There are numerous implications for a Health Service Department moving from a cost center to a profit center. It is essential to first differentiate between the two subdivisions. A cost center is a financial department that is in charge of the costs of a company. On the other hand, a profit center is responsible for the profit of an organization. The former is concerned with minimizing costs, whereas the latter aims to maximize revenues and earn profits for an organization (Mukhopadhyay, n.d.). A cost center is typically less complex than a profit center because it deals with costs only, while the latter covers costs, revenues, and profits. This makes the scope of a cost center narrower in comparison to a profit center.
The health service business also differentiates between centralized and decentralized systems. Centralization in healthcare refers to a healthcare management system where certain roles such as decision-making are performed by one person or a small group of people. It is the organization of departments and services into fewer units (Sreeramareddy & Sathyanarayana, 2019). Centralization can happen at a national level where few people decide the path that the healthcare system of a country takes. It could also happen at an organizational level and involves the consolidation of departments or functions. For example, centralization may refer to the storage of patient data in one platform, such as electronic health records (EHR). In contrast, decentralization refers to healthcare that is controlled or managed by many people. This implies that decisions are made by various people within the system rather than top executives. An example of decentralization is when key decision-makers from state and local levels meet to set goals and plans for healthcare provision.
Although the healthcare industry has increasingly become commercialized, it can still return to its mission of serving people regardless of their economic status. Healthcare professionals have an ethical responsibility to provide care to all people whether or not they have the means to pay for the services. In the United States, this could be difficult since providing care to people without insurance can bankrupt hospitals. However, a program known as Medicaid provides healthcare coverage to underprivileged people (Currie & Duque, 2019). Some of the services provided under Medicaid include inpatient and outpatient services, laboratory services, and physician visits. Although there are some criteria to be met before being covered by Medicaid, the program covers a significant part of the population that has historically been underserved. Examples of such groups include low-income populations, the elderly, people with impairments, and pregnant women (Currie & Duque, 2019). Healthcare providers can also provide free or subsidized care at community levels with the help of financial aid and other assisted programs. They can serve those without insurance by directing them to programs such as Medicaid and providing such subsidized care.
When public health professionals are not permitted to bill or have reimbursable codes, it results in negative consequences. First, it decreases their financial incentive to provide quality care. They can lose focus on their goals and fail to achieve the objectives of public healthcare. This would subsequently reduce the quality of care provided to patients. Second, it would also increase negligence amongst the professionals towards recipients of care. Since they would be demotivated from providing quality care, negligence levels will increase within the facilities they work. It is essential to provide incentives for healthcare providers to perform their work diligently, and one of the ways to do this is to allow them to have reimbursable codes or bills.
References
Currie, J., & Duque, V. (2019). Medicaid: What does it do, and can we do it better? The ANNALS of the American Academy of Political and Social Science, 686(1), 148-179. Web.
Mukhopadhyay, S. (n.d.). Differences between cost center and profit center. WallStreet Mojo. Web.
Sreeramareddy, C. T., & Sathyanarayana, T. (2019). Decentralized versus centralized governance of health services. The Cochrane Database of Systematic Reviews, 2019(9). Web.