Assignment in TQM Diploma AUC Ishikawa Quality Leader Financial Management application case study Managed Care Organizations

1. GROUP ASSIGNMENT IOP
ISHIKAWA QUALITY LEADER
FINANCIAL MANAGEMENT
MANAGED CARE ORGANIZATIONS
Dr. Rashad A. Helal Mohamed
Dr. Khalid A. Nasr
Dr. Mahmoud Lotfy
By

2. Kaoru Ishikawa
Juran
Edward Deming
James Harrington
QualityGurus
Atthe1986ASQAnnualQualityCongress
Mason Westcott

3. ISHIKAWA QUOTES
1915-1989
ASQ established the Ishikawa Medal to recognize the Human side of the Quality
Quality Control Statistician, the foremost Japanese Quality leader in Revolution 1940

4. ISHIKAWA QUOTES
1915-1989
ASQ established the Ishikawa Medal to recognize the Human side of the Quality
Quality Control Statistician, the foremost Japanese Quality leader in Revolution 1940

5. ISHIKAWA QUOTES
1915-1989
ASQ established the Ishikawa Medal to recognize the Human side of the Quality
Quality Control Statistician, the foremost Japanese Quality leader in Revolution 1940

6. ISHIKAWA QUOTES
1915-1989
ASQ established the Ishikawa Medal to recognize the Human side of the Quality
Quality Control Statistician, the foremost Japanese Quality leader in Revolution 1940

7. ISHIKAWA QUOTES
1915-1989
ASQ established the Ishikawa Medal to recognize the Human side of the Quality
Quality Control Statistician, the foremost Japanese Quality leader in Revolution 1940

8. ISHIKAWA’S MAIN CONTRIBUTIONS
Kaoru Ishikawa has Expanded Deming’s Cycle Four Steps into Six Steps
1. Determine Goals & targets.
2. Determine methods of reaching Goals.
3. Engage in Education & Training.
4. Implement Work.
5. Check the effects of Implementation.
6. Take Appropriate Actions.
Seven tools of Quality Control (B7).
Invented Fishbone (Cause and Effect Analysis).
Emphasized the Internal Customers.
Implementation of Quality Circles.
Shared Vision.

9. FINANCIAL MANAGEMENT
• Definition: is the study and Control of Money resources to meet the Goals and
Objectives of the Organization.
• Who Performs it? CFO
• What Does it include?
Financial Plan Prioritizes mostly growing up the business
(more investment in Capital)

10. Budgets
Functions
Operational Cash Capital Master
Time
Long
Term
Short
Term
Flexibility
Fixed Flexible
It is used for daily
operation
it includes general
expenses
Cash
Flow In
and out
Deal with
major
Assets
like Land,
Buildings
Equipment
Summary
for all
budgets
mostly
more
than 3
years
mostly
less
than 3
years
Mostly
No
changes
as
Installatio
ns
Accepts
some
changes
situation
ally

11. Capital Budget
Enterprise Budget

12. Flexible Budget
Cannot clearly known before

13. Operational Budget
Cash Budget
Short Term Budget for only one year

14. FINANCIAL TERMS AND BASICS
RETURN ON INVESTMENT - ROI
A performance measure used to evaluate the efficiency of an investment or to
compare the efficiency of a number of different investments.
It calculates How much money you gain from an investment
Expressed as Percentage or Ratio.

15. FINANCIAL TERMS AND BASICS

16. ROI=
𝑻𝒐𝒕𝒂𝒍 𝑹𝒆𝒗𝒆𝒏𝒖𝒆−𝑻𝒐𝒕𝒂𝒍 𝑬𝒙𝒑𝒆𝒏𝒔𝒆𝒔
𝑻𝒐𝒕𝒂𝒍 𝑬𝒙𝒑𝒆𝒏𝒔𝒆𝒔
× 𝟏𝟎𝟎
ROI=
35,328,733,04 – 17,009,369,94
17,009,369,94
× 𝟏𝟎𝟎
ROI=
18,319,363,10
17,009,369,94
× 𝟏𝟎𝟎
ROI = 107.7%

