Week 8 Assignment1 Louisville Community Hospital

Week 8 Assignment1 Louisville Community Hospital


Week 8 Assignment1 Louisville Community Hospital
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Healthcare Financial Management and Economics

Assignment1: Ratio Analysis

It is important to understand that when interpreting financial statements, the numbers alone may not provide the whole financial picture of an organization. Instead, you must analyze the statements using ratios, which are then compared to benchmarks across the healthcare industry. For this Assignment, you examine the financial documents for Louisville Community Hospital and analyze the organization’s financial health.

Louisville Community Hospital

Louisville Community Hospital is a small community hospital serving a rural population.

Louisville Community Hospital
Statement of Operations (in thousands) for the
Years Ended December 31, 2016 and 2017

2016
2017
Revenues
Net patient service revenue $23,000 $19,000
Net assets released from restriction 1,000 800
Total operating revenues 24,000 19,800

Expenses
Salaries and benefits 13,000 9,000
Supplies and other expenses 7,000 6,000
Depreciation 2,500 2,000
General services 200 100
Total operating expenses 22,700 17,100

Operating income 1,300 2,700
Non-operating income 4,000 2,500

Excess of revenues over expenses 5,300 5,200

Increase (decrease) in net assets $5,300 $5,200






Louisville Community Hospital
Balance Sheet (in thousands)
for the Years Ended December 31, 2016 and 2017

2016 2017
Current assets
Cash and cash equivalents $700 $500
Net patient receivables 4,000 3,500
Inventory 950 750
Total current assets 5,650 5,250

Non-current assets
Plant, property, and equipment
Gross plant, property, and equipment 26,500 24,000
(less accumulated depreciation) (18,000) (17,000)
Net...