Williamson Health Care Facility is a newly opened hospital. The hospital will be offering outpatient and inpatient services to its customers. The hospital has 400 beds. The hospital will be offering specialized services in the following areas heart diseases, surgery, respiratory diseases, dermatology, gastroenterology and gynecology. The hospital will employ around 40 physicians and about 40 subordinate staffs who will be equally distrusted across various hospital departments. The hospital has five departments that will be vital for offering various services needed for the success of the hospital. These departments includes emergency department that will be offering emergency services to emergency cases to the patients such as fire and accident casualties, administration department that will be mandated with overseeing the supervision role of the hospital, finance and accounting department that will be concerned with preparing financial reports of the hospital as well as advising the management of various financial related issues. Supply and marketing department will be another important section of the hospital that will be plays the role of ensuring that the hospital has the required medical supplies and the services of the hospital are well marketed to the members of the public. Finally, human resource department will be concerned with dealing with issues related to employees of the hospital such as salaries, motivation and others issues related to them.
This essay deals with issues relating to the organization of the hospital. First, the essay will determine whether it is important of for the hospital to embrace the idea of incorporation and the advantages and disadvantages of embracing the idea. Secondly, the paper will determine the feasibility of a profit of nonprofit organization status for this facility. I will also create a contract structure for the medical staffs of the facility. Then the essay will come with a plan of hiring as well as appointing specialists for the clinic. Finally, the essay will justify the decision to accept Medicare or Medicaid as potential sources of payment for the facility.
Advantages and Disadvantages of Incorporation
According to Dignam and Lowry, incorporation involves “formation of a new-fangled corporation which is recognized in law as person which is popularly known as legal entity” (Dignam and Lowry, 2006). In this cases will incorporate this health facility. There is a process that I will follow when incorporating the health facility.
First, I will prepare an article of incorporation that will be filled by the relevant government agencies. The articles will give in details the purpose of the intended incorporation, the location of the business, the type as well as the number of shares that will be distributed to various interested stockholders. Then I will pay all the appropriate legal fees as well as the registration fees. In order for the process of incorporation to be successful the hospital management should follow the due legal process to avoid any inconveniences that may hinder the entire process of incorporation.
There are a number of benefits that are related to incorporation. First, the corporation has the capacity to continue indefinitely unlike sole proprietorship. This means that the existence of the health facility will not be affected by the death of any of the director, shareholder or any other important stakeholder who directly related to the health facility. Secondly, the corporation has the ability to receive high credit rating at any given time. The credit rating of the corporation does not depend on the credit score of the shareholders and this solely dependent on how the facility will be using it funds that it acquires from various financers. Another advantage of incorporation is that it will enable the facility to raise capital by selling stock to the members of the public. For instance, the facility may be in an urgent need to expand it operation and it may not be in a position to raise funds through other sources of finances. Therefore, the incorporated facility management may raise the needed fund for expansion by selling more shares to the interested investors in the business of the facility. Dignam and Lowry noted that many states from different parts of the world “tends to charge lower taxes to corporation as compared to the amount of taxes that are charged to individuals” (Dignam and Lowry, 2006). This is another benefit that the health facility will receive by it being incorporated. As an owner of corporation one has the ability to transfer ownership from one individual to another. The owner can sell his shares that he own in the facility to another investor without any legal restriction. Finally, another notable benefit of incorporation is that the owner of the corporation assets will be protected by the law when the facility will be bankrupt. An individual obligation towards debt is only limited to the number of shares that he owns in the facility. Therefore, the shareholders of the facility will benefit from this legal provision when it comes to facility debts.
On the other hand, there are a number of disadvantages that are related with incorporation. To start with incorporation reduces the control of owners in the matters of the business. In the case of the health facility the shareholders will leave the issues relating to the management of the facility to managers who will be supervised by directors appointed by the shareholders. Shareholders of the facility will be prone to double taxation as result of incorporation. The facility will be required to pay corporate tax and on the other hand the shareholders dividend will be taxed by relevant authorities. Additionally, decision making process will be slowed given that the shareholders of the facility will be required to meet and approve the management decisions. Finally, the secrets of the facility will be open to the members of the public. The company management will be required by the law to publish the facility financial reports on various media for the purpose of the shareholders to determine how their corporation is performing.
Feasibility of a Profit or Nonprofit Organizational Status for this Facility
The facility management may decide to make the facility a profit or nonprofit organization. It is important to take into consideration the feasibility of any of the alternatives available to the management. The cost a benefit criteria will be used to assess the feasibility of each of the alternative available.
