Talk of The Villages Florida - View Single Post - Why UF Health Doesn't Accept United Health Care, The Villages Medicare Advantage Plan
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Old 04-11-2021, 07:52 AM
CoachKandSportsguy CoachKandSportsguy is offline
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Nonprofit only means they do not have shareholders ... that profits (if any) are retained not distributed. Nonprofits may or may not pay federal business income tax on their mission-related businesses. (They undoubtedly pay many other taxes on unrelated activities, e.g, renting out office space to doctors.). The profit and tax exempt statuses are technically unrelated. Bottom line: All of this has little if any effect on how they negotiate with insurance carriers.
Also technically true. however, many non profits source their large cash flow investment needs from bond holders, as well as are renters from hospital reits. However, both bond holders and REITS have convenants or required payments which the hospital must maintain, or they can be evicted, (does happen) or bonds are called, credit ratings are lowered and the cost of future investment or ownership is less certain.

So there is a relationship between customers served, prices negotiated, government reimbursements, commercial payers, depending upon the type of customers you are accepting, and the bond holders, credit ratings for future investment in upgrading old buildings and equipment, and reits for rental fees.

The finances of large service providers is very, very dependent upon the services provided and the margin of the individual services as well as the mix of services and customers.

Safety net hospitals have a large portion of government payment or uninsured, and therefore rely heavily upon government payments, some with greater than 50% of customers are government or uninsured, based upon population of geography served.

So a single concept might satisfy your belief system, the finance world is always much more difficult to balance all the variables to long term success:

Which is easier? running any large organization successfully for 10 years? or going out of business due to a key strategic miss or financial ineptness?

finance guy