Project Report: Health Financial Management & Pathology Lab Plan

This project report focuses on the health financial management aspects of establishing a pathology lab within a clinic, aiming to improve profitability and service quality. The report outlines the proposal, including its aims, benefits, and potential risks, and details the processes, resources, and reporting mechanisms necessary for successful implementation. A key component is the zero-based budgeting approach, which breaks down costs such as labor, utilities, equipment, and training. The report includes a contingency plan addressing potential funding shortfalls and a breakeven analysis to determine the activity level required for financial sustainability. Financial information, including cost calculations and breakeven point analysis, is provided in the attachments, offering a comprehensive overview of the financial considerations for the pathology lab project.

Running Head: Health Financial Management
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Project Report: Health Financial Management

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Contents
Executive summary..........................................................................................................3
Background.......................................................................................................................3
The proposal.....................................................................................................................4
Aims..............................................................................................................................4
Benefits.........................................................................................................................4
Risks.................................................................................................................................5
Process..............................................................................................................................7
Resources..........................................................................................................................7
Reporting of outcome.......................................................................................................7
Financial information........................................................................................................7
References.........................................................................................................................9
Attachment 1...................................................................................................................10
Attachment 2...................................................................................................................10

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Executive summary:
The business plan is related to open a pathology lab in the clinic itself. The
commencement of pathology lab in the clinic itself improves the total profitability level of the
business. The laboratory would offer services as well as products to the patient and the local
residents in the New South Wales. the main aim of the pathology lab is to assure that high
quality services is to offered to the residents as well as the total revenue of the clinic could be
improved. Various type of chronic disease has been studied in the report in order to make
sure that the best of the services and variety of products could be offered to the patients.
Outline:
The outline of the report has been set in such a manner that the various associated
cost, revenues, factors etc of new pathology lab could be found and a better decision could be
made about the business. The new pathology lab has been prepared in a way to offer chronic
disease and laboratory services to the local residents in the New South Wales. The legal and
financial serves has also been discussed in the report in order to commence the laboratory
services in the business.
Background:
The total population of the area has been estimated and it has been found that there us
huge scope for the pathology lab in the area. It would improve the profitability level of the
business. As well as it has been estimated that the population would be increased at a great
growth rate in near future. The report explains that along with the improvement in the total
population, the number of disease would also be increased in the New South Wales. It has
been found that in that particular area, no advance pathology lab is there and it would be
tough for the clinic to set up the lab and offer advances services to the patients (Federal
Register of Legislation, 2011). The reports explain that most of the people are suffering from
the various types of diseases. This report suggests that it is the need of the hour for the clinic
to take some new steps for the local resident and grab the opportunity to improve the overall
performance in the industry,
The pathology lab is the crucial step to diagnosis; prognosis and various therapies for
the huge number of diseases which are communicable and non communicable. Along with
the improvement in the diabetes rate and other diseases, the demand of the laboratories’ and

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treatment has been improved (Cashin et al, 2017). Though, it has been estimated that along
with the time, the changes into the clinic and new department would lead to the business
towards higher expenses. But these expenses could be recovered by the clinic in no time
because of the huge demand and higher revenue from the market.
The proposal:
The main business proposal is to commence the new pathology lab in the clinic itself
to meet the demand of the patient and improve the turnover level of the business. The new
business would help the business to reach over a point where the cost of the clinic would be
lower than the total revenue of the business and it would lead towards the higher profitability
level to the business (Schäferhoff et al, 2015).
Aims:
The main aim of the business proposal of new pathology lab is to offer better and
quality services to the clients at nearby area at reduced price. The business has to make sure
that they have better laboratory and specialized in the lab in order to provide the quality
services to their customers. The main aim of the new proposal is to reach over the breakeven
level as soon as possible, the level where the cost and the revenue of the business would be
similar and no extra loss or profit would be occurred by the business (Reich et al, 2016). The
new department of the clinic would improve the total footfall and the revenue level in the
clinic. The clinic could strategies at advance level to meet the demands and aim of the
business.
Benefits:
Because of the pathology lab, the following benefits could be got by the business:
Efficiency gain:
The main aim of the business is to offer the quality services. The quality services
would improve the customer’s level in the clinic. Along with the improvement in the quality
services and the footfall, the gain level of the business would be improved. The flow of the
patient would lead to the business towards higher profitability (Murray, Lim & Dieleman,
2017).

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Potential savings increased cost:
On the basis of the overall calculations, it has been estimated that the potential
savings of the business would be improved along with the changes in the operations and the
new lab in the clinic. The calculations express that the savings of the clinic would be reached
at huge level. The use of advance technology, advanced changes etc would improve the
savings and reduced the level of cost in the business (Pinto, Masaki & Harimurti, 2016).
What are the expected benefits of this proposal?
Factor Benefits
Patients It would be easier for the local resident to get proper treatment in no time at
reduced cost (Mulenga & Ataguba, 2017).
The operating hours of the lab would be 24 hours which would make it
flexible and easily accessible for the patients.
The services would be faster because of less time in driving and easy
convenience.
Facility The facility level of the laboratory would be higher because it would be
associated with advanced technology and all the related equipment would be
provided in the lab to offer efficient services.
Clinicians The experienced and professional staff would offer the services in the
laboratory.
The worth of the amount would be given to each of the patient
Training programs and skill development program would be provided to each
of the staff to improve the service level (Grigorakis, Floros, Tsangari &
Tsoukatos, 2018).
Other Efficient and professional service would improve the footfall.
It would improve the opportunity for the clinic.
Local health district would offer better benefits to the clinic.

