Hcs_405_Ethics

Reporting Practices and Ethics Beth Lowery HCS 405 October 22, 2012 Marjorie Romano “The financial pressures experienced by most healthcare organizations are intense. Not surprisingly, financial statements receive frequent and persistent scrutiny. Declining financial performance makes the organization and its management team look bad. If financial covenants aren't met, a hospital's bond rating may be down-graded, resulting in reduced access to low-cost capital and other serious financial ramifications. For whatever reason, the board, management team, and external constituencies may want to "make the numbers look better." The heat is on the CFO to "do the books differently." Some organizations still hold the CFO account able for the organization's financial performance even though he or she may have no control over the actions that lead to negative financial consequences. The CFO may worry about job security” (Tyler). It seems that all or most health care organizations are in trouble financially and that all organizations are in a desperate search for a financial management system that will work for them. This paper will discuss generally accepted accounting principles, corporate compliance, ethics, fraud and abuse. Generally Accepted Accounting Principles “The phrase "generally accepted accounting principles" (or "GAAP") consists of three important sets of rules: (1) the basic accounting principles and guidelines, (2) the detailed rules and standards issued by FASB and its predecessor the Accounting Principles Board (APB), and (3) the generally accepted industry practices. If a company distributes its financial statements to the public, it is required to follow generally accepted accounting principles in the preparation of those statements. Further, if a company's stock is publicly traded, federal law requires the company's financial statements be audited by independent public accountants. Both the company's management and the independent accountants must certify that the financial statements and the related notes to the financial statements have been prepared in accordance with GAAP” (accounting principles). Making Good Ethical Decisions “Sound ethical decision-making by each of us is essential to Health Net’s success. We all make ethical decisions every day. Some decisions are obvious and easy to make while others are not. Decisions that involve a violation of law or Company policy are clear and easy to make. For those decisions that are not clear or simple, we use reason and our four guiding values – Honesty, Integrity, Transparency and Accountability – to make the right ethical choices. The first thing to do is determine whether you have an ethical issue. Consider: * Could the decision damage someone or a group' * Does the decision involve choices between alternatives that might be good or bad, depending on your perspective, or between two “good” or two potentially “bad” alternatives' * If you determine that you have an ethical dilemma, use these four questions to guide your decision-making process in order to reach the optimal ethical conclusion. If you determine that you have an ethical dilemma, use these four questions to guide your decision-making process in order to reach the optimal ethical conclusion” (health net). Compliance with Laws and Regulations “We work in one of the most regulated industries in the world. Full compliance with both the spirit and the letter of all applicable laws, processes, Company policies and regulations is the responsibility of every associate. We are each expected to: * Understand and comply with relevant laws, regulations and compliance processes that apply to our position; * Ensure basic processes are effectively implemented and compliant with all requirements; and * Help others to ensure basic processes are compliant. “If at any time you doubt whether a course of action is lawful or ethical, seek advice from your supervisor, the Chief Compliance Officer, the Chief Ethics Officer, the Legal Department or the Health Net Integrity Line” (health net). From observing the news I have noticed a lot of fraud due to people taking money that does not belong to them. I agree that it is very important to follow all rules and laws that are in effect to prevent any errors that may occur. Conclusion In conclusion, in health care finances it is important to respect all aspects of the field. Following all generally accepted accounting principles, corporate compliance and understanding ethics fraud and abuse is a necessity for an organization to be successful. All organizations should have available training courses to its employees, so that they understand all rules and regulations in order to provide quality care to the organizations patients. References (n.d.). Accounting Principles. Retrieved February 3, 2012 from: http://www.accountingcoach.com/online-accounting-course/09Xpg01.html (n.d.). Health Net. Retrieved February 3, 2012 from: http://investor.health.net/phoenix.zhtml'c=70296&p=irol-govConduct#Compliance Tyler, J. Larry, (2012). Life and Health library. Maintaining the strength of your convictions: given the recent rash of ethical transgressions within and beyond health care, discussions about ethical standards, conflicts of interest, and moral decision making are occurring nationwide. This is a good thing! Retrieved February 3, 2012 from: http://findarticles.com/p/articles/mi_m3257/is_5_58/ai_n6077782/