17. FINANCIAL TERMS AND BASICS
• It is system used to determine the actual costs of resources used for each process
or service ( it determines the cost of activities and resources used)
ACTIVITY BASED COSTING (ABC SYSTEM)
COST BENEFIT ANALYSIS – CBA = COST OF OUTCOME / BENEFITS FROM THE SERVICE
COST EFFECTIVENESS ANALYSIS – CEA = COST OF OUTCOME / IMPROVEMENT OF ONE OUTCOME
• Comparison of Cost (Expenditures) with the outcomes (effects) in quantitative but
Non-Monetary Value e.g. Mortality Rate, Infection Rate
• Comparison of Cost (Expenditures) with the outcomes (effects) in quantitative
Monetary Value e.g. Revenue

18. FINANCIAL PLAN ALIGNS WITH STRATEGIC PLAN
Current Situation
Strategic Goal

19. FINANCIAL PLAN ALIGNS WITH STRATEGIC PLAN
Financial Plan for the strategic Goal

20. THE BASICS OF MANAGED CARE
Health Maintenance Organization (HMO) or, as called in some states, Managed
Care Organization (MCO) is a system for providing health care services to its
members.
HMOs are responsible for financing health care as well as contracting with
the providers who deliver medical care to their members.

21. THE BASICS OF MANAGED CARE
Our Focus
HMO
style
IPA: Independent Practice Association
MSO: Management Services Organization
OWC: Open with Care
ACO: Accountable Care Organizations
HIE: Health Information Exchange
HITECH Act: The Health Information Technology
for Economic and Clinical Health
MU/ EHRs: meaningful use / Electronic Health
Records
HMO: Health Maintenance Organization
PPO: Preferred Provider Organization
POS: Point Of Service plan
EPO: Exclusive Provider Organization
PHO: Physician-Hospital Organization

22. TYPES OF MANAGED CARE ORGANIZATIONS (MCOS)
1. Health Maintenance Organizations (HMOs)
2. Preferred Provider Organizations (PPOs)
3. Exclusive Provider Organizations (EPOs)
4. Point-of-Service Plans (POS)
Health Maintenance Organizations (HMOs) By far the most common type, HMOs
ostensibly focus on wellness (e.g., by providing for annual physical examinations).
Members (who are insured) pay a fixed annual premium in return for health care access
that is limited to the HMO’s network of physicians and hospitals. Medical care is also
limited to a prearranged, comprehensive list of medical services that will be provided to
the enrolled group as a whole. Most HMOs require patients to choose (from the HMO
network) a physician as a primary care provider (PCP) who must first be consulted for any
medical concern. The PCP, and not the patient, then decides if the patient should consult a
specialist or get a second opinion. This practice (common to most forms of MCOs in
general) is known as “gatekeeping.”
Preferred Provider Organizations (PPOs) the managing entity is
not always the insurer; it also may be an employer or a plan administrator.
Discounted rates are negotiated with specific health care providers in
return for increased patient volume. However, members may choose
providers outside of the PPO network, but they will have to pay more to do
so
Exclusive Provider Organizations (EPOs) the managing entity
contracts with a group of health care providers who agree to internally
follow utilization procedures, to refer patients only to other specialists
within the EPO, and to use only those hospitals contracted with the EPO.
Members must use EPO providers.
Point-of-Service Plans (POS) The designation of POS refers to the
fact that the amount of co-payment an insured pays is dependent upon the
“point of service.” If an insured member goes outside of the plan network to
receive care, the co-payment is higher, as network providers have agreed
to accept a discounted rate for services in return for patient volume and
patient referral.

23. DRGs
• Payment
according to
Diagnosis
Packages
Capitation
• Payment
with fixed
number
of Dollars
PMPM
Capped Rate
• Payment
with
maximum
daily rate
of cases
Case Rate
• Reimbursement
of health care
providers (such as
hospitals and
physicians) "on the basis
of expected costs for
clinically-defined
episodes of care.
• (Shared Risks)
Per Diem
• Daily
allowance is
a specific
amount of
money
Reimbursement Systems
Fee For Services
FFS
Discounted FFS
Prospective
Payment System

24. CASE STUDY EXAMPLES
Capitation
Case Rate

25. Clinical Pathway style
1
2
3
4 5
87
6

26. Clinical Pathway style