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Risks:
Risk Issue Severity Impact Mitigation Plan Notes
Financial risk There are huge
financial risk in
front of the
clinic because
of the insure
about the
patient flow,
huge capital
investment,
changes in the
technology etc.
It would
affect the
total revenue
of the clinic
and could
occur the
loss (Evans
& Pablos-
Méndez,
2016).
Discount
coupons
Better marketing
strategies
Effective
services etc are
few things which
could mitigate
the risk.
It’s important
for the
business to
evaluate each
of the financial
factors before
commencing
the new
business.
Patients The error in the
reports could
lead the issues
to the patient.
Unnecessary
prick, delay in
the reports etc
could lead huge
risk in the
business.
Could affect
negatively to
the
pathology
lab
Recruiting
experience and
technological
advancement
could help the
business to
improve.
Friendly
connection and
better services
could mitigate
the risk of the
business.
Insurances Workplace
injuries,
robbery of
equipments etc
are normal in
the clinic
Economical
changes and
impact
New ethical
practices
Safety rules
Emergency
alarm
The safety
practices and
the
occupational
health should
be

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Risk Issue Severity Impact Mitigation Plan Notes
which could
affect the
financial and
non financial
performance of
the business.
24 surveillance
camera (Cashin
et al, 2017)
implemented
by the
business to
improve the
work
productivity
Process:
Action: (attachment 1)
The process explains that the responsibilities and duties would be offered in the
department on the basis of the work demand and the specialization. The owner and the
manager are responsible for all the changes and the strategies. Further, it has been found that
the other daily activities and footfall would be managed by the receptionist and their duties
have been described in the process chart in attachment 1.
Resources:
The below resources would be additionally required in the business:
Human resource department
Physical resources and equipment
Continuous education and training program
These resources are mandatory for the department to work efficiently.
Reporting of outcome:
A committee would be formed in the department which would involve the manager,
financial manager, HR manager, marketing manager, auditor, accountant etc in order to
manage all the activities and operations of the business. On the basis of the final report,
financial report is must in the business which has been studied and analyzed in the next
heading (Hillestad et al, 2015).

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Financial information:
In order to prepare the zero based budgeting for the pathology lab, below items have
been added:
Labour cost
Utilities cost
Changes in the technology cost
Equipment cost
Training cost
Receptionist
Auditor and accounting cost
Legal and advisory cost
Nurses cost etc. (Brandao de Souza, 2009)
For the purpose of contingency plan further, an effort has been made to calculate the
breakeven point in the business. The calculations express that the different outcome will be
received if the zero based budgeting figures would be changed along with the other factors of
the business. In case of cheaper place, lower labour rate and average fee of the business, it
has been found that the BEP level of the business would be improved.
In order to evaluate the breakeven point of the business, it has been found that the
total cost of the business is different from the 10% changes in the BEP level of the business.
The total calculations and BEP analysis could be found in the attachment 2.

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References:
Brandao de Souza, L. (2009). Trends and approaches in lean healthcare. Leadership in health
services, 22(2), 121-139.
Cashin, C., Bloom, D., Sparkes, S., Barroy, H., Kutzin, J., O'Dougherty, S., & World Health
Organization. (2017). Aligning public financial management and health financing:
sustaining progress toward universal health coverage. World Health Organization.
Evans, T., &Pablos-Méndez, A. (2016). Shaping of a new era for health financing. The
Lancet, 387(10037), 2482-2484.
Federal Register of Legislation. (2011). Work Health Safety Act 2011. Australian
Government. Retrieved from: https://www.legislation.gov.au/Details/C2017C00305
Grigorakis, N., Floros, C., Tsangari, H., &Tsoukatos, E. (2018). Macroeconomic and
financing determinants of out of pocket payments in health care: evidence from
selected OECD countries. Journal of Policy Modeling. 3(2), 502-517.
Hillestad, R., Bigelow, J., Bower, A., Girosi, F., Meili, R., Scoville, R., & Taylor, R. (2005).
Can electronic medical record systems transform health care? Potential health benefits,
savings, and costs. Health affairs, 24(5), 1103-1117.
Mulenga, A., &Ataguba, J. E. O. (2017). Assessing income redistributive effect of health
financing in Zambia. Social Science & Medicine, 189, 1-10.
Murray, C. J., Lim, S. S., &Dieleman, J. L. (2017). Expanding GBD collaboration—call for
experts in health financing and health systems. The Lancet, 389(10064), 18-19.
Pinto, R., Masaki, E., &Harimurti, P. (2016). Indonesia Health Financing System
Assessment.
Reich, M. R., Harris, J., Ikegami, N., Maeda, A., Cashin, C., Araujo, E. C., ... & Evans, T. G.
(2016). Moving towards universal health coverage: lessons from 11 country
studies. The Lancet, 387(10020), 811-816.
Schäferhoff, M., Fewer, S., Kraus, J., Richter, E., Summers, L. H., Sundewall, J., ... &
Jamison, D. T. (2015). How much donor financing for health is channelled to global
versus country-specific aid functions?. The Lancet, 386(10011), 2436-2441.

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Attachment 1:
Business plan
A
Collaboration and approval
Local Health district
Time
Money
Resources
Resources (human and physical)
Staffing Consumables Utilities
Receptionist (1staff) Gloves and spirit Building rent
Swab balls electricity Bill
Registered nurse Blood collection tubes and Water bill
Urine collection containers
(2 RN) Needles
Lab technician (2)
Cleaner (1)
Started pathology lab
Out comes

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Attachment 2:

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