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  1. Role of physician in a hospitals revenue and cost flow.


    Conduct literature search and review articles on the role of physician in hospitals revenue and cost flow. Based on your findings from your literature review, discuss the role of physician in a hospitals revenue and cost flow. How do physician contribute to a hospitals revenue and costs.     


Subject Nursing Pages 3 Style APA


Role of Physician in Hospital Cost Flow and Revenue

Physicians play a vital role in the healthcare system. According to Graban (2016) their primary role is to manage medial and health needs for the clients. Physicians have direct contact with inpatient and outpatients and perform responsibilities and roles such as medical management, preventive examination, screening, treatment planning, and diagnosis. While discharging these duties, physicians directly and indirectly impact the cost flow and revenues of their respective hospitals. It is upon this basis that this paper discusses the role of physicians in hospital’s revenue and cost flow.

By offering medical services, physicians significantly contribute towards revenue collection in hospitals. Miller (2013) reports that a survey by Merritt Hawkins identified that physicians generate more than $1,448,458 for their hospitals annually. Miller adds that the encounters made between physicians and patients determine not only the quality of healthcare but also the cost of care received by patients. Physicians impact cost flows by the number of admissions they make, treatments and tests they order, procedures they perform, and drugs they prescribe. As a result, physicians’ control 87% of all healthcare spending in the USA (Miller 2013). For this reason, the ‘physicians pen’ is considered the most powerful tool in the healthcare system.

In addition, insurance firms compensate hospitals depending on efficiency and quality metrics. The most efficient physicians therefore attract higher pay-outs to their affiliated hospitals. Brick, Scherr and Ubel (2019) introduce another perspective noting that the volume of patients served by a physician could equally influence revenues and cost flow. For instance, serving many patients increases revenues. Based on the economic concept on economies of scale, serving more patients optimizes revenues while reducing costs.

Guided by these arguments, it is evident that physicians contribute to hospital revenues and costs in a number of ways. First, their efficiency helps reduce instances of medical errors thus attracting less costs and more revenues. Secondly, specialty physicians especially those offering orthopaedic, oncology, neurosurgeon services attract higher revenues for their respective hospitals (Taheri et al., 2000). Third, physicians contribute to higher costs through their selection of selection of prescriptions and medical procedures.


Brick, D. J., Scherr, K. A., & Ubel, P. A. (2019). The impact of cost conversations on the patient-physician relationship. Health communication, 34(1), 65-73.

Graban, M. (2016). Lean hospitals: improving quality, patient safety, and employee engagement. New York: CRC Press.

Miller, P. (2019). New Survey Shows Physicians Are Key Revenue Generators for Hospitals. Retrieved from: https://www.merritthawkins.com/news-and-insights/blog/healthcare-news-and-trends/new-survey-shows-physicians-are-key-revenue-generators-for-hospitals/

Taheri, P. A., Butz, D., Griffes, L. C., Morlock, D. R., & Greenfield, L. J. (2000). Physician impact on the total cost of care. Annals of surgery, 231(3), 432.



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