Economics for Healthcare Managers

Susan Jensen

Robert H. Lee 2000, 184 pp $74 hardback

Nurses in today's health care environment have taken on roles Florence Nightingale never dreamed about. Economics, a course not offered in traditional nursing programs, is becoming an essential tool for nurse managers.

During the 1980s, the US health care system's costs were the highest in the world, but its outcomes were not always the best. Political pressures to control costs and improve results were trademarks of the 1990s, requiring health care professionals to learn about and understand economic concepts.

The author of this book teaches nurses about economic theory, an understanding of which is required to make sound decisions in today's health care environment. This book is written to be understood even by readers who have no background in economics.

Economics is a framework for understanding fixed and variable costs, market demand, competition, and profitability. It helps managers focus on key issues and outline strategies for realizing goals, and it sensitizes them to ideas that affect operations and offer opportunities for improvement. Economic theory provides rules for dealing with competition, making sense of costs, and understanding the real value of goods and services.

Fifteen chapters discuss different principles of economics related to nursing, health care finance systems, risk management, costs, demand, elasticities, profit, supply and demand, pricing, and regulations. Each chapter includes specific examples and cases that illustrate how these economic concepts apply to the health care environment.

Even in a not-for-profit hospital environment, there is still a need to maximize revenues and minimize costs. When practiced, the economic concepts presented in this book will help facilities become low-cost providers without having to lower quality standards.

The health care system is economically interesting to study for several reasons.

* It is highly regulated.

* Patients generally pay only a small portion of their bill directly.

* Commercial insurance companies offer numerous and diverse insurance programs.

* Federal, state, and local governments are involved in providing insurance programs and paying the bills.

* Some patients are not insured.

The book examines the growth of health care, the shrinking share of direct consumer payments, the growth of managed care, the increasing number of uninsured patients, expansion of outpatient services, the surplus of physicians and hospitals, and rapid changes in technology. It also discusses medicine and medical technologies being brought to the public's attention through many media sources. Consumers desire new, better therapies they hear about.

Today, all nurses need to understand economics. This book is an excellent introduction to economic principles for nursing professionals, regardless of their specific roles. Everyone involved in health care can do his or her part to monitor expenses and provide constructive criticism, as well as provide ideas for system improvement.

This book is available from Health Press Administration, One North Franklin St, Suite 1700, Chicago, IL 60606-3491.

SUSAN JENSEN

RN, BS, CNOR OR NURSE

GLEN FALLS HOSPITAL

GLEN FALLS, NY

COPYRIGHT 2004 Association of Operating Room Nurses, Inc.
COPYRIGHT 2004 Gale Group