Financial management in a medical practice is aimed at balancing financial sustainability with delivering high-quality patient care. This includes budgeting, managing costs, and ensuring revenue streams are healthy.
A balance sheet provides a snapshot of the practice’s financial position at a specific point in time, showing assets, liabilities, and equity. It helps assess the overall financial health of the practice.
The operating budget outlines the expected revenue and expenses for day-to-day operations, helping practice managers allocate resources efficiently and ensure financial stability.
Accounts receivable refers to the money owed to the practice by patients or insurance companies for services already provided. Managing accounts receivable is crucial for maintaining cash flow.
Fixed costs are expenses that remain constant regardless of the level of services provided. Rent is a fixed cost because it does not vary with the number of patients treated.
