A hospital functions differently than a company for obvious reasons. First and foremost, hospitals are dealing with the health of human lives. However, there are some aspects of a hospital that must be run like a business. There is no way to evade the ever-present issue of financing. Despite dealing with issues more serious than most businesses, hospitals must still have appropriate financial practices in order to stay afloat. Because of medical insurance coverage, many patients fail to see hospitals as a company. However, hospitals must also worry about money in order to remain functioning properly. Here are five financial tips for hospitals to ensure everything continues running smoothly.

1. Optimize Staff

A company's employee base is one of the most costly components. However, hospitals have an especially hard time rightsizing their staff due to the intricacies of the required positions and shifts. To be sure, hospitals require a certain level of qualification for all employees. Furthermore, employees in all positions need to be present at any given time in order to provide service to patients. Hospitals have to worry about this while still maintaining a payable work structure. Hospitals are advised to carefully consider the goals and needs of their practice and hire in accordance. Ensuring that there is the right amount of staff (not too much and not too little) can save hospitals considerable amounts of money in unnecessary hours.

2. Rightsize Medical Equipment

Hospitals require incredible amounts of medical equipment to operate properly. Depending on the particular nature of the practice, more specialized equipment may be required. Similar to the tip for optimizing staff, hospitals can save a lot of money by rightsizing their medical equipment. Hospitals will have to consider their particular needs regarding patient numbers, particular treatments administered, staff specialties and more. These factors will help to determine the particular kind and amount of medical equipment to purchase. Hospitals can easily lose money by purchasing equipment that is rarely or never used.

3. Clean Depreciation from Records

Whenever an old building or outdated piece of equipment is no longer in use, hospitals must ensure they are properly disposed of. For example, an old surgical light should be replaced if it is malfunctioning. Besides physically removing a piece of equipment or moving out of a building, hospitals must also ensure these unused assets are removed from the records. If a building is no longer in use but remains in the books, hospitals may continue to pay years of unnecessary insurance by accident. The same financial risk can occur when the records aren't updated from disposed equipment. Keeping thorough and updated records can help save hospitals from unnecessary financial burdens.

4. Measure Productivity

While this may not seem like a financing tip, hospitals can save a considerable amount of money from this method. In fact, hospitals typically conduct RVUs to measure physician productivity. This form of measurement takes into account expenses from malpractice, normal practice expense and specific physician work. Hospitals can measure these components and then determine the productivity rate. From this, hospitals can determine how much to pay each physician based upon their output. Furthermore, hospitals can save money by determining what unnecessary costs are arising from malpractice.

5. Consult a Tax Expert

Another major, inevitable expense to a hospital is the payment of taxes. While state and federal taxes are unavoidable, there are ways that hospitals can save extra money. In fact, many hospitals qualify for tax deductions and other special monetary benefits. While the particular benefits and deductions will differ between individual hospitals, this is an excellent way to secure a hospital's financing. It is advisable to consult a reputable tax expert who can determine the greatest amount of tax savings that can be claimed by hospitals.

Author's Bio: 

Dixie Somers is a freelance writer and blogger for business, home, and family niches. Dixie lives in Phoenix, Arizona, and is the proud mother of three beautiful girls and wife to a wonderful husband.