Exploring financial sustainability in healthcare managementExploring financial sustainability in healthcare management

Healthcare organisations, like any other business, need to be financially sustainable to provide quality care to their patients. This means being able to generate enough revenue to cover expenses, invest in new technologies, and make necessary upgrades to its facilities. Without financial sustainability, a healthcare organisation may have to cut corners, reduce staff, or even close its doors. Therefore, it is key to understand the sustainable performance of healthcare systems (SPHS).

According to a report titled How can the Healthcare System Deliver Sustainable Performance? A Scoping Review, healthcare spending is growing faster than economic growth across the globe. The challenges facing healthcare systems include an ageing population, which has resulted in an increase in chronic diseases and multimorbidity and increasingly costly new medical technology. It is believed that around 30 per cent of care provided by healthcare systems is low value, owing primarily to administrative costs, bureaucracy, overdiagnosis, overtreatment, or other issues.

Hospitals are a cornerstone of healthcare delivery, accounting for 28.3 per cent of total current health expenditures in Germany, 53.2 per cent in Turkey, and more than 35 per cent in 21 OECD nations in 2017, according to The Association between Hospital Financial Performance and the Quality of Care — A Scoping Review Protocol’ report.

Previously, SPHS was defined solely in terms of financial sustainability. Now it has expanded to include how well the system is accepted by patients and workers, how adaptable and resilient it is in the face of challenges, and how well it can absorb new knowledge and innovations, while keeping financial sustainability its core focus.

SPHS features the creation of acceptable workplace cultures, direct community and consumer involvement, and the use of evidence-based practices and technologies. These emphasise on several factors that contribute to financial sustainability in healthcare organisations. One of the most important is financial management. This involves monitoring revenue streams, controlling expenses, and identifying opportunities for growth. By keeping a close eye on finances, healthcare organisations can ensure that they are operating within their means and maximising their resources.

Another important factor is efficiency. Healthcare organisations that operate efficiently can save money and improve patient outcomes. For example, if a hospital can reduce the time it takes to discharge a patient, it can free up beds for new patients and reduce the overall cost of care. By streamlining processes and eliminating waste, healthcare organisations can operate more efficiently and save money.

Technology is also an important factor in financial sustainability. Healthcare organisations that invest in new technologies such as electronic health records and telemedicine can improve patient care and reduce costs. Electronic health records can further help reduce errors and improve coordination of care, while telemedicine can provide access to care for patients who might not otherwise be able to receive it.

According to the study, Boosting Sustainability in Healthcare Sector through Fintech: Analysing the Moderating Role of Financial and ICT Development, financial institutions are partnering with Fintech organisations to facilitate financing at the individual and company levels. Financial and ICT growth moderates the association between Fintech development and long-term performance within the healthcare realm.

Collaboration and partnerships are also important for financial sustainability. Healthcare organisations can work together to share resources and reduce costs. For example, hospitals can collaborate on purchasing agreements for medical supplies or share expensive diagnostic equipment.

Finally, fundraising and philanthropy can also play a role in financial sustainability. Many healthcare organisations rely on donations from individuals, corporations, and foundations to fund research, purchase equipment, and provide financial assistance to patients. By building strong relationships with donors and community partners, healthcare organisations can ensure that they have the resources they need to continue providing quality care to their patients.

In conclusion, financial sustainability is crucial for healthcare organisations to continue providing quality care to their patients. Proper financial management, efficiency, technology, collaboration, and philanthropy are all important factors in achieving financial sustainability. By focusing on these areas, healthcare organisations can ensure that they have the resources they need to provide the best possible care to their patients.