Gapenski's Healthcare Finance: An Introduction to Accounting and Financial Management, Seventh Edition

  • 15h 23m
  • Kristin L. Reiter, Paula H. Song
  • Health Administration Press
  • 2021

Gapenski’s Healthcare Finance: An Introduction to Accounting and Financial Management explores how healthcare organizations manage financial operations to optimally provide patient care. This significantly revised edition of one of Health Administration Press’s best-selling books introduces the key foundational elements of healthcare finance, including both accounting and financial management. Numerous examples throughout showcase how healthcare finance is practiced in a variety of organizations, including hospitals, medical practices, clinics, home health agencies, nursing homes, and managed care organizations. Authors Kristin L. Reiter and Paula H. Song present the financial management and accounting concepts that are most critical to managerial decision-making. They emphasize not only financial theory and principles but also practical tools healthcare managers can use to make the crucial decisions that promote the financial well-being of their organization.

Gapenski’s Healthcare Finance examines the current financial environment in which providers operate, with an emphasis on health system design, healthcare insurance, and reimbursement methodologies. Dates, exhibits, references, and resources have been updated throughout. All examples and financial statements reflect current accounting and reporting standards. Extensive updates and content new to this seventh edition include:

  • A discussion of health reform that reflects the current status of the Affordable Care Act
  • Information on the field’s increasing focus on social determinants of health
  • Tax rates and examples that reflect the effects of the Tax Cuts and Jobs Act
  • A discussion of Medicaid expansion and health insurance exchanges
  • Coverage of the implications of value-based payment for the revenue cycle
  • Substantial reorganization of the financial accounting chapters to orient students to financial accounting before the book’s coverage of the income statement, statement of changes in equity, the balance sheet, and the statement of cash flows
  • A new chapter supplement provides expanded analysis of the double-entry accounting system
  • Amendments to the financial accounting conceptual framework by the Financial Accounting Standards Board
  • Better differentiation of risk measures of realized vs. expected return distributions

In a dynamic environment, healthcare leaders need to practice good financial decision-making for the health of their patients and the financial stability of their organization. From this book, current and future managers will understand the finance problems provider organizations face and how best to solve them.

About the Author

Kristin L. Reiter, PhD, is professor and associate chair in the Department of Health Policy and Management in the Gillings School of Global Public Health, and a research fellow in the Cecil G. Sheps Center for Health Services Research, both at the University of North Carolina at Chapel Hill.

She received a bachelor’s degree in accounting from Northern Illinois University. She also earned a master’s degree in applied economics and a doctorate in health services organization and policy, with a concentration in corporate finance, from the University of Michigan. Prior to joining academia, she worked in public accounting, serving not-for-profits and clients in the insurance industry.

Dr. Reiter teaches undergraduate- and graduate-level courses in healthcare accounting and financial management and is involved in research projects examining rural health policy, hospital financial performance, and the business case for quality. In the past 15 years, she has served on audit, finance, and advisory committees of several healthcare professional associations. She is the author or coauthor of more than 50 peer-reviewed articles, and she has presented to academic and professional audiences in the United States, France, and Canada.

Paula H. Song, PhD, is the Richard M. Bracken Chair and Professor in the Department of Health Administration in the College of Health Professions at Virginia Commonwealth University. Her research and teaching interests cover areas such as healthcare financial management, investment strategies in not-for-profit hospitals, payment reform, and business case evaluation for health initiatives. Dr. Song received a doctorate in health services organization and policy as well as a master’s in health services administration and applied economics from the University of Michigan in Ann Arbor. She has published more than 50 peer-reviewed articles and has coauthored five leading textbooks on healthcare finance. In 2020, she was awarded the John D. Thompson Prize by the Association of University Programs in Health Administration.

In this Book

  • Preface
  • Healthcare Finance Basics
  • Healthcare Insurance and Reimbursement Methodologies
  • Financial Accounting Basics, the Income Statement, and the Statement of Changes in Equity
  • The Balance Sheet and Statement of Cash Flows
  • Recording and Compiling Financial Accounting Data
  • Cost Behavior, Organizational Costing, and Profit Analysis
  • Semi-fixed Costs and Operating Leverage
  • Departmental Costing and Cost Allocation
  • Step-Down Method Illustration
  • Service Line Costing and Pricing
  • Making Service Decisions
  • Financial Planning and Budgeting
  • Time Value Analysis
  • Interest Rate and Time Calculations and Amortization
  • Financial Risk and Required Return
  • Long-Term Debt Financing
  • Credit Enhancement, Term Structure of Interest Rates, and Economic Factors that Influence Interest Rate Levels
  • Equity Financing and Securities Markets
  • The Market for Common Stock, Securities Markets Regulation, and the Investment Banking Process
  • Capital Structure and the Cost of Capital
  • The Basics of Capital Budgeting
  • Project Risk Analysis
  • Revenue Cycle and Current Accounts Management
  • Financial Condition Analysis
  • Market Value Ratios, Common Size Analysis, Percentage Change Analysis, and Economic Value Added
  • Glossary