Hcm 345 Milestone One

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HCM 345 Milestone One
Student’s Name
Instructor’s Name
Institutional Affiliation
Date
2
Part 1
Reimbursement and the Revenue Cycle
Describe what reimbursement means to a healthcare organization. What would happen
if services were provided to patients but no payments were received for those services?
To begin with, reimbursement refers to the compensation received by the healthcare
facilities for the services rendered to the patients (Dang et al., 2021). In other words,
reimbursement is a financial transaction between the payers of healthcare services such as
insurance providers or government agencies. Reimbursement seeks to achieve the following
objectives; revenue generation, cost recovery, budgetary planning, incentivizes the providers
of healthcare services among others. Firstly, the primary goal of reimbursement is to generate
revenue to enable the healthcare facility meet its financial obligations. Such financial
obligations include paying staff, purchasing health machines and equipment, conducting
research to name just a few.
Secondly, reimbursement helps the healthcare organization to recover the cost
associated with provision of healthcare services. Undoubtedly, the facility incurs some costs
in procuring medical equipment, drugs among other things that are directly spent by the
patients. Thirdly, reimbursement enhances effective budgetary planning. This is because the
organization is able to predict future cash inflows and thus plan accordingly (AbbasiFeinberg, …
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