
1. Does the policy improve efficiency?
2. Are the goals to improve care and reduce costs?
Explore the unintended consequences:
1. What secondary impacts does the policy have on the organization? Unit? Staff? Patient?
2. Does the policy need revision?
Suggest alternatives to the policy:
1. In your opinion, is the policy the best way to address the issue? Support your position by explaining why or why not.
Cite at least 3 evidence-based, peer-reviewed sources published within the last 5 years to support your position(s).
Cost control is the method of identifying and managing business expenses and financial data so they can be analyzed and lowered where possible. Collecting costs in a consolidated format allows organizations to make more accurate and informed projections, know where they can minimize costs, and identify areas of overspending.
This is why cost control and vendor management often go hand-in-hand, since optimizing how you interact with vendors can produce significant cost savings for your business. You may look to streamline contract renegotiations to lock in favorable prices, work to build sustainable relationships with vendors and customers, and create partnerships that complement both businesses.
After all—the goal of cost control is to give your company a powerful framework that’s designed to improve visibility and keep you in control of your costs.
Project schedules can be divided up into components and steps, and most managers allocate the overall budget to each part according to its needs. Making an effort to control costs helps:
Having a proper budget in place directly impacts critical decisions like what new employees to hire, what features to include, and how much time should be spent on each part of the job. A well-kept budget that follows and organization’s business rules essentially shows you where the project is going and how it will end up. Project performance in this case is directly tied to its budgeting.
It’s no secret that cost management and control are data and analysis-heavy fields, and it’s no surprise then why software developers have found an application for automation here. Software-based management optimizes the process in multiple ways:
You may hear terms like “cost management” and “cost control” used interchangeably. While they are heavily related and equally important, there’s a subtle distinction that might be worth knowing whenever you’re talking with your teams about them.
Cost management primarily deals with all the processes regarding budget planning, including estimation, financing, and funding. To manage costs requires attention from the planning phases to final completion, ensuring the project as a whole stays within approved budgetary limits. A critical step of cost management is making both indirect and direct costs more predictable through strong accountability, control, and information gathering.
By comparison, cost control mainly deals with projects during their execution phase and relies on cost management practices for success. Having planners work with each other to achieve proper budgeting is how cost controls work.
When talking about cost controls, business owners first put down a “baseline” and then measure the variance between it and the actual cost, taking corrective action to minimize unexpected spikes.