At all costs: know your organization's financial health
Sometimes for nurse practitioners, clinical practice is the easy part. There are many other things that NPs need to know. The financial workings of your organization are an example. Many NPs don't spend a lot of time thinking about the financial health of their clinic or hospital, but taking a bit of time now and again to find out how things are going is a really good idea.
Poor financial health may result in restructuring that puts more duties into the NP workload. It could result in layoffs. In many organizations, NP positions are the first to go. Your organization may end up bankrupt or declaring insolvency. Don't say this can't happen. It's happened twice to me in my career!
In both circumstances, final financial decisions were made by a Board of Directors, or Board of Governors.Many organizations are governed in this way. A Board has many duties, but the fundamental role is a fiduciary duty. This means that the members of the Board are duty-bound to consider the best interests of the organization, including long term viability. In otherwords....don't make decisions that drive the organization to bankruptcy! (1)
I don't know what happened on the Boards of the two organizations I've worked for that have declared bankruptcy/insolvency. However, it's unbelievable to me that no one saw it coming, or made a real effort to stop the financial bleeding before it was too late. The staff, including NPs, were kept in the dark until it was too late. So, what is the value in you, an individual NP, learning more about the financial structure and health of an organization? I say yes, plenty!
Arming yourself with knowledge is the best way to help avoid being caught by surprise.
A few tips:
1. Know how your organization is governed. Who makes final financial decisions? Are they transparent? Do staff have a say in the proceedings?
2. Know who's on the board. Ask yourself if they are qualified to be making final financial decisions? What is their level of acceptable risk?
3. Go to annual meetings and learn how to read a financial report.
4. ASK tough questions.
The Nurse Practitioner Open Journal arose out of both of my bankuptcy/insolvency experiences. NPs need access to evidence. Evidence that is specific to our roles, in the context of our practices. That is the reason that we accept policy articles...which can be research-based, case studies, scoping reviews and more.
As I said last week, I know you have a story. Why not share it?
Have a great week,
Editor-in-Chief Nurse Practitioner Open Journal