Discussion Question #3
You have just finished preparing a volume adjusted variance analysis for the salary performance in your department and discovered the following. What was originally reported as $38,900 favorable compared to budget, has been determined via the analysis to be $85,400 unfavorable ($23,650 of favorable labor rate variance and $109,050 of unfavorable efficiency variance). Assuming that the performance report is for the final month of the fiscal year, what is your reaction to it? Are you pleased with this level of performance, unhappy with it, wary of it? And why do you feel this way?
Discussion Question #4
A faculty colleague of mine at the School (Gerry Anderson) and a colleague of his (Ge Bai) published an interesting article in the May 2016 issue of Health Affairs, entitled, “A More Detailed Understanding of Factors Associated with Hospital profitability.” You can access the article at: http://content.healthaffairs.org/content/35/5/889.full . A synopsis is available at http://www.jhsph.edu/news/news-releases/2016/nonprofit-hospitals-earn-substantial-profits.htmlI.
In the article, Anderson and Bai identify the most profitable hospitals in the U.S., and note that 7 of the top 10 are not-for-profit hospitals.
I would like your reaction to the article. In particular, consider the following questions: Is it good or bad that not-for-profit hospitals make a lot of profit? If it is bad, what are the remedies? If it is acceptable, what arguments can they make to Anderson and Bai?
Read the scenarios in both discussions and answer the questions . Use finance terms.