Sample interview questions: What financial metrics do you track to assess the financial health of a hospital?
Sample answer:
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Revenue: Total patient revenue, net patient revenue, revenue per patient day, and revenue per adjusted discharge. A hospital’s income primarily comes from patient care services, so tracking revenue is essential for assessing its financial health.
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Expenses: Total operating expenses, salaries and benefits, supplies, and pharmaceuticals. Expenses are the costs associated with providing patient care, and they can be a significant drain on a hospital’s financial resources. Tracking expenses is necessary to ensure they are under control and not jeopardizing the hospital’s financial stability.
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Profit Margin: Net income divided by total revenue. The profit margin is a measure of a hospital’s profitability. A Positive profit margin indicates that the hospital is generating more revenue than it is spending on expenses, while a Negative profit margin indicates that the hospital is losing money. A hospital’s financial health can be significantly impacted by its ability to maintain a positive profit margin.
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Days Cash on Hand: Cash on hand divided by total daily expenses. Days cash on hand is a measure of a hospital’s liquidity. It indicates how long the hospital could continue to operate without running out of cash. Tracking this metric is essential to ensure the hospital has enough cash to cover its operating expenses and meet its financial obl… Read full answer
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