Health Care Management

The financial pressure points faced by firms in the health care business can be determined by looking at the flow of funds diagram. In this diagram, the health care organization sits in the middle, and as a result acts almost as a conduit or intermediary between different entities. Funds come into the health care organization from third party payers, and go out to suppliers and employees. There are other pressure points as well, however, wherever intermediaries exist.

One such pressure point is with the third party payers. They take in money from patients and employers, and disperse it to health care organizations and to physicians. They earn their profit on the difference between what they take in and what they pay out. This makes the third party payers a key pressure point, since not only do the people that pay them want to pay less, but the...
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