If the management decides to make the facility a nonprofit organization it will be required charge lower prices to the patients who will be served by the facility. This in turn will require the facility management to look for alternative means of financing the activities of the business. Given the facility of is at its initial stages the idea of making it a nonprofit organization is not feasible at the moment. Considering that the facility has shareholders, after being incorporated, it will be important for the management to “adopt an alternative that take into account the interests of the shareholders” (Hartigan, 2006). The goal of shareholders is always to maximize their wealth and making the facility a nonprofit will not be aimed at achieving this goal.
On the other hand the idea of making the facility a profit making organization is the very feasible. This alternative takes into account the interest of the shareholders and the welfare of all stakeholders in general. The facility needs to pay it employees well if it is to attract highly qualified professionals in the current competitive environment. The option enables the management to charge prices that will keep the hospital by providing high quality services to the patients. The option will also enable the facility to raise profits that it will return to the shareholders in form of dividends for their investment in the facility. I therefore, believe that this option of making the facility a profit making organization to be feasible given the current state of the facility.
Contract Structure for Inclusion for Medical Staff for this Facility
The health care facility will get into contract with different stakeholders such as financiers, employees and suppliers. For instance, the facility will get into contract with medical staffs who will be offering health care services to the patients. It is therefore, important to have a contract structure in place that will act as guideline to the management of the facility when structuring various contracts with different parties.
The first item that will be in the contract will be the offer. This clause of the contract “will explain; in detail the terms and conditions of the contract” (Barnett, 2003). For instance what are the reasons behind entering into the contract, for example the offer may be to supply medical supplies to the hospital. The second clause will be “enforceability of the contract” (Ewan, 2005). The contract being entered by the facility and the other parties must be enforceable in court of law. This clause will provide guidelines on whether the contract in question is legally valid.
The third clause will be about the acceptance. It will provide that the parties to the contract agree to the terms and conditions of the offer and are willing to perform the contract fully. The final clause will be about consideration. This will contains the issues relating to payment after the performance of the contract or failure to perform the contact under consideration.
Outline of a Plan to Hire or Appoint Specialists for the Clinic
In order for the health care facility to achieve its goals of creation it requires employees who will be mandated to perform different roles in various departments. Therefore, in order to employ the services of the right individuals the facility human resource department needs to have a hire plan in place that will contains guidelines that will be followed while hiring employees. The same guidelines will be followed when appointing a person to a certain office.
To start with the hire plan will contain the qualifications needed for an individual to fill a certain post within the facility. As noted by Deligiannis (2012), “the qualifications will specify the educational requirements, skills and experience that one is needed to have in order to qualify as a candidate for the job in question.” The next item in the hire plan will be terms and conditions of service. It will elaborate in details the nature of relationship that is expected between the employee and the employer. In addition, the plan will contain the duties that the expected employee will be performing within the premises of the facility. The next clause in the plan will contain information relating to terms of remuneration and compensation. This will detail the salary that the employee will be receiving as well as other forms of benefits that he will be getting from the facility. Finally, the hire plan will take contain the document relating to the rights that the employee has within the facility. It will explain whether the employee has the right to join a trade union or not.
Medicare or Medicaid Justification
All citizens are entitled to good health care and it’s their constitutional right to have access to affordable health care system. For years this has not been the case whereby, most of the citizens have not been able to access affordable health care system due to high cost charged by various health care providers in the United States of America. With this in mind the Obama administration formulated a health care bill in 2009 with an aim of ensuring that law was passed to enhance affordability of health care services to the American citizens. Low income families will benefit from the act in many ways. First, they can now afford to take health insurance covers that will enable them access medical care services at affordable costs which in earlier years they could not afford to raise. The provision states that all persons who are not insured by an employer, Medicare, Medicaid or any other public insurance cover should purchase as well as comply with a private insurance policy that is approved failure to do so will attract penalty on them.
The facility should be in the forefront of ensuring that all Americans get access to affordable health care. It should therefore, accept payments from those are covered by Medicare and Medicaid. According to Kaiser family Foundation, this will help reduce the cases of “patient not being treated for lack of funds to pay for their health care services” (Kaiser Family Foundation, 2010). The facility will also be assured of payment given that it will have the right to claim payment from Medicaid and Medicare.
The essay has provided the guidelines that will be followed by the administration of the facility to make it operational by establishing all the relevant departments and putting the appropriate structures in place.