Financial_Effects_and_Constraints

Financial Effects and Constraints Operations management (OM) consists of organizing and facilitating process flows within a certain department or business. OM is used in every kind of business but for the purpose of this paper the OM is in a pharmacy setting. The topic of discussion is the effect of a pharmacy on OM and discussion of finances. Revenue constraints and financial factors do influence the decision of the pharmacy in whether to continue operations or to stop them. Importantly, one must understand which financial reports to use to base their decisions as well as how to use forecasting techniques to support the business. Starting with the effects of a pharmacy on the OM is of interest because of its uniqueness in health care. Effects of a Pharmacy on Operations Management Pharmacies have a great effect on OM with or with out being associated with a health care facility. The effects are incorporating major activities of the hospital, clinic, or long term care facility with their daily processes. Also, adjusting to the everyday orders, to the emergency orders, and the outside orders to create a cohesive work environment. Some other effects are staffing, recognizing the inside consults, getting clarification of prescriptions and in-house med orders. Making sure the turn around times are sufficient and staff is used adequately are also important effects. There are many effects that a pharmacy has on OM these are some and then there is also the retail side of things that makes the process profitable. The OM of a pharmacy is complex and highly utilized. Keeping these effects in mind and using the appropriate tools to measure every aspect will help the OM sustain success in the pharmacy. Incorporating the major activities that come from the internal departments can be a very busy, and time consuming detail that must never be over looked. Cooperation and communication for these internal customers will be key to providing the financial stability as well as the staff organization. The reason financial stability comes into play here is because it takes time to process these orders as well as disorganization can cause errors and errors can cause major financial burden. Process flows to incorporate all customers, internal and external, is most important and must be watched. Utilizing staff efficiently and effectively in all area’s at all times and in proper training is essential and will prove to be a success if managed properly. Revenue Constraints and Financial Factors Factors influencing pharmacies today include state and federal regulations. These two influencers are at the heart of reimbursement for medications and technological advances. These are big players in the revenue constraints. These entities set the bar for Medicaid reimbursement on medications, setting the payment to the pharmacy very low. Back in 2006 they predicted billion dollar losses due to the government interaction and guidelines (James, 2008). Other financial factors include the implementation of computerized physician order entry (CPOE). CPOE is now used in most facilities so the pharmacies must have this technology and have it linked with the facilities to get the prescriptions. This is a high cost for many pharmacies causing a good look to see if the pharmacy can sustain this financial burden. References James, M. August 2008. State and Federal Issues Affecting Community Pharmacy. Pharmacy Times. Retrieved from: www.pharmacytimes.com/publications/career/2008/careers_2008_08